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A Structure and Efficiency Approach to Reforming Access and Content Policy

A Structure and Efficiency Approach to Reforming Access and Content Policy

Steven S. Wildman
Associate Professor of Communication Studies
Northwestern University

D. Karen Frazer

Ph.D. Candidate, Department of Communications Studies
Northwestern University

Introduction

From its inception, broadcast television has been recognized as having the potential to serve a variety of important social and political needs in addition to broadcasters' commercial interests and the interests of viewers as consumers. Because broadcasting in the United States has always been dominated by privately owned broadcast operations, the question of how a television industry so constituted might be induced to serve societal goals in addition to broadcasters' commercial objectives has been an issue of perennial debate-a debate given some urgency by the impending transition to digital television and the need to make sure that policies appropriate to a digital television industry are in place before the transition occurs. An important part of this ongoing debate addresses issues relating to the content of television programs and the commercials within those programs, including the roles of policies governing access to program time or commercial time in determining content.

Previous work by participants in the Aspen Institute Working Group on Digital Broadcasting and the Public Interest identified four benchmark models for reforming content and access policies.1 This chapter offers a critical assessment of those benchmark models and proposes a fifth model for the reform of access and content policy. At its broadest, an exercise of this type can address three very general questions:

  • Is there good cause to change the current regime governing public interest programming by broadcasters?

  • Does the transition to digital broadcasting fundamentally change the issues of concern and the need to address them through regulatory intervention?

  • Assuming that reform is called for, how is it best accomplished?

Our analysis focuses primarily on this third question. While we recognize that disagreement exists over the need to change the current regulatory structure, the analysis presented in this chapter accepts as a working hypothesis that such a change is warranted.

The nature of the concerns addressed through public interest programming2 is such that there is no quantitative measure or index to tell us whether the many and various public interests served through television are being adequately addressed. Such assessments are by necessity subjective and politically expressed. The fact that dissatisfaction with the current state of affairs is fairly widespread might itself be taken as evidence of needs inadequately served, although this suggestion begs the question of whether there are superior alternatives. If, however, a broad consensus exists that the current system can be substantially improved, the transition to digital broadcasting is the ideal opportunity to make the attempt, regardless of whether or not there is anything unique to digital broadcasting has unique qualities that should be reflected in public interest requirements for broadcasters. This period of transition will be sufficiently disruptive that much of the old bargain with broadcasters must of necessity be rewritten; government and industry are already embedded in this process. Any larger scheme for regulating broadcasters will have more integrity if all the pieces are put in place simultaneously, rather than assembled piecemeal.

In assessing proposals for reforming content and access policies, we employ two criteria. First, is a proposed policy structurally appropriate? By this we mean to what extent does a policy proposal actually address the ultimate sources of the various content and access policy concerns? Second, if a policy proposal is structurally appropriate, is it the most efficient, or even the most effective, way of addressing a specific policy concern? That is, are there other policies that might either address the same concern more fully or at a lower opportunity cost?3

To address the root causes of content and access policy concerns, we must first identify them. While many different specific complaints about content and access have been voiced regarding television broadcasting, the first section of this chapter argues that all of them reflect a small set of behavioral traits of three sets of actors: viewers, commercial broadcasters, and people directly involved in the political process. Content and access policies are structurally appropriate only to the extent that they acknowledge and respond to these basic behavioral traits. The second section evaluates the four benchmark models in terms of their structural appropriateness, and the third section evaluates them again in terms of their effectiveness and the efficiency with which they address the policy concerns for which they are appropriate. The fourth section builds on the analysis of the previous three sections to develop a fifth model for access and content policy reform, one that we believe can harness the self-interest of the relevant actors to address the shortcomings we see in the benchmark models. The chapter concludes with a summary of our analysis and reviews its implications for content and access policy.

The Behavioral Roots of Content
and Access Policy Problems

At the heart of the complaints about the current system and the fears regarding what will happen with digital television is the concern that, in the absence of policy intervention, most television viewers will consume too little of certain types of information believed to be beneficial to themselves or others, and/or will consume too much programming of types believed to lead to harmful effects (particularly for children). If this concern is legitimate, it must be because, left to their own devices, some or all of the relevant private actors-viewers, commercial programming services, and participants in the political process-will fail to fully internalize the public interest in their private decisions. Four sets of underlying factors might contribute to this problem of over- or under-consumption of certain types of programming.

Misalignment of Personal Consumption Incentives and Viewers' Private Interests or the Public's Interest

It is important to realize that there is both a supply side and a demand side to the television consumption problems identified with the current system. While policy proposals have tended to focus on supply (require more of favored types of programs, limit the quantities of disapproved program types, etc.), the efficacy of such solutions is constrained by the extent to which they have their roots in underlying viewer preferences.

Demand-driven under and over-consumption problems may arise in two ways. One is that viewers may not realize their own true self-interest in the viewing choices they make. The second is consumption externalities. Society at large realizes benefits or is harmed by certain viewing choices made by individual viewers, but viewers attending to their own self-interest pay no attention to the societal consequences of the choices they make.4 Why might viewers fail to realize maximum personal benefits from the programs they select? One justification for such a claim could be that, individually, viewers suffer from a failure of will when they make choices among alternative programs. While people may recognize that in the long run they would be happier, or more content, if they watched more educational, or political, or cultural programming, the here-and-now temptation of more titillating, but ultimately less-satisfying programs, is too much to resist. It's like the dieter at a buffet who can't resist one last trip to the dessert table, knowing all the while that he or she will regret the added calories later on. While such an argument is analytically plausible, absent solid empirical evidence that most viewers wish that they were forced to make different viewing choices on a regular basis (and, with the possible exception of children's television, we are aware of no such evidence), we find this notion to be dubious as a justification for some sort of collective enforcement of will regarding the types of programs watched. It is too easy for cultural elitism to masquerade as well-meaning assistance for people considered too weak-willed to do what is in their own best interest.

A second justification for intervening in viewing choices to force individual viewers to watch more of the types of programs that will improve their individual lots is that viewers themselves do not (or are not able to) recognize their own long-term interests in their choices of programs, while public officials do (or are able to). The dangers of elitism cloaked in expressions of concern for the common good (or the good of the common person) are obvious in this kind of argument as well, but it is also consistent with the logic of representative democracy. The issues associated with children's programming again provide a case in point. It is too much to expect individual citizens to carefully review the voluminous academic literature on the effects of violent programming on children's attitudes toward violence. Yet, it is not unreasonable to expect congressional subcommittees or regulatory agencies to undertake such investigations-as they have done. Nevertheless, whether it is lack of information or failure of will that is alleged, the obvious danger that one group may use the policy process to increase the supply of programs that it favors at the expense of those favored by others dictates that proposals to regulate programming on behalf of viewers' individual self interests should have to meet extremely high evidentiary burdens before being implemented.

