SUPREME COURT OF UNITED STATES

Federal Communications Commission

Vs.

WNCN Listeners Guild Insilco Broadcasting Corporation

Nos. 79-824 to 79-827.

Argued Nov. 3, 1980.

Decided March 24, 1981.

Kristin Booth Glen, New York City, for respondents WNCN Listeners Guild, Inc., et al.

Wilhelmina Reuben Cooke, Washington, D. C., for respondents, The Office of Communication of
United Church of Christ, et al.

Justice WHITE delivered the opinion of the Court.

Sections 309(a) and 310(d) of the Communications Act of 1934, 48 Stat. 1064, as amended, 47
U.S.C. § 151 et seq. (Act), empower the Federal Communications Commission to grant an
application for license transfer1 or renewal only if it determines that "the public interest,
convenience, and necessity" will be served thereby.2 The issue before us is whether there are
circumstances in which the Commission must review past or anticipated changes in a station's
entertainment programming when it rules on an application for renewal or transfer of a radio
broadcast license. The Commission's present position is that it may rely on market forces to promote
diversity in entertainment programming and thus serve the public interest.

This issue arose when, pursuant to its informal rulemaking authority, the Commission issued a
"Policy Statement" concluding that the public interest is best served by promoting diversity in
entertainment formats through market forces and competition among broadcasters and that a change
in entertainment programming is therefore not a material factor that should be considered by the
Commission in ruling on an application for license renewal or transfer. Respondents, a number of
citizen groups interested in fostering and preserving particular entertainment formats, petitioned for
review in the Court of Appeals for the District of Columbia Circuit. That court held that the
Commission's Policy Statement violated the Act. We reverse the decision of the Court of Appeals.

* Beginning in 1970, in a series of cases involving license transfers,3 the Court of Appeals for the
District of Columbia Circuit gradually developed a set of criteria for determining when the "public-
interest" standard requires the Commission to hold a hearing to review proposed changes in
entertainment formats.4 Noting that the aim of the Act is "to secure the maximum benefits of radio
to all the people of the United States," National Broadcasting Co. v. United States, [1943] USSC
100; 319 U.S. 190, 217[1943] USSC 100; , 63 S.Ct. 997, 1009[1943] USSC 100; , 87 L.Ed. 1344
(1943), the Court of Appeals ruled in 1974 that "preservation of a format [that] would otherwise
disappear, although economically and technologically viable and preferred by a significant number
of listeners, is generally in the public interest." Citizens Committee to Save WEFM v. FCC, [1974]
USCADC 616; 165 U.S.App.D.C. 185, 207[1974] USCADC 616; , 506 F.2d 246, 268 (en banc). It
concluded that a change in format would not present "substantial and material questions of fact"
requiring a hearing if (1) notice of the change had not precipitated "significant public grumbling";
(2) the segment of the population preferring the format was too small to be accommodated by
available frequencies; (3) there was an adequate substitute in the service area for the format being
abandoned;5 or (4) the format would be economically unfeasible even if the station were managed
efficiently.6 The court rejected the Commission's position that the choice of entertainment formats
should be left to the judgment of the licensee,7 stating that the Commission's interpretation of the
public-interest standard was contrary to the Act.8

In January 1976, the Commission responded to these decisions by undertaking an inquiry into its
role in reviewing format changes.9 In particular, the Commission sought public comment on
whether the public interest would be better served by Commission scrutiny of entertainment
programming or by reliance on the competitive marketplace.

Following public notice and comment, the Commission issued a Policy Statement11 pursuant to its
rulemaking authority under the Act.12 The Commission concluded in the Policy Statement that
review of format changes was not compelled by the language or history of the Act, would not
advance the welfare of the radio-listening public, would pose substantial administrative problems,
and would deter innovation in radio programming. In support of its position, the Commission
quoted from FCC v. Sanders Brothers Radio Station, 309 U.S. 470, 475, 60 S.Ct. 693, 697, 84
L.Ed. 869 (1940): "Congress intended to leave competition in the business of broadcasting where it
found it, to permit a licensee . . . to survive or succumb according to his ability to make his
programs attractive to the public."13 The Commission also emphasized that a broadcaster is not a
common carrier14 and therefore should not be subjected to a burden similar to the common carrier's
obligation to continue to provide service if abandonment of that service would conflict with public
convenience or necessity.

The Commission also concluded that practical considerations as well as statutory interpretation
supported its reluctance to regulate changes in formats. Such regulation would require the
Commission to categorize the formats of a station's prior and subsequent programming to determine
whether a change in format had occurred; to determine whether the prior format was "unique";16
and to weigh the public detriment resulting from the abandonment of a unique format against the
public benefit resulting from that change. The Commission emphasized the difficulty of objectively
evaluating the strength of listener preferences, of comparing the desire for diversity within a
particular type of programming to the desire for a broader range of program formats and of
assessing the financial feasibility of a unique format.

Finally, the Commission explained why it believed that market forces were the best available means
of producing diversity in entertainment formats. First, in large markets, competition among
broadcasters had already produced "an almost bewildering array of diversity" in entertainment
formats.18 Second, format allocation by market forces accommodates listeners' desires for diversity
within a given format and also produces a variety of formats.19 Third, the market is far more
flexible than governmental regulation and responds more quickly to changing public tastes.
Therefore, the Commission concluded that "the market is the allocation mechanism of preference
for entertainment formats, and . . . Commission supervision in this area will not be conducive either
to producing program diversity [or] satisfied radio listeners."

