BARBARA KREISMAN: Everyone should have a copy of the agenda and the proposals for today. And all of you people on the phone, they were sent by e-mail, also. So hopefully, you received them last night.
BARBARA KREISMAN: I think maybe we'll start. If we could all maybe just go around the room and introduce ourselves so everyone on the phones knows who's here. And then we'll go to the people on the phone. I'm Barbara Kreisman, the DFO here at the FCC.
ANN LUCEY: Ann Lucey with CBS/Showtime.
MARGARET WILDER: Margaret Wilder with Entravision Communications.
SALVADOR GUZMAN: Salvador Guzman with S. G. Communications
VONYA MCCANN: Vonya McCann with Sprint/Nextel Corporation.
SUSAN FOX: Susan Fox with Disney-ABC.
JIM WINSTON: Jim Winston with the National Association of Black Owned Broadcasters.
ANN ORR: Ann Orr with the National Association of Broadcasters Education Foundation.
HENRY RIVERA: Henry Rivera. I am chairing the committee.
MARIE LONG: Marie Long with AT&T.
BARBARA KREISMAN: Okay, Marie Long.Who's next?
BARBARA KREISMAN: [ROBERT MENDEZ] Bob Mendez, Disney-ABC.
PAUL JONES: Paul Jones, Time Warner Telecom.
REBECCA KLEIN: Becky Klein, the Loeffler Group.
SHEBA CHACKO: Sheba Chacko, BT.
BARBARA KREISMAN: Anyone else?
RAY GUTIERREZ: Ray Gutierrez, Showtime Networks, on behalf of Matt Blank.
DAVID HONIG: David Honig with MMTC.
MARIA BRENNAN: Maria Brennan, American Women in Radio and Television.
BARBARA KREISMAN: Thank you all very much. Good morning and welcome to the third meeting under its present Charter of the advisory committee on diversity for Communications in a digital age. Over the past months,
BARBARA KREISMAN: all of the subcommittees have met, put in a great deal of effort, and today have prepared to report on their progress to date. A special thanks goes to David Honig, up there on the phone someplace, who facilitated today's report
BARBARA KREISMAN: Some of the reports are interim because the project's proposed are very, very substantial. And some contain, on the contrary, very clever recommendations that can more quickly serve to provide opportunity for small businesses,
BARBARA KREISMAN: minority applicants, and new entrants.
BARBARA KREISMAN: It's been a pleasure to work with all members of the subcommittees.
BARBARA KREISMAN: This is just the beginning. I feel that it's a great beginning here, and that we're on a real roll. With that, I turn the meeting over to Chairman Rivera.
HENRY RIVERA: Thank you, Barbara. I want to share and echo Barbara's sentiments. I think we're off to a terrific start, as you'll see as we get through the recommendations this morning. I have to thank Barbara for all the work she's put in.
HENRY RIVERA: We are where we are because of her efforts. She's really worked hard, and could I ask this group to give her a round of applause, please?
HENRY RIVERA: Thank you, Barbara. We are joined, fortunately, by Commissioner Jonathan Adelstein, who has joined us to make some opening remarks. Mr. Commissioner, the floor is yours, sir.
JONATHAN ADELSTEIN: Well, thank you, Mr. Commissioner.
JONATHAN ADELSTEIN: It's good to be here. Good morning and buenos dias. I want to thank you all for the work you're doing on behalf of the Commission, and Barbara for your support to this group. I certainly appreciate the energy that you put into this -- all the talent
JONATHAN ADELSTEIN: We have an incredible group in this diversity committee. I know you're volunteering your time and your energy to this, and I especially appreciate that you're here to promote the ideals of diversity in our plastic society
JONATHAN ADELSTEIN: We saw in Chicago last week -- Ann you were there-- an amazing outpouring from the people of Chicago. Really talking about what I think is a crisis in this country. I sensed crisis-level concern among the populace,
JONATHAN ADELSTEIN: minority populations. We were at Operation PUSH. They're very, very concerned about this issue. We desperately need to enhance the diversity of ownership and employment opportunities for minorities and women in media and telecommunications industries that we oversee here.
JONATHAN ADELSTEIN: I know today's -- as Barbara said -- today's meeting includes reports from subcommittees. I'm pleased that the committe's working, so I don't want to take too much of your time.
JONATHAN ADELSTEIN: Some of you may know last week at the Chicago hearing I called for an FCC forum to form an independent panel on female and minority ownership, something that's sort of separate from us and would report back to us.
