Update: Comment Deadlines Set in Contest Rule Proceeding

Last month we reported on a Notice of Proposed Rulemaking (NPRM) aimed at dragging the on-air contest rule (i.e., Section 73.1216) into the 21st Century. The NPRM has now made it into the Federal Register, which means that we now know the deadlines for filing comments and reply comments in response to the FCC’s proposal. Comments are due by February 17, 2015, and replies are due by March 19. Comments and replies may be filed electronically through the FCC’s ECFS filing site; refer to Proceeding No. 14-226.

Update: Effective Date, Comment Deadlines Set in Cell Phone Signal Booster Proceeding

Several weeks ago we reported on the FCC’s order disposing of several petitions for reconsideration that had been filed with respect to its 2013 decision to adopt a new regulatory approach to the use of cell phone signal boosters. In its most recent order the Commission adopted a couple of tweaks to its rules and proposed some further tweaks. All of those actions have now made it into the Federal Register. As a result, we now know when all but one of the newly-revised rules will take effect, and we also know the deadlines for commenting on the proposed additional tweaks.

According to one notice, all the revisions adopted by the Commission last month will take effect on
December 29, 2014 except for Section 20.21(f)(1)(iv)(A)(2), which, because it’s an “information collection”, must first be run past the Office of Management and Budget thanks to the Paperwork Reduction Act.

And according to a separate notice, comments on the newly-proposed tweaks are due by December 29, 2014 and replies are due by January 20, 2015.

Finally Bringing Broadcast Contest Rules into the 21st Century?

Three years in the making, a notice of proposed rulemaking would give the thumbs up to online contest rules.

Big News! The Commission has taken the unusual step of proposing a rule revision requested by broadcasters and of potential benefit to broadcasters, both TV and radio! The on-air contest rule – Section 73.1216 – is up for a long-overdue overhaul. And while there may be plenty to criticize in the FCC’s less-than-prompt attention here, let’s not focus on that just now. Instead, let’s take a look at how the Commission figures to make broadcasters’ lives a little better.

As we have reported previously, the contest rule requires (among other things) periodic on-air disclosure of all material elements of the contest. You can find some examples of the rule in action here, here and here. For many contests, that imposes a considerable burden on both stations (who must be sure to intone the rules on the air, often at auctioneer speed – or scroll them in infinitesimal print – regardless of how much that can interrupt program flow) and audience members (who have to suffer through the interruptions).

Nearly three years ago, Entercom filed a petition for rulemaking advancing an unquestionably reasonable proposal: instead of the over-the-air requirement, why not let broadcasters post contest rules on their websites (or, if a broadcaster doesn’t happen to have a website, on a state broadcast association site) for all the world to read whenever all the world happens to want to read them? As Entercom put it, this would be consistent with “how the majority of Americans access and consume information in the 21st century.”

The Commission is now on board with the idea.

In a Notice of Proposed Rulemaking (NPRM), it has proposed expanding the rule to permit broadcasters to post on-air contest rules on “the station’s Internet website, the licensee’s website, or if neither the individual station nor the licensee has its own website, any Internet website that is publicly accessible”. (In the alternative, broadcasters would still be able to satisfy the disclosure requirement through “a reasonable number of periodic” on-air announcements.)

Material contest terms disclosed online would have to conform in all substantive respects to those mentioned over the air – probably not a big deal. Ditto for the proposal concerning any changes to the material terms during the course of the contest: such changes would have to be fully disclosed on air, or the fact that such changes had been would have to be announced on air (with interested audience members being directed to the written disclosures online).

Stations choosing to disclose contest rules online would have to announce on-air that the rules are accessible online, which might not be a problem but for one gotcha: the “complete, direct website address where the terms are posted” would have to be announced “each time the station mentions or advertises the contest.” (The emphasis there is ours, not the FCC’s.) For stations which prefer to promote the bejeebers out of their contests, that requirement could get real old real fast for stations and audience alike. Still, such details can be addressed in comments in response to the NPRM and, ideally, the Commission might be convinced that a “full-website-every-time” notice requirement is probably overkill.

The NPRM also seeks comment on a variety of practical questions, such as:

  • What steps can be taken to ensure that contest terms are easy for consumers to locate on a website?
  • How long should a licensee be required to maintain contest information online?
  • Should licensees be required to distinguish in some way contest terms deemed “material” from other contest information to ensure that “material” terms aren’t buried in lengthy fine print? 
  • Does the term “material” need to be refined?

To the extent that the Commission really hasn’t decided any of these questions – and we should be willing to take them at their word here – input from affected broadcasters could prove very beneficial in the development of standards that comport with the reality of the industry. Deadlines for comments haven’t been set yet. Check back here for updates on that front.

Bottom line: props to Entercom for getting the ball rolling. And props, too, to the Commission for keeping the ball rolling on a proposal likely to do broadcasters some good.

But we’ve got to wonder exactly why it took the Commission so long. Entercom’s proposal was filed nearly three years ago. Not only was it unopposed, it attracted considerable support. In adopting the NPRM, all five Commissioners patted themselves on the back for embracing Entercom’s proposal. Given this universal, unanimous love-fest in support of the proposals, what exactly was the hang-up for three years?

FCC Further Tweaks Signal Booster Rules

Some rules relaxed while measures added to prevent interference to wireless networks 

Back in early 2013, the FCC took steps to help consumers deal with the dreaded cell phone phenomenon of dead spots by allowing the use of private signal boosters. (Readers should recall that boosters receive and re-transmit cell phone signals to improve coverage in their immediate vicinity.) And now, underscoring its interest in encouraging such devices, the Commission has tweaked its rules. But be forewarned, the tweaks are highly technical and unless you’re deeply involved in the manufacturing side of the booster universe, you shouldn’t expect to notice any dramatic changes.

To recap, there are two classes of approved boosters, Consumer and Industrial. Consumer boosters, in turn, come in two flavors, Wideband Consumer Boosters (designed to boost signals of more than one cell provider) and Provider-Specific Consumer Signal Boosters (designed to boost the signals of just a single cell provider). All Consumer Boosters are subject to “Network Protection Standards” (NPS), although those standards differ somewhat between the two different types of Consumer Boosters.

Among the NPS imposed on manufacturers of Wideband Consumer Boosters was a testing requirement – involving downlink noise limits, if you really must know – which proved problematic for manufacturers. (As it turned out, neither the FCC’s Office of Engineering and Technology nor most Telecommunications Certifying Bodies had the filtering equipment necessary to measure the downlink noise as required, which obviously complicated the testing process.)

So several manufacturers, noting that the downward noise testing element was not included in the NPS as a means of protecting against interference, suggested that it could be tossed. They also suggested that bidirectional capability, which was what the downward noise limit test was designed to help achieve and confirm, could be addressed in other ways (for example, by adding downlink gain limits to the Transmit Power Off Mode requirement – we warned you that the tweaks are highly technical, didn’t we?).

The FCC agreed. Signal booster makers can thank Wilson Electronics, V-COMM and Wireless Extenders for getting the ball rolling on this front.

The Commission also added some requirements for mobile Provider-Specific Consumer Signal Boosters to provide additional protection against interference to wireless networks. In particular, mobile Provider-Specific boosters now:

  1. are subject to the stronger noise limits set for Wideband Consumer Boosters;
  2. must meet the stronger gain limits for Wideband Consumer Boosters if directly connected or using direct contact coupling; and
  3. may not exceed a maximum booster gain of 58 dB (for frequencies below 1 GHz) and 65 dB (for frequencies above 1 GHz) if they use an inside antenna and have both automatic gain adjustment based on isolation measurements between booster donor and server antenna and automatic feedback cancellation.

(We did mention that there would be some technical stuff going on here, didn’t we? But wait – there’s more!)

The Commission also will apply the “antenna kitting rule” to all Provider-Specific Consumer Signal Boosters. Originally, that rule was applicable to all Wideband units but only mobile Provider-Specific units; from here on, it will apply to all consumer boosters, mobile and fixed. (For those new to this: “Antenna Kitting” is a requirement that manufacturers sell antennas, cables and any other type of “coupling device” along with the booster, to control for interference.)

And, in what we view as borderline labeling overkill, all fixed consumer boosters – Provider-Specific and Wideband – must now include the emphatic direction that “[t]his device may ONLY be operated in a fixed location for in-building use”. And that incantation (intended to prevent, or at least discourage, interference to wireless networks) has got to be invoked not once, not twice, not thrice, but at least four (count ‘em, four) separate times: in on-line, point-of-sale marketing; in any manual or installation instructions; on the packaging; and on a label affixed to the booster itself. 

In addition to all these revisions, the Commission has requested comments on whether to remove the “personal use” restriction in place for Provider-Specific Signal Boosters. Since consumers using those boosters are already required to obtain consent from carriers to operate on their frequencies, the Commission figures that the additional “personal use” provision is redundant. Deadlines for comments on this proposal will be set when the Further Notice of Proposed Rulemaking appears in the Federal Register, which hasn’t yet happened. We’ll keep you informed.

Travelers' Information Stations: To Filter (above 5 kHz) or Not to Filter, THAT is the Question

Comments have been invited on an NAB/SBE proposal aimed at (slightly) improving the audio quality on the TIS without interfering with AM stations.

Last July we blogged about changes the Commission had adopted to improve Travelers' Information Stations (TIS). At that time, the FCC proposed another fairly drastic change – the elimination of certain filtering requirements – that might potentially improve the service. The proposal went farther than some commenters thought advisable, which prompted them to propose a more moderate approach and, in response, the Public Safety and Homeland Security Bureau has now issued a Public Notice seeking further comment. (The Bureau probably could have skipped this step, but this writer thinks it’s a good thing they didn’t.)

TIS are low-power AM stations broadcasting information of interest to motorists, including traffic and road conditions, travel advisories, hazards, directions and the like. Each station covers only a small geographic area, most commonly along major highways and near tourist destinations.

AM service is notoriously interference-prone, with TIS as a potential source. The interference occurs because of the “sideband” portion of the TIS-transmitted AM signal. Excessively wide sidebands can cross over into another station’s channel, causing interference to that station. With AM stations – whose signals, particularly at night, can extend for hundreds of miles – this can cause big problems.

To reduce interference, the rules have historically required the filtering of TIS audio frequencies above 3 kHz. TIS are uniquely suited to filtering because they (theoretically) carry only voice transmissions, not music or other sounds. With the currently required filtering, music sounds awful, but voice is generally comprehensible (if not mellifluous) – roughly the same quality as wireline telephones. For TIS stations, on which non-voice transmissions are generally barred, that’s all you really need: the goal is to have listeners understand the words, not be entertained.

But at night and in areas of difficult terrain, “generally comprehensible” sometimes isn’t really. To improve the TIS, the FCC proposed eliminating the filtering requirement altogether.

That proposal got multiple positive responses, but not everyone was on board. The National Association of Broadcasters (NAB) and the Society of Broadcast Engineers (SBE), in particular, pushed back, proposing instead that the filter requirement be preserved but relaxed from 3 kHz to 5 kHz. A bump to 5 kHz would make the voice sound better, NAB/SBE argued, while still providing reasonable protection to nearby AM services.  And since TIS are deemed a secondary service, preventing interference is supposed to be paramount.

It seems like a good solution: the (objectively) poor audio quality on TIS gets better, but it doesn’t substantially increase the risk of interference. Win-win. Even the American Association of Information Radio Operators, whose petition initiated the original rulemaking to improve the TIS, supports the NAB/SBE proposal (although the AAIRO did propose a couple of additional tweaks to the NAB/SBE approach).

There is also the issue of the “steepness” of the filters. No filter is perfect: a 5 kHz filter will cull out only part of the signal below 5 kHz and leave some above it. The FCC proposed one profile, but it’s possible that another might be better, or cheaper, since steeper filters tend to be more expensive to implement. We’ll see what the comments say.