The externalities argument for trying to change viewing choices is easier to accept as grounds for policy intervention because it is congruent with our basic notions of how a democratic society should function. It is generally accepted that a more-informed citizenry makes better policy choices, and that all citizens benefit when this is happens. Each citizen therefore has a vested interest in the amount of policy/politically relevant information consumed by every other citizen. If television programming does, or can, make a meaningful supplemental contribution to the informational base from which citizens form opinions and influence policymaking, there may be substantial public benefits from policies that successfully modify viewing choices. Whether such policies can be justified depends on their practical consequences, however, an issue discussed more fully below.

Misalignment of Commercial Motives and the Public Interest in Program Content

Commercial and public interests in program content may be misaligned for at least two reasons. The first follows from a failure of viewers to internalize their own and society's long-term interests in their viewing decisions. Commercial broadcasters profit by satisfying the wants and needs that viewers do express. If viewers don't recognize their own personal (long-term) interests in the programming choices they make, or if they fail to internalize the larger public interest in what they watch, then commercial broadcasters will do nothing to address these consumption problems. In fact, they will profit most by catering to these basic failings of viewers as consumers. This is true for broadcasters supported by both advertisers and viewer payments.

A second reason why commercial program offerings may not be well aligned with the larger public interest in programming is the widely recognized tendency of an advertiser-supported broadcast system to oversupply the types of programs preferred by viewers with majority preferences and undersupply the types of programs desired by viewers with less mainstream tastes. This problem, which has been extensively studied by economists, also arises, although not as severely, with pay television.5 The basic problem is that broadcasters have an incentive to continue to offer increasing numbers of highly similar programs targeted to a large audience of majority taste viewers-even though the contribution of an additional marginal mainstream program to viewer welfare may be quite small compared to that of a program appealing to a smaller audience whose preferences aren't well served by mainstream fare. Only when further subdivision of the mainstream audience becomes less profitable than more specialized programming for viewers with less mainstream tastes will the incentive structure change.

Misalignment of Market Allocations of Commercial Time and the Public Interest

There are at least four reasons why commercial and public interests in the allocation of commercial time might not be in alignment. The first relates to the allocation of ad time between commercial and political messages. The basic problem is that candidates and voter initiatives compete in a political arena, but do so in part by purchasing advertising time sold in a commercial arena. There is no reason to expect that the amounts that commercial advertisers are willing to pay and the amounts that political actors are willing to pay for ad time will be an accurate gauge of the relative contributions of commercial and political speech to the public good. In fact, it is widely believed that the demand for ad time expressible by political actors is not commensurate with the social benefits of their messages-so commercial speech unduly crowds out political speech.

Second, because market allocations reflect willingness to pay, which for political speech means ability to pay, the allocation of commercial time among political messages may not reflect the public's true interest in the relative amounts of exposure given to different messages. A commonly expressed concern is that the allocation of political ad time among candidates and initiatives on the basis of market prices unfairly biases political debate in favor of incumbents (who typically are able to raise more campaign money than their challengers) and status quo solutions generally over less traditional alternatives (because large commercial interests with much at stake in the status quo are willing to contribute heavily to maintain it). The fear is that well-financed interests will simply drown out their opponents' messages by flooding the air waves with their own commercials.6

Third, there is also the concern that commercial broadcasters may refuse to sell time to candidates advocating policies they don't like, or offer time at discriminatorily low rates to candidates with views of which they approve. This too is a market allocation problem, if broadcasters' interests in political outcomes are allowed to influence business decisions regarding the sale of ad time.

Finally, it might be argued that viewers watch the public interest programming that is available less frequently than they should because they are not adequately informed about its existence, content, and scheduling. This information deficiency might be rectified by advertising public interest programs on the more heavily viewed commercial programs; but there is no reason to expect that market allocations of ad time will adequately reflect the public benefits in ads for public interest programming. Note, however, that this argument is not independent of the claim that viewers' choices of what to watch do not reflect the full value of public interest programming to themselves and to society. If they did, broadcasters would find it profitable to produce and to promote such programs just as they do more traditional entertainment programs.

Misalignment of Messages Supplied by Political Actors and Voters' Information Needs

Independent of the concern that commercial markets for advertising time and program time will not allocate enough time to political messages, there is also the concern that, if left solely to political actors, political messages will not provide as much useful information as they should. In this case, it is the personal interests of political actors that are not entirely consistent with the public's interest in the messages they supply. The primary objective of politicians and supporters of ballot initiatives is to convince voters that they themselves represent the right choice, not to provide voters with the information required to make the right choice. Thus, the messages supplied by political actors are likely to be characterized by omissions and mischaracterizations (both of themselves and of their opponents) that make it more difficult for voters to make informed choices. Given the misalignment of commercial and public interests discussed above, these deficiencies in political debate are not likely to be corrected by commercial broadcast programming. The solution, therefore, requires some sort of policy intervention, perhaps in relation to campaign reform more generally.

Structural Analysis of the Four Benchmark Models

Content and access policies can succeed only to the extent that they directly confront the factors giving rise to content and access problems discussed above. Different responses are appropriate to each of the four sets of factors.

The problem of personal consumption incentives not fully reflecting the public's interest in viewers' choices can be addressed by either trying to change viewers' tastes in programs to bring them more in line with the public's interest in their viewing choices, or by changing the set of programs they have to choose among. While the viewing options available are likely to have some impact on the evolution of viewer tastes, substantial change in viewer preferences is an ambition that can be achieved only in the long run (if ever), perhaps through the educational system.7 It is also a goal that most likely cannot be accomplished with policies whose direct impacts are on the content of a limited number of programs and on conditions for access.

Viewers' options may be beneficially altered in two ways: public interest programs can be made more appealing to viewers, and commercial alternatives to public interest programs can be restricted. Making public interest programs more appealing requires that more money be spent producing them, and, perhaps, that more of them be broadcast so that viewers are more likely to find them available when they have the time and inclination to watch television. Restricting commercial alternatives would certainly be the most effective way of increasing the viewing of public interest programming-if the options were restricted at the same time that programs of particular public interest were being broadcast. For example, all networks, both broadcast and cable, might be required to carry presidential debates. Restricting commercial options generally is not a politically feasible option when the current, and increasing, abundance of channels is apparently so important to so many viewers (and voters).

