So Howard Stern calls in to Ronn Owens’ radio show on KGO in San Francisco yesterday to confront FCC Commissioner Michael Powell. Here’s the transcript.

The current state of broadcasting is pretty messy. It’s hard to argue otherwise. We are feeling the effects of the waves of deregulation that have been ongoing since the Reagan administration, but really came home to roost with the 1996 Telecommunication Act. With companies like Clear Channel, Infinity, and a handful of other companies gobbling up stations, the entire industry has contracted. The power now resides in the hands of just a few stations — the power to program, the power to sell, the power to promote, the power to innovate. Howard Stern is a direct beneficiary of this trend. Without consolidation, Stern wouldn’t be carried on as many stations as he is. There would be dozens of local morning shows on all these stations. But Stern is cheaper and generates enough revenue to justify his satellite-fed programming rather than a local show.

Ever since Janet Jackson’s wardrobe malfunction in January, the FCC has been working overtime to enforce very vague notions of indecency and obscenity. The problems isn’t that they are doing this. Rather, it’s how they are going about it. First, the FCC only investigates indecency claims made by the general public. They don’t sit around monitoring thousands of radio and TV stations waiting for someone to utter a profane word. Because of this system, the process is necessarily selective. If no one reports a violation, it won’t be investigated.

Second, the policy and law on the issue of obscene and indecent content are not exceedingly clear. It’s subject to broad interpretation and ultimately comes down to the votes of the FCC commissioners. It would certainly be easier to codify the specific words that can’t be said on radio, but I don’t think any law-making body wants to get into that kind of restriction of speech.

So we are left with a very messy system that seems to target people like Stern, while leaving other broadcasters like Oprah untouched. Stern’s decision is to leave the public airwaves at the end of 2005 and sign on with Sirius satellite radio in 2006. He believes he will evade the watchful eyes of the FCC by moving to satellite. However, it’s conceivable that satellite could come under FCC scrutinty sometime in the next few years. Some, including Bud Paxson, have already begun to make the argument that the FCC should have oversight of all cable and satellite broadcasting, just as it does for the over-the-air stations.