The Court of Appeals, sitting en banc, held that the Commission's policy was contrary to the Act as
construed and applied in the court's prior format decisions. [1979] USCADC 270; 197
U.S.App.D.C. 319, 610 F.2d 838 (1979). The court questioned whether the Commission had
rationally and impartially re-examined its position21 and particularly criticized the Commission's
failure to disclose a staff study on the effectiveness of market allocation of formats before it issued
the Policy Statement.22 The court then responded to the Commission's criticisms of the format
doctrine. First, although conceding that market forces generally lead to diversification of formats, it
concluded that the market only imperfectly reflects listener preferences23 and that the Commission
is statutorily obligated to review format changes whenever there is "strong prima facie evidence that
the market has in fact broken down." Id., at 332, 610 F.2d, at 851. Second, the court stated that the
administrative problems posed by the format doctrine were not insurmountable. Hearings would
only be required in a small number of cases, and the Commission could cope with problems such as
classifying radio format by adopting "a rational classification schema." Id., at 334, 610 F.2d, at 853.
Third, the court observed that the Commission had not demonstrated that the format doctrine would
deter innovative programming.24 Finally, the court explained that it had not directed the
Commission to engage in censorship or to impose common carrier obligations on licensees: WEFM
did not authorize the Commission to interfere with licensee programming choices or to force
retention of an existing format; it merely stated that the Commission had the power to consider a
station's format in deciding whether license renewal or transfer would be consistent with the public
interest. 197 U.S.App.D.C., at 332-333, 610 F.2d, at 851-852.

Although conceding that it possessed neither the expertise nor the authority to make policy decisions
in this area, the Court of Appeals asserted that the format doctrine was "law," not "policy,"25 and
was of the view that the Commission had not disproved the factual assumptions underlying the
format doctrine.26 Accordingly, the court declared that the Policy Statement was "unavailing and of
no force and effect." Id., at 339, 610 F.2d, at 858.27

II

Rejecting the Commission's reliance on market forces to develop diversity in programming as an
unreasonable interpretation of the Act's public-interest standard, the Court of Appeals held that in
certain circumstances the Commission is required to regard a change in entertainment format as a
substantial and material fact in deciding whether a license renewal or transfer is in the public
interest. With all due respect, however, we are unconvinced that the Court of Appeals' format
doctrine is compelled by the Act and that the Commission's interpretation of the public-interest
standard must therefore be set aside.

It is common ground that the Act does not define the term "public interest, convenience, and
necessity."28 The Court has characterized the public-interest standard of the Act as "a supple
instrument for the exercise of discretion by the expert body which Congress has charged to carry out
its legislative policy." FCC v. Pottsville Broadcasting Co., [1940] USSC 15; 309 U.S. 134,
138[1940] USSC 15; , 60 S.Ct. 437, 439[1940] USSC 15; , 84 L.Ed. 656 (1940). Although it was
declared in National Broad casting Co. v. United States, that the goal of the Act is "to secure the
maximum benefits of radio to all the people of the United States," 319 U.S., at 217, 63 S.Ct., at
1010, it was also emphasized that Congress had granted the Commission broad discretion in
determining how that goal could best be achieved. The Court accordingly declined to substitute its
own views on the best method of encouraging effective use of the radio for the views of the
Commission. Id., at 218, 63 S.Ct., at 1010. Similarly, in FCC v. National Citizens Committee for
Broadcasting, [1978] USSC 106; 436 U.S. 775, 98 S.Ct. 2096, 56 L.Ed.2d 697 (1978), we deemed
the policy of promoting the widest possible dissemination of information from diverse sources to be
consistent with both the public-interest standard and the First Amendment, id., at 795, 98 S.Ct., at
2112, but emphasized the Commission's broad power to regulate in the public interest. We noted
that the Act permits the Commission to promulgate "such rules and regulations, . . . not inconsistent
with law, as may be necessary to carry out the provisions of [the Act],"29 and that this general
rulemaking authority permits the Commission to implement its view of the public-interest standard
of the Act "so long as that view is based on consideration of permissible factors and is otherwise
reasonable." Id., at 793, 98 S.Ct., at 2111.30 Furthermore, we recognized that the Commission's
decisions must sometimes rest on judgment and prediction rather than pure factual determinations.
In such cases complete factual support for the Commission's ultimate conclusions is not required,
since " 'a forecast of the direction in which future public interest lies necessarily involves deductions
based on the expert knowledge of the agency.' "

The Commission has provided a rational explanation for its conclusion that reliance on the market is
the best method of promoting diversity in entertainment formats. The Court of Appeals and the
Commission agree that in the vast majority of cases market forces provide sufficient diversity. The
Court of Appeals favors Government intervention when there is evidence that market forces have
deprived the public of a "unique" format, while the Commission is content to rely on the market,
pointing out that in many cases when a station changes its format, other stations will change their
formats to attract listeners who preferred the discontinued format. The Court of Appeals places great
value on preserving diversity among formats, while the Commission emphasizes the value of
intraformat as well as interformat diversity. Finally, the Court of Appeals is convinced that review
of format changes would result in a broader range of formats, while the Commission believes that
Government intervention is likely to deter innovative programming.

