Current Briefing

Should public broadcasting go more commercial?

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Concerned that public TV and radio needs to invest in programming to survive growing channel competition, and that federal funding is not reliable, an influential minority of pubcasting execs continue to talk about seeking to drop or loosen laws that forbid them from carrying outright commercials. Some argue that their stations should be given the option of converting from "noncommercial" to "nonprofit" broadcasters, which would maintain high quality standards but also sell commercials.

Public TV has boosted underwriting for national programs by consolidating sales in the PBS Sponsorship Group, operated by the network and four major producing stations to sell program underwriting. A separate, private rep firm, National Public Television, started by cable ad entrepreneur Robert Williams, handles so-called "spot" sales of freestanding "corporate support announcements" on many stations.

Public radio isn't eager to go after commercial revenues — and the NPR Board has gone on record opposing the idea.

In public TV, however, some station leaders believe they could boost that income by carrying outright commercials. The question became an ongoing debate in the field:

Dependence on ad-like credits remained an issue in 2003, when Wick Rowland, a Denver public TV manager, wrote that public TV is locked in a seductive dance with commerce.

An unusual proposal for advertising on public TV--never acted upon, but with potential for the the DTV age--is the PTV Weekend idea from a former PBS president, Lawrence Grossman in 1995, when the field was under attack by congressional Republicans. [Links to Current coverage, Grossman proposal and pro-con debate.] Grossman proposed a new commercial network, parallel to PBS, that would provide top-flight cultural programming to public TV stations on Friday and Saturday nights. The idea--most recently called PTV Weekend--would require approval by Congress, and so far has not yet won a consensus within public TV. Grossman developed the proposal with Markle Foundation aid, and continued developing it in 1996-97, talking with potential investors.

Grossman, who would maintain noncommercial support for the kinds of programming that can only be supported in that way, and other advocates for a mixed economy on public TV point to Britain's Channel Four, which manages to serve a legislated programming mission while receiving support from advertising. The British channel, however, was founded under the long influence of the BBC tradition and with a unique financial structure that initially isolated program decision-makers from direct financial incentive.

The idea of commercializing public TV was proposed by some public TV leaders and considered by Republican leaders in Congress in 1995 and 1996, though a key House leader, Rep. Jack Fields (R-Tex.) rejected putting it in his February 1996 bill. Fields, however, did propose allowing overlapping public TV stations (where there is more than one per city) to be sold off for commercial purposes. Fields and other Republican leaders wanted public broadcasting to pay its own way through private-sector means. [Briefing on federal aid and other options for pubcasting.]

Underwriting credits

For now, the FCC prohibits commercials and allows only underwriting credits, which are restricted by the commission's rules in what they can say and show. The difference is a vast gray area that lawyers examine closely on the rare occasions when the commission finds a violation, as in the WTTW case in late 1997.

On top of the FCC rules, several pubcasting networks including PBS have more restrictive rules against commercial appearance, though they are occasionally loosened. In 2002, for instance, PBS decided to permit sponsors to show their corporate mascots (if they stand still) and celebrities (if they're giving testimonials for public TV).

The network rules are too tight in the view of some station executives. While PBS limits the length of a national underwriting credit to 15 seconds or less, many large stations routinely sell 30-second credits. In 1995, PBS contended that its national credits, which it restricts to 15 seconds, are undercut by the longer spots sold by some local stations, but a group of prominent stations rebelled at enforcement of tighter PBS underwriting guidelines. Within two months, PBS backed away from extending the guidelines.

Four years later, the issue remained unresolved. An extensive PBS Board study in 1999 found that 30-second credits are not common but half of stations oppose restrictions on them.

Though PBS "streamlined" its own underwriting guidelines in 1994 in hopes of increasing revenues from underwriting, its president, Ervin Duggan, argued forcefully against commercialization, and the network pushed for consistent, tighter rules on stations' local underwriting. But that movement ran head-on into the search for potential revenues to replace federal aid. Commercials were back on the list of potential revenue sources.

In public radio, the stations sometimes hold tougher acceptability standards than NPR. In 2003, fundraisers at some stations complained about underwriting credits on national programs that sound — to them — too commercial.

NPR provoked a flurry of criticism in 2001 by accepting underwriting from the government of Kuwait. The network soon reversed its policy and won't accept any more underwriting funds from foreign governments.

Underwriting credits have problems of their own

Though underwriting credits are relatively free of hucksterism, they carry their own problems. One is that they are worth much less to a corporate donor (who therefore pay less to the public broadcaster) than a full-strength commercial, since the credits are often restricted in length and content.

Airing credits also can involve pubcasting in controversies over products of underwriters, as in the case of Cheetos snack foods, proposed for sponsorship of a children's program in 1996, or alcoholic beverage companies, which NPR rejected in 1995.

Another problem in the close connection between underwriting and particular programs: corporate donors seldom give sizable amounts in exchange for credits that run in station breaks; they want to support particular programs that (a) reach intended audiences and/or (b) deal with topics of interest to them.

In this situation, where stations must often raise funds separately for every program they wish to produce, corporate donors can influence program content by deciding which programs to underwrite and which to reject.

The funder often must be interested in the program's subject, but when the interest becomes too close, the underwriting deal can damage the credibility of the program and the producer. Such a deal blew apart late in 1996 when critics of KQED in San Francisco charged that the Mondavi winery had helped arrange funding for a program about its patriarch.

Sale of merchandise on public TV

Direct selling of videotapes and other products on public TV is another semi-commercial practice questioned by some critics. Books and tapes related to programs are commonly offered by producers on PBS, and local stations dispense similar merchandise as premiums for pledge-drive donors. Big sellers include authors of self-help books, including Suze Orman and Gary Null. Some fundraisers, including former PBS development chief Mike Soper, say premiums have become a form of retailing, not thank-you gifts to donors, that undercut philanthropic attitudes.

In 1993, the big public TV station in Chicago, WTTW, experimented with broadcasting an an upscale home-shopping service. Opponents petitioned the FCC for relief. Two years after the experiment, the commission found the station had violated an FCC rule, but did not agree with complaints that the fundraising technique was too commercial.

Programs that are commercials

Despite rules to the contrary, companies and nonprofits that want to blow their own horns can raise or pay money for that purpose to appear on several minor, unscrutinized series on some public TV stations.

In 2004, WJMK Inc., producer of American Medical Review and other shorts paid for by manufacturers, released Walter Cronkite from a deal to host the near-ads, settling lawsuits by both parties. In earlier stories, critics describe how the scheme worked.

World Business Review used a similiar business plan, with Gen Alexander Haig as host, and participating stations may have violated FCC rules by accepting payments. Another series, Spotlight On, charges fees to companies and trade associations to put their messages into fillers aired on public TV.

There also has been a version for nonprofits. The Visionaries, was supported by money raised or contributed by the same nonprofit organizations that are get positive treatments on screen. The series distributor, American Public Television, pulled three episodes from distribution and announced it is examining others.



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