Something Erratum In The State Of . . .
Commission replaces “gender” with “ethnicity” in policy against discrimination in advertising contracts.
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It’s really never too late to admit to a mistake. And so it is that, more than two years after the fact, the FCC has issued an Erratum making a seemingly major change to language originally announced in the Commission’s Diversity Order. (That Order was adopted by the Commission in late 2007, but was not released until March, 2008.) The mistake? When the Commission said “gender” in the original order, it didn’t really mean “gender”; it meant “ethnicity”.
Gender – ethnicity . . . ethnicity – gender . . . you say “tomato”, I say “tomahto”. That’s the kind of mistake that just about anybody could make, right?
The changed language appears in the policy designed to discourage the advertising business practice of including “No Urban/No Spanish” clauses when placing commercials on stations. (For a refresher course on the no-discrimination policy, click here.) The policy, as originally articulated in the Diversity Order, required broadcasters to certify, in their next license renewal applications, that their advertising contracts don’t discriminate on the basis of race or gender. Now the FCC says that it really meant that the certification should specify nondiscrimination on the basis of ethnicity rather than gender.
We confess that, when the Diversity Order was first issued, we were a bit perplexed as to why the FCC was insisting that broadcasters’ certifications refer to “race or gender”. After all, the new policy was based on concern about alleged “No Urban/No Spanish” advertising orders, not “No Urban/No Female” orders. So when the Erratum explains that the change is necessary to “more accurately reflect the Commission’s clear intent”, it’s hard to argue – even if it makes you wonder (a) how, exactly, the mistake got through in the first place and (b) why it’s taken more than two years to acknowledge and correct it.
The Erratum offers no explanation about why the change is being made now (as opposed to, say, April, 2008) – but we can speculate. The required certification is to be included in Form 303-S, the broadcast renewal application form. Since the most recent broadcast renewal cycle had just wrapped up in early 2007 – less than a year before the Diversity Order was adopted – and the next wasn’t going to start until 2011, the Commission probably didn’t feel any pressure to revise the form to include the certification back then. But now, with the first renewal applications of the next cycle due in little more than a year, the Commission may be starting to focus on nitty-gritty details like how, exactly, the certification should be worded.
The precise wording of the certification is not unimportant. Of course, we know from the Diversity Order that, come renewal time, each broadcaster will be expected to certify that: (a) the broadcaster’s advertising contracts do not discriminate on the basis of race or gender (oops, make that race and ethnicity); and (b) such contracts contain nondiscrimination clauses. But the Commission still hasn’t bothered to explain exactly what it expects such “nondiscrimination clauses” to say.
In the wake of the Diversity Order, we took at stab at crafting a nondiscrimination clause to address the problems targeted by the Commission. The trouble is, we really don’t know for sure whether that good faith effort will be satisfactory to the Commission come renewal time. In fact, we know for sure that our original suggested language will definitely not be satisfactory, since our language – which was based on the FCC’s own language in the Diversity Order – referred to “race and gender”, rather than “race and ethnicity”. We know now that that was wrong – but how was anybody to know that before the recent Erratum, since the Commission had been very clear up to that point that it was targeting discrimination against “race and gender”?
In any event, anyone who has been trying to assure their ability to certify accurately that they have complied with the FCC’s nondiscrimination policy – whether by sticking our suggested contract language or somebody else’s into their advertising contracts – would do well to take the time, now, to substitute “ethnicity” for “gender” where appropriate. And if you previously sent out letters to all your advertisers indicating that the nondiscrimination language should be deemed to be a part of all agreements previously entered into, you might want to send out another batch of similar letters, this time substituting (you guessed it) “ethnicity” for “gender”.
And now that the Erratum has re-focused everybody’s attention on the nondiscrimination certification requirement, we offer a couple of questions to ponder.
First, when the renewal application certification language is finally adopted by the Commission, how will it deal with the fact that, from 2008-2010, the agency’s direction had been to avoid discrimination based on “race and gender”, not “race and ethnicity”?