In making these judgments, the Commission has not forsaken its obligation to pursue the public
interest. On the contrary, it has assessed the benefits and the harm likely to flow from Government
review of entertainment programming, and on balance has concluded that its statutory duties are
best fulfilled by not attempting to oversee format changes. This decision was in major part based on
predictions as to the probable conduct of licensees and the functioning of the broadcasting market
and on the Commission's assessment of its capacity to make the determinations required by the
format doctrine. The Commission concluded that " '[e]ven after all relevant facts ha[d] been fully
explored in an evidentiary hearing, [the Commission] would have no assurance that a decision
finally reached by [the Commission] would contribute more to listener satisfaction than the result
favored by station management.' " Policy Statement, 60 F.C.C.2d 858, 865 (1976). It did not assert
that reliance on the marketplace would achieve a perfect correlation between listener preferences
and available entertainment programming. Rather, it recognized that a perfect correlation would
never be achieved, and it concluded that the marketplace alone could best accommodate the varied
and changing tastes of the listening public. These predictions are within the institutional competence
of the Commission.

Our opinions have repeatedly emphasized that the Commission's judgment regarding how the public
interest is best served is entitled to substantial judicial deference. See, e. g., FCC v. National
Citizens Committee for Broadcasting, supra; FCC v. WOKO, Inc.[1946] USSC 131; , 329 U.S. 223,
229[1946] USSC 131; , 67 S.Ct. 213, 216[1946] USSC 131; , 91 L.Ed. 204 (1946). Furthermore,
diversity is not the only policy the Commission must consider in fulfilling its responsibilities under
the Act. The Commission's implementation of the public-interest standard, when based on a rational
weighing of competing policies, is not to be set aside by the Court of Appeals, for "the weighing of
policies under the 'public interest' standard is a task that Congress has delegated to the Commission
in the first instance." FCC v. National Citizens Committee for Broadcasting, supra, at 810, 98 S.Ct.,
at 2119. The Commission's position on review of format changes reflects a reasonable
accommodation of the policy of promoting diversity in programming and the policy of avoiding
unnecessary restrictions on licensee discretion. As we see it, the Commission's Policy Statement is
in harmony with cases recognizing that the Act seeks to preserve journalistic discretion while
promoting the interests of the listening public.

The Policy Statement is also consistent with the legislative history of the Act. Although Congress
did not consider the precise issue before us, it did consider and reject a proposal to allocate a certain
percentage of the stations to particular types of programming.33 Similarly, one of the bills
submitted prior to passage of the Radio Act of 192734 included a provision requiring stations to
comply with programming priorities based on subject matter.35 This provision was eventually
deleted since it was considered to border on censorship.36 Congress subsequently added a section to
the Radio Act of 1927 expressly prohibiting censorship and other "interfer[ence] with the right of
free speech by means of radio communication."37 That section was retained in the Communications
Act.38 As we read the legislative history of the Act, Congress did not unequivocally express its
disfavor of entertainment format review by the Commission, but neither is there substantial
indication that Congress expected the public-interest standard to require format regulation by the
Commission. The legislative history of the Act does not support the Court of Appeals and provides
insufficient basis for invalidating the agency's construction of the Act.

In the past we have stated that "the construction of a statute by those charged with its execution
should be followed unless there are compelling indications that it is wrong . . . ."39 Prior to 1970,
the Commission consistently stated that the choice of programming formats should be left to the
licensee.40 In 1971, the Commission restated that position but announced that any application for
license transfer or renewal involving a substantial change in program format would have to be
reviewed in light of the Court of Appeals' decision in Citizens Committee to Preserve the Voice of
the Arts in Atlanta[1970] USCADC 183; , 141 U.S.App.D.C. 109, 436 F.2d 263, 267 (1970), in
which the Court of Appeals first articulated the format doctrine.41 In 1973, in a statement
accompanying the grant of the transfer application that was later challenged in WEFM, a majority of
the Commissioners joined in a commitment to "take an extra hard look at the reasonableness of any
proposal which would deprive a community of its only source of a particular type of
programming."42 However, the Commission's later Policy Statement concluded that this approach
was "neither administratively tenable nor necessary in the public interest."43 It is thus apparent that
although the Commission was obliged to modify its policies to conform to the Court of Appeals'
format doctrine, the Policy Statement reasserted the Commission's traditional preference for
achieving diversity in entertainment programming through market forces.

III

It is contended that rather than carrying out its duty to make a particularized public-interest
determination on every application that comes before it, the Commission, by invariably relying on
market forces, merely assumes that the public interest will be served by changes in entertainment
format. Surely, it is argued, there will be some format changes that will be so detrimental to the
public interest that inflexible application of the Commission's Policy Statement would be
inconsistent with the Commission's duties. But radio broadcasters are not required to seek
permission to make format changes. The issue of past or contemplated entertainment format
changes arises in the courses of renewal and transfer proceedings; if such an application is
approved, the Commission does not merely assume but affirmatively determines that the requested
renewal or transfer will serve the public interest.