There are implementation questions on the table. Where exactly should the filters be installed in the TIS transmission system? If the filtering requirement is modified, or eliminated, would TIS licensees be required to recertify their transmitters? Since any relaxation of the 3 kHz rule would presumably be intended to benefit TIS, could a TIS licensee decline to make the change if the station were to determine, for example, that the change would be too expensive?

Since it has already solicited comments on changing the filtering, the Commission might have been able simply to issue an order straightaway adopting the NAB/SBE proposal. Instead, they have given the public another opportunity to comment on the possible new direction proposed by NAB/SBE.

Good for them. This is the way the system is supposed to work: the FCC should be sure to afford plenty of opportunity for input on what they’re considering. Here, in response to a suggestion made by commenters in a rulemaking, the Commission tentatively embraced the suggestion and solicited  comment on it, only to receive an alternate suggestion on which it has now sought further comments. It’s difficult to imagine anyone accusing the FCC of making some backroom deal with one or another established player in a way that might undermine a public safety service: the FCC has given the users and operators of the TIS a chance to weigh in on this new 5 kHz proposal, and if it turns out the 5 kHz Great Compromise isn’t so Great, ideally that determination will keep the Commission from taking an ill-advised turn. Sure, it might delay things by a few months, but in this case, doing it right is worth the delay.

Comments in response to the Bureau's public notice are due by May 16, 2014; reply comments are due by June 2. Comments may be uploaded through the FCC's ECFS online filing system here; enter them in Proceeding Number 09-19.

E911 Update: Third Further NPRM Comment Deadlines Set

Earlier this month we reported on the FCC’s Third Further Notice of Proposed Rulemaking (NPRM) in its effort to improve E911 location capabilities. The NPRM has now made it into the Federal Register, as a result of which we now know the comment deadlines. Comments in response to the NPRM may be filed by May 12, 2014 and replies by June 11.

In Depth and On Time: FCC Contemplates Indoor E911 Location Information With Added Dimensions

Commission looks to move CMRS location requirements indoors, expand them from 2-D to 4-D.

Since 2010 the FCC has been insisting on greater accuracy in the ability of wireless providers to pinpoint the location of wireless phones for E911 purposes. The automatic location information (ALI) rules currently in place require that carriers be able to provide Public Safety Answering Points (PSAPs) the location of an E911 caller to within 50 to 300 meters (depending on the technology used). But that requirement applies only to calls originating outdoors, and it mandates provision of only horizontal locations determined by geographic coordinates (i.e., latitude and longitude).

Nowadays, however, wireless phones are the source of most 911 calls, and the “great majority” of wireless calls originate indoors – hence the need for improved indoor E911 location capability.

Fortunately, test bed results and industry input confirm that indoor location technologies have improved considerably, so much so that they are expected to “deliver 50-meter location accuracy for many indoor environments with a high degree of reliability” in the near term. With its Third Further Notice of Proposed Rulemaking (NPRM) the FCC is now looking to ensure that the wireless-dependent public benefits from that capability.

But locating E911 callers inside buildings poses an additional question: how are first responders supposed to find the caller-in-distress when the geographic coordinates identified by the carrier turn out to be the site of a multi-story building?

No problem. The various fancy gadgets that can be built into smartphones include barometric sensors. According to a source cited by the FCC, as of 2013 all of Samsung’s “flagship smartphone models” had such sensors on board, as did a couple of Sony models. Apple was expected to join the club in 2014. Because (a) barometers measure air pressure and (b) air pressure varies according to elevation, such sensors can provide vertical location information (the “z-axis”) to supplement the horizontal (“x-axis” and “y-axis”) information already available.

Given all these considerations, the FCC is now proposing to require CMRS operators to hone their indoor E911 location accuracy accordingly. In particular, CMRS operators would have to:

  • Ÿprovide horizontal location (x- and y-axis) information within 50 meters of the caller for 67% of 911 calls placed from indoor environments within two years of the effective date of adoption of rules, and for 80% of indoor calls within five years.
  • provide vertical location (z-axis) information within three meters of the caller for 67% of indoor 911 calls within three years of the adoption of rules, and for 80% of calls within five years. The FCC chose the three-meter spec because the average floor-height in multi-story buildings is between 3.1-3.9 meters (depending on the type of building). Thus, the three-meter spec proposed by the Commission should permit first responders to narrow the search for the caller to a single floor.
  • meet these indoor requirements at either the county or PSAP geographic level.

And a chronological component would be added to the accuracy determination: CMRS providers would have to generate a location fix (“time to first fix”) in no more than 30 seconds in order for the 911 call to be counted towards compliance with location accuracy requirements. (Short calls of, e.g., 10 seconds or less could be excluded in measuring compliance with accuracy requirements because such call may not provide enough time to get a location fix.)

Indoor location accuracy requirements could be demonstrated through participation in an independently administered test bed program modeled on the indoor test bed administered by the Communications Security, Reliability, and Interoperability Council (CSRIC). Providers could also use alternative means providing the same level of test result reliability.

Along with the more stringent accuracy standards, the Commission is proposing to:

  • standardize the content and the process for delivery of confidence and uncertainty data that is generated by CMRS providers for each wireless 911 call and delivered to PSAPs on request.
  • require CMRS providers to inform PSAPs of the specific location technology or technologies used to generate location information for each 911 call.
  • accelerate the previously established timeframe for replacing the current handset- and network-based accuracy requirements with a unitary requirement.
  • require that CMRS providers periodically report E911 Phase II call tracking information, indicating what percentage of wireless 911 calls include Phase II location information.
  • establish a separate process by which PSAPs or state 911 administrators could raise complaints or concerns regarding the provision of E911 service.
  • require CMRS providers to conduct periodic compliance testing.

The NPRM is chock-full of related questions about which the FCC seeks public comment, including: the benefits of implementing these rules; the costs to carriers, whether a specific waiver process should be implemented for carriers seeking relief from the indoor location accuracy requirements; whether compliance within the proposed timeframes is reasonable; and whether the availability of Phase II information for roamers continues to be a concern, since the evolution of location technology may have reduced differences among carriers that could previously have complicated the location process for roamers. Because of the wide-ranging nature of the FCC’s proposals, all CMRS providers should take the time to review the NPRM carefully to assess its potential impact on their operations.

For this blogger, though, the FCC’s proposal regarding the use of z-axis data to benefit the greater good is probably the most significant use of that information since Capt. Kirk issued the command to move the Enterprise Z-minus ten thousand meters to defeat Khan.

Comments and replies will be set when the NPRM is published in the Federal Register. Check back here for updates.

Update: Last of the New Cell Phone Booster Rules Now in Effect

When last we reported on the FCC’s comprehensive new approach to the regulation of cell phone boosters, one last piece of red tape had to be snipped before the new rules would take effect. That is, the Office of Management and Budget still had to rubberstamp a number of the new rule sections before they could take effect, thanks to the ironically-named Paperwork Reduction Act. (If you’re keeping score, the sections in question are Sections 1.1307(b)(1); 20.3; 20.21(a)(2); 20.21(a)(5); 20.21(e)(2); 20.21(e)(8)(i)(G); 20.21(e)(9)(i)(H); 20.21(f); 20.21(h); 22.9; 24.9; 27.9; 90.203(q); 90.219(b)(1)(i); 90.219(d)(5); and 90.219(e)(5).)

Good news! According to a notice in the Federal Register, OMB has given all those sections the big Thumbs Up, so they have all become effective as of September 11, 2013. (Note, however, that as the Commission made clear in its Report and Order last February, compliance with the rules will not be required of all consumer and industrial signal boosters sold and marketed in the U.S. until March 1, 2014).

Update: Effective Date, Comment Deadlines Set in Travelers' Information Station Proceeding

In late July we reported on the FCC’s adoption of new rules governing Travelers’ Information Stations. Those new rules (contained in the “Report and Order” portion of the “Report and Order and Further Notice of Proposed Rulemaking” (R&O/FNPRM)) have now been published in the Federal Register, which means that they are set to take effect on September 18, 2013. Meanwhile, in a separate item in the same issue of the Federal Register, the Commission has published the “Further Notice of Proposed Rulemaking” component of the R&O/FNPRM. According to that item, comments on in response to the FCC’s proposals are due to be filed by September 18, 2013, and reply comments by October 3.

2013 Reg Fees Set

Significant increases across-the-board for broadcasters; no announced deadline for fee payments yet, but indications are that they will be due sometime in “the middle of September”

The final 2013 regulatory fees have been announced by the Commission.  For those of you anxious to cut to the chase, here’s a link to a convenient table setting out new fees (and, for TV-related services, comparing (a) the fees the FCC has now adopted against (b) last year’s fees). But before you head on out to the table, you might want to brace yourself – this year’s fees are, with very limited exceptions, a lot steeper than last year’s.

How much steeper? About 7.5% across-the-board on the TV side – which, for a VHF TV station in one of the top ten markets translates to an impressive $6,000 bump up. For radio, the increases tend to be more in the 5% range – preferable to 7.5%, for sure, but still likely to sting a bit.

The relative uniformity in the fee increases over last year should not be a surprise. As we reported last May, when the FCC first proposed this year’s fees, the Commission is re-jiggering the cost allocation method underlying the annual calculation of fees. That re-jiggering means serious upticks for some services, including broadcasting. In fact, the anticipated increases were so serious that, to cushion the initial blow, last May the Commission was contemplating capping increases at 7.5%. And that’s just what it’s done. (For a somewhat more detailed discussion of the allocation method that has led to the increases, see our previous posts here and here.)

The Commission has not yet announced the dates of the window period during which reg fees can be filed this year, but it does say (in Paragraph 1 of its order) that these fees “are due in September 2013” and (in Paragraph 56), “payments of the regulatory fees will not actually be due until the middle of September”. So don’t give up your August beach rental, and go on ahead and make plans for a nice Labor Day . . . but look for a hectic week or two when you get back.

In addition to the fees themselves – and the cost allocation method underlying them – the Commission has announced a number of reg fee-related changes that will kick in next year. So while we need not worry about these changes for this year’s filing, heads up for next year. Those changes include:

  • VHF and UHF stations will be merged into a consolidated reg fee category (although the consolidated VHF/UHF fee category will presumably still include differing tiers according to market size);
  • Internet protocol TV (IPTV) licensees will be subject to reg fees (the new IPTV category will be included in a new fee category along with cable TV);
  • Reg fees for FY 2014 (i.e., those that will be paid next year) will have to be paid electronically; and
  • The Commission plans to transfer unpaid reg fees to the Department of the Treasury for collection at the end of the payment period, rather than 180 days after the close of the payment period, as is its present practice.

With respect to that last point – shipping unpaid fees to Treasury for collection sooner rather than later – the FCC advises that regulatees “will not likely see any substantial change in the current procedures of how past due debts are to be paid”. That, of course, remains to be seen.

With respect to TV translator, LPTV and Class A TV and TV booster stations, the Commission will continue charging only one fee per station, even if the station is transmitting both an analog and a digital signal. This is a hold-over from pre-transition days, and will be re-visited in future years as any remaining analog operations switch over to digital-only.

As has always been the case, failure to pay reg fees on time can have dire consequences. Those include: a late payment penalty of 25 percent of the unpaid amount, starting immediately after the deadline; additional processing charges for collection of late fees; and administrative penalties, such as withholding of action on any applications from delinquent parties, eventual dismissal of such applications, and even possible revocation proceedings. 

Remember, the FCC will not be sending you a hard-copy reminder of your reg fee bill.