Second, how are we to interpret the fact that the Commission has removed “gender” from the mix, rather than simply inserting “ethnicity” along with “race” and “gender”. Doesn’t that seem to send the somewhat distasteful message that advertising contracts that discriminate based on gender are OK?
Third, while we may all agree that ethnic discrimination can be a bad thing, is it really advisable to impose a blanket prohibition which seems to bar, or at least discourage, all ethnicity-based advertising? For example, if an advertiser wants to target a particular ethnic community with spots in that community’s native tongue, wouldn’t it be perfectly reasonable to limit the run of those spots to stations broadcasting in that language? So if you have an ad in Chinese, directed (obviously) to a Chinese-speaking audience, wouldn’t you want to be able to specify “Chinese language radio, no English or Spanish or Arabic”? But wouldn’t such a limitation run afoul of the nondiscrimination policy as it currently stands? Is this really what the Commission wants?
Fourth, where do noncommercial stations fit in here? The Diversity Order (at Paragraphs 49-50, if you’re inclined to check) referred only to “advertising” contracts. As we all know, NCE stations air “enhanced underwriting announcements”, not ads. But many might argue that it’s all pretty much the same thing. Plus, NCE stations use the same Form 303-S as commercial licensees for their renewals. Our guess is that NCE licensees are subject to the nondiscrimination policy, But the Commission hasn’t said so expressly.
And finally, exactly how does imposing the new certification requirement on all broadcasters (including broadcasters who may themselves happen to be the victims of the “No Urban/No Spanish” practices) have any effect at all? Isn’t it the advertiser (and its ad-buying agency) – and not the broadcaster – who is the real source of this practice? If an advertiser (or its agency) is willing to discriminate, what is to prevent it from lying to the broadcast station? In other words, irrespective of a licensee’s certification, the underlying discriminatory practices may still be going on outside the Commission’s reach.
There is one question you failed to raise--what contract?
Local direct buys are handshake agreements--they aren't going to sign a contract so no need to waste the time or blow away a customer.
Most agency business comes in by e-mail. E-mail request for rate and avails--then if we are lucky, an e-mailed order with directions on where to download the spots,--followed aft er the flight by an electronic invoice.
Yes, I know, first year contract law, offer, consideration, etc., created a contractual arrangement between advertiser and station. But the day of the written contract with several inches of fine print has long passed.
Of course, the real "bottom line" is that the Commission seeks to punish the broadcaster for the evils of the ad agencies. As if we have ANY leverage over what the agencies do. Tough enough to get paid within a reasonable time by them.
Tom --
Fair point. Unfortunately, the FCC didn't bother to address such practical details. In the Diversity Order, all it said (at paragraph 50) was: "[W]e conclude that it is appropriate for the Commission to require broadcasters renewing their licenses to certify that their advertising contracts do not discriminate on the basis of race or gender [whoops -- that's the original 2008 language; now that we're in 2010, you should ignore "gender" and sub in "ethnicity"] and that such contracts contain nondiscrimination clauses." So barring any changes between now and then, come renewal time you and other licensees will be expected to certify that your advertising contracts "contain nondiscrimination clauses". One possible way of dealing with the informal email situation (i.e., the email back-and-forth that results in a buy without an actual document titled "contract") might be to include at the bottom of all your out-going email correspondence some fine print language specifying that you do not discriminate on the basis of race or ethnicity in the sale of advertising. That way you will arguably have tagged the prospective advertiser with knowledge of your policy, so if the advertiser does buy time, you can assert that the advertiser knew or and accepted that proviso. As for oral agreements, you should probably get used to making sure that, at some point in the conversation with potential advertisers, you mention that nondiscrimination policy out loud.
Again, it's possible that the wording of the actual certification to be included in the Form 303-S may shed some more light on what's expected of licensees. For now, we're stuck with what the Commission said in the Diversity Order.