Under its present policy, the Commission determines whether a renewal or transfer will serve the
public interest without reviewing past or proposed changes in entertainment format. This policy is
based on the Commission's judgment that market forces, although they operate imperfectly, not only
will more reliably respond to listener preference than would format oversight by the Commission
but also will serve the end of increasing diversity in entertainment programming. This Court has
approved of the Commission's goal of promoting diversity in radio programming, FCC v. Midwest
Video Corp., [1979] USSC 52; 440 U.S. 689, 699[1979] USSC 52; , 99 S.Ct. 1435, 1441, 59
L.Ed.2d 692 (1979), but the Commission is nevertheless vested with broad discretion in determining
how much weight should be given to that goal and what policies should be pursued in promoting it.
The Act itself, of course, does not specify how the Commission should make its public-interest
determinations.

A major underpinning of its Policy Statement is the Commission's conviction, rooted in its
experience, that renewal and transfer cases should not turn on the Commission's presuming to grasp,
measure, and weigh the elusive and difficult factors involved in determining the acceptability of
changes in entertainment format. To assess whether the elimination of a particular "unique"
entertainment format would serve the public interest, the Commission would have to consider the
benefit as well as the detriment that would result from the change. Necessarily, the Commission
would take into consideration not only the number of listeners who favor the old and the new
programming but also the intensity of their preferences. It would also consider the effect of the
format change on diversity within formats as well as on diversity among formats. The Commission
is convinced that its judgments in these respects would be subjective in large measure and would
only approximately serve the public interest. It is also convinced that the market, although
imperfect, would serve the public interest as well or better by responding quickly to changing
preferences and by inviting experimentation with new types of programming. Those who would
overturn the Commission's Policy Statement do not take adequate account of these considerations.

It is also contended that since the Commission has responded to listener complaints about
nonentertainment programming, it should also review challenged changes in entertainment
formats.45 But the difference between the Commission's treatment of nonentertainment
programming and its treatment of entertainment programming is not as pronounced as it may seem.
Even in the area of nonentertainment programming, the Commission has afforded licensees broad
discretion in selecting programs. Thus, the Commission has stated that "a substantial and material
question of fact [requiring an evidentiary hearing] is raised only when it appears that the licensee
has abused its broad discretion by acting unreasonably or in bad faith." Mississippi Authority for
Educational TV, 71 F.C.C.2d 1296, 1308 (1979). Furthermore, we note that the Commission has
recently re-examined its regulation of commercial radio broadcasting in light of changes in the
structure of the radio industry. See Notice of Inquiry and Proposed Rulemaking, In the Matter of
Deregulation of Radio, 73 F.C.C.2d 457 (1979). As a result of that re-examination, it is eliminated
rules requiring maintenance of comprehensive program logs, guidelines on the amount of
nonentertainment programming radio stations must offer, formal requirements governing
ascertainment of community needs, and guidelines limiting commercial time. See Deregulation of
Radio, 46 Fed.Reg. 13888 (1981) (to be codified at 47 CFR Parts 0 and 73).

These cases do not require us to consider whether the Commission's present or past policies in the
area of nonentertainment programming comply with the Act. We attach some weight to the fact that
the Commission has consistently expressed a preference for promoting diversity in entertainment
programming through market forces, but our decision ultimately rests on our conclusion that the
Commission has provided a reasonable explanation for this preference in its Policy Statement.

We decline to overturn the Commission's Policy Statement, which prefers reliance on market forces
to its own attempt to oversee format changes at the behest of disaffected listeners. Of course, the
Commission should be alert to the consequences of its policies and should stand ready to alter its
rule if necessary to serve the public interest more fully. As we stated in National Broadcasting Co.
v. United States :

"If time and changing circumstances reveal that the 'public interest' is not served by application of
the Regulations, it must be assumed that the Commission will act in accordance with its statutory
obligations." 319 U.S., at 225, 63 S.Ct., at 1013.

IV

Respondents contend that the Court of Appeals judgment should be affirmed because, even if not
violative of the Act, the Policy Statement conflicts with the First Amendment rights of listeners "to
receive suitable access to social, political, esthetic, moral, and other ideas and experiences." Red
Lion Broadcasting Co. v. FCC, [1969] USSC 141; 395 U.S. 367, 390[1969] USSC 141; , 89 S.Ct.
1794, 1806, 23 L.Ed.2d 371 (1969). Red Lion held that the Commission's "fairness doctrine" was
consistent with the public-interest standard of the Communications Act and did not violate the First
Amendment, but rather enhanced First Amendment values by promoting "the presentation of
vigorous debate of controversial issues of importance and concern to the public." Id., at 385, 89
S.Ct., at 1804. Although observing that the interests of the people as a whole were promoted by
debate of public issues on the radio, we did not imply that the First Amendment grants individual
listeners the right to have the Commission review the abandonment of their favorite entertainment
programs. The Commission seeks to further the interests of the listening public as a whole by
relying on market forces to promote diversity in radio entertainment formats and to satisfy the
entertainment preferences of radio listeners.46 This policy does not conflict with the First
Amendment.

Contrary to the judgment of the Court of Appeals, the Commission's Policy Statement is not
inconsistent with the Act. It is also a constitutionally permissible means of implementing the public-
interest standard of the Act. Accordingly, the judgment of the Court of Appeals is reversed, and the
case is remanded for further proceedings consistent with this opinion.

So ordered.

Justice MARSHALL, with whom Justice BRENNAN joins, dissenting.