Solutions to the other three sets of factors are more obvious. The appropriate response to the problem of commercial motives not fully reflecting the public interest in program content is to either finance or compel the production of programming different from that generated by the market. The response to the problem of markets for ad time underallocating time to ads for candidates, political issues, and public interest programming is similarly direct. Either purchase or compel broadcasters to provide the ad time required to remedy the imbalance. Finally, if televised information supplied by political actors is not sufficiently informative, the solution is to produce programs (or commercials) that provide the information voters need to make informed decisions.

How do the four benchmark models stack up when judged by these criteria for structural effectiveness? None explicitly addresses the problem of politician-supplied information being insufficient and in some cases misleading. But it may be unrealistic to expect a policy solution to this problem, because it would have to be approved by the politicians whose claims and promises would be scrutinized. Other than this, there is considerable structural variation in the four models.

The Improved Public Trustee Model

This is the least radical of the four benchmark proposals. Since the inception of broadcasting in the United States, both radio and television broadcasters have been granted commercial licenses contingent on providing certain services deemed to be in the public interest. While the interpretation of broadcasters' public service obligations has varied over time, the existence of such obligations as key features of their licenses has not been questioned.8 Under the benchmark proposal for reforming the public trustee model, the following current public interest obligations on broadcasters would be maintained and extended to cover digital broadcasting: provision of civic programming and educational programming in the public interest as specified in license regulations and supplemental rules (e.g. the Children's Television Act); provision of equal opportunities for access for electoral candidates (equal time) at LUR (lowest unit rates) and reasonable access for federal candidates; and minimum behavioral requirements (sponsor identification, no payola, etc.).

In response to complaints about the current system, new requirements would be added and certain existing ones strengthened. Proposed revisions include elimination of "postcard renewal" of licenses (to force a more thorough performance review) and reinstatement of the Fairness Doctrine's requirements for broadcasting material in the interests of civic participation in politics and increased diversity of viewpoints. Other revisions would lessen the regulatory burden on broadcasters, such as broadening exemptions to equal-time requirements to encourage stations to broadcast more political programming and eliminating LUR requirements in exchange for free time for political candidates. Other changes have also been proposed to streamline and simplify public interest obligations, such as the development of quantitative and qualitative guidelines for educational and civic programming. Finally, while it is often not considered in discussions of the public trustee approach, it must be recognized that broadcasters' public trustee obligations are to be carried out in a television industry that also includes the Public Broadcasting System (PBS), whose mission is also to supply programming that remedies deficiencies of the private system.

If we judge this model only on structural appropriateness, and set aside the question of how effective it is in achieving content and access policy goals, the public trustee approach doesn't look too bad. Programming that would not naturally be supplied by commercial broadcasters is provided by the stations of the Public Broadcasting System, and by commercial broadcast stations through the enforcement of the requirements of the Children's Television Act and other requirements for the broadcast of educational and civic programming. Requirements that broadcasters air public service announcements and sell ad time to political candidates at LUR address the problem of commercial messages squeezing out political messages whose value to the public is not fully reflected in the amounts candidates and issues advocates spend on advertising. The public trustee model does not directly address the problem of viewers' choices not appropriately reflecting the larger public interest in what they watch (or even their own long-term personal interests), but, except to the extent that they can fund more attractive PBS programming, neither do any of the other benchmark proposals. This version of the public trustee model also does nothing to raise viewers' awareness of the program offerings on public television channels; but adding a requirement that commercial broadcasters set aside some ad time for the promotion of public station programming would seem to be a relatively minor amendment to current proposals for an enhanced public trustee obligations.

Perhaps it should not be too surprising that the various elements of the revised public trustee/PBS approach for dealing with content and access policy issues are relatively well targeted from a structural perspective. They evolved through a process of trial and error selection over decades as policymakers responded in a rather ad hoc fashion to very specific policy problems. The real problems of the public trustee approach are problems of efficiency and effectiveness, which we discuss in the next section. While some problems may arise from underfunding, others are simply the consequences of poor instrument design.

The Spectrum Fee Model

Under this model, broadcasters would be relieved of all public interest programming requirements and would thus lose their "public trustee" status, although certain minimum behavioral requirements relating to open or fair business practices9 and restrictions on indecent and obscene content would be retained.10 In exchange for this relief, and in order to provide what commercial broadcasting has so far been unable to do to general satisfaction, a fee (the suggested range is 1-3 percent ) would be levied on some combination of broadcasters' gross advertising revenues and receipts from station sales. The fees collected would fund an enhanced public broadcasting system and possibly a political "time bank" enabling candidates to purchase time on broadcast stations. An enhanced PBS system would take primary responsibility for providing political, educational, and civic programming in the public interest, although commercial broadcasters might still be required to publicize such program offerings on their own channels.

Like the revised public trustee model, the spectrum fee model (also referred to by Henry Geller as the "pay/public broadcasting model"11) addresses the problem of certain types of programs being undersupplied by commercial broadcasters by providing such programs on public television stations. Only with the political time bank does the spectrum fee approach address the problem of too little ad time being allocated to political speech; the problem of meeting the public's interests by public service announcements is not addressed at all, although this too could be funded through a more broadly defined time bank. To the extent that fees collected from broadcasters permit higher budgets for PBS programs, the problem of viewer choices not reflecting public interests could be at least partially addressed, although this gain would be offset to some degree by the loss of public interest programming that would otherwise have been provided by commercial broadcasters under the public trustee approach. While the spectrum fee benchmark model makes no explicit provision for advertising PBS programs on commercial channels, a portion of the fee-generated funds could be used to purchase commercial time for this purpose.

Pay Plus Access

Pay-plus-access is a hybrid of the spectrum fee and public trustee approaches. Broadcasters would be relieved of most public interest programming requirements except for minimum free-time requirements for electoral candidates. Candidates would be allotted broadcast time during an election campaign, some of which would be in prime time. Because of the candidate free-time requirement, broadcasters would remain limited public trustees. However, in order to cover the rest of their public service obligation, a fee would be levied in the same manner as in the spectrum fee model. Funds collected could be used to subsidize the purchase of advertising by electoral candidates (either through funds controlled by political parties or through a time bank against which candidates could draw) and to finance high-quality civic and educational programming by public broadcasters. Access for other types of political or even civic and educational programming might also be required via a leased-access scheme similar to the leased-access channel requirements for cable television, but equal time provisions would be eliminated. Broadcasters might also be required to publicize the expanded programming options available via public broadcasting.