JONATHAN ADELSTEIN: Based on the Commission's historic failure to deal with the dearth of female and minority ownership, I think that we need -- and we have almost a moral obligation -- to address this problem before, not after,
JONATHAN ADELSTEIN: we deal with the broader media ownership proceeding. I think the panel needs to be independent, needs to be bipartisan, representing the interests of all stakeholders, large and small broadcasters, female minority broadcasters,
JONATHAN ADELSTEIN: new entrants, investors, advertisers, public interest groups, and of course this committee needs to participate in that, too.
JONATHAN ADELSTEIN: Now, while you've been tasked by the Chairman to consider one of the many proposals that MMTC, NABOB, and the previous Diversity Committee recommended over the years, the independent panel would also look at more than 43 proposals that have been collecting dust over the years.
JONATHAN ADELSTEIN: We have a great group. Some of these proposals have been languishing here since the early 1990s. I'd appreciate this committee's support for that effort for an independent panel, I very much think it would complement the work that you're doing for us.
JONATHAN ADELSTEIN: It would go beyond it, incorporate, of course, what you're doing. Now, you're doing some very important work this morning. I think some of these recommendations from the subcommittees are things we are really interested in your input on.
JONATHAN ADELSTEIN: For instance, I'm pleased to see that the committee will consider proposing access to capital conference for media and telecom entrepreneurs, with a special focus on investment-banking and private equity groups.
JONATHAN ADELSTEIN: I think that's a great idea. It perfectly dovetails with my proposal to develop an independent bipartisan panel. Any ideas that come from the conference could be considered in a meaningful way and within the context of other recommendations that are beyond the charge of this diversity committee
JONATHAN ADELSTEIN: As I said during your first meeting, I think the diversity committee is really needed today and in the future. Until we can honestly and finally say we've achieved the goals of diversity, fairness, and equity,
JONATHAN ADELSTEIN: I believe that we all need to work together to do a lot more. I know your predecessor committee, the earlier incarnation, made a lot of thoughtful recommendations relating to increasing minority womens' access to capital,
JONATHAN ADELSTEIN: which is the subject you're talking about, lowering barriers to entry, improving SEC policies to facilitate greater minority participation in these industries. I also know the Commission hasn't always been partcularly responsive to those recommendations,
JONATHAN ADELSTEIN: and hasn't acted on any of them. So developing a mechanism to act on all of the ideas regarding improving the state of female minority ownership of broadcast assets is especially important. We just can't afford to wait any longer.
JONATHAN ADELSTEIN: Chicago underscored that. I've been saying it for some time. I think you recognize the desperation of the situation.
JONATHAN ADELSTEIN: I would like to make a brief mention about another recommendation for consideration today that deals with the guide for diversity in media telecom industries. Again, a great idea. I think a guide like that could be very helpful.
JONATHAN ADELSTEIN: Although, it doesn't provide any regulatory measures, it's a step in the right direction. I'd like to make one proposal about it, though. I think you should add a section on how the government, federal,
JONATHAN ADELSTEIN: state, and local, can help advance ownership diversity. Some readers of this guidebook will likely be policymakers, like myself, government officials at all levels of government, and they need guidance,
JONATHAN ADELSTEIN: too, on best practices. So, those are just some of my thoughts I wanted to share with you. I wanted thank you for all the work you're doing, and thank you for giving me time to say hello.
HENRY RIVERA: Thank you Jonathan. We really appreciate you coming, and appreciate your forward thinking about this terrible problem that we're all facing and that we're all working to solve. And appreciate it very, very much.
HENRY RIVERA: Okay, moving on to the next item on our agenda.
HENRY RIVERA: Ann Orr has joined us from the National Association of Broadcasters Education Foundation. NABEF has some very interesting diversity initiatives that I thought it would be worthwhile to share with the committee. Just to give you some ideas of some kinds of things that other people are doing might help stimulate some thinking on our part in terms of coming up with some ideas.
HENRY RIVERA: So, I'm going toturn the floor over to Ann, and we'll hear from her for a little while. Ann, and it's all yours.
ANN ORR: Thank you, Henry. I want to thank you in particular, Mr. Chairman, for inviting me to be here this morning; and Barbara to you, as well. We're very excited to talk a little bit about the programs that we have at the NAB Education Foundation.