Under §§ 309(a) and 310(d) of the Communications Act of 1934, 48 Stat. 1064, as amended, 47
U.S.C. § 151 et seq. (Act), the Federal Communications Commission (Commission) may not
approve an application for a radio license transfer, assignment, or renewal unless it finds that such
change will serve "the public interest, convenience, and necessity."1 Any party in interest may
petition the Commission to deny the application, § 309(d)(1), and the Commission must hold a
hearing if "a substantial and material question of fact is presented," § 309(d)(2). In my judgment,
the Court of Appeals correctly held that in certain limited circumstances, the Commission may be
obliged to hold a hearing to consider whether a proposed change in a licensee's entertainment
program format is in the "public interest."2 Accordingly, I would affirm the judgment of the Court
of Appeals insofar as it vacated the Commission's "Policy Statement."

* At the outset, I should point out that my understanding of the Court of Appeals' format cases is
very different from the Commission's.4 Both in its Policy Statement and in its brief before this
Court, the Commission has insisted that the format doctrine espoused by the Court of Appeals,
"favor[s] a system of pervasive governmental regulation,"5 requiring " 'comprehensive,
discriminating, and continuing state surveillance.'6 The Commission further contends that
enforcement of the format doctrine would impose "common carrier" obligations on broadcasters and
substitute for "the imperfect system of free competition . . . a system of broadcast programming by
government decree."7 Were this an accurate description of the format doctrine, I would join the
Court in reversing the judgment below.8 However, I agree with the Court of Appeals that "the actual
features of [its format doctrine] are scarcely visible in [the Commission's] highly-colored portrait."
[1979] USCADC 270; 197 U.S.App.D.C. 319, 332[1979] USCADC 270; , 610 F.2d 838, 851
(1979).

In fact, the Court of Appeals accepted the Commission's conclusion that entertainment program
formats should ordinarily be left to competitive forces. The court emphasized that the format
doctrine "was not intended as an alternative to format allocation by market forces," and "fully
recognized that market forces do generally provide diversification of formats." Ibid. (Emphasis in
original.) It explained that "the Commission's obligation to consider format issues arises only when
there is strong prima facie evidence that the market has in fact broken down," ibid., and suggested
that a breakdown in the market may be inferred when notice of a format change "precipitate[s] an
outpouring of protest," id., at 323, 610 F.2d, at 842, or "significant public grumbling," ibid. The
Court of Appeals further stated that "[n]o public interest issue is raised if (1) there is an adequate
substitute in the service area for the format being abandoned, (2) there is no substantial support for
the endangered format as evidenced by an outcry of public protest, (3) the devotees of the
endangered format are too few to be served by the available frequencies, or (4) the format is not
financially viable." Id., at 332, 610 F.2d, at 851. Finally, the Court of Appeals indicated that the
Commission's obligation to hold an evidentiary hearing is limited to those situations in which the
record presents substantial questions of material fact. Id., at 324, 610 F.2d, at 843.

The Court of Appeals thus made clear that the format doctrine comes into play only in a few limited
situations. Consequently, the issue presented by these cases is not whether the Commission may
adopt a general policy of relying on licensee discretion and market forces to ensure diversity in
entertainment programming formats. Rather, the question before us is whether the Commission may
apply its general policy on format changes indiscriminately and without regard to the effect in
particular cases.

II

Although the Act does not define "public interest, convenience, and necessity," it is difficult to
quarrel with the basic premise of the Court of Appeals' format cases that the term includes "a
concern for diverse entertainment programming." Id., at 323, 610 F.2d, at 842.9 This Court has
indicated that one of the Act's goals is "to secure the maximum benefits of radio to all the people of
the United States." National Broadcasting Co. v. United States, [1943] USSC 100; 319 U.S. 190,
217[1943] USSC 100; , 63 S.Ct. 997, 1009[1943] USSC 100; , 87 L.Ed. 1344 (1943).10 And we
have recognized "the long-established regulatory goal of . . . diversification of programming." FCC
v. Midwest Video Corp., [1979] USSC 52; 440 U.S. 689, 699[1979] USSC 52; , 99 S.Ct. 1435,
1441, 59 L.Ed.2d 692 (1979). At the same time, our cases have acknowledged that the Commission
enjoys broad discretion in determining how best to accomplish this goal. See FCC v. National
Citizens Committee for Broadcasting, [1978] USSC 106; 436 U.S. 775, 98 S.Ct. 2096, 56 L.Ed.2d
697 (1978); National Broadcasting Co. v. United States, supra. The Commission has concluded that
a general policy of relying on market forces is the best method for promoting diversity in
entertainment programming formats. As the majority notes, ante, at 595, this determination largely
rests on the Commission's predictions about licensee behavior and the functioning of the radio
broadcasting market.