Like the spectrum fee approach, pay-plus-access addresses the problem of viewers choosing to watch too little public interest programming by raising funds through a fee on broadcasters that could be used to finance more appealing public interest programs. By funding the production of PBS programs, the model also addresses the problem of the commercial system supplying too little of certain types of programs. The same objectives would also be served by leased-access requirements if they were included as part of this approach. The problem of access to ad time for political speech is addressed through the minimum free-time requirements for political candidates and the use of fees collected from broadcasters to subsidize political advertising. Deficiencies of the commercial system in informing viewers of the availability of public service programs would also be addressed if commercial broadcasters were required to publicize them, although it should be noted that this extends broadcasters' obligations beyond simple access.

Pay or Play

Under the pay-or-play model, broadcasters would be given the option of meeting clearly specified public interest programming obligations or paying to get out of these requirements. Two variations on this approach differ according to who would get paid by a broadcaster buying out obligations.

What has been called the "spectrum check-off" variant would assign each broadcaster an explicit financial obligation in exchange for the continued right to use its portion of the broadcast spectrum. The market value of the spectrum employed for broadcasting has been suggested as one way of determining the financial magnitude of the obligation. (We will comment on the merits of this approach to quantifying the obligation in section III. We simply note here that neither the magnitude of the financial obligation nor the manner in which its value is determined plays a role in the operational logic of the spectrum check-off proposal.) Because we have reservations about the use of the current commercial value of broadcast spectrum to financially quantify a broadcaster's obligation, and because the use of the check-off mechanism is not dependent on any particular methodology for quantifying the obligation, we will use the more general term, "obligation check-off," in referring to this approach.

With obligation check-off, broadcasters could choose among the options of: (1) covering their obligations with outright cash payments-which would then be used to support public interest programming by public broadcasters; (2) earning "check-offs" against their obligations by providing public interest programming and access time on their own stations (access time commitments could include free ad time for candidates and public service announcements); or (3) combining cash payments and check-offs.

What we will call the "tradable obligations" variant of pay-or-play would assign each broadcaster a set of obligations that would be clearly specified and quantified in terms of programming and access to be provided. Broadcasters would be allowed to trade these obligations amongst themselves, with the terms of trade set by law or by regulators. The tradable obligations proposal was inspired by the trading in pollutant emission rights made possible by the Clean Air Act of 1990. Market efficiencies are the intuitive appeal of this approach. Ideally, trading in public service obligations (which could involve cash payments among stations) would result in these obligations being met by the stations able to do so most efficiently.

To the extent that the public interest obligations specified under either version of pay-or-play result in more resources being devoted to public interest programming and more time set aside for public interest purposes than is currently the case, both address the problems of commercial broadcasters undersupplying certain types of programming and spending too little to produce it relative to what is appropriate for public policy purposes. Because the quantifiable public interest obligations of the tradable obligations approach could cover virtually any public interest that might be served by broadcasters, almost any content or access policy goal could theoretically be addressed, with one notable exception. If the sponsors of political messages require access to the vast majority of prospective voters, allowing the trading of obligations to provide access to ad time could result in the concentration of political advertising on a few stations that reach only a fraction of the total television audience. The obligations check-off model thus has the potential to fail completely in this regard, should broadcasters decide to buy their way out of these obligations entirely.

Table 1 summarizes this review of the four benchmark models in terms of their structural appropriateness. By structural criteria alone, there is no obvious winner or loser among them. Each has advantages and disadvantages relative to the others. It is also worth noting that the structural elements of these proposals could be combined in various ways. Thus collectively they might be viewed as a menu of options from which policymakers could pick and choose in developing content and access policies. However, any final judgment regarding the merits of these four benchmark proposals and any combination of their components must also reflect effectiveness and efficiency considerations.

Effectiveness and Efficiency Assessments

Complaints about the way the public trustee approach to content and access policy is currently handled are of three general types: (1) Commercial broadcasters get off too easy because they are not required to make public interest contributions commensurate with the value of the spectrum they use for free; (2) the public doesn't receive the benefits it should from commercial broadcasters' performance of the obligations they do have; and (3) the public broadcasting system that is supposed to compensate for the failings of commercial broadcasters is underfunded. At heart, the first and third complaints are assertions that, respectively, broadcasters should be taxed more (albeit indirectly) and that more should be spent on public broadcasting. As such, they are public finance issues. The second complaint concerns the effectiveness, not the efficiency, of current policy. Regardless of whether there are more efficient alternatives, the general feeling is that current policies accomplish very little of value regarding the public interest performance of commercial broadcasters.

We will not deal herein with the question of how much should be spent on the public broadcasting system. Other than the implicit claim that more would be better, none of the four benchmark models offers a methodology for determining how much should be spent on public broadcasting. In addition, the optimal amount would vary with the contributions of commercial broadcasters, which would be different for each of these policy proposals. This observation is not a criticism of the benchmark models. As with health care, national defense, education, or virtually any other macro-level policy concern, there exists no practically implementable formal methodology for determining what level of commitment of public resources is optimal. Rather, spending levels are adjusted incrementally in response to general feelings that too much or too little is being spent to achieve various policy goals.

The Appropriate Level for Broadcaster Contributions

Only proponents of the spectrum check-off version of the obligation check-off pay-or-play model point to a methodology that they claim produces a valid financial measure of what broadcasters' public service obligations should be. While the 1 to 3 percent fees that would be collected on various revenue measures under the spectrum fee and play-plus-access approaches are magnitudes with which many people would feel comfortable, there are no first principles from which their proponents claim they are derived.

One proposal associated with the spectrum check-off approach would quantify broadcasters' public service obligations at the value the license for the least-watched station in a market might command in an auction.12 The intuitive logic of this approach is that broadcasters benefit from free use of broadcast spectrum with a market value that greatly exceeds the cost of their current public service obligations. Because the right to use the broadcast spectrum is given away, its underlying value is a rent realized as a lump sum contribution to broadcasters' profits that can be collected as a tax without affecting the efficiency of their operations. Thus, the tax itself would be efficient. Use of the auction value of the least-watched station limits the risk to broadcasters that they would be unfairly taxed for their own contributions to the profitability of their operations. This type of protection is important, because if broadcasters were taxed on their own contributions to station profitability, this would constitute a tax on top of normal corporate income taxes that might discourage spending on broadcast services.

