Cumulus and Zimmer Press FCC to Lift Radio Ownership Caps, September 15

Cumulus Media and Zimmer Communications met with FCC leadership on September 9 to push for elimination of local radio ownership rules frozen since 1996. Both companies argue that Spotify, YouTube, SiriusXM, and digital advertising platforms have fundamentally altered the market, eroding listener attention and ad spending. The FCC’s Republican majority and recent approval of television ownership deregulation signal momentum for radio rule reform.

Why radio broadcasters want ownership caps lifted

Cumulus and Zimmer say the 30-year-old rules no longer reflect market reality. Collin Jones, Cumulus executive vice president of corporate strategy, told FCC staff that the competitive landscape has “completely transformed” with services like streaming music, podcasting, satellite radio, and social media that did not exist in 1996. Jones wrote that eliminating local ownership caps is “urgent” to help radio groups achieve economies of scale and spread operating costs across more outlets.

The digital ad squeeze on local radio

Radio broadcasters face a two-front assault on advertising revenue. Local ad spending now sits at close to three-quarters digital, with Google and Facebook capturing roughly 85% of that local digital share, according to Zimmer’s FCC filings. Large retailers like Walmart and Amazon have also pulled spending away from local radio, the traditional source of ad inventory. Industry revenues continue on a downward trajectory, making consolidation essential for survival.

FCC momentum builds for deregulation

The FCC’s Republican majority has already eliminated the 39 percent ownership cap on broadcast television stations, signaling appetite for broader deregulation. John Zimmer, president of Zimmer Communications since 1980, met separately with FCC Chairman Brendan Carr and legal advisors to Commissioners Olivia Trusty and Anna Gomez on the same day. Zimmer first petitioned for ownership rule changes in 2019 and has pursued the issue for seven years. The FCC is expected to address radio ownership rules as part of its 2022 Quadrennial Review.

Public safety and local journalism at stake

Zimmer argues that only viable local broadcast stations can provide reliable disaster alerting and emergency journalism. Consolidation would allow station groups to invest in quality local programming and attract more listeners and advertisers. Without the ability to achieve greater local scale, radio station groups struggle to attract necessary investment capital in a market where streaming and digital platforms now dominate listener attention.

Final Thoughts

Cumulus Media and Zimmer Communications face an uphill battle to prove radio consolidation serves the public interest, but FCC momentum on television deregulation and a sympathetic Republican majority suggest ownership rule reform could advance before year-end. Investors in radio stocks should monitor FCC action closely.

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