Radio Pres: Forced Cell Phone FM Tuner is “Pro-Consumer”

Radio Pres: Forced Cell Phone FM Tuner is “Pro-Consumer”

National Association of Broadcasters executive vice president Dennis Wharton blasts critics for using usual “Washington-style tactics” that are “long on exaggeration, rhetoric and factual inaccuracies,” and cites evidence of a growing radio audience as proof that “cell phone subscribers deserve access to radio’s free service.” Says opposition is a “simple case of anti-competitive behavior.”

Last week I mentioned how reports had surfaced of a developing backroom deal between the National Association of Broadcasters (NAB) and the RIAA to to get Congress to require all portable electronic devices to include an FM tuner in exchange for radio paying a reported $100 million annually in royalties to artists and record labels.

The pact would be a compromise between the two groups who’ve been clashing over radio’s longstanding exemption from having to pay performance fees under US copyright law. Radio, which would’ve been liable for billions in royalties, gets a substantial reduction in exchange for the RIAA’s support in expanding its reach. The RIAA, in turn, gets a nice annual check for $100 million which it sorely needs to subsidize continually declining CD sales.

After receiving widespread criticism, NAB executive vice president Dennis Wharton is trying to “set the record straight.” He says that critics are using a “customary Washington tactic” to denigrate this “pro-consumer feature” with arguments that are “long on exaggeration, rhetoric and factual inaccuracies.”

I think he’s trying to paint critics with the Washington tag in order to make them seem outside the mainstream, but I think it’s safe to say that most critics are average folks leery about govt mandating design requirements instead of the likes of tech companies like Apple or Motorola. If consumers really wanted an FM tuner they’d seek out those handsets that have them.

Wharton emphasizes that “radio’s audience is GROWING,” and that “when given the choice, consumers like radio-capable cell phones,” but is this really the case? It’s audience may be growing in potential, but I highly doubt that more people are tuning in these days. Radio’s not what it used to be. Consumers are able to dial into sites like Last.fm and Pandora to stream commercial free music ad nauseam! Companies like Clear Channel stripped radio down to a boring shell of its former self.

He oddly cites a study conducted in Latin America and Asia that found 45% of mobile users there listed radio as one of their top three reasons for purchasing a cell phone. Considering that that would makes it more popular than Internet access, texting, and digital camera function proves the study is worthless in the US. Talk about using “Washington-style” tactics.

Just because people Ecuador or Thailand like radio tuners on their cell phones doesn’t mean we ought to force  manufacturers in the largest consumer market in the world to include them.

“Cell phone subscribers deserve access to radio’s free service,” he continues. “In a society where cell phones and other mobile devices are increasingly ubiquitous, it makes perfect sense to have radio-enabled chips in these devices, particularly from a public safety perspective.”

That’s the thing. The NAB’s main defense seems to be that an inclusion of a radio tuner is critical from an emergency information perspective. It doesn’t seem to get that people, for the most part, don’t want a radio tuner in their cell phone.

Wharton adds that a “radio receiver would also free up network capacity” and allow consumers to use less bandwidth, a point which he uses to suggest that some critics are concerned that this will mean less revenue for cell phone providers.

“So what’s motivating critics to oppose the inclusion of radio receivers in cell phones? It could be a simple case of anti-competitive behavior. Every minute a cell phone user listens to free, local radio is one less minute spent using the wireless industry’s fee-based applications. Moreover, since listening to local radio would require no network bandwidth, cell phone subscribers wouldn’t be forced to pay the escalating rates associated with streaming data-rich, fee-based applications,” he says.

This argument has to be the best of them all. Radio and the RIAA are trying to force manufacturers to include a product that consumers aren’t clamoring for, and yet manufacturers are the ones being “anti-competitive?” Whether it wants to admit it or not radio is losing its popularity. The playlists aren’t customizable like they are with online streaming services, and radio’s chalk full of commercials, fake DJ chatter, and homogenized music. People don’t want a radio tuner because the quality of content just isn’t there.

Stay tuned.

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