In our opinion, this approach to determining how much broadcasters should pay for the right to use the spectrum suffers from flaws both theoretical and practical. On the practical side, it fails to allow for differences in the value of different portions of the broadcast spectrum. The most obvious difference is that between UHF and VHF stations. VHF signals are clearer and carry farther than UHF signals broadcast with equivalent power. These differences are reflected in larger audiences, more network affiliations, and higher profits for VHF than UHF stations. In markets with both VHF and UHF stations, the least-watched station will almost always be a UHF station. Using its auction value as a measure of the underlying value of the licenses of all stations in these markets will leave a substantial portion of the value of VHF licenses untaxed. Of course, this problem might be addressed by making upward adjustments to reflect the greater value of VHF licenses, but these adjustments would have to be calculated on a market-by-market basis to reflect factors such as numbers of stations, degree of competition from cable, and viewer populations and demographics that are certain to vary substantially.

These practical problems with assessing the market values of television licenses can in principle be solved by developing more sophisticated estimating techniques; but flaws in the theory supporting this approach cannot. We see two problems for the theory. First, and least troubling, is the fact that there is no reason to assume that the least-viewed station in a market makes no contribution to its own profits over and above the value of its spectrum. If the limited spectrum allotted to television were not a constraint on the number of television stations in large markets, and if small populations didn't limit the number of broadcasters in smaller markets, this might be a reasonable assumption. But the number of television stations in most markets is constrained by one of these two factors. Therefore, there is no good reason to assume that the marginal broadcaster in a local market contributes nothing to the profits it earns from its spectrum. While this theoretical issue might be side-stepped with a different methodology for estimating the current market value of broadcast spectrum, better estimates of the innate present value of broadcast spectrum will not address our second, and more fundamental, objection to this approach to determining how much broadcasters should contribute. This objection is illustrated by the following example.

Consider a hypothetical broadcaster who held the license to a television station in a major market from the time it was first awarded in 1948 until it was sold for the first time in mid-1998 for $300 million. While the license was given away free in 1948, assume the owner would have been willing to pay $10 million for it, over and above necessary investments in equipment and programming, had it been auctioned off rather than given away. Now suppose that the same $10 million continually reinvested in safe financial instruments such as U.S. treasury bills would have earned a real (and predictable) rate of return of five percent annually over this period. With continual reinvesting in treasury bills, the $10 million would have grown to $114.7 million by 1998. In the recent sale, however, the station changed hands for $300 million.

How much of the current $300 million market value represents a gift by the government to the station's current owner? We would argue none, because the current owner paid full market value for it. Whatever the value of the giveaway, it was fully captured by the original owner. (This would be true regardless of how many times the station changed hands since the license was first awarded.) Suppose the value of the giveaway could be collected from the original owner-or the owner's heirs-even though the practical and legal barriers to doing so are likely to be insurmountable. How much should they pay? (Equivalently, how much should the owners of a station that has never changed hands pay?) While the case for collecting $114.7 million seems clear, the government's claim to any more of the current $300 million market value is far less obvious. The $10 million the original owners would have paid fifty years ago represented the probability weighted sum of the present values of many different possible futures. For those in which the station stayed in business the owner would have had to continually reinvest in the station as technologies changed and equipment depreciated-investments that likely also contributed to the current $300 million valuation. In one of these futures (the one observed), the value of the station would grow to $300 million by 1998; but if the market value was $10 million in 1948, there must have been other possible futures in which the value of the station failed to keep up with the compounding value of the equivalent investment in treasury bonds-possibly including futures in which the station would have lost money (a situation that characterized many UHF stations throughout most of the history of the television industry). From this perspective, collecting more than $117.4 million from the original owners would appear to be a tax on good fortune and initiative with no allowance made for the risks in broadcasters' commitments in accepting the initial TV licenses.

As this example makes clear, once a station has been sold, collecting the value of spectrum assets given away by the government from the current owner is inappropriate because the full value of the giveaway was realized by the very first holder of the license. All subsequent owners have behaved exactly as do business people investing in other assets-paying prices they thought to be fair reflections of future earning potential. Any attempt to collect the value of spectrum given away from current owners would undoubtedly be challenged as an illegal taking. Collecting the value of spectrum assets given away from original owners is complicated by the need to determine what the original market value would have been at the time a license was given away and the risk that should be attributed to subsequent investments in the station by the original owner. While it is certainly true that current license holders paid for licenses with public service obligations they knew could be changed at any time, this fact by itself provides no hint as to what the correct level of the obligations should be.

To our knowledge, the proposal that broadcasters be charged for the value of the spectrum given them by the government is the only attempt at a first principles approach to determining the value of broadcaster's public service obligations. As indicated above, we think this approach is flawed, perhaps fatally so, by conceptual and practical difficulties. On the other hand, the terms under which broadcast licenses are awarded allow for the possibility that broadcasters' public service obligations may be changed over time, as deemed appropriate by government authorities. This would seem to be justification enough for changing these obligations in ways that would better serve the public interest in broadcast services.

Efficiency and Effectiveness Considerations

As we noted earlier, the current public trustee model had been largely deemed a failure in dealing with content and access concerns, because it has proven to be ineffective in producing its hoped-for benefits. The reasons for the poor performance of the current public trustee model seem fairly clear. Many of the relevant performance requirements are hard to quantify (especially those relating to program content); those that are quantifiable in principle, such as LUR and equal-access requirements, are costly to monitor; the penalties for noncompliance are generally weak; and, because these requirements contribute more to costs than to revenues, profit-motivated broadcasters have every incentive to evade them when they can and to satisfy them in the least costly way that is minimally acceptable to regulators when they can't. For the most part, the proposals for an enhanced public trustee model are just more of the same. While the burden on broadcasters would undoubtedly be greater and additional public service would be provided, compliance problems and dissatisfaction with licensee performance are likely to be just as prominent features of enhanced public trustee requirements as with the current requirements.13 We therefore ask whether elements of the other three benchmark models offer more effective approaches to achieving the goals of content and access policy.

Compliance issues would be largely eliminated under the spectrum fee approach, because all responsibility for public interest programming would be borne by an expanded PBS system. While it is true that expansion of the PBS system would be financed by a tax on station ad revenues and/or proceeds from station sales, and there would be an incentive on the part of station owners to minimize these taxes, the aggregates against which they would be levied are commonly reported and should be fairly straightforward to monitor. If a time bank were created to fund the purchase of commercials for political candidates and causes, as long as purchases were made at market rates, broadcasters would have no incentive to restrict the amount of time sold to political candidates and for public service announcements. The inefficiencies for which there should be concern arise from the possibility that a public broadcasting system with a monopoly on public interest programming would not be efficient in the use of the resources at its disposal.