ANN ORR: The mission of our foundation is largely divided into four separate focusi [sic]. The first is education and training programs, and those are targeted to people of color and women.
ANN ORR: The second is diversity initiatives, largely in the area of outreach which augment our education and training programs. We also focus on the importance of highlighting the importance of the First Amendment,
ANN ORR: as well as find ways to honor community service and philanthropy on behalf of our stations.
ANN ORR: But I'm here today to talk largely about our diversity programs. We characterize our initiatives as the pipeline approach to advancing the goal of expanding diversity at all levels of broadcasting.
ANN ORR: The goal here is to bring a lot of new talent, who are people of color and women, into the broadcasting industry, and to support them along the way as they advance their careers with different training programs at different career ladder levels until finally we reach our penultimate program,
ANN ORR: which is the Broadcast Leadership Training Program, which focuses on station ownership and senior executive levels.
ANN ORR: In terms of ownership and senior executive levels, let me talk about three separate initiatives we have. The first is the Broadcast Leadership Training Program. This program is a 10-weekend MBA-style program that brings together people of color and women to learn the trade of what it takes to purchase the station and to operate the station effectively once they have been fortunate enough to purchase the station.
ANN ORR: Over the course of the 10 months, they learn from communication attorneys, from the FCC and the FCC staff, as well as business and industry leaders in broadcasting, and finally, and probably most importantly,
ANN ORR: financial experts -- members of Wall Street, venture capitalists, etc. -- so that they have not only a great handle on how to put together a business plan, how to shop that business plan around to different financial opportunities,
ANN ORR: but also they are able to have this tremendous network that they call upon time and time again -- of people in the financial industry, of communications experts, and of people in broadcasting -- so that when they are ready to forge ahead and work on purchasing stations,
ANN ORR: they are really on solid ground to do so.
ANN ORR: The focus of this 10-weekend program is largely in the categories of developing a business plan, in securing financing, identifying and evaluating stations, negotiating the deal, closing the takeover, and operating for success
ANN ORR: We started this program in 2000, we are now in the eighth year of the program.We just kicked it off in September. We've had 125 people who have graduated from that program. Fifteen percent of thosegraduates currently own stations,
ANN ORR: a number of others are actively looking to purchase stations, and an additional 20 have been promoted to higher levels in their corporation or have moved to larger markets. As part of our effort to facilitate the purchase of stations,
ANN ORR: we have also been working with some of our member companies to host forums.
ANN ORR: We do this -- we serve as the hosting agent to something that MMTC started, and David, I don't know if you're on the phone still --
ANN ORR: MMTC brought together Clear Channel Citadel and several other companies who want to provide opportunities for people of color and women to purchase their properties that are up for sale. We are fortunate enough to serve as the host of those forums,
ANN ORR: the first of which is Clear Channel. You see that in the picture here, where the company comes together with people of color and women in advance of the sale of their properties so that everybody is fully informed about the process as well as eventually,
ANN ORR: about the properties that are for sale. That's been, initially, very promising. In fact, David is down as we speak at the radio show, about to host, another one of these forums.
ANN ORR: Another one -- I don't have a picture of this so I didn't put it on the slide -- but we've also worked closely with MMTC to host ownership forums. And we do this at our annual show in Las Vegas where we bring together experts in the industry as well as financial deep pockets to sit in a series of round tables so that people who are interested in purchasing stations can hop from table to table to not only network,
ANN ORR: but to learn more about the process of their own journey.
ANN ORR: Then we go lower on that pipeline to senior management. We provide fellowships for people of color and women to attend several professional training programs. Two of those are the MDS Program -- the Management Development Seminar for television executives and EDP -- the Educational Development Program for radio executives.
ANN ORR: This is for largely general managers or general sales managers about to be general managers.Each of those programs focuses on leadership, on management, on new technologies, on diversity -- all the tools that these general managers will need to be great leaders and to move on one day to higher corporate success.
ANN ORR: We started this program in 1999. To date, we've graduated 162 professional fellowships from these two programs.
ANN ORR: We do this in partnership with the McCormick Tribune Foundation. Many of the graduates of these programs then go on to become part of our BLT program. So, you see how that -- not to extend on this metaphor too much -- how that pipeline is really working
ANN ORR: At the mid management level, we started a new program this year called Connections Mid-level Mentoring.