I agree with the majority that predictions of this sort are within the Commission's institutional
competence. I am also willing to assume that a general policy of disregarding format changes in
making the "public interest" determination required by the Act is not inconsistent with the
Commission's statutory obligation to give individualized consideration to each application. The
Commission has broad rulemaking powers under the Act,11 and we have approved efforts by the
Commission to implement the Act's "public interest" requirement through rules and policies of
general application. See, e. g., FCC v. National Citizens Committee for Broadcasting, supra; United
States v. Storer Broadcasting Co.[1956] USSC 61; , 351 U.S. 192, 76 S.Ct. 763, 100 L.Ed. 1081
(1956); National Broadcasting Co. v. United States, supra.
The problem with the particular Policy Statement challenged here, however, is that it lacks the
flexibility we have required of such general regulations and policies. See, e. g., United States v.
Storer Broadcasting Co., supra, National Broadcasting Co. v. United States, supra. The Act imposes
an affirmative duty on the Commission to make a particularized "public interest" determination for
each application that comes before it. As we explained in National Broadcasting Co. v. United
States, supra, 319 U.S., at 225, 63 S.Ct., at 1013, the Commission must, in each case, "exercise an
ultimate judgment whether the grant of a license would serve the 'public interest, convenience, or
necessity.' " The Policy Statement completely forecloses any possibility that the Commission will
re-examine the validity of its general policy on format changes as it applies to particular situations.
Thus, even when it can be conclusively demonstrated that a particular radio market does not
function in the manner predicted by the Commission, the Policy Statement indicates that the
Commission will blindly assume that a proposed format change is in the "public interest." This
result would occur even where reliance on the market to ensure format diversity is shown to be
misplaced, and where it thus appears that action by the Commission is necessary to promote the
public interest in diversity. This outcome is not consistent with the Commission's statutory
responsibilities.

Moreover, our cases have indicated that an agency's discretion to proceed in complex areas through
general rules is intimately connected to the existence of a "safety valve" procedure that allows the
agency to consider applications for exemptions based on special circumstances. See E. I. du Pont de
Nemours & Co. v. Train, [1977] USSC 29; 430 U.S. 112, 128[1977] USSC 29; , 97 S.Ct. 965,
975[1977] USSC 29; , 51 L.Ed.2d 204 (1977); Permian Basin Area Rate Cases[1968] USSC 140; ,
390 U.S. 747, 771-772[1968] USSC 140; , 88 S.Ct. 1344, 1362-1363, 20 L.Ed.2d 312 (1968); FPC
v. Texaco Inc., [1964] USSC 131; 377 U.S. 33, 40-41[1964] USSC 131; , 84 S.Ct. 1105, 1109-
1110[1964] USSC 131; , 12 L.Ed.2d 112 (1964); United States v. Storer Broadcasting Co., supra,
351 U.S., at 204-205, 76 S.Ct., at 771-772; National Broadcasting Co. v. United States, supra, 319
U.S., at 207, 225, 63 S.Ct., at 1005, 1013. See also WAIT Radio v. FCC, 135 U.S.App.D.C. 317,
321, 418 F.2d 1153, 1157 (1969); American Airlines v. CAB, 123 U.S.App.D.C. 310, 359 F.2d 624
(en banc), cert. denied, 385 U.S. 843, 87 S.Ct. 73, 17 L.Ed.2d 75 (1966); WBEN, Inc. v. United
States, [1968] USCA2 173; 396 F.2d 601, 618 (CA2), cert. denied, 393 U.S. 914, 89 S.Ct. 238, 21
L.Ed.2d 200 (1968). For example, in National Broadcasting Co. v. United States, supra, we upheld
the Commission's Chain Broadcasting Regulations, but we emphasized the need for flexibility in
administering the rules. We noted that the "Commission provided that 'networks will be given full
opportunity, on proper application . . . to call our attention to any reasons why the principle should
be modified or held inapplicable.' " Id., 319 U.S., at 207, 63 S.Ct., at 1005. And we concluded:

"The Commission therefore did not bind itself inflexibly to the licensing policies expressed in the
regulations. In each case that comes before it the Commission must still exercise an ultimate
judgment whether the grant of a license would serve the 'public interest, convenience, or necessity.'
If time and changing circumstances reveal that the 'public interest' is not served by application of the
Regulations, it must be assumed that the Commission will act in accordance with its statutory
obligations." Id., at 225, 63 S.Ct., at 1013.

Similarly, in upholding the Commission's Multiple Ownership Rules in United States v. Storer
Broadcasting Co. supra, we noted that the regulations allowed an opportunity for a "full hearing"
for applicants "that set out adequate reasons why the Rules should be waived or amended." Id., at
205, 76 S.Ct., at 771.
This "safety valve" feature is particularly essential where, as here, the agency's decision that a
general policy promotes the public interest is based on predictions and forecasts that by definition
lack complete factual support. As the Court of Appeals admonished the Commission in a related
context:

"The Commission is charged with administration in the 'public interest.' That an agency may
discharge its responsibilities by promulgating rules of general application which, in the overall
perspective, establish the 'public interest' for a broad range of situations, does not relieve it of an
obligation to seek out the 'public interest' in particular, individualized cases. A general rule implies
that a commission need not re-study the entire problem de novo and reconsider policy every time it
receives an application for a waiver of the rule. On the other hand, a general rule, deemed valid
because its overall objectives are in the public interest, may not be in the 'public interest' if extended
to an applicant who proposes a new service that will not undermine the policy, served by the rule,
that has been adjudged in the public interest." WAIT Radio v. FCC, supra, at 321, 418 F.2d, at 1157.

In my judgment, this requirement of flexibility compels the Commission to provide a procedure
through which listeners can attempt to show that a particular radio market differs from the
Commission's paradigm, and thereby persuade the Commission to give particularized consideration
to a proposed format change. Indeed, until the Policy Statement was published, the Commission had
resolved to "take an extra hard look at the reasonableness of any proposal which would deprive a
community of its only source of a particular type of programming."13 As I see it, the Court of
Appeals' format doctrine was merely an attempt by that court to delineate the circumstances in
which the Commission must temper its general policy in view of special circumstances. Perhaps the
court would have been better advised to leave the task of defining these situations to the
Commission.14 But one need not endorse every feature of the Court of Appeals' approach to
conclude that the court correctly invalidated the Commission's Policy Statement because of its
omission of a "safety valve" procedure.