The access portion of the pay-plus-access model should exhibit all the inefficiencies and compliance problems for access requirements of the public trustee model. As with the spectrum fee model, these agency issues would be eliminated for the public interest programming provided by a presumably expanded PBS; but the efficiency concerns associated with a single government supplier of certain types of programming in the spectrum fee model would have to be addressed.

The appeal of the two variants of the pay-or-play model is the efficiencies that might be realized through reliance on market-like incentives in the allocation of public interest obligations. Unfortunately, the success of both schemes rests on the ability of government to meaningfully quantify access and content obligations. With obligation check-offs, broadcasters would have the option of performing certain public service requirements themselves or paying either public broadcasters or a public authority (which would pay public broadcasters) to do them instead. Check-offs thus require specific dollar figures be applied to each performance requirement. As noted earlier, paying public stations to take over commercial broadcasters' access obligations cannot meet the goals for access policy if the effectiveness of political messages depends on their being received by larger audiences than are likely to be reached by PBS stations.

This concern aside, it is still not obvious that obligation check-offs would improve the efficiency with which public service obligations are carried out. If commercial broadcasters find it most profitable to meet their performance requirements themselves, there is no reason they shouldn't look for the least-cost options that minimally satisfy regulatory requirements. If commercial broadcasters were to contract with public stations to perform their public service obligations, it would be because public stations could save commercial broadcasters money, not because public stations could do a better job of satisfying the true public interest goals of content and access policy. If public stations competed for such broadcaster payments, this result would be virtually assured. While making payments to a public authority which would then commission public stations to fulfill commercial broadcasters' performance requirements would avoid this problem, it wouldn't eliminate the possibility of commercial broadcasters choosing to do their own public service programming on the cheap, and we would still have to contend with the implications for efficiency of having all public service programming provided by public stations that may not have the same efficiency motivations as commercial broadcasters.

The tradable obligations version of pay-or-play comes closer to employing a true market mechanism for allocating public service obligations because commercial stations could actually trade such obligations among themselves. Measurement problems are certain to be even greater for tradable obligations than for obligation check-offs, however, because now it would be necessary both to quantify the performance requirements of individual broadcasters and to establish the rates at which one broadcaster's performance requirements should be exchangeable for another's. For example, should one hour of public interest programming on a VHF station be worth more than an hour of similar programming on a UHF station, because the VHF station will typically draw a larger audience? Should the structures of local television markets and the types of programs affect the terms of trade? Unless assigned relative values closely reflect the true public interest in different types of content and access on different stations, trading in these requirements could lead to perverse results. For example, a single, little-watched UHF station could end up with all of a market's access obligations for political speech, because this would be the station for which the commercial opportunity cost of access time would be least. This is just one of many ways in which stations distinguished primarily by their superior ability to evade the true intent of public service requirements might end up performing the bulk of them if they were tradable.

As is evident, none of the four benchmark proposals have outstanding efficiency properties. Public trustee obligations have historically generated disappointing results because content obligations in many cases are not quantifiable, because performance is difficult to monitor in any case, and because the natural profit incentives of broadcasters lead them to find ways to minimize the cost of meeting their public service obligations rather than searching for ways to increase the effectiveness with which they are met. These incentive compatibility problems are largely eliminated by the spectrum fee model through reliance on an expanded public broadcasting system to perform most public service obligations. The improvement is contingent, however, on the effectiveness with which a monopoly public broadcasting system meets the same obligations. Furthermore, a time bank for purchase of ad time on commercial stations for political speech would be necessary to ensure wide reach for these messages. As a hybrid of the trustee and spectrum fee models, the pay-plus-access model shares the advantages and inefficiencies of both.

The obligation check-off version of pay-or-play would be more efficient than the current system to the extent that public broadcasters paid to perform the public service requirements of commercial broadcasters actually would do a better job in carrying them out. However, there is no guarantee that commercial broadcasters still wouldn't find it more profitable to perform these requirements themselves, but as cheaply as possible. In this case, obligation-check-off would have efficiency properties similar to those for the public trustee model. Furthermore, commercial time would have to be purchased from commercial broadcasters to ensure wide distribution of political messages. Obligation trading could lead to the most efficient broadcasters in each market dominating in the provision of public service and access programming. However, this market approach could just as easily lead to those broadcasters most efficient at avoiding the true intent of public interest requirements performing most of them.

A Fifth Alternative: Pay-and-Compete for a Public Buyer

We have observed that the components of the four benchmark models might be viewed as items on an expanded menu of policy elements from which policymakers could choose in designing content and access policies. In this section, we describe a fifth model that we believe will do a better job of serving the ultimate goals of public interest programming than any of the four benchmark models, by combining certain elements of the spectrum fee, pay-plus-access, and pay-or-play models and adding a critical contribution of its own.

Most of the efficiency problems with the four benchmark models are consequences of private decision makers' personal interests being not fully compatible with the public's interest in their decisions. This occurs for several reasons. Under the public trustee model (current or enhanced), public service obligations are costs to broadcasters that subtract from the bottom line. Attempts to enforce public service obligations under this model will always have to fight against the inherent incentive of broadcasters to minimize costs of this type, especially when meritorious performance of these obligations is not rewarded in financial markets. This enforcement problem is compounded by the fact that, especially for content-related goals, quality of service cannot be meaningfully quantified, which makes monitoring compliance difficult and costly. The same problems plague the access requirements that would be retained under a pay-plus-access model. While compatibility problems with private-actor incentives are avoided by the spectrum fee model, it does not solve the efficiency implications of having a single public broadcasting service monopolize the provision of public interest programming.

The two versions of pay-or-play attempt to rectify the incentive compatibility problems of the other three models by relying on more market-like mechanisms. The primary problem with the tradable obligations version of pay-or-play is that it is likely to result in broadcasters competing to minimize the costs of their public service obligations, rather than competing by offering viewers better public service programming. The "government as buyer" flavor of the obligation check-off version of pay-or-play takes us part way toward a solution to this problem by putting each commercial station in a quasi-competitive situation with respect to the public broadcasters the government could pay to perform its public service requirements-should the station elect to pay rather than check-off the requirements by performing them itself. The government is not a fully empowered buyer, however, because quantification of the obligations that might be checked-off severely limits the government's ability to make the types of qualitative judgments buyers normally make in choosing among purchase alternatives. Because the government would not be able choose a qualitatively superior service provided by a public broadcaster over a similar service provided by a commercial broadcaster that just barely satisfied the quantitative guidelines, commercial broadcasters may still find it most profitable to take a cost-minimization approach to satisfying their public service obligations.