ANN ORR: This is for managers who are local sales managers, who are national sales managers, who are just below that general manager or general sales manager level.We have found that one of the most effective ways of retaining people of color and women in the industry is to provide mentoring opportunities for them at a key point in their career.
ANN ORR: If they're at a point where they're not sure if they're really going to make it to higher levels -- there're a lot of barriers or glass ceilings -- all over the place, it helps to have a mentor to help to guide people at that level through the process of how they can find their own pathway to future success.
ANN ORR: We started this program last September. We had 10 proteges who were at the mid-management level. We paired them with the 10 mentors you see here on this screen. We had executives such as Charles Warfield,
ANN ORR: Gary Chapman, Jenny Hubbard, Susan Austin, Jim Conschafter, Lyle Banks, etc. Very senior people in the industry. This program has already proven its tremendous success in the first year of operation: 40% have already been promoted in the first year to more senior level positions,
ANN ORR: and we're about to increase that number to 50%. So, we're very pleased with that success rate, and we're on the second year of that.
BARBARA KREISMAN: Could we just take a moment? You guys on the phone: if you could please mute your phone? You're interfering with some of the audio. Thanks.
ANN ORR: Then we focus on the entry level, which is the beginning of the journey in your career in broadcasting. We support three media sales institutes. These are institutes that operate on college campuses.
ANN ORR: They are 10-day intensive programs that bring people of color into the campus to learn from industry experts. And this is all media at large -- it's broadcasting, it's cable, it's internet -- to learn the trade of media sales
ANN ORR: As you may know, many people who start in media sales walk into a station -- they're in an office, they're given a phone book and a telephone and told to go. We don't really think that's proper training for how to succeed in the industry.
ANN ORR: So, we started this program at Howard in 1999. We then expanded, with our partner NABOB, two years ago on the campus of Florida A&M. And last year, we expanded to the University of North Texas at the Spanish-language media center there.
ANN ORR: As a result, since 1999, we've trained 221 students for entry-level positions. Close to 90% of those students have been hired at the end of the Media Sales Institute Program. Each of the colleges hosts a career fair at the end of the 10 days and recruiting companies meet with the graduates of these programs.
ANN ORR: And 90% actually go into the industry, which is a tremendous rate. Here's a picture of the Howard University students and then we move on to Florida A&M. And Jim, we tried to get your logo as best we could there.
ANN ORR: Hope we succeeded. Good-looking bunch, all of them.
ANN ORR: Then there is the University of North Texas where we broadened out into the Hispanic community.
ANN ORR: As part of our diversity outreach efforts, we also host two career fairs, one at the NAB radio show, which actually happened yesterday, and two at the NAB convention. At the NAB convention, we have 50 recruiting companies.We have CBS,
ANN ORR: we have Oprah, we have ABC, we have NBC, but we also have a lot of other companies like Hearst Argyle and Belo and Bonneville who meet with 1200 applicants for jobs who walk through this full day career fair.
ANN ORR: As you can see, there's sort of a broad cross-section of what everybody looks like.
ANN ORR: That's been very successful to help people find jobs in companies where they want to work and to make great networking connections.
ANN ORR: And then we also have decided this year -- we branched out to reach into college campuses and to develop some student programs so that we're bringing people along and attracting them into the industry before they make their career decisions.Last year,
ANN ORR: we started an NABEF Scholar Program. By scholar we mean scholarship.
ANN ORR: We offer 10 scholarships to people of color and women.
ANN ORR: The only requirement is that they have to be a broadcasting major and they have to show financial need. We have selected the institutions, and the institutions then select the students. Here's a map that you see on the screen.
ANN ORR: We tried to create some broad geographic diversity of those institutions. Here's a picture of some of the students. The size of the scholarship is $10,000 per year. I could have used that myself when I was in college.
ANN ORR: But we start in the junior year and then continue through to the senior year. We also require that these students accept an internship in a broadcasting station -- in a radio or television station.
ANN ORR: Uh oh. Well, for the rest of my presentation, which is unfortunately failed, which we also support the Emma Bowen Foundation, which Henry is very instrumental in. he's the Vice Chairman. That is a wonderful foundation if you don't know very much about it.
ANN ORR: The Emma Bowen Foundation provides, basically, internship programs starting in high school for people of color who are interested in working in media. It carries that internship program through their four years of college.
