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In the early twentieth century, radio was regarded primarily as a device to make maritime operations safer and a potential advancement of military technology. During WORLD WAR I, however, entrepreneurs began to recognize the commercial possibilities of radio. By the mid-1920s, commercial radio stations were operating in many parts of the United States, and owners began selling air time for advertisements. The Federal Radio Commission was created, in 1927, to assign applicants designated frequencies under specific engineering rules and to create and enforce standards for the broadcasters' privilege of using the public's airwaves.

The commission later became the Federal Communications Commission (FCC), which was established by the Communications Act of 1934 (47 U.S.C.A. § 151 et seq.). The FCC issues licenses to radio and television stations, which permit the stations to use specific frequencies to transmit programming. Licenses are issued only on a showing that public convenience, interest, and necessity will be served and that an applicant satisfies certain requirements, such as citizenship, good character, financial capability, and technical expertise.

Before 1996, the FCC restricted persons or entities from acquiring excessive power through ownership of a number of radio and television facilities. The rule was based on the assumption that if one person or company owned most or all of the media outlets in an area, the diversity of information and programming on these stations would be restricted.

The Telecommunications Act of 1996 eliminated the limit on the number of radio stations that one entity may own nationally. The FCC was also directed to reduce the restrictions on locally owned radio stations. Congress determined that less regulation was in the public interest.

In addition, the FCC seeks to prohibit the broadcast of obscene and indecent material. The Supreme Court has upheld regulations banning obscene material, because OBSCENITY is not protected by the FIRST AMENDMENT. It also permits the FCC to prohibit material that is "patently offensive," and either "sexual" or "excretory," from being broadcast during times when children are presumed to be in the audience (FCC v. Pacifica Foundation, 438 U.S. 726, 98 S. Ct. 3026, 57 L. Ed. 2d 1073 [1978]).

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