These problems with the two versions of pay-or-play disappear if "play" is eliminated as an option to pay. By itself, this change simply converts pay-or-play to spectrum fee. However, broadcasters could still be given the chance to earn back their public interest fees with various types of public interest programming and access commitments, but this time at the discretion of a public authority commissioned to develop and oversee public interest programming. This is pay-plus-compete for a public buyer. The public authority14 would in essence be a buyer of public interest programming and access time, spending from a budget comprised of broadcaster payments plus funds available from other sources, such as government funding and private donations. Commercial broadcasters would have the option of competing with public stations and with each other to supply these services, with the outcome of these competitions decided by the public buyer's assessment of the comparative merits (which could include price, audience reached, and subjective evaluations of quality) of competing offers.

The primary advantage of the pay-plus-compete for a public buyer model is that it turns public service obligations into opportunities for profit that would enlist the natural incentives of competitive markets on behalf of the goals served by public interest broadcasting. It would also make the cost of public service much more transparent than models that would impose performance requirements on broadcasters without ever calculating the opportunity costs to broadcasters of carrying them out. In this regard, we would require the public authority to pay market-negotiated prices for access time, rather than LUR as proposed for other models. Price discrimination is a natural feature of competitive markets, and if a public authority or political candidates can't negotiate time sales at LUR, it must be because they, like most other ad buyers, are unable to make offers to broadcasters as attractive as buyers paying LUR.15 It is frequently argued that the high cost of ad time unreasonably escalates the costs of political campaigns. However, if ad time has economic value, then forcing broadcasters to make time available for political messages at rates below what otherwise similar buyers would pay doesn't lower the cost of political campaigns, it just shifts part of the cost from politicians to broadcasters. The fact that the public benefits from additional political speech would exceed the public benefits from the commercial speech it would displace is not in itself justification for forcing broadcasters to bear these costs. In reality, if political messages are undersupplied, the problem is not that campaigns are too costly, but that they are underfunded relative to the benefits the public would realize if more resources were devoted to them. Whatever obligation is deemed appropriate for broadcasters should be fully reflected in the public service fees assessed against them.

With the exception of restricting viewers' access to alternatives to public interest programming, the pay-plus-compete for a public buyer model just described is sufficiently flexible to address all issues of structural appropriateness raised in section I. For example, in addition to programming, the public buyer could use its expanded budget to purchase (or subsidize the purchase of) access to ad time on commercial stations to ensure that political messages reach commercial broadcasters' large audiences. Similarly, ad time could be purchased to promote public interest programs to a wider audience than is now the case. The expanded budget would also make possible more attractive public interest programming that might counter, to some degree, viewers' neglect of their own and the public's long term interests in what they watch. Finally, programming that remedies the informational deficiencies of the messages supplied on behalf of candidates and ballot initiatives could also be commissioned, if this was politically feasible.

Summary and Conclusions

General and long-standing dissatisfaction with the results of the policies that set and govern commercial broadcasters' access and content obligations has made these policies the subject of continual debate and the object of repeated attempts at reform. The impending transition to digital television has intensified this debate and is hoped by many to be an occasion for making meaningful changes from the current policy approach. This chapter described a framework for evaluating access and content policies from the perspectives of structural appropriateness and efficiency. Assessments of structural appropriateness reflect the degree to which policies that might be implemented actually address various performance failures of participants in broadcast markets and the political system that access and content policies are supposed to rectify. Effectiveness and efficiency evaluations are concerned with how much is accomplished, or likely to be accomplished, by these policies, and whether there are alternative approaches that might substantially improve on their performance. This framework was used to evaluate four benchmark models for reforming access and content policy that were identified in previous work by the Aspen Institute Working Group on Digital Broadcasting and the Public Interest. It also served as the basis for a fifth model for reforming these policies, which was proposed in this chapter.

The structural appropriateness of any particular set of content and access policies can be assessed in terms of whether the policies directly address either the causes or consequences of four broad types of failures attributed to political and market actors. These are: (1) the failures of viewers to adequately reflect their own and the public's best interest in the viewing choices they make; (2) the failures of profit-motivated commercial broadcasters to provide adequate amounts of certain types of programs that can make important contributions to the knowledge base that should inform policy debate and voting in a democratic society; (3) the perceived tendencies of markets for broadcast commercial time to undersupply time for political ads and to oversupply time for commercial ads relative to social benefits realized from the two types of ads, and to sell too much time to incumbents and establishment candidates generally compared to their electoral challengers; and (4) the tendency of political actors to provide less information generally and less-objective information about themselves and their positions than voters need to make informed choices. No single benchmark model was clearly superior to the others in terms of structural appropriateness alone. Each of the benchmark models addressed the major structural concerns in one way or another, with two notable exceptions. First, none of the models directly addresses the problem of political actors supplying too little or biased information; but since proposals to address this deficiency would have to be approved by the political actors who would be affected by a change in policy, there may be no politically feasible solution to this problem. Second, none of the four benchmark models deals head-on with the possibility that it may be necessary to limit viewers' programming options to get them to meaningfully increase their consumption of programs for which the societal benefits exceed the immediate personal consumption benefits. Because viewers are also voters, soluions to this problem depend on voters showing greater appreciation for the long-term consequences of their choices among political candidates and television policies than they do in their daily decisions regarding what to watch on television. The fifth model proposed in this chapter is similar to the other four in terms of structural effectiveness.

The four benchmark models differ most in their efficiency properties. Broadcaster compliance has always been a problem for access and content policies in the past, and it remains an important problem today. That the current approach is beset by compliance problems should not be a surprise. Many, if not most, of the performance objectives set for broadcasters under current policy cannot be effectively quantified nor objectively measured. This makes it difficult and expensive to monitor compliance. Furthermore, these requirements are costly to broadcasters both in terms of resources contributed and revenues foregone-and these costs increase the more effectively broadcasters carry out their public service obligations. Therefore, profit-motivated broadcasters are driven by their own self-interests to evade those public interest obligations they can and to satisfy those they can't evade at the lowest cost possible-which generally means at the level of quality just sufficient to avoid the opprobrium of regulators.