And here’s our standard final cautionary heads up: Historically, the FCC’s fee calculator has NOT included fees for any auxiliary licenses that may be associated with the main license.  (We've told you about this in the past . . . and it's still true.)  Since separate fees are due for those auxiliaries over and above the main license reg fee, it’s very important to doublecheck your records and the FCC’s records to be sure that your payment includes the necessary fees for all applicable authorizations. Since a failure to pay even a single $10 fee for a remote pickup could result in the dreaded red light status, extreme care should be taken on this front.

The Report and Order announcing the 2013 fees will technically take effect once it is published in the Federal Register, which we expect to happen in the very near term. As indicated above, the precise dates during which reg fees will be payable have not yet been set (although we do know that those dates are likely to be sometime in “the middle of September”). Check back here for updates.

FCC Tweaks "Travelers' Information Station" Rules

Minor expansion in content, “ribbon” networks are allowed.

“Tune to 1610 AM for parking information.” “When flashing tune to 530 AM.”

We all know these signs. The FCC calls the service behind them “Travelers’ Information Stations” (TIS). These are low-power AM stations permitted to broadcast only information on traffic and road conditions, travel advisories, and other information of interest to motorists. Each covers only a small geographic area, most commonly along major highways and near tourist destinations.

The FCC has made minor changes to the rules – the first since the TIS was created in 1977.

We blogged about the proposed rules in January 2011,  but the proposals go back farther, to 2008, when Highway Information Systems, Inc., proposed sweeping changes. Later that year, the American Association of Information Radio Operators (AAIRO) filed its own, more moderate, proposal. Other groups followed with a variety of ideas that included renaming the service, changing the site and power limitations, and greatly expanding the system’s use.

The FCC, in the end, stuck to the middle of the road. (Sorry!) It clarified that permissible content for TIS includes weather alerts regarding difficult or hazardous conditions, plus information on a host of other emergency and non-emergency traffic and travel-related events and locations, along with any communications related directly to the imminent safety of life or property. Also permissible are certain non-travel related emergency information, including Amber Alerts and Silver Alerts, and information on the availability of 511 service (travel conditions by telephone).

The FCC rejected a call to allow any non-commercial content, and specifically disallowed non-emergency, non-travel information, such as routine weather information, emergency-preparedness messages, and terrorist threat levels. Reasoning that this information is widely available through other sources, the FCC concluded that broadcasting it over TIS would dilute the effectiveness of TIS in assisting travelers with geographically focused emergency information. (At the same time, however, the FCC acknowledged that some alternative sources for this kind of information, such as cell phones and mobile Internet access, should not be used while driving.) In keeping with the historical focus on serving the traveling public, the FCC turned down a requested name change to “Local Government Radio Service.”

In what should be a relief to TIS licensees, the FCC acceded to AAIRO and others who asked it, within the bounds of reason, to defer to the discretion of licensees when determining what information to broadcast. The alternative – rejected by the FCC – would have had the FCC set up strict, rule-based criteria. Licensees are equipped with better knowledge of local conditions, the FCC concurred, and are in the best position to determine what constitutes an imminent threat or emergency condition.

Perhaps the biggest change is one allowing licensees to create “ribbon” networks which broadcast the same information through multiple transmitters. This allows a licensee that operates a number of transmitters to produce some information only once. The FCC made clear, though, that all content broadcast from a given transmitter still must be relevant to travelers within the coverage area of that transmitter.  

The FCC declined to make changes to the field strength limits or the site location requirements. Although it recognized some evidence of limited interference, it decided this can be resolved by cooperation between licensees and by individual license modifications where necessary.

The FCC’s decision also includes a Further Notice of Proposed Rulemaking (FNPRM) on whether to drop the present requirement for filtering TIS audio frequencies above 3 kHz. The filtering gives TIS broadcasts a “low fidelity” quality, sounding more like a telephone than a radio broadcast. The rule is intended to limit interference, but some parties say it is ineffective and reduces intelligibility.

Check back here for comment deadlines relative to the FNPRM.

[FHH represents parties in this proceeding.]

2013 Reg Fees: The FCC Proposes a Couple of Alternatives

Commission looks to update its methodology for calculating regulatory fees, but proposes a possible alternative approach to cushion the blow this year.

One of the time-honored rites of spring – at least at the FCC – is the release, every April or May, of a Notice of Proposed Rulemaking setting out the schedule of regulatory fees the Commission thinks it may impose on all regulatees come August-September. Historically, we here at CommLawBlog have tried to be Johnny-on-the-spot in letting our readers know the fees that have been proposed, even though the fees that eventually adopted (usually in July) may vary here and there from the initial proposal.

But this year is different.

Instead of providing one set of proposed fees, the Commission has given us a Notice of Proposed Rulemaking (NPRM) laying out two sets of possible fees . . . because it’s in the process of a much-needed update of its calculation methodology, and it’s still not sure: (a) whether the new approach is exactly right and, even if it is, (b) whether that new approach should be applied this year. Depending on which method it ultimately adopts, the fees for some broadcasters could swing by a couple of thousand dollars. As a result, we’ve had to prepare a more elaborate table reflecting the proposals, so we’re a day or so behind our usual curve. Please bear with us.

To understand what’s going on here, you have to understand how reg fees are calculated.

The FCC is required by Congress to collect enough reg fees to, in effect, cover the FCC’s costs of operation. Those are determined by Congress through the annual appropriations process. This year the FCC’s nut is $339,844,000. (Note that the FCC’s actual costs are technically lower thanks to the sequester that kicked in earlier this year, but the nut remains the same because of Congress’s appropriation.)

Starting with the total amount it must collect, the Commission then allocates that amount based on the number of full-time FCC employees (FTEs) devoted to the various fee categories carried out by its various bureaus. We don’t need to get into the nitty-gritty of that particular process – which even the Government Accountability Office acknowledged has been less than fully transparent – except to note that the FTE figures the FCC has been using date back to 1998. Those interested in delving more deeply here may want to check out our post from last fall where we addressed the subject in more detail.

We can all agree (as the Commission itself concedes) that things in the regulatory world have changed a bunch in the last 15 years. As a result, maybe reliance on 15-year-old FTE data isn’t the best, or at least the most accurate, way to determine reg fees.

That being the case, the Commission has revised its FTE numbers (using September, 2012 figures) and its overall inter-Bureau allocations (with particular focus on International Bureau activities, which relate in large measure to regulatees across several other bureaus). The result of these revisions: a new allocation of costs that would reduce the reg fee burden to be imposed on regulatory activities associated strictly with the International Bureau, but substantially increase the share of costs to be borne by Media Bureau and Wireless Bureau regulatees. 

In its NPRM the Commission specifically seeks comment on its revised approach to cost allocation.

The Commission recognizes that its re-jiggered allocation method would lead to significantly higher fees for some of its regulatees. Because of that, it is proposing to cap rate increases at 7.5% for this year. But presumably recognizing that any change – and particularly substantial change – can cause discomfort, the FCC is also suggesting that it might instead maintain its historical allocations at least for purposes of calculating the 2013 fees. The end result: two different sets of proposed fees to consider and comment on.

We have laid out the two proposed sets of fees, along with last year’s fees (for comparison purposes) in a couple of tables you can find here. It’s likely that most broadcasters would favor keeping the previous allocation method, since that would result in lower fees for all radio licensees and the vast majority of TV licensees. The difference for some TV folks would be significant: VHF licensees in the Top 10 markets would be on the hook for more than $4,000 more under the updated approach; for Markets 26-50, the difference on the VHF side would be more than $3,000. Bear in mind, though, that it is pretty much a given that the Commission will implement its adjusted allocation method eventually.

Beyond the methodological questions, the FCC is proposing additional changes in the reg fee drill. Of particular interest to TV licensees is the notion of treating VHF and UHF stations as essentially identical for reg fee purposes. This is based on the perception that the historical preference for VHF stations has largely, if not entirely, disappeared as a result of the 2009 DTV transition. Reg fees for TV stations would still be tiered based on market size, but no distinction would be made between UHF and VHF. The Commission is asking for comments on this, and promises that, if the proposal is adopted, it won’t kick in until 2014.

With respect to TV translator, LPTV and Class A TV and TV booster stations, however, the Commission plans to continue charging only one fee per station, even if the station is transmitting both an analog and a digital signal. This is a hold-over from pre-transition days, and will be re-visited in future years as any remaining analog operations switch over to digital-only.

And perhaps most jarring for the Luddites and traditionalists among us: the Commission is proposing to stop accepting paper and check transactions for reg fee payments, starting as of October 1, 2013. This is in keeping with an overall governmental shift toward a “paperless Treasury”. Under the new approach, the Commission would not accept payments by check (not even cashier’s checks!) or any accompanying hardcopy forms (e.g., Form 159) in connection with reg fee payments. Those of you with a couple of checks still left in the checkbook may take heart: since this change would not take effect until October, and since 2013 reg fees will have to be paid sometime in August or September (if the FCC’s past practice holds true), you’ll still be able to make one more paper payment before moving ahead into the 21st Century.

Comments on all of the proposals set out in the NPRM are due by June 19, 2013; reply comments are due by June 26. Again, the NPRM – and the fees described in it – are still only proposals. We won’t know the final fees until sometime this summer, and we won’t know the deadline for paying the fees until sometime later – although the fees are generally due in late August or early/mid-September. Check back here for updates.

LPFM Update: Effective Date Set for Remaining Changes from 6th Report and Order

In December of last year we reported on the Commission’s “Fifth Order on Reconsideration and Sixth Report and Order” (we refer to it as the 6th R&O) in which it (a) tied up some loose ends relative to LPFM and FM translator matters and (b) adopted new rules and policies governing LPFM applicants. The 6th R&O was published in the Federal Register the following month, but (as we reported in January) that didn’t mean that all the new rules went into effect back then.

Rather, the changes to Sections 73.807, 73.810, 73.827, 73.850, 73.853, 73.855, 73.860 and 73.872 – and the revised version of FCC Form 318 – all had to be run past the Office of Management and Budget for its approval. (Those changes all involved “information collections” requiring OMB review thanks to the Paperwork Reduction Act.)

The Commission has now announced that OMB is happy with the changes. As a result, they will all take effect on May 23, 2013. It’s unlikely that the changes will have any immediate impact, since they relate primarily to LPFM applications, and there’s currently no opportunity to file for new LPFM authorizations. However, as we all know, the Commission is hoping to be able to open a window for new LPFM applications sometime in the near future – October, 2013 is one target date, although many are doubtful that the Commission will be able to hit that target. Anyone who expects to be filing any LPFM apps in that window should be sure to make note of the effectiveness of the 6th R&O changes.

Update: Effective Date of New Cell Phone Booster Rules Announced

Last February we reported on the FCC’s adoption of a new comprehensive regulatory approach to cell phone boosters. The Report and Order setting out that approach has now made it into the Federal Register. As a result, many – but not all – of the new rules will take effect as of May 13, 2013. Which of the amended rules won’t kick in then? Why, those would be Sections 1.1307(b)(1); 20.3; 20.21(a)(2); 20.21(a)(5); 20.21(e)(2); 20.21(e)(8)(i)(G); 20.21(e)(9)(i)(H); 20.21(f); 20.21(h); 22.9; 24.9; 27.9; 90.203(q); 90.219(b)(1)(i); 90.219(d)(5); and 90.219(e)(5). Those all involve “information collections” and, thus, must first be blessed by the Office of Management and Budget thanks to the hilariously-named Paperwork Reduction Act. Check back here for further updates on that front.

Please keep in mind the crucial distinction between cell phone boosters (at issue here) and cell phone jammers. The latter remain illegal.

FM Translator Application Update: Bureau Provides More Guidance on Preclusion Showings

Bureau gently prods applicants in the proper direction with a public notice that reads like “Preclusion Showings for Dummies"

As we have previously reported, FM translator applicants whose applications are still alive and kicking are subject to a variety of filing deadlines looming in the very near future. Different deadlines apply, based on whether the application has been identified by the Media Bureau as (a) one of 713 “singleton” applications or (b) one of a separate batch of 639 applications not satisfying the “singleton” criteria.

