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Radio contests get trickier as they migrate to the web

I love radio games, although I rarely enter them any more. Back in the pre-cyberspace days when KQED-FM in San Francisco was a classical radio station, they used to run these amazing listener call-in contests where they would play one second of the opening of three famous pieces, and if you phoned in and got them right, you won tickets to some big concert or recital. One night in the mid-1980s I totally wowed all my friends by identifying all three: Copland’s Appalachian Spring, Bruckner’s Seventh Symphony, and Mendelssohn’s Midsummer Nights’ Dream.

PandG Naphtha Soap Contest (source: Old Time Radio: old-time.com)

PandG Naphtha Soap Contest, circa 1940 (source: Old Time Radio: old-time.com)

Man, I was so impressed with myself. Come to think of it, though, I can’t remember what the prize was. Oh now I recall, comps to a piano recital at the Masonic Auditorium, to which my date stood me up. Ok. Let’s not go there.

Adhere to the rules

These days radio contests are a lot less highbrow, much more web based, and a lot more complicated. Stations sometimes botch them, and when they do, the listeners get really pissed. And when they call the Federal Communications Commission, the agency responds, as it did in February, proposing a fine against Los Angeles station KOST for allegedly mishandling a radio contest. I called some broadcast attorneys after that action to get a sense of its significance.

“This decision really does point to the strict enforcement the Commission has of its contest rules,” telecom attorney Frank Jazzo of Fletcher, Heald & Hildredth told me. “A lot of this type of enforcement is complaint driven. But you can be assured that a disgruntled contest entrant is going to take their complaint to the FCC.”

One listener sure did after the fan didn’t win a KOST contest in which consumers plugged into the event through the radio station’s web site. The contestants’ 2006 gripe to the FCC charged that the station announced the winners hours before the game entry period concluded.

KOST’s parent company Clear Channel responded that since the game was mostly run on the web, it was out of the Commission’s purview. Forget it, answered the agency. “We find that the promotion of the Contest over the air and the requirement that listeners stay tuned to the radio station belie Licensee’s assertion that the Contest was conducted exclusively over the website and that Section 73.1216 does not apply,” the FCC concluded in February, and proposed to fine KOST $6,000 bucks.

Section 73.1216 says you have to run the event “substantially as announced or advertised. No contest description shall be false, misleading or deceptive with respect to any material term.” The FCC hasn’t made a final judgment on the case yet, but other stations have tried the web argument in the past, without success.

“When you are running contests, even if it is an online contest, it is absolutely essential that you adhere to the rules,” Jazzo explained.

Would I lira to you?

This isn’t the first case that played out along these lines. According to the FCC, in 1999 a Clear Channel frequency in El Paso told listeners that if they called in and got ten questions right, they would win “10,000.” After one person did just that, the station’s general manager informed her that—surprise!—the number referred to Italian lira, not dollars.

The winner received a check for 53 bucks, the then-USD equivalent amount.

But Clear Channel told the FCC that this was ok because, again, “the station never stated ‘on the air’ that it was giving away ten thousand dollars,” the Commission’s summary for that incident explained. “Rules for the contest, which stated that the prize was 10,000 Italian lira, were posted on Clear Channel’s web site.” The agency rejected that line of reasoning then, as it has now.

So maybe radio stations should just migrate contests completely over to the Internet, right? There are some good reasons to move in that general direction, notes broadcast attorney John Crigler of Garvey, Schubert, and Barer.

“It’s obviously a lot easier to provide information online,” he explained to me. “Stuff like contest rules don’t make very interesting copy, on air. It may make sense to do contests on the web.”

And in that case stations would certainly be beyond the radar of Section 73.1216, Jazzo added. But one of the points of these events is to generate excitement over the air. “So I don’t think we’re going to see an end to on air contests, but I think contests are certainly a way of driving traffic to the web site.”

But there’s another problem, warns Crigler. Just because your contest is on the web, doesn’t mean it’s not subject to regulation. There are state governments that have or soon will pass anti-Internet gambling laws that could impact your game.

“The one that I stumble across all the time, particularly with contests, is that it’s not all that difficult for a contest to lapse over into a lottery,” he explained. “And if you start offering online lotteries, you are in big trouble, because that may run afoul of the prohibitions on Internet gambling.”

Depends who is running for what

So what’s the difference between a “contest” and a “lottery”? That’s another dilemma, Crigler acknowledged. It’s not always easy to tell. The general definition of a lottery is that there have to be three elements, he says: prize, chance, and consideration—the last category what you do to get into the event, such as buy a ticket.

“If you remove any one of those, it won’t be a lottery. It will be a contest or a sweepstakes.” And what are they? “To oversimplify, in contrast to a lottery, a contest consists of only skill and prize; and a sweepstakes of only prize and chance.”

And which states are likely to pass laws that could potentially regulate web radio contests as Internet gambling? “The main variable is who the state Attorney General is and what office he plans to run for,” Crigler saltily noted.

Then there’s the tough question of whether a radio licensee will come under some other state’s laws if a consumer from that state enters the contest. In the end, Crigler concurs that when it comes to contests and broadcasting, make sure you keep your on-air staff on the same page: rules-wise.

As for the ‘Net, it’s no savior here. The “golden age” of cyberspace is over, Crigler said, because these days, “the Internet isn’t regulated by anyone, it’s regulated by everyone.”

I think it’s great that state and federal agencies are watching out for consumers in this area. But I also feel some sympathy for radio stations, because the regulatory environment has obviously gotten a lot more complex than back when I awed my friends with my encyclopedic knowledge of the concert repertoire.

Come to think of it, though, can you imagine a classical radio station today that would run such a contest? Never mind. That’s the subject of another blog post.


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