This omission is not only a departure from legal precedents; it is also a departure from both the
Commission's consistent policies and its admissions here. For the Commission concedes that the
radio market is an imperfect reflection of listener preferences,15 and that listeners have
programming interests that may not be reflected in the marketplace. The Commission has long
recognized its obligation to examine program formats in making the "public interest" determination
required by the Act. As early as 1929, the Commission's predecessor, the Federal Radio
Commission, adopted the position that licensees were expected to provide a balanced program
schedule designed to serve all substantial groups in their communities. Great Lakes Broadcasting
Co., 3 F.R.C.Ann.Rep. 32, 34, rev'd on other grounds, 37 F.2d 993 (D.C.Cir.), cert. dism'd, 281 U.S.
706, 50 S.Ct. 467, 74 L.Ed. 1129 (1929). The Commission's famous "Blue Book,"16 published in
1946, reaffirmed the emphasis on a well-balanced program structure and declared that the
Commission has "an affirmative duty, in its public interest determinations, to give full consideration
to program service."17 As the Commission explained:

"It has long been an established policy of broadcasters themselves and of the Commission that the
American system of broadcasting must serve significant minorities among our population, and the
less dominant needs and tastes which most listeners have from time to time."
This theme was reiterated in the Commission's 1960 Program Statement,19 which set forth 14
specific categories of programming that were deemed "major elements usually necessary to meet the
public interest, needs and desires of the community,"20 and which emphasized the necessity of each
broadcaster's programming serving the "tastes and needs" of its local community.21 To ensure that
licensee programming serves the needs of the community, the Commission has, for example,
decreed that licensees have a special obligation to provide programs for children, even going so far
as to declare that licensees must provide "a reasonable amount of [children's] programming which is
designed to educate and inform and not simply to entertain."

Moreover, in examining renewal applications, the Commission has considered claims that a licensee
does not provide adequate children's programming,23 or programming for women and children,24
or for a substantial Spanish-American community,25 or that the licensee has ignored issues of
significance to the Negro community,26 or has not provided programming of specific interest to
residents of a particular area.27 In each case, the Commission reviewed submissions ranging from
general summaries to transcripts of programs, to determine whether the licensee's programming met
the public-interest standard.

There is an obvious inconsistency between the Commission's recognition that the "public interest"
standard requires it to consider licensee programming in the situations described above and its
Policy Statement on review of entertainment program formats. Indeed, the sole instance in which
the Commission will not consider listener complaints about programming is when they pertain to
proposed changes in entertainment program formats. The Policy Statement attempts to explain this
exceptional treatment of format changes by drawing a distinction between entertainment and
nonentertainment programming. The Policy Statement suggests that the Commission reviews only
nonentertainment programming, and even then, only in special circumstances. Thus, the Policy
Statement argues that the fairness doctrine and political broadcasting rules issued pursuant to § 315,
47 U.S.C. § 315, allow the Commission to exercise direct control of programming. In these areas,
reasons the Statement, the Commission's role "is limited to directing the licensee to broadcast some
additional material so as not to completely ignore the viewpoints of others in the community."28
This "limited involvement in licensee decisionmaking in the area of news and public affairs"29 is
contrasted, in the Commission's view to "the pervasive, censorial nature of the involvement in
format regulation."30 The majority presumably concludes that the Commission has provided a
rational explanation for distinguishing between entertainment and nonentertainment programming.
With all due respect, I disagree.

In the first place, the distinction the Commission tries to draw between entertainment and
nonentertainment programming is questionable. It is not immediately apparent, for example, why
children's programming necessarily falls on the "nonentertainment" side of the spectrum, and the
Commission has provided no explanation of how it decides the category to which particular
programming belongs. Second, I see no reason why the Commission's review of entertainment
programming cannot be as limited as its review of nonentertainment programming. Nothing
prevents the Commission from limiting its role in reviewing format changes to "directing the
licensee to broadcast additional material," thereby ensuring that the viewpoints of listeners who
complain about a proposed format change are not completely ignored. Third, and most important,
neither the fairness doctrine nor the political broadcasting rules have anything to do with the various
situations described above in which the Commission has not hesitated to consider program formats
in making the "public interest" determination. The fairness doctrine imposes an obligation on
licensees to devote a "reasonable percentage" of broadcast time to controversial issues of public
importance, and it requires that the coverage be fair in that it accurately reflect the opposing views.
See Red Lion Broadcasting Co. v. FCC, [1969] USSC 141; 395 U.S. 367, 89 S.Ct. 1794, 23 L.Ed.2d
371 (1969). The political broadcasting rules regulate broadcasts by candidates for federal and
nonfederal public office. See The Law of Political Broadcasting and Cablecasting, 69 F.C.C.2d
2209 (1978). The Commission's examination of whether a broadcaster's format includes
programming directed at women or at residents of the local community, or its requirement that
licensees provide programming designed to serve the unique needs of children, simply has nothing
to do with either the fairness doctrine or the political broadcasting rules. Thus, the Commission's
purported justification for its inconsistency is no explanation at all, and I am puzzled by the
majority's apparent conclusion that it provides a rational basis for the Commission's policy.