Some, but not necessarily all, of those 1,352 applicants must file “preclusion showings” as part of their required submissions. Apparently, from the filings that have already rolled in the door, the Bureau’s staff has concluded that at least some of the affected applicants haven’t fully grasped what’s expected of them. Accordingly, the Bureau has tried, tried again, this time by issuing yet another public notice providing further “guidance” or “clarification” of the filing requirements.

The notice, which reads like “Preclusion Showings for Dummies”, is relatively short and to the point. Where preclusion showings are required, the notice thoughtfully bold faces the word “required” as an additional helpful visual cue. The concepts don’t appear to be particularly complicated (but then we didn’t think they were particularly complicated when they appeared in the Fourth Report and Order or in the previous public notices). In any event, anybody with a translator application still in the hunt should be sure to review the public notice carefully and to follow its directions thoroughly.

Hint: We gather from indications we have received from Bureau personnel that one particular bugaboo involves applications which, as originally filed, proposed facilities within 39 km of a “Spectrum Available Market Grid”. If no changes at all are being proposed to those originally-specified facilities, then no preclusion showing is required. But if the applicant proposes to amend its original proposal – by changing power, height, channel, location, antenna pattern, etc. – then a preclusion study is required. 

That’s because the staff’s initial determination that the application was in a “Spectrum Available Market Grid” (and, thus, not subject to the preclusion showing requirement) was based on the originally-proposed facilities. Any change in those facilities could alter the underlying factors that made the application’s market “Spectrum Available” in the first place. The preclusion study, based on the application’s amended proposal, will allow the Bureau staff to assess whether the market remains “Spectrum Available” or whether it has become, as a result of the amended proposal, “Spectrum Limited”. 

Some might view the most recent public notice as an annoying bit of unwelcome bureaucratic niggling, but hold on there. The Bureau is trying to get the word out to all affected applicants sooner rather than later to ensure that those applicants will have been given every possible opportunity to satisfy the Bureau’s requirements before the applicable deadlines come and go. If, as appears to be the case, the Bureau has already noted considerable shortfalls along those lines in what has been submitted thus far, the Bureau is doing everybody a favor by trying again to point applicants in the right direction.

As we observed last month, a failure to give the Bureau what it wants could result in dismissal of your application(s).  It would be a shame to have come this far in the process only to crater on a technicality at the ultimate (or maybe penultimate) stage of that process.

FM Translator Application Update: Bureau Announces Window for Filing of Preclusion Showings

639 surviving applicants face the next hurdle in the now decade-long contest.

In the long-running reality show “Survivor – 2003 FM Translators”, if you happen to be a player whose FM translator applications haven’t yet been kicked off the island, heads up: the Media Bureau has just announced the next challenge. This time affected applicants have been given a 19-day window (from April 1-19, 2013) within which to submit their Preclusion Showings.

Which applications are subject to the challenge? Any of the 639 still-pending FM translator application originally filed in the 2003 window (for Auction 83) which specifies a transmitter site that is (1) inside a Spectrum Limited market and/or (2) within 39 km of any Spectrum Limited Market Grid. For those of you who may be unclear about whether you’re still in the game (and, thus, facing this next chore), the Commission has provided a list of all 639 lucky applications. You can find a PDF version of the list at this link, but we suspect that you may find this MS-Excel version a bit more useful in terms of slicing and dicing the data on the list, which spans ten single-spaced pages. Here’s the Bureau’s explanatory description of the list:

Attachment A lists each Auction 83 Filing Window tech box proposal for which a Preclusion Showing amendment must be electronically submitted by the April 19 deadline. The list is sorted by the state in which the specified community of license is located. The “Market” column lists, if applicable, the Fall 2011 Arbitron Market number as set forth in Appendix A in the Fourth Report and Order. Each market designation was based on the location of the proposal’s specified transmitter site. The “In SL Buffer” column identifies with a “Yes” each proposal that specifies a transmitter site that is within 39 km of at least one Spectrum Limited Market Grid.

And what the heck is a “Preclusion Showing” anyway?

The Bureau’s announcement of the window walks you through the practical end of how and what it expects you to file. In addition, the Bureau has issued a separate summary description of the tests (i.e., the “Grid Test” and the “Top-50 Transmitter Site Test” that will have to be satisfied in the Showings. We strongly recommend that any applicant planning to file one or more Preclusion Showings review both of these notices in detail and be prepared to jump through all the hoops set out in each.

Anyone who may be a little fuzzy on what this whole FM translator application situation is all about may want to revisit our extended collection of posts on the subject, which may be found here. (Just keep scrolling down - there are a lot of posts covering several years' worth of developments.)  At this stage of the game, though, if you’re wondering what a “Grid Test” is or whether you’re in a “Spectrum Limited Market”, you’ve got a lot of catching up to do.

For those of you who are still in the game and playing to win, remember: the window for Preclusion Showings opens on April 1 and slams shut on April 19. Good luck.

Update: Deadline Set for Oppositions to Petitions for Reconsideration of Latest LPFM Decision

Last December the Commission released its Fifth Order on Reconsideration and Sixth Report and Order in the long-running LPFM proceeding. Five parties weren’t 100% happy with the results so – surprise, surprise! – they have filed for reconsideration of various aspects of the FCC’s decision. The petitioners (with links to their respective petitions) are:

Prometheus Radio Project

Michael Couzens and Alan Korn

REC Networks

LET THE CITIES IN!!

LifeTalk Radio, Inc.

According to a notice in the Federal Register, if you want to oppose any (or all) of these petitions, you have until March 21, 2013Replies to any oppositions will be due by April 1.

While the opening of a new pleading cycle – with the consequent opportunity for a pleading war – is often a harbinger of delay, our guess is that that’s not the most likely scenario here. As we have reported, the Media Bureau is doing its darnedest to tee the next LPFM application window up as quickly as possible (maybe even by next October, if the Chairman gets his wish). It’s unlikely that a handful of recons will distract the Bureau from that mission, but you never know. In the meantime, look for continued progress in the Bureau’s efforts to clear the FM translator application dead wood, a necessary antecedent to the LPFM window.

Update: FCC Releases "Consumer Guide" on Cell Phone Signal Boosters

The FCC tells you what you need to know, for now . . .

Did you read our earlier post on new requirements for cell phone signal boosters? If not, you’re probably a member of Commissioner Pai’s signal-booster-ignoramus-club. (Check out his separate statement in which he opined that, “[i]ndeed, I very much doubt that most individuals will learn about these requirements [relative to cell phone boosters] in the foreseeable future.”) Presumably with you in mind, the FCC has now released a Consumer Guide on what you need to know if you currently own a signal booster.

To aid in the effort to educate the American public, we are passing this information on to you, our valued readership. So if you own a signal booster or are thinking of getting one, take a look at the Guide.

Signal booster manufacturers and cell phone service providers (including resellers) should also take a look at our original post because the new requirements will affect you as well.

FM Translator Application Update: Singleton List Released, Long-form Deadline Set

The FM translator application juggernaut rolls on. 

Having processed the Selections Lists and Caps Showings filed in January and having, as a result, tossed several thousand applications earlier this month, the Media Bureau has sifted through the remaining rubble and identified 713 singleton applications that may be grantable in relatively short order. The lucky 713 applications: (a) are apparently not mutually exclusive with any other applications filed back in the 2003 filing window and (b) don’t run afoul of the technical limitations imposed in last year’s Fourth Report and Order. (Helpful reminder: To satisfy those limitations, an application must be: (1) outside all Spectrum Limited markets and (2) not within 39 km of any Spectrum Limited market grid.)

Heads up, though. If you’re on the singleton list, you’ve only got until March 28, 2013 to prepare and file your long-form application (Form 349), along with any required filing fee and Form 159, in order to stay in the game.

The public notice announcing the singleton list also includes some guidelines relative to what you can and can’t do in the long-form application. Attention should be paid to those details, because a failure to comply could result in dismissal. It would be a shame to have come this far in the application process only to crater on a technicality at the ultimate (or maybe penultimate) stage of that process.

In particular, the long-form application may specify facilities (including, e.g., transmitter site, power, height, directional pattern, channel) different from those specified in the original 2003 “tech box” showing as long as they constitute “minor” changes. If the proposed changes would result in a site (a) within the 39 km buffer of any defined Market Grid and/or (b) at an out-of-grid location within a Top-50 Spectrum Limited Market, the applicant will also have to file a preclusion showing relative to the amended proposal. (If the facilities specified in the long-form Form 349 application are identical to those specified in the “tech box” filed back in 2003, no preclusion study is necessary.) 

Along with the public notice announcing the singleton list, the Bureau has also released a separate set of guidelines describing in considerable detail the required preclusion showing. Again, attention should be paid to the details, since the Bureau has made clear that preclusion studies must be complete and sufficient and, most importantly, they may not be “amended, corrected, completed or resubmitted” after March 28.

Once the March 28 deadline has come and gone, the Bureau will review the amendments, dismiss any applications that fail to satisfy the terms set out in the public notice, and the rest will be put out on a public notice which will trigger a 15-day petition to deny period. Of course, any of the 713 applicants who fail to file a Form 349 by the deadline will also be dismissed.

FCC Gives Cell Phones a Boost

New devices should help to eliminate “dead spots” with little risk of interference.

Despite the promise of ubiquitous cell phone coverage, we are all too familiar with the dreaded phenomenon of dead spots. Historically, cell users frustrated by that phenomenon often fought back by using signal boosters that receive and re-transmit cell phone signals to improve coverage. Recognizing the obvious desirability of boosters, but concerned about their potential for interference, the FCC has now adopted a new comprehensive regulatory approach to boosters. As a result, we can look for a new breed of consumer signal boosters hitting the market soon, probably by year’s end.

This should come as good news for consumers . . . unless you rely upon poor signal coverage as an excuse to avoid calls from your mother (shame!), have an aversion to compulsive cell-phone talkers (like some of us here), or have already purchased an existing device that’s not compliant with the FCC’s rules (in which case you may need to upgrade).

Previously, the FCC did not specifically prohibit boosters, but its rules were a bit fuzzy. For years various groups expressed concern that “unauthorized” boosters were causing harmful interference to wireless networks. To address those concerns, the FCC initiated a formal rulemaking to look into the issue in 2011. The result: two new categories of boosters, subject to different requirements.

“Consumer Signal Boosters” are “out-of-the-box” devices for personal use by individuals to improve cell coverage in a limited area, like a house, a car, an RV, a boat, etc.  “Industrial Signal Boosters” are all others.  Deployed by wireless providers, they serve larger areas, like campuses, hospitals, tunnels, airports, office buildings, etc. Since such industrial boosters aren’t significantly affected by FCC’s latest action, we’ll focus here on the new category of Consumer Signal Boosters. (Also unaffected by the new rules are “femtocells,” which connect to the network though broadband Internet access rather than licensed cell frequencies.)

Ready to get boosted?

Sorry, but you’ll need to wait a little longer for booster manufacturers to bring their products into compliance with a new “Network Protection Standard” designed to ensure that all new devices have appropriate safeguards.  Under that Standard, all Consumer Signal Boosters must:

  1. comply with existing technical parameters for the applicable spectrum band of operation;
  2. automatically self-monitor certain operations and shut down if not in compliance;
  3. automatically detect and mitigate oscillations (caused when the device picks up its own signal too strongly, like the feedback in a public address system);
  4. power down or shut down automatically when a device is not needed, as when the device approaches the base station with which it is communicating;
  5. be designed so that these features cannot be easily defeated; and
  6. incorporate interference avoidance in systems that use unlicensed frequencies internally.