ANN ORR: As you can imagine, that is a tremendous opportunity for many of these students who are extremely bright, who've learned the industry trade, and are hired into the industry. We actually were fortunate enough to sponsor -- we sponsor two students as well as support the Emma Bowen Foundation-- and one of our students last year was the Student of the Year.
ANN ORR: So we're very, very proud of her.
ANN ORR: And finally, last year we also started an internship program in engineering and technology. We discovered that the engineering industry in broadcasting is a very graying industry.We needed to bring some new talent in.
ANN ORR: It's not very diverse. So, we sponsored an internship program for 10 people of color and women who are interested in engineering and technology. We also support an internship at a radio or television station for those 10 students.
ANN ORR: Two have already been hired as a result of this summer's internship, and I think about two more are going to be hired in the course of the next month.
ANN ORR: So in a nutshell, those are the initiatives of the Foundation. We're very proud of our work. It's a slice of what needs to be done, frankly, but we welcome any partnerships --we are not alone in this --
ANN ORR: and any questions that you might have. And thank you very much.
HENRY RIVERA: Thank you Ann. We appreciate you coming. You should be proud of the initiatives you're undertaking. I think they're very creative. Does anybody have any questions or comments for Ann?
ROBERT MENDEZ: This is Bob Mendez. Ann, how do we reach you?
ANN ORR: Hi Bob. Can you repeat that question?
ROBERT MENDEZ: How can I reach you?
ANN ORR: I can give you my email address, if that's good.
ROBERT MENDEZ: That'd be great.
ANN ORR: Okay, it's Aorr@nab.org.
ROBERT MENDEZ: Great. A lot of the things that you're doing really dovetail with some of the initiatives that we're trying to undertake and I'd love to have a conversation with you about how we can work together.
ANN ORR: Great. I look forward to that, Bob. Thank you.
MARIA BRENNAN: Hi Ann, this is Maria with .... I apologize if I missed this because some of us on the phone are .... Did you mention where we could find additional information, particularly about the BLT ...?
ANN ORR: Yeah, Maria, you're sort of fading in and out, but I think you're asking for what our website URL is? It's www.nabef.org. And also, if you have written down my e-mail address, I'd be happy to supply you with information as well.
ANN ORR: Maria is a great partner in our work, as you can imagine.
HENRY RIVERA: Anything else for Ann?
HENRY RIVERA: If not, we'll thank Ann again, we appreciate you coming. And we'll move on to the next item in the agenda, which is reports from subcommittees.The first subcommittee that will be reporting is the access to capital subcommitte, chaired by Rodney Hood.
HENRY RIVERA: I don't think Rodney is on the phone. Rodney are you on the phone?
HENRY RIVERA: He had a conflicting meeting. So David, I think you were going to take this?
DAVID HONIG: Sure. I hope everybody can hear me OK. I'm down in Charlotte at the radio show as Ann has said to present a session today called "How to Buy a Radio Station." This committee has met a couple of times.
DAVID HONIG: It has considered two questions, one of which it's postponed making a recommendation on until it has an opportunity to confer with subject matter experts. And that's the subject of multicast must carry for disadvantaged businesses for DTV subchannels.
DAVID HONIG: The subcommittee will take up that matter in either fourth quarter '07 or first quarter '08. The question that it did take up was a proposal that originated with the Commissioner office to convene an access capital conference,
DAVID HONIG: probably in New York, it could take place at a University. You have the recommendation before you. Sponsorship was sought from some of the leading trade associations, particularly the private -- I'm blocking here -- the Private Equity Council: NAB,
DAVID HONIG: NCPA, CPIA, Consumer Electronics Association, ... and others. And the purpose of this conference which we're hoping the members would help frame, would be not only to have a dialogue among the scholars,
DAVID HONIG: bankers, and entrepreneurs on the difficulties and status of capital access for small minority businesses, but also to provide networking between entrepreneurs and the capital providers and to help bridge ....
BARBARA KREISMAN: David? David? Somebody on the phone has their speakerphone open, and it's making it really hard for us to hear. So, please, everyone on the phone, mute your phone. David?
DAVID HONIG: Yes, that's better.
BARBARA KREISMAN: Is that better?
DAVID HONIG: Yeah, that's good. Did everyone hear it? Do I need to go back? But also to bridge the communication gap that sometimes exists between the regulatory community and the banking community on these subjects of mutual interest.
DAVID HONIG: This is presented today in your materials as an interim report. We would like to get feedback from some of the members and then, on obtaining that, come back and present it, after it's fleshed out some more,
DAVID HONIG: as a recommendation. We're not quite prepared to present this as a recommendation to be voted on in today's meeting.