One of the four benchmark models would reform the current public trustee approach by asking broadcasters to do more to serve the public interest. Because this model is similar in its basic design to the current approach, we would expect it to be beset by similar problems. Each of the three remaining benchmark models takes a different approach to addressing the incentive compatibility problems of the public trustee model. The spectrum fee model would simply charge broadcasters a fee for using the spectrum and use the funds generated from these fees to support public interest programming by public broadcast stations. While the self-interests of public broadcasters are not inconsistent with the goals for public interest programming, it is an open question how efficiently monopoly public broadcasters would carry out the public service obligations that traditionally have been assigned to commercial broadcasters. In addition, the effectiveness of political speech may depend on the broad dissemination of political messages, which may not be possible if political ads are confined to the generally lightly viewed public channels. The pay-plus-access model would address this problem by adding to the spectrum fee model a requirement that broadcasters make a certain amount of ad time available to political candidates.

Two variants of a pay-or-play model for access and content policy reform would try to improve the performance of commercial broadcasters' public service obligations by giving commercial stations the option of either performing their public service obligations themselves or paying other stations (either public or private) to carry them out. In our view, it is possible that these approaches may be able to generate market-like efficiencies in serving the public interest in television broadcasting. There is also a very strong possibility, however, that the end result of the types of arbitrage these models make possible will be public interest programming provided primarily by those stations that are most efficient at evading the true goals of access and content policies. The possibility of these adverse outcomes arises from the need to quantify what are inherently nonquantifiable performance goals to facilitate exchanges under the two variants of pay-or-play. Pay-plus-compete for a public buyer, the fifth model proposed in this chapter, addresses the quantification problem by empowering a public agency to purchase the programming required to meet the goals of access and content policy and, in doing so, to make the kinds of subjective judgments employed by buyers in commercial markets every day. As with the spectrum fee and pay-plus-access models, commercial broadcasters would contribute to the public agency's budget through a spectrum use fee (which we do not think should be equal to the current market value of the spectrum); and, as with pay-or-play, broadcasters would have the chance to earn back their contributions through programming and commercial time sold to the public agency-but in a competitive market in which public broadcasters could also compete for these funds. By turning public service obligations from a pure cost to a revenue opportunity, and by empowering the public agency to select among competing proposals on the basis of how well they address the goals of access and content policy, the profit motiv that promotes efficiency in competitive markets could be harnessed on behalf of public interest programming.

Endnotes


1. See Sections I and II of this volume.
2. Here, and for the remainder of this chapter, the term "public interest programming" is broadly defined to include all televised content, whether in programs or in commercials, that serves a public interest in addition to the immediate commercial value of programming.
3. This kind of opportunity cost is very broadly construed to include the value of both political and economic options foregone to put a given policy in place.
4. A more complete listing of reasons why viewers' programming choices may fail to fully serve either their personal interests as consumers or the larger social interest in their choices is provided in Andrew Graham's chapter in this volume.
5. See A. M. Spence and B. M. Owen, "Television Programming, Monopolistic Competition and Welfare," Quarterly Journal of Economics 91 (1976): 103-126; B. M. Owen and S. S. Wildman, Video Economics (Cambridge: Harvard University Press, 1992); and S. S. Wildman and B. M. Owen, "Program Competition, Diversity, and Multichannel Bundling in the New Video Industry," in Video Media Competition: Regulation, Economics, and Technology, ed. Eli Noam (New York: Columbia University Press, 1985).
6. The validity of this fear rests on at least two assumptions, both of which are open to honest questioning. First, it rejects the possibility that individual voters might find it useful to take into account other prospective voters' assessments of the merits of a candidate or ballot initiative in forming their own opinions and that the quantity of ads for a candidate or issue works as a gauge of the amount of support it does or will command. To our knowledge this possibility has not been empirically tested, but it is consistent with recent theoretical modeling of information cascades. See, e.g., Sushil Bikhchandani, David Hirshleifer, and Ivo Welch, "Learning from the Behavior of Others: Conformity, Fads, and Informational Cascades," Journal of Economic Perspectives 12, no. 3 (summer 19998): 151-170.
Second, it assumes that messages either gain in credibility the more frequently they are repeated or that voters are less likely to remember ads for candidates who advertise least, irrespective of the merits of the messages presented. There is some empirical evidence in support of this concern, as research into how voters analyze candidates suggests that during campaigns, stereotypes and impressions may have more influence than issue-related information-especially for less-knowledgeable or less-motivated voters, who are more likely to be influenced by political "spot" advertising. See, e.g., Marion Just, Ann Crigier, and Lori Wallach, "Thirty Seconds or Thirty Minutes: What Viewers Learn from Spot Advertisements and Candidate Debates," Journal of Communication 40, no. 3 (summer 1990): 120-133; and Robert S. Wyer, Jr., and Victor C. Ottati, "Political Information Processing," in Explorations in Political Psychology, ed. Shanto Iyengar and William J. McGuire (Durham, N.C.: Duke University Press, 1993).
7. This possibility is more fully discussed in Robert M. Entman and Steven S. Wildman, "Reconciling Economic and Non-Economic Perspectives on Media Policy: Transcending the Marketplace of Ideas," Journal of Communication 42, no. 1 (winter 1992): 5-19.
8. This is not to say that the merits of public service obligations have not been questioned. See., e.g., Mark S. Fowler and Daniel L. Brenner, "A Marketplace Approach to Broadcast Regulation," Texas Law Review 60, no. 2 (February 1982): 207-257.
9. E.g., program and message sponsors would have to be identified and the current prohibitions on payola and rigged quizzes would be retained.
10. It is also argued that this reduced set of requirements for broadcasters would make broadcast regulation more similar to that of cable, and thus make more level the playing field on which the two media contend. Given that the two media are regulated very differently on a number of dimensions, it is hard to assess the validity of this claim.
11. See Henry Geller, "Implementation of 'Pay' Models and the Existing Public Trustee Model in the Digital Broadcast Era," in this volume.
12. See the more fully elaborated version of this model in Todd Bonder, "A 'Better' Marketplace Approach to Broadcast Regulation," Federal Communications Law Journal 36 (1984): 27-68.
13. An exception is the proposal that looser equal-time requirements be part of an enhanced public trustee model. This is to make it less costly for broadcasters to air controversial programming (the opportunity cost of reply time is reduced) in hopes they will respond with more issues-oriented fare. This revision would at least partially correct an inefficiency due to a design flaw in the equal time requirements of the current trustee model.
14. The public authority could be a specially designated nonprofit entity as well as a government agency. There is also no reason why multiple public authorities with different public service missions couldn't share the overall budget for public service programming and access time.
15. Features justifying LUR prices are most likely features of ad buys, such as bulk purchases and long-term commitments, that reduce the financial risk in ad inventory for the seller.

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