The FCC does not want buttons, knobs or switches which allow for these features to be deactivated.  (Understandable, as we ourselves can’t resist pressing buttons on electronic devices just to see what they will do.)

The new rules prescribe two alternative sets of technical specifications that comply with the Network Protection Standard.  But equipment manufacturers are not obliged to adhere to either, if they can demonstrate compliance some other way.

The FCC does not anticipate compliant Consumer Signal Boosters becoming available until late 2013. By March 1, 2014, all boosters marketed in the U.S. must comply with the new standards.

As for consumers, the “out-of-the-box” ease of use will be complicated by some additional paperwork requirements.

Once you get your hands on a compliant Consumer Signal Booster, you will have to give your cell phone provider certain registration information and get the provider’s permission before putting the booster to use. In practice, getting the provider’s permission should be a non-issue for most: all of the major providers (Verizon Wireless, AT&T, Sprint, and T-Mobile), plus many smaller providers, have agreed to grant blanket approval for Consumer Signal Boosters that meet the Network Protection Standard.  You would need to request express permission only from smaller providers that have not yet signed on.

The registration information you’ll have to provide will include, as a minimum, the booster’s: (a) owner (and, if different, its operator); (b) make; (c) model; (d) serial number; (e) location; and (f) date of initial operation. The aim is to help authorities track down devices that cause interference problems. Providers will have to set up a free registration process. Also, providers will have to announce (at least annually for the first two years) whether or not they have consented to the use of each FCC-certified model.

But let’s suppose you’re one of those early adopters who hopped onto the booster bandwagon before now. How do the new rules affect your pre-Network Protection Standard booster?

Good news: the FCC does not prohibit consumers from continuing to use such legacy devices, even if those don’t comply with the Network Protection Standard. BUT a consumer will need express permission from the wireless provider to use these “legacy” devices. The provider is not obligated to give consent (especially if the old school booster is likely to cause harmful interference) and the consent can be withdrawn at any time.

Consumer note: Non-compliant boosters cannot be marketed in the U.S. after March 1, 2014.

Continued operation of any Consumer Signal Booster, whether legacy or new, is contingent on the device not causing harmful interference. If a service provider or the FCC tells you to turn off your device because of interference issues, you must do so, or face potential penalties.

With respect to penalties, in a separate statement Commission Pai acknowledged that consumers using legacy boosters might violate the new requirements simply out of ignorance:

[W]e cannot expect that every American who currently uses a booster will know that he must register that booster and obtain his carrier’s consent. Indeed, I very much doubt that most individuals will learn about these requirements in the foreseeable future. For some reason unbeknownst to me, most Americans just don’t watch FCC open meetings or read FCC orders.

[Blogmeister’s note to Commissioner Pai: Many Americans may not watch your meetings or read your orders because we here at CommLawBlog take care of some of that heavy lifting for them.

At Pai’s suggestion, the Commission has directed the Enforcement Bureau to give consumers who are violating the rule (whether by using unregistered devices or by failing to obtain consent from their providers) the chance to avoid a fine by shutting the device off. That’s a one-shot-only chance, though: a consumer who has previously been warned by the Bureau and who continues in violation can expect a fine.  

Looking for more information? The FCC has set up a handy signal booster website that provides some background and links to related materials.

More FM Translator Applications Down the Tubes

Media Bureau gives Dave Doherty a break, provides itemized list of latest victims

In what may be the last peristaltic spasm of the FM translator review process, the Media Bureau has announced that it has dismissed “several dozen” (by our count it’s a total of 40) remaining FM translator applications that were filed back in 2003. According to its public notice, the Bureau “has now completed” its review of the Selection Lists and Cap Showings filed last month by translator applicants and “has identified those applications which do not satisfy filing requirements”. So if your application (a) wasn’t already tossed out in last week’s mass dismissal and (b) isn’t listed in this most recent batch, then presumably you’ve survived the cut and your application can now be processed. 

No official word yet on when the next processing steps are likely to happen, but we’re guessing they’ll be happening sooner rather than later – possibly in a matter of a few weeks. As we have previously reported, the Commission has made clear its hope that the next LPFM window can be opened promptly (as early as next October, if the Chairman has his way), and the Bureau has thus far been doing its darnedest to turn that hope into reality.

One additional note: Unlike last week – when the Bureau tossed more than 3,000 applications without issuing any itemized public notice specifically identifying those applications – this time around it has provided a listing of the 40 latest victims in PDF and Excel formats, convenient for easy slicing and dicing. That should take our friend Dave Doherty off the hook this time around.

Lists of Surviving FM Translator Applications Now Available

Apparently undaunted by the approaching blizzard, Dave Doherty at Skywaves Consulting up in Millbury, Massachusetts, has been hard at work culling potentially useful information from CDBS about the FM translator application situation. Now, in addition to the lists of dismissed applications he passed along to us a few days ago, he has provided a couple of lists reflecting all the vintage 2003 FM translator applications that survived the first round of dismissals. Here you go: a list of surviving applications arranged alphabetically by applicant, and a list of the same applications arranged by state and city. This, ideally, will help address the concerns expressed by a commenter to an earlier post,

Dave cautions that the Media Bureau has indicated that more applications may be headed for the Dismissalville in the near term – thanks, apparently, to the fact that some applicants’ tech showings were either messed up or MIA, thus requiring additional staff analysis. The smart money figures that such additional analysis will identify more applications destined for the dumpster. Presumably the Bureau will let us all know if and when that happens, but you never know.

And while caution is being dispensed, we’ll add here that we have not test-driven Dave’s latest set of lists, so you rely on them at your own risk. But, as we noted the last time around, the lists provide a more useful approach than the Bureau’s public notice. Thanks again, Dave – and don’t hurt yourself shoveling snow!

FM Translator Dismissal Aftermath - The Private Sector to the Rescue!

Searchable lists of the 3,000+ dismissed applications now available

Let’s have a big CommLawBlog cheer for the private sector! As we reported yesterday, the Media Bureau unceremoniously dumped about 3,000 FM translator applications into the trash. In doing so, the Bureau chose not to issue the type of public notice that usually accompanies such actions. Instead, the staff issued a public notice announcing, in general terms, that it had tossed the apps, and advising that anyone who wanted to know which applications had been tossed could knock themselves out performing wildcard searches in CDBS. As we observed, this approach was not especially helpful to folks in the private sector who might have an interest in figuring out which applications were gone and which are still alive and kicking.

Fortunately, Dave Doherty from Skywaves Consulting LLC in Millbury, Massachusetts has come to the rescue. Dave has prepared two lists of all the dismissed applications. One list is organized alphabetically by applicant, the other alphabetically by state. They both contain the same data – Facility ID Number, Channel, Frequency, State, City, Applicant Name and File Number.  Both lists are searchable. We haven't doublechecked Dave's handiwork, so if you're inclined to rely on it, you do so at your own risk.  But at least it attempts to provide a more useful approach to the dismissed translators than the FCC did.  We asked Dave if we could post links to his two lists for our readers, and he graciously agreed. Thanks, Dave! (Dave’s contact information is available on his lists, if you want to thank him personally.)

Bureau Disposes of FM Translator Applications

As drive toward an LPFM auction moves forward, applications get tossed for real while Selection Lists/Caps Showings get released, sort of.

That loud flushing noise you may just have heard was the sound of about 3,000 FM translator applications heading down the tubes. Having analyzed the various Selection Lists and Caps Showings submitted by translator applicants late last month, the Media Bureau has announced that it has now tossed “approximately 3,000” vintage 2003 translator applications. In the same public notice, the Bureau has also announced the “release” – and we use that term loosely – of all of the underlying Selection Lists and Caps Showings submitted during the recently closed Selection Filing Window.

Which applications got thrown out and which didn’t? Good question. The Bureau’s one and only (apparently) public notice on the subject doesn’t include a list of the dismissed applicants, or applications, or file numbers, or any of the other conventional data you might expect. If you want to know any specifics, the staff apparently expects you to head online to CDBS, where you can probably figure out precisely which applications got dismissed and which continue to live on if you’ve got boatloads of (a) time and (b) motivation and (c) luck.

According to the public notice, each of the translator applications dismissed today “will include the following CDBS Public Notice comment: ‘Dismissed February 5, 2013 per DA 13-XX.’” A quick random spot check of FM translator applications dismissed today did not turn up any such comment, but the staff may still be working on that. By performing a “wildcard” search we were able to generate a list of 3,033 translator applications that were (a) filed in March, 2003 and (b) dismissed as of today. However, that list identified the applications only by file number – no reference to applicant or community of license or channel – so it’s not clear how useful that list would be to anybody.

[For the record, here’s how we performed our search: 

(1) Go to CDBS and click on “Search for Application Information”;

(2) For the following fields, enter the information indicated (see illustration):

            File Number:                   BNPFT            200303%

            Application Status:      Dismissed

            Status Date:                    02/05/2013      02/05/2013

(3) Click on “Submit Application Search” button.]

Of course, if you happen to have an idea of what you’re looking for – maybe you’re interested in a particular applicant, or a particular community, channel, state, etc. – you’re in better shape, because you can narrow down the wildcard search accordingly.  But we suspect that even such a narrowed-down quest will yield results that will require considerable patience to sift through.

If you want to see the Selection Lists and Caps Showings the Bureau has now “released”, that, too, will require considerable effort. Each applicant’s Lists/Showings submission has apparently been uploaded to CDBS, but only to the applicant’s last-filed “BNPFT” application listing. To find a particular applicant’s submission, the staff (in a footnote to the public notice) instructs you to: (a) perform a wildcard search for all FM translator applications filed by that applicant in March, 2003; (b) once that search produces a list of applications, click on the “Info” link relative to the first application at the top of the list; (c) when the Info page comes up, click on the “View Correspondence Folder” link; and then (d) click on the link labeled “Click to View Imported Letter” bearing the date February 5, 2013.   Repeat as necessary.

On the one hand, the Media Bureau is to be applauded for digging through the Selection Lists/Caps Showings submitted just last month and weeding out thousands of ten-year-old applications that were clogging up the system. The Bureau is, of course, under the gun to tee up an LPFM auction – as early as next October, if the Chairman has his way – so there was pressure to get this job done sooner rather than later, but it’s still impressive that the staff managed to handle it as quickly as it did.

On the other hand, the apparent desirability of quick action may not completely excuse the less than helpful manner in which the staff’s action has been packaged and presented to the rest of us. For example, applicants who remain hopeful that their applications may yet be granted have no easy way of determining which, if any, other applications may still be standing in their way. It’s also difficult to confirm that the list of dismissals conforms to the various Selection Lists/Caps Showings submitted by the affected applicants. Is it possible that some applications that should have been on the chopping block were inadvertently spared, or vice versa? Good luck figuring that out. Sure, we’re only talking about FM translators here, and sure, these applications have been sitting around for ten years already, for crying out loud. But does that justify imposing unusual burdens on any translator applicants still theoretically in the fight?

In the end, we suspect that the Bureau’s approach, inelegant though it may be, is not an inappropriate way to signal the start of the shut-down process for Auction 83, an auction that never really got off the ground in the first place. To be sure, some surviving applications will somehow remain to be processed and, eventually, granted. But it has long been evident that, in order even to begin to wrap things up here, drastic action would have to be taken. The Bureau’s public notice reflects such action.

Update: Effective Date Set for New LPFM/FM Translator Rules

As we reported last month, in December the Commission released its “Fifth Order on Reconsideration and Sixth Report and Order” (we refer to it as the 6th R&O) in which it (a) tied up some loose ends relative to LPFM and FM translator matters and (b) adopted new rules and policies governing LPFM applicants. The 6th R&O has now been published in the Federal Register, which means that most (but not all) of the new rules are set to become effective on February 8, 2013.