The majority attempts to minimize the inconsistency in the Commission's treatment of entertainment
and nonentertainment programming by postulating that the difference "is not as pronounced as it
may seem," ante, at 602. This observation, even if accurate, is simply beside the point. What is
germane is the Commission's failure to consider listener complaints about entertainment
programming to the same extent and in the same manner as it reviews complaints about
nonentertainment programming. Thus, whereas the Commission will hold an evidentiary hearing to
review complaints about nonentertainment programming where " 'it appears that the licensee has . . .
act[ed] unreasonably or in bad faith,' " ibid. (quoting Mississippi Authority for Educational TV, 71
F.C.C.2d 1296, 1308 (1979)), the Commission will not consider an identical complaint about a
licensee's change in its entertainment programming. As I have indicated, see supra, at 614-616,
neither the Commission nor the majority is able to offer a satisfactory explanation for this
inconsistency.

Nor can the Commission find refuge in its claim that " '[e]ven after all relevant facts [h]ad been
fully explored in an evidentiary hearing, [the Commission] would have no assurance that a decision
finally reached by [the Commission] would contribute more to listener satisfaction than the result
favored by station management.' " Policy Statement, 60 F.C.C.2d 858, 865 (1976), quoting Notice of
Inquiry, 57 F.C.C.2d 580, 586 (1976). The same must be true of the decisions the Commission
makes after reviewing listener complaints about nonentertainment programming, and I do not see
why the Commission finds this result acceptable in one situation but not in the other. Much the same
can be said for the majority's suggestion that the Commission should be spared the burden of
"presuming to grasp, measure and weigh . . . elusive and difficult factors" such as determining the
number of listeners who favor a particular change and measuring the intensity of their preferences,
ante, at 601. But insofar as the Commission confronts these same "elusive and difficult factors" in
reviewing nonentertainment programming, it need only apply the expertise it has acquired in dealing
with these problems to review of entertainment programming.

III

Since I agree with the Court of Appeals that there may be situations in which the Commission is
obliged to consider format changes in making the "public interest" determination mandated by the
Act, it seems appropriate to comment briefly on the Commission's claim that the " 'acute practical
problem[s]' inherent in format regulation render entirely speculative any benefits that such
regulation might produce."31 One of the principal reasons given in the Policy Statement for
rejecting entertainment format regulation is that it would be "administratively a fearful and
comprehensive nightmare,"32 that would impose "enormous costs on the participants and the
Commission alike."33 But at oral argument before the Court of Appeals, Commission counsel
conceded that the " 'administrative nightmare' " argument was an " 'exaggeration' " which was not "
'very significant at all' " to the Commission's ultimate conclusion. 197 U.S.App.D.C., at 330, 610
F.2d, at 849. The Commission's reliance on claims that its own counsel later concedes to lack merit
hardly strengthens one's belief in the rationality of its decisionmaking.

Although it has abandoned the "administrative nightmare" argument before this Court, the
Commission nonetheless finds other "intractable" administrative problems in format regulation. For
example, it insists that meaningful classification of radio broadcasts into format types is impractical,
and that it is impossible to determine whether a proposed format change is in the public interest
because the intensity of listener preferences cannot be measured.34 Moreover, the Commission
argues that format regulation will discourage licensee innovation and experimentation with formats,
and that its effect on format diversity will therefore be counterproductive.

None of these claims has merit. Broadcasters have operated under the format doctrine during the
past 10 years, yet the Commission is unable to show that there has been no innovation and
experimentation with formats during this period. Indeed, a Commission staff study on the
effectiveness of market allocation of formats indicates that licensees have been aggressive in
developing diverse entertainment formats under the format-doctrine regime.35 This "evidence"-- a
welcome contrast to the Commission's speculation--undermines the Commission's claim that format
regulation will disserve the "public interest" because it will inhibit format diversity.

The Commission's claim that it is impossible to classify formats, is largely overcome by the Court
of Appeals' suggestion that the Commission could develop "a format taxonomy which, even if
imprecise at the margins, would be sustainable so long as not irrational."36 197 U.S.App.D.C., at
334, 610 F.2d, at 853. Even more telling is the staff study relied on by the Commission to show that
there is broad format diversity in major radio markets, for the study used a format classification
based on industry practice.37 As the Court of Appeals noted, it is somewhat ironic that the
Commission had no trouble "endorsing the validity of a study largely premised on classifications it
claims are impossible to make." Ibid.38 To be sure, courts do not sit to second-guess the
assessments of specialized agencies like the Commission. But where, as here, the agency's position
rests on speculations that are refuted by the agency's own administrative record, I am not persuaded
that deference is due.

IV

The Commission's Policy Statement is defective because it lacks a "safety valve" procedure that
would allow the necessary flexibility in the application of the Commission's general policy on
format changes to particular cases. In my judgment, the Court of Appeals' format doctrine was a
permissible attempt by that court to provide the Commission with some guidance regarding the
types of situations in which a re-examination of general policy might be necessary. Even if one were
to conclude that the Court of Appeals described these situations too specifically, a view I do not
share, I still think that the Court of Appeals correctly held that the Commission's Policy Statement
must be vacated.

I respectfully dissent.