HENRY RIVERA: Thank you, David. Becky, I believe you had a conversation with someone at the Private Equity Council. Would you like to share that information with the group?
REBECCA KLEIN: Yes, that correct. I had a conversation with a person named Robert Stewart at Private Equity Council. I don't know if he's familiar to any of the members here today. A couple of conversations -- and it was related to the fact that they were interested in knowing what our committee was doing.
REBECCA KLEIN: They were interested in seeing if there was any kind of relevant role they can assist us with. So there were three different things proposed. One of them that overlapped with this interim recommendation as far as assisting with a conference.
REBECCA KLEIN: And so, they were keen on doing that. They had also, most recently, told me about the fact that NAIC and Private Equity Council come together to help support the creation of a new trade association called the Access to Capital Coalition that has a primary focus on diversity issues.
REBECCA KLEIN: It is a very new organization and he was offering for the Subcommittee on Access to Capital to work with them and see if there's possibilities to be able to have Private Equity Council play a role, and that perhaps access to capital coalition also play a role
HENRY RIVERA: Alright, thank you. So we don't need to vote on this right now. This is an interim report. Do we like this idea? Do we want to have this fleshed out and brought back to us as a recommendation?
HENRY RIVERA: Yes? All right. Okay. Is there anyone who has a contrary view? Does anyone else have anything to add to this conversation about this particular initiative?
HENRY RIVERA: If not, David, I think if you'd be good enough to convey that to Rodney, we'll go ahead and move forward with that, hopefully.
DAVID HONIG: Thank you.
HENRY RIVERA: If there's anyone who wants to work on this, who's not a member of that subcommittee, please feel free to let Rodney know. I'm sure they could use some help. This looks to be a fairly large undertaking.
HENRY RIVERA: So the more help they can get, I think the better.
HENRY RIVERA: Before we go on, I was just handed a letter from Chairman Martin. It's addressed to me and I'll just read it to you.
HENRY RIVERA: Dear Chairman Rivera,
HENRY RIVERA: This letter requests the assistance of the Advisory Committee on Diversity for Communications in the Digital Age in facilitating greater diversity in the communications sector by encouraging educational outreach in the context of ownership transactions.
HENRY RIVERA: Specifically, I request that the diversity committee work with all industry trade associations to provide small businesses, minority and women entrepreneurs, and other designated entities with the information necessary so that they can be aware of emerging ownership opportunities in the communications industry
HENRY RIVERA: I point your attention to a successful model for such outreach. In January, 2006, Clear Channel Communications sponsored an educational conference presented by the Minority Media and Telecommunications Council and hosted by the National Association of Broadcasters Education Foundation.
HENRY RIVERA: This conference helped to ensure that minority and women entrepreneurs had access to information necessary to enable them to participate in the acquisition of Clear Channel radio and television assets.
HENRY RIVERA: So that was a nice segue, Ann. We did not plan this.
HENRY RIVERA: I would encourage the Diversity Committee to facilitate the creation of similar educational conferences to be conducted by the communications industry whenever a significant ownership transaction is proposed to the Commission.
HENRY RIVERA: These conferences would serve to encourage and facilitate communications companies that engage in transactions and licensed transfers, to include small businesses, minorities, women entrepreneurs and other designated entities during negotiations on assets and properties identified for divestiture.
HENRY RIVERA: I understand that on the Diversity Committee agenda is a proposal to develop a detailed plan for a conference on access to capital for media and telecom entrepreneurs in cooperation with a major university in New York City.
HENRY RIVERA: This conference will focus on the investment banking and private equity communities, and the opportunities for small businesses new entrants, and designated entities to acquire access to financing and thereby facilitate entry to ownership in the communications sector.
HENRY RIVERA: Please consider expanding your proposal to include the outreach and educational conferences that I have referred to above in conjunction with major ownership transactions.
HENRY RIVERA: So, it was good that we thought that was a good idea, because he certainly does.
HENRY RIVERA: I'm grateful for your work on the Diversity Committee and I look forward to working with you on developing programs that will increase opportunities for small businesses, minorities and women entrepreneurs,
HENRY RIVERA: and designated entities.
HENRY RIVERA: Sincerely, Kevin J. Martin.
HENRY RIVERA: We will get copies of this to the entire committee.