The changes to Sections 73.807, 73.810, 73.827, 73.850, 73.853, 73.855, 73.860 and 73.872 will not take effect on that date, though. All those sections involve what we call “information collections”. As a result, they are subject our old friend, the Paperwork Reduction Act, which means that they will have to run past the Office of Management and Budget first before they can be implemented.

Note that the establishment of effective dates for the new rules should not affect the fast-approaching deadline by which FM translator applicants must file their “Selection Lists” and “Caps Showings”. As we have previously reported, the window for filing those lists and showings opens on January 10 and closes on January 25.

FM Translator Application "Selection Lists"/"Caps Showings" Requirements Clarified

With January 25 deadline fast approaching, the Media Bureau has provided some (non-binding) guidance to FM translator applicants.

If you’re one of the folks with a bunch of FM translator applications still pending from the 2003 filing window, you’re probably hard at work trying to figure out what, if anything, you should be filing in response to the Commission’s public notice announcing the deadline for “Selection Lists” and related “Caps Showings”.  (You might have missed that notice, since it was released the afternoon of December 21 – that is, the Friday of the long Christmas weekend.)

As we pointed out, in the wake of that notice a considerable amount of work must be done, and there’s not a lot of time to do it in. The window for filing Selection Lists and Caps Showings opens in two days (on January 10), and closes on January 25

But the Media Bureau feels your pain, and in an effort to assist translator applicants, the Bureau has released a set of 12 clarifying examples (actually, it’s 17, if you count the five sub-examples tacked onto Example 12). They provide reasonably specific directions for what is and is not expected of applicants in a variety of possible scenarios. (They’re especially helpful if you happen to have five applications pending in the Atlanta area, three of which are Inside the Atlanta Market.) So translator applicants currently struggling with making selections and assembling showings would be well-advised to take a few minutes (and a couple of deep breaths) and check out the Bureau’s examples. That may save some time and aggravation.

But heads up. While the examples are “intended to provide general guidance reflecting the staff’s initial interpretation of the application selections and cap showings procedures”, they may not be the last word.   The Bureau’s notice specifically disclaims that the examples “are not intended to establish binding precedent”. Further, “[t]he staff will make specific rulings in response to actual selections and submissions on a case-by-case basis.” In other words, applicants should feel free to rely on the examples, but such reliance will not necessarily safeguard an applicant’s selections or showings from adverse determinations by the staff down the line.

Good luck.

FM Translator Application Dismissal Lists - A Clarification

“Selection Lists” may be filed by email.

Last month we reported on the Media Bureau’s announcement of the deadline and procedures for filing lists of FM translator applications to be dismissed pursuant to the provisions of the “Fifth Order on Reconsideration and Sixth Report and Order” (which we’ve previously referred to as the 6th R&O). In our post, we said that “[a]ll showings will be submitted on paper – there will be no electronic filing.”

Oops. As a helpful member of the Audio Division has pointed out to us, the Bureau’s public notice DOES provide for submission of the Selection Lists (and related “Caps Showings”) by email, which is technically “electronic filing” (even if it doesn’t involve CDBS). 

The address to use: FXshowings@fcc.gov. While that address may or may not be operational as of today (January 3, 2013), we have been advised that it’ll for sure be up and running by January 10, the day the window for filing Selection Lists and Cap Showings opens.

But heads up. The FCC’s email system will not accept attachments larger than 10 MB. The Bureau’s notice instructs that “files beyond that size [i.e., 10 MB] should [be] divided into multiple sub-10 MB documents and sent via separate e-mails.”

Our apologies for any confusion that we may have caused.  And many thanks to our sharp-eyed reader who brought this to our attention.

Update: Deadline for FM Translator Dismissal Lists Announced

Public notice spells out showings that must accompany applicants’ choices of which 2003-era FM translator applications will stay and which will go

If you’re one of the lucky folks who happens to have translator applications still pending at the Commission from the famous 2003 filing window, heads up – depending on how many applications you have and what markets they propose to serve, you could have a lot of homework to do between now and January 25. That’s because the Media Bureau has announced that the window period for submitting “translator application selection” lists (“Selection Lists”) and related “Caps Showings” will run from January 10-25, 2013

So much for taking any time off during the Christmas/New Year’s/MLK extended holiday season.

The Bureau’s public notice is not unanticipated. As we noted just ten days ago, the Commission is highly motivated to wrap up the long-running face-off between FM translator applicants and would-be LPFM applicants. The culling of the herd of translator applications that have been sitting around for nearly ten years is an essential step in achieving that goal.

As those of you who have been following the LPFM/FM translator imbroglio through our blog already know, the Commission has devised a highly complex set of technical guidelines to govern which translator applications will be processed and which will be dismissed. The applicants themselves will have the first say, but their ability to pick and choose among their pending applications is subject to the Commission’s complex guidelines.

In announcing the deadline for submitting the Selection Lists, the Bureau has provided a useful summary of the technical factors that will come into play as applicants prepare their lists. We won’t try to summarize those factors here – the Bureau has already done an admirable job on that front, so we’ll simply provide another link to the Bureau’s public notice.

We will, however, note that the January 25, 2013 deadline appears to be absolute. In bold face text the Bureau warns that “Selection Lists and Caps Showings may not be submitted, amended, corrected or resubmitted for further consideration after the Caps Deadline.” So if you’re going to be among those filing lists and showings during the upcoming window, be sure to double- and triple-check your work before turning it in.

And just who will be having to submit Selection Lists and Cap Showings? According to the notice, “[n]o submission is required for this filing window by any Auction 83 [FM translator] applicant that has fewer than 51 pending Applications nationally and no more than one pending Application in any of the Appendix A Markets.” The term “Appendix A Markets” refers to a list of markets set out in Appendix A to the Commission’s Fourth Report and Order. (We described that Report and Order last April.) So you’re off the hook if you have no more than 50 pending translator applications and no more than one application in any Appendix A Market.

The rest of you should get busy.

You’re going to have to decide which applications you want to continue to prosecute and which you’re willing to toss. No applicant will be permitted to keep more than 70 applications on file, so some of you will have to do some whacking just to get in under that limit. 

And once you’ve made that cut, the fun will have just started. 

Applicants that plan to prosecute 51-70 applications nationally will have to demonstrate, with respect to any of its applications outside any Appendix A Market, compliance with a number of “national caps conditions”. That demonstration will include a “No Overlap Showing” and a showing that “at least one [LPFM] licensing opportunity will remain at the proposed site if the Application is granted.” In the “No Overlap Showing” the applicant will have to show that the proposed 60 dBu contour of the particular translator application won’t overlap with the equivalent contour of any other translator application or authorization held by the applicant as of December 4, 2012. (All contours will be determined by the standard prediction method.)

The Bureau’s notice also points out that the grant of any application with a transmitter site outside of an Appendix A Market will be subject to a condition that, for the first four years of operation, the translator’s 60 dBu contour must overlap the 60 dBu contour as originally granted. In other words, for the first four years a non-Appendix A Market translator won’t be able to be relocated so far away that its modified 60 dBu contour does not overlap the originally granted 60 dBu contour. (Again, all contours will be determined by the standard prediction method.)

For Appendix A Market applications, there may be even more to be done. Applicants wishing to prosecute more than one translator application in a given Appendix A Market will be subject to a number of restrictions. First, an applicant may prosecute no more than three applications in any Appendix A Market. For each such application, a “No Overlap Showing” will have to be submitted. And in addition, for each of those applications the applicant will have to demonstrate that certain LPFM licensing opportunities will not be precluded.

And all of this has to be wrapped up and delivered to the FCC by 7:00 p.m. (ET) on January 25, 2013. All showings will be submitted on paper – there will be no electronic filing.

As noted, once an applicant has filed its Selection List and accompanying Caps Showings, there’s no changing them at all. The Bureau will then sift through them and clear its files accordingly. If an applicant that should file a Selection List and Caps Showing fails to, or if it files a “deficient” showing, the Commission will follow a particular drill for deciding which applications will stay and which will go.

Finally, a note of caution to everybody who has a vintage 2003 translator application still pending. You all are still subject to the anti-collusion rules. That means that you cannot, at any point in the caps selection process, communicate with other applicants with respect to various application-related matters. (The particular areas to avoid are spelled out in Section 1.2105(c) of the rules.)

Effective Date of New LPFM Rules Set

Updated “water files” also released as FCC works to advance LPFM/FM translator plan

Having settled on a framework for clearing the FM translator logjam and getting the LPFM application process up and running (at least in theory), the Commission is losing no time in its efforts to implement that framework. The “Fifth Order on Reconsideration and Sixth Report and Order” in the ongoing LPFM/FM translator saga has now been published in the Federal Register. (We wrote about that order last week.) Barring a stay of the effectiveness of the order – and such a stay is unlikely in the extreme – the new rules will become effective on January 10, 2013. (That will also be the deadline for petitions for reconsideration, should anybody be inclined to seek reconsideration.  Parties interested in seeking judicial review will have until February 9 to get their petitions for review filed with an appropriate court.)

The Federal Register publication (and consequent effective date) probably won’t have any immediate impact on things, though. What will have an immediate impact will be the FCC’s public notice concerning the deadline by which applicants with more than the permitted number of translator applications must elect which of their applications they plan to dismiss. That public notice could show up any time now. Since (1) the Commission appears keen on getting the LPFM show on the road, and (2) the LPFM window process won’t be able to proceed until the translator backlog is cleared, and (3) the translator backlog won’t be cleared until dismissal elections have been made, and (4) dismissal elections won’t be made until the FCC sets a deadline for them, our guess is that that deadline is likely to be announced sooner rather than later. Check back here for updates.

And also on the LPFM front, the Commission has released some updated “water files” for certain markets. These files clarify or correct certain “minor discrepancies” with respect to the possible exclusion of grid points at locations over water or not within the United States. (For more on the significance of “grid points” and related matters, see our post from last April.) The communities affected by the updated water files: Chicago; Detroit; Los Angeles; and Jacksonville (the one in Florida). The code, updated water files and other relevant materials may be accessed in a zip file at http://www.fcc.gov/Bureaus/MB/Databases/source_code/lpfm/lpfm6.20121206.zip.

Update: Reply Comment Deadline Extended in Latest CVAA Rulemaking

The Commission has extended the deadline for reply comments in its rulemaking proceeding concerning possible expansion of the obligations of video providers with respect to emergency information. (The proposal arises from the Twenty-First Century Communications and Video Accessibility Act of 2010, or CVAA.)  We wrote about the NPRM in that proceeding here, noting that the original comment deadlines were pretty darned abbreviated, particularly in view of the complex proposals under consideration. While the comment deadline remains December 18, the reply comment deadline has now been extended to January 7, 2013.

FCC Looks to Bring More Emergency Information to the Visually Impaired

NPRM to implement additional mandates of the Twenty-First Century Communications and Video Accessibility Act is on the fast track

As our readers know, in the Twenty-First Century Communications and Video Accessibility Act of 2010 (CVAA), Congress aimed to ensure that folks with disabilities have “better access to video programming”.  In the two years since the CVAA was enacted, the Commission has taken multiple steps to comply with that statutory direction.

But one important component of “video programming” remains to be addressed: emergency information during non-news programs.  Existing rules already provide that all pertinent emergency information broadcast during regular or special newscasts must include an aural component for visually impaired persons.  But what about announcements broadcast outside of newscasts? 

We all know that emergencies don’t occur strictly at 6:00 p.m. or 11:00 p.m. (or even at the new trendy 4:00 or 5:00 a.m. hour), conveniently timed for scheduled newscasts.  It’s not unusual for broadcasters to interrupt non-news programming to air emergency information short of devastating disaster coverage – such as weather warnings or alerts about dangerous circumstances (flooding, chemical spills, wildfires, etc.).  Such information is often displayed on a visual crawl or some similar visual method, without accompanying audio.  In such situations, the FCC requires only that the broadcaster include an aural tone that alerts visually impaired viewers so that they can turn on a radio or ask someone else to read the screen for them. 

