The Big Picture

Patrick Goldstein and James Rainey
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FCC report suggests more disclosure of 'pay-to-play' news

June 9, 2011 |  6:14 pm

FCCGenachowski An FCC report on "Information Needs of Communities," released Thursday, proposes an increase in reporting requirements for television broadcasters that have "pay-to-play" relationships with companies.

In response to reports in the L.A. Times and other media about deceptive news reports, the report suggests that stations should have to maintain an online record of when they are paid to include advertisers in the heart of programming.

The broadcasters have previously been required to alert the public via a notice during the programs. An Internet reporting requirement would be new.

A team of researchers suggested the additional "sponsorship identification" in the voluminous report that covered many issues about local news broadcasting. The reporting would be designed to help the public better discern what is real news and what is airtime companies paid for.

If adopted, the reform "would create a permanent, searchable record of which stations use these arrangements," said the agency's report, released in Washington, "and afford easy access by consumers, competitors and watchdog groups to this information."

In my On the Media column last year, I disclosed how local TV stations were airing content from advertisers as if it were real news, without disclosing the practice to the public, as required by FCC regulations.

KCBS, for example, promoted City of Hope Medical Center. KTLA (like owned by Tribune Co.) hyped the Ford Motor Co. A paid tout for the toy industry reported on multiple news channels around the country. Yet it would have been hard for the public to know that all of those reports came as a result of payments by the advertisers.

The FCC cited The Times' reporting, along with other media critiques of pay-to-play content on TV, in its assessment of the condition of local media. "This trend, if not checked by the industry itself, will rot away the community’s trust in local TV," the report said.

Previously, the sponsorship identifications could be made either via an on-air announcement or with an on-screen message. But even as advertisers seem more intent on getting their products into the middle of shows (to avoid ads, which viewers have learned to TiVo around), many do not clearly disclose the sponsorship arrangements.

It's unclear whether the disclosure proposal will go anywhere, or whether TV outlets will abide by it. History suggests they might not. The public interest group Free Press has been waiting for nearly five years for a resolution of its complaints against TV stations that did not disclose pay-to-play arrangements. There has been no indication if, or when, the FCC will move on the complaints.

An earlier study by the Knight Commission on the Information Needs of Communities prompted the FCC inquiry. That 2009 report described the serious lack of journalism in many American communities. It found a particular need for more "accountability journalism," the investigative reporting and analysis that, in particular, scrutinizes public officials and agencies.

The new report suggests that those problems remain. "This is an emerging gap in local
news coverage that has not yet been fully filled by other media," said FCC Chairman Julius Genachowski. "And the less quality reporting we have, the less likely we are to learn about government misdeeds."

A group of journalists, scholars, and government officials, led by entrepreneur and onetime journalist Steven Waldman, suggested that nonprofit organizations, universities and public media outlets could provide some of the feet-to-the-fire journalism that has gone missing.

One source of potential revenue: The study suggests some of the $1 billion the federal government spends annually in advertising could be redirected to local news sites to give them a better chance of thriving.

“Government has been slow to move on those issues,” said Alberto Ibargüen, president of the Knight Foundation. “We're hopeful that the FCC's 'Information Needs of Communities' report will move us from debate to action.” 

Anyone looking for more of the feds take on the crisis facing the media will get it in a reported expected out later this year from the Federal Trade Commission.

--James Rainey

Twitter: latimesrainey

Photo: Federal Communications Commission Chairman Julius Genachowski will study the recommendations in a report on local journalism. The FCC study found a serious lack of "accountability journalism" in many parts of America. It suggested that nonprofits and universities could be among the institutions to help fill the gap. Credit: Gary Friedman / Los Angeles Times