HENRY RIVERA: David, I think you will need to call this to Rodney's attention, specifically.
BARBARA KREISMAN: I was wondering if the Committee would consider actually adopting today as a best practice, the proposal to conduct these educational conferences, and then go ahead and continue its work on laying out the details.
BARBARA KREISMAN: ... would have a best practices that's adopted, so the industry would know that this is something that this committee, at least, feels and recommends it follows, especially as major transactions come up. I'd hate to lose the time because in the next several months, anything could happen.
HENRY RIVERA: That's a very good suggestion.
BARBARA KREISMAN: This is up to the Committee, however.
HENRY RIVERA: Alright, it's a very good suggestion. Do you like that notion?
DAVID HONIG: It's a good idea.
HENRY RIVERA: We would endorse this concept? Would someone make a motion?
DAVID HONIG: So moved.
HENRY RIVERA: Is there second?
HENRY RIVERA: Is there any further discussion on this?
HENRY RIVERA: All in favor please say aye.
HENRY RIVERA: Opposed, same sign.
HENRY RIVERA: Thank you, Barbara. Great suggestion. Alright, so we will get copies of this letter to all of you. I'm very pleased the chairman is as interested as he is in what we're doing and in the work of this particular subcommittee.
HENRY RIVERA: So we'll move on to --
BARBARA KREISMAN: And he would have been here in person, but we have conflictied with a radio show unfortunately
HENRY RIVERA: Right, in Charlotte. We'll move on in our agenda to the New Technology Subcommittee and Max Navarro is coming at of San Antonio for this. He is -- or Brownsville. He's had some important business meetings that preclude his attendance.
HENRY RIVERA: Again, we'll turn to David Honig to present this item. David?
DAVID HONIG: I'll take a crack at this. Thank you, Henry. The committee had a couple meetings, one of which lasted four hours at the Commission -- Barbara was our host. We had six subject matter experts and I think five of our members participated.
DAVID HONIG: We considered a number of engineering issues relating to terrestrial radio. We are not prepared to present a recommendation on that subject at this time, but will probably be able to do so at the next meeting.
DAVID HONIG: We also considered a proposal, which you have before you, that we are voting on and presenting for your consideration and vote today as a substantive recommendation entitled "Recommendation on Leasing or Ownership of FM or DTV Subchannels Under the Sharetime Rule." To emphasize,
DAVID HONIG: this proposal really presents a voluntary opportunity for broadcasters who own full power DTV television or commercial FM stations, which they could take advantage of if they choose to -- it's one more way for them to use and monetize their spectrum.
DAVID HONIG: Since all of the spectrum, be it subchannels or the full main channel, are part of the same license, we believe that this spectrum could be subject to the sharetime rule, which has been around for 50 or 60 years.
DAVID HONIG: For those wishing to reference it, it's cited here: 47 CFR (Part) 73.17.15 -- which basically allows a station to be split into two mutually exclusive parts, each of which would be licensed. The advantage of this procedure is thatit doesn't require auctions.
DAVID HONIG: There would be no incentive for a broadcaster to lose the revenue just to the Treasury, so that's why there have been no options of this nature. It also, by providing an alternative to a lease -- and of course leases are also a wonderful idea if they can be encouraged -- it has the advantage of being essentially a package of rights that financial institutions would regard as the equivalent of ownership.
DAVID HONIG: Although, of course a broadcast license is not collateral, the banking community has figured out how to treat it essentially as that for the purpose of protecting themselves. And it's much easier, especially for a new entrant,
DAVID HONIG: especially for a niche operator or a small business to secure capital for something that looks like ownership as opposed to looking like a lease. Since there are thousands and thousands of stations which could choose to make available an HD2,
DAVID HONIG: HD3, or a DTV subchannel in this way, the subcommittee believes that this proposal, were the Commission to put it out for comment and rulemaking, and it to result in a rule or policy statement, would have just enormous impact in providing new opportunities for the industry to monetize their assets,
DAVID HONIG: for the growth of digital technology and the takeup of receivers and service from consumers. And especially for new entrants, particularly minorities and women, to have access to the spectrum, and access to capital in a way that seldom is available through traditional means.
DAVID HONIG: So, it's commended to the full committee for its consideration and vote.
HENRY RIVERA: Thank you David. I think this is a tremendous idea and, and I think it's an example of the kind of recommendation that we should be working on and making to the Commission. I agree with David.