But that might place the visually impaired at a disadvantage by making the emergency information available too late for proper responsive action.  In keeping with its CVAA mandate, the FCC has issued a Notice of Proposed Rulemaking (NPRM) looking to expand the existing rules to require that emergency information be provided aurally using the same secondary audio stream that is now used for various purposes.  (Those purposes include video description and, sometimes, Spanish or other foreign language soundtracks.)  And in a related proposal, the Commission is also inviting comments on how it should implement the statutory requirement to prescribe regulations requiring receiving apparatus to have the capability to decode and make emergency information available.

Use of the secondary audio stream

The possible complications attending the proposed use of the secondary audio stream are somewhat daunting.  How many TV stations and MVPDs have an activated secondary audio channel?  And should those that do not be treated differently?  Do cable and satellite MVPDs have bandwidth constraints that impair their ability to add audio streams; and if not, might a secondary stream carriage requirement impair DBS local-into-local service in small markets?  If a station has two audio streams in addition to its primary stream, how will visually impaired viewers know to which stream they should tune, particularly for stations providing both foreign language and video description services and given constraints on naming protocols that affect how TV remote controls access different audio streams? 

Those questions involve only the current allocation scheme.  What’s going to happen if and when the TV band is repacked?  What will be the impact on available bandwidth for TV stations that elect to share channels after the proposed reverse auction and consequent spectrum repacking? 

And at the nitty-gritty station level, who’s going to be providing the audio for the emergency information on the secondary audio stream?  For stations without sufficient staff, should automated text-to-speech technology be permitted, even if there is an accompanying risk of errors that might distort the information?  Should the aural information have to be identical to the video content, or would it be enough to provide only “critical details” about an emergency?  If the same audio stream is used for both visual description and emergency information, how can we be sure that video description service will not be unduly interrupted?  Is a change needed in the rule that prohibits emergency information from blocking video description or video description from blocking emergency information?

Who exactly should be subject to the new rules?  For the time being, the FCC is planning to leave IP-based services alone, given the lack of a uniform technical standard for additional aural carriers.  But the CVAA requires that “program owners” comply.  The FCC’s rules define video programming provider and video programming distributor, but what is a “program owner”?

Apparatus regulation

The CVAA requires that “apparatus designed to receive or play back video programming transmitted simultaneously with sound” must have certain capabilities to provide information (including particularly emergency information) to the blind and visually impaired. 

The statute’s goal may be clear, but it’s a bit lacking in implementational details.  When it comes to apparatus for displaying programs, just what types of gear should be included?  The statute covers picture screens of any size, no matter how small.  The FCC tentatively proposes to include DVD and Blu-Ray players, but only to the extent that they receive, play back, or record TV broadcast or MVPD services.  But what about DBS set-top boxes, recording devices, and other devices that may process signals differently from how a TV receiver processes them?  Should there be any minimum performance standards?  Is there a way to insert the main channel audio on the secondary stream when no emergency information is being provided, so that the secondary stream is not silent, misleading users into thinking that the stream is not working?

Oh, yes – the statute allows the FCC to grant waivers to equipment manufacturers for devices that may be able to receive and play back video programming but are designed primarily for another purpose.  One basis for waiver: whether the purposes of the VCAA are “achievable” with the particular apparatus.   That’s all well and good, but how is the FCC supposed to figure out what’s “achievable”?  The statute provides some general guidance on that issue – considerations include the nature and cost of steps that would be necessary to meet the statutory requirements, the technical and economic impact on the manufacturer, the “type of operations” of the manufacturer and the extent of its product line.  But it’s now up to the FCC to develop some more concrete guidelines.

And finally, the FCC asks, if all of the above ideas fall into hopeless confusion or impracticality, is there some other way to achieve compliance with the CVAA?  Are there “alternate means” of fulfilling the statutory purpose; and if so, what standards should be applied to requests to use alternate means?

The questions posed in the NPRM are many and complicated, particularly with respect to the logistics of implementation.  So it’s something of a surprise that the Commission is allowing only 20 days for comments and half that for reply comments (and note that Christmas Day falls right in the middle of the reply comment period).  Comments are currently due December 18, 2012, with Reply Comments due December 28.  With such abbreviated commenting opportunities, spanning the Christmas holiday, does the FCC really contemplate no controversy over these proposals?

Translate This (Again)! Final Framework for LPFM/FM Translator Resolution Adopted

Commission adjusts FM translator application caps as process to clear FM translator backlog looms; LPFM window tentatively set to open in October, 2013

It looks like the long-running tug-of-war for spectrum between low-power FM (LPFM) advocates, on the one hand, and FM translator advocates, on the other, may be close to wrapping up, at least as far as the FCC is concerned. With a “Fifth Order on Reconsideration and Sixth Report and Order” (we’ll just refer to it as the 6th R&O), the Commission has tied up some loose ends remaining from last March’s “Fourth Report and Order and Third Order on Reconsideration” (4th R&O) and adopted new rules and policies governing LPFM applicants.

With these changes, the Commission is positioned to move forward on two related fronts. First, it should be able to clear the logjam of 6,000 or so translator applications remaining from the 2003 FM translator window. And second, it can establish a timeline for the first LPFM window filing opportunity in more than a decade.

Anyone new to the LPFM/FM translator imbroglio – or anyone who may not recall the monumental effort the Commission made earlier this year to solve that seemingly insoluble conundrum – may want to take a quick look at our coverage of that effort. You can find some relevant posts from last April, here, here and here. Having dealt with all that heavy regulatory lifting, the Commission was able to make the 6th R&O relatively straightforward and limited in scope (although it still weighs in at a hefty 83 pages, not counting appendices and Commissioners’ statements). In it, the Commission fine-tunes its approach to the translator backlog and sets the stage for a window for new LPFM applications tentatively set to open on October 15, 2013.

Here are the highlights:

Clearing the translator backlog

First things first. Before the Commission can open an LPFM window, the remaining 6,000 or so translator applications filed back in 2003 have got to be cleared out. To hasten that, the FCC has revised the cap limits (i.e., the number of translator applications any single applicant can continue to prosecute) and settled on a process to deal with those applications that survive the cap-limit culling.

Application caps – Originally, the Commission had settled on a 50-application cap. But now that has been relaxed somewhat, in some limited circumstances. In the 6th R&O, the Commission has revised the cap upward to 70 applications nationally, with a limit of 50 in the largest U.S. markets. 

Additionally, translator applicants are now faced with a cap of three applications in the 156 largest markets – as opposed to the one-per-market cap announced last March. However, the relaxed per-market cap is subject to a number of considerations. For example, submarkets in the largest cities will be considered separate markets for purposes of applying the three-application local limit. No 60 dBu overlap will be permitted with another commonly-owned application. (And with respect to demonstrations of no-overlap, the Commission will not accept alternate contour prediction – e.g., Longley-Rice – showings.) Additionally, applicants will need to submit studies showing that their proposed translators will not preclude LPFMs in either the market “grid” or at the translator’s proposed site.

Thinning the herd – With those new caps (and related limitations) in place, here’s how the Commission plans to deal with the translator backlog.

The first step will be a public notice requiring compliance with the new national and local caps. As early as January 2013, applicants will be told to elect their top-70 (and top-50 in major markets) applications by a date certain. Applicants with more than three applications in the larger markets will be ordered to make similar elections. Thousands of FM translator applications should be eliminated from the database, thereby – the theory goes – making room for LPFM stations.

Next, or simultaneously, the FCC will begin processing “singleton” translator applications in non-“spectrum limited” markets (those where opportunities theoretically remain for new LPFM stations. Check out our post from last April for more details on “spectrum limited” markets.). Applicants in this category will be invited to file “long form” applications to supplement the abbreviated Forms 349 they filed in the 2003 translator window. 

At the same time, applicants in “spectrum limited” markets will be afforded an opportunity to file long-form applications which include, where possible, showings that the grant of their applications will not preclude opportunities for future LPFM stations. 

The FCC will then open a settlement window allowing technical settlements or limited buy-outs (for expenses only) among mutually-exclusive applicants for non-“spectrum limited” markets.

Singleton applicants in “spectrum limited” markets which can demonstrate no preclusion of LPFM opportunities will then be processed and granted. A settlement window will then be opened to allow the sorting out of non-preclusive applicants in “spectrum limited” markets.

Any remaining singletons will then be processed and granted. 

After these steps are completed, some groups of mutually-exclusive translator applications are still likely to remain. The FCC will conduct an auction among remaining applicants for commercial translator licenses; remaining non-commercial (NCE) translator applications will be chosen under the Commission’s noncommercial comparative points system. In hybrid groups of NCE and commercial MX applications, it’s likely the NCE applicants will be afforded an opportunity to amend to specify commercial operations, thereby avoiding dismissal.

Timing – As noted, we can expect to see, probably within a matter of weeks, the public notice requiring translator applicants to elect which of their applications they will continue to prosecute. Since all translator applicants have long been on notice that they would be having to make some such election (even if the precise application has been somewhat up in the air until now), don’t be surprised if the Commission provides only very limited time within which to make those elections.

But the follow-up processes of settlements, singleton processing, resolution of MX groups, etc. could take considerably longer. 

How long? According to the Commission, “to maximize LPFM filing opportunities it is critical for the Media Bureau to complete substantially all of its processing of the pending FM translator applications prior to the opening of the LPFM window.” So you might figure that no LPFM window will be opened until the translator backlog has been cleared. Perhaps, but as noted above, the Commission has tentatively set October 15, 2013 as the target date for the next LPFM window. That suggests that the Commission thinks it can wrap up the translator backlog in the next nine months. We wish them luck with that. (Perhaps recognizing the potential for delay along the way, in the 6th R&O the Commission authorizes the Media Bureau to “adjust” the October, 2013 date “in the event that future developments affect window timing”.)

The next LPFM window

When the LPFM window does open, LPFM applicants will be subject to a number of new rules and policies. They include:

  • New second-adjacent channel short-spacing waiver criteria for LPFM applicants vis-à-vis FM, FM translator and LPFM stations. The new criteria will permit use of the undesired/desired signal strength ratio methodology to evaluate potential interference. (Up to now, such methodology has been available only to translator applicants.). The criteria will also permit the use of directional antennas, alternate antenna polarization and lower ERP in waiver requests.
  • Interference complaint procedures for third-adjacent channel LPFMs vis-à-vis FM, FM translator, or FM booster stations. (Third-adjacent channel spacing requirements for LPFM applications were repealed by Congress in 2010, but actual interference is still a cognizable issue under the rules.)
  • Modified selection criteria for mutually-exclusive LPFM applicants. The new criteria will make available additional comparative “points” to those proposing to establish local studios and for applications by Native Americans to serve their tribal lands.
  • Expanded ownership limits which will permit, subject to certain restrictions, ownership of up to two FM translators by an LPFM station.
  • Elimination of the plan adopted in 2000 to license LP10 (10 Watt) LPFM stations.
  • Elimination of IF protection requirements applicable to LPFM.

What you see is what you get. 

So the FCC has finally resolved a proceeding that had its origins in the 2003 FM translator window. As to LPFM/full-power interference issues and the imposition of FM translator application caps, the FCC (with significant input from Congress) has spoken. Some mass filers will lose the bulk of their remaining translator applications, as will applicants who concentrated in just a few markets, but the adjustments to the caps may help some. LPFMs will have new spectrum rights vis-à-vis full-power FM and other FM services, new opportunities to own translators, and new limitations on the facilities they can hold. It’s safe to say that nobody is likely to be 100% happy with 100% of the Commission’s resolution of the LPFM/FM translator conundrum. But a decade of uncertainty is over, unless either the FCC re-thinks things or a court of appeals (at the request of one or another disgruntled party) finds some flaw in the Commission’s actions – neither of which possibilities is likely, in this writer’s view. If all goes as planned, the FCC’s new rules will become effective 30 days after their publication in the Federal Register (except for some aspects that will require prior OMB approval). Check back with us for updates on that situation.