HENRY RIVERA: This could result in a substantial increase in the number of minority owners. Does anyone have any questions for David or comments about this? Is there any discussion?
HENRY RIVERA: Are you ready for the question, then?
HENRY RIVERA: The chair will take the recommendation of the subcommittee as a motion.
HENRY RIVERA: Is there a second?
HENRY RIVERA: Alright. Any further discussion?
HENRY RIVERA: All in favor say aye.
HENRY RIVERA: Opposed, same sign.
HENRY RIVERA: The motion carries. Thank you very much, David.
DAVID HONIG: Thank you.
HENRY RIVERA: Alright moving on to our next interim report from the Outreach Subcommittee, which is chaired by Becky Klein. We're fortunate Becky is with us. She intended to be here in person, but she had problems with her flight.
HENRY RIVERA: At the last minute she was not able to be here, but she is with us on the phone. So, Becky, the floor is yours.
REBECCA KLEIN: Okay, and I want to thank David Honig for this as well, and his contribution to outlining this recommendation. The subcommittee had this particular recommendation, the Guidebook on Diversity,
REBECCA KLEIN: as one of its initial ideas to consider. What you see before you is a draft of a outline of what a guide book would entail. The Guidebook on Diversity is somewhat distinct from the previous guidebook that was issued a couple of years ago,
REBECCA KLEIN: I guess, three years ago, related to workplace diversity. This one, I would characterize it as more external in nature as far as providing some constructs for issues related to diversity in terms of contracting,
REBECCA KLEIN: in terms of ownership diversity, and outlining the competitive and economic growth advantages of diversity in those areas.
REBECCA KLEIN: I do understand, and am sensitive to, Commissioner Adelstein's comments on potentially including in here aspects of how government at different levels may be able to integrate diversity programs. So, that's something the subcommittee hasn't yet spoken of,
HENRY RIVERA: that would be a good thing for us to do. The other thing that has yet to be forwarded from the subcommittee related to this guidebook is a [HENRY RIVERA:] Thank you, Becky. It appears that basically we would be voting on the concept of such a book,
HENRY RIVERA: leaving the details to the subcommittee to flesh out in terms of the actual contents and working up a budget that we would later present to the Commission. Does anyone have any comments about this idea,
HENRY RIVERA: this recommendation? Any thoughts, questions for Becky?
JAMES WINSTON: Just one comment. [INAUDIBLE] I know this is all very tentative, but one of the chapters that I think probably needs to be added is how media and telecom companies can benefit from diversity. This suggests that they're being very giving,
JAMES WINSTON: but I think there's also a lot they can receive in the process. I think that's worth pointing out.
HENRY RIVERA: Great suggestion, Jim. Did you get that Becky?
REBECCA KLEIN: I did. Thank you for that.
HENRY RIVERA: Any other comments or suggestions?
HENRY RIVERA: Shall we vote then? The chair will take the recommendation as a motion, is there a second?
HENRY RIVERA: Alright, any further discussion? If not, all in favor say aye.
HENRY RIVERA: Opposed?
HENRY RIVERA: Motion carries. Alright, that brings us to the end of our agenda. Is there any new business to come before the committee?
HENRY RIVERA: If not, I want to thank all of you for being here, particularly those of you who come from great distances. I know it's a sacrifice. I want to thank
HENRY RIVERA: the subcommittees for all the work that is evidenced by these recommendations. I want to add my thanks to David. David is a member of all of the subcommittees, so he's very busy.
HENRY RIVERA: And he is sort of the scrivenor for what happens in those subcommittees and he's been doing a great job. So, thank you, David, for that. I think we're off to a great start. We will be meeting again in December.
HENRY RIVERA: We will get you the date as soon as Barbara can get some dates that this room is available to us. We'll get that date out to you so you can get it on your calendars. It'll be early in December rather than later,
HENRY RIVERA: because I know that begins to conflict with the Holidays, and people will get out, but I would like to have another meeting of this committee this year. So, unless anyone has anything else, we will be adjourned until the next meeting.
HENRY RIVERA: Again, thank you all for coming and for all of your hard work.
BARBARA KREISMAN: would be great if you guys on the phone -- would you mind sending me an email that you're on the phone? We couldn't hear everyone, and I just want to make sure we have the names correct for the transcript.
BARBARA KREISMAN: Thanks.
HENRY RIVERA: Thanks everyone. Bye.