Reg Fee Calculation Method Under the Microscope

NPRM seeks input on overarching goals and nitty-gritty methodology of reg fee process.

We all know that regulatory fees are imposed annually. The precise fees to be paid each year are proposed in the spring and then, after a notice-and-comment period, finally announced in summer, usually to be paid in September. It happens with mundane regularity. 

But did you ever wonder how the Commission comes up with the actual numbers?

In a Notice of Proposed Rulemaking (NPRM), the FCC has pulled back the curtain on that process, inviting us all into the sausage factory so that we can take a look around and maybe provide our own input into possible changes in the system. The deadline for comments is September 17, 2012; reply comments are due by October 16. If you think you might want to toss in your two cents’ worth, you should probably get started now – the NPRM is pretty dense and requires considerable patience (and some NoDoz®) to wade through.

To get you oriented, here’s a thumbnail sketch of what’s going on. (Caution: this is only a thumbnail sketch. If you want to get fully immersed in the NPRM, you’re on your own.)

The FCC is required by Congress to collect reg fees annually to “recover the costs of . . . enforcement activities, policy and rulemaking activities, user information services, and international activities.”  (It’s in Section 159 of the Communications Act – you can look it up.) That means that the total amount of fees collected should amount to the total amount of funds appropriated for the FCC’s activities by Congress. Essentially, Congress is looking to have the FCC pay for itself through reg fee collections.

The Act requires that fees be allocated among the FCC’s regulatees based on the “full-time equivalent number of employees” (FTEs) in “the Private Radio Bureau, the Mass Media Bureau the Common Carrier Bureau and other offices of the Commission”. We put that quaint listing in quotes because that’s just what the Act said when it was first adopted nearly two decades ago, and that’s what it still says. In the meantime, of course, the names of the Bureaus have changed, and a number of their responsibilities have been shifted to the International Bureau. Nowadays, notwithstanding the statutory language, the FCC treats its present Media, Wireline Competition, Wireless Telecommunications and International Bureaus as the “core licensing bureaus” for reg fee calculation purposes.

The various activities of each of the core licensing bureaus fall into categories. Based on historical data (more on that below), the FCC determines how many FTEs are attributable to each category. The total fees to be collected per category are then calculated by multiplying the total appropriations amount by a fraction, the numerator of which is the FTEs for that category and the denominator of which is the total number of FTEs overall.

Once the fees-per-category have been calculated, the Commission comes up with the fees to be charged individual regulatees within each category by dividing the gross fee for a given category by the total number of “fee payors” in that category. The concept of “fee payor” is somewhat flexible – it depends on “characteristics appropriate to each service, such as the number of licenses or number of subscribers the fee payor has.” (That’s why the Commission prefers to refer to “fee payors” as “units”.)

Some FTEs can’t be allocated to specific categories. Those are deemed to be “indirect FTEs”; they get allocated proportionately among the various core licensing bureaus.

So one thing is clear: the calculation of reg fees depends crucially on the allocation of FTEs. But check this out: the FTE data currently in use are based on data collected in 1998. Back then Commission employees’ time cards tracked their time based on reg fee categories. The FCC abandoned such tracking in 1999 because, among other things, time card entries “prove[d] subjective and unreliable.” Oddly, that subjectivity and unreliability hasn’t stopped the Commission from continuing to rely on the last batch of such apparently subjective and unreliable data (i.e., the 1998 collection) for the last 14 years.

The Commission is now, at long last, asking how it can best update its approach to fee calculations, including (but not limited to) the FTE data on which it relies. In doing so, the FCC is also looking more broadly to establish “overarching goals” to govern its reg fee program. The goals currently envisioned by the Commission are fairness, ease of administration, and sustainability. (Comments on those goals – and any others that might come to mind – are specifically requested in the NPRM.)

As far as the specific fee calculation mechanisms go, the FCC is looking at three general areas for possible change. First, it could jigger with the allocation of FTEs within each bureau. Second, it could update and adjust FTE allocation percentages among the bureaus. And third, it could reallocate FTEs among the fee categories within each of the core bureaus. (If those all sound somewhat duplicative, that’s what we thought, too. The NPRM spells out the intricacies of each of those areas over four-and-a-half single-space pages of bureaucratese, if you’re inclined to wade deep into the weeds on this.)

The bottom line here was perhaps best described by Commissioner Pai:

In 1998, each industry segment largely still played in its own sandbox – telephone companies offered telephone service, cable operators offered cable television, and so on. But today’s currency is convergence: Telephone companies have entered the video market, cable operators are winning voice customers, satellite operators offer competitive radio, television, and broadband services, and wireless providers have unleashed a mobile revolution few if any saw coming.

The Commission must strive to keep pace with this swiftly changing industry – especially when, as here, Congress has affirmatively told us to do so in Section 9 of the Communications Act.

The extent to which any revision in the Commission’s approach – whether broad-brush or finely-tuned – might alter any particular reg fee for any particular regulatee is far from clear. But since reg fees are now a permanent fixture, it would be nice if the calculation of those fees were based on (a) some formula that makes sense and (b) data that are not, by the FCC’s own admission, subjective and unreliable. The NPRM is a welcome step in that direction.

Again, comments on the NPRM are due by September 17, 2012. Reply comments are due by October 16.

OMB OK on FM Translator Application Culling

Meanwhile, back at the FM translator application backlog . . .

In March, the Commission announced the process by which the pile of several thousand FM translator applications, still pending since the infamous 2003 filing window, would be trimmed down. (You can read the Commission’s full 35-page – not including appendices – decision here, or our punchy, far more abbreviated recap of it here.) As we reported in May, the process by which the Commission intends to thin the herd involves “information collections” (as they are known in Paperwork Reduction Act parlance). Such collections must be approved by the Office of Management and Budget (OMB) before they can be implemented.

According to a notice published in the Federal Register, OMB has given its thumbs up to the Commission’s process.  (The imprimatur was technically handed down on July 24.) This clears the way for the FCC to get the culling started. Look for a public notice in the near future setting deadlines and the like. The Commission has been under considerable pressure to move things along on the LPFM front, and clearing the FM translator backlog is an essential first step. Because of that, we won’t be surprised if things start to happen pretty fast at this point. Folks with FM translator applications pending from the 2003 window should familiarize themselves with the FCC’s process as outlined back in March (if they haven’t done so already), determine how that process affects their applications, and be prepared to act in short order. Check back here for updates.

Update: Video Description Now In Effect

[Blogmeister Note: As we reported last September, the FCC has re-imposed the “video description” requirement at Congress’s direction (see the behemoth 21st Century Communications and Video Accessibility Act of 2010). Nearly two years after the passage of that Act, the video description rules have taken effect as of July 1, 2012. If you’re a bit hazy on the details of the new rules and want an in-depth review of who’s got to do what when, check out our earlier post, which lays things out in detail. For those of you who need only a quick refresher course, what better (or, at least, quicker or more refreshing) way of getting that to you than with . . . (wait for it) . . . haikus! A CommLawBlog exclusive: Video Description in 51 syllables! ]

Top four stations in
Twenty-five largest markets
Must have 50 hours

Big MVPDs
Also provide 50 hours
On top five channels

All others pass through
Video-described programs
To their blind viewers

Update: FCC Invites PRA Comments on FM Translator Dismissal/Amendment Process

The Great FM Translator Application Purge has moved one step closer: the FCC has formally initiated the Paperwork Reduction Act (PRA) process which must be completed before the “information collection” aspects of the herd thinning measures can be implemented. With respect to the several thousand new FM translator applications still pending since 2003, the new rules adopted last March in the Fourth Report and Order (4th R&O) impose application caps of (a) 50 nationwide and (b) one in each of the 156 markets identified in Appendix A of the 4th R&O. Any applicant with more than 50 apps nationwide and/or more than one app in any of the listed markets must dismiss enough applications to bring themselves under the limits. The letters necessary to seek those dismissals constitute “information collections” subject to the PRA.

Additionally, the 4th R&O affords pending FM translator applicants some limited opportunities to amend their applications. Those amendments, too, are “information collections”.

With its notice in the Federal Register, the Commission has invited the usual PRA comments on both aspects.  We'd like to be able to tell you exactly what the "information collections" actually look like, but the notice doesn't contain any examples.  Instead, it provides instructions for how to find copies on the OMB website -- but when we tried to follow those instructions, we came up empty.  Ideally this problem will be corrected before comments are due.

And speaking of the due date, anyone so inclined has until June 29, 2011 to submit comments to the Commission. After that, the Commission will bundle up all comments received and ship them over to the Office of Management and Budget, which will open its own 30-day comment period. After that, look for a notice that OMB has approved the process, which will clear the way for the Commission to open its doors for dismissals/amendments. If things move smoothly, it looks like those doors might swing open toward the end of the summer. (Check back here for updates.)

While we would like to say that the PRA process gives everyone a meaningful opportunity to affect the course of FCC regulations, recent experience suggests that that might not be entirely accurate. Still, the invitation for comments has been issued, and we’d be remiss if we didn’t pass the word along.

USF/ICC Update: Changes in Carrier Reporting Requirements Effective May 8, 2012

In its sprawling Report and Order and Further Notice of Proposed Rulemaking on the Universal Service Fund (USF) and Intercarrier Compensation, released last November, the Commission adopted (among a lot of other things) a number of changes to the various reporting requirements. Those requirements affected certain carriers, including competitive eligible telecommunications carriers (ETCs) and incumbent local exchange carriers. (Last December we described how many, but not all, of the extensive changes would affect wireless providers.)

Because many of the modified reporting requirements involved “information collections” subject to the Paperwork Reduction Act, they could not take effect right away. Rather, they had to be reviewed and approved by the Office of Management and Budget. That process has now been completed, according to a notice published in the Federal Register. As a result, a number of the rule changes adopted last fall have now become effective or applicable as of May 8, 2012.

The rules that have become effective are: Sections 54.312(b)(3); 54.313(b); 54.313(h); 54.314; and 54.320(b). The rules that have become applicable are: Sections 54.305(f); 54.307(b) and (c); and 54.313 (a)(1)-(a)(6).

Additionally, the Federal Register notice provides official notification to ETCs and other unspecified stakeholders that information required to be filed pursuant to Section 54.313(a)(2)-(6) and (h) must be filed by July 2, 2012.  Section 54.313 sets out the annual reporting requirements for high cost recipients.

2012 Reg Fees Proposed: Up, Up and Away!

The FCC has performed that annual rite of spring – its announcement of proposed regulatory fees for 2012. These are the reg fees that, for the vast majority of Commission regulatees, will be due and payable by a to-be-announced date (probably sometime in August or September). As with most ritual activities, there are no real surprises here: the rates are, with very few exceptions, proposed to go up. 

In general, the Commission figures that broadcast-related reg fees should get bumped up between 4-7% or thereabouts, depending on the type of facility in question and the market in which it’s located. There are some exceptions, though. For example, commercial VHF TV stations in Markets 51-100 would enjoy a nearly 9% reduction (amounting to $2,205) compared to last year’s fee, if the FCC’s proposal holds. And fees for UHF stations in Markets 11-25 would drop $1,000 (about 3%) from last year’s levels.

We’re attaching a grid providing the proposed 2012 fees along with some comparative information showing the changes from the fees actually imposed last year. (Red entries reflect 2012 fees that would go up over last year’s fees; the small handful of green entries reflect fees that would go down this year.)

As always, the Commission is giving everybody a chance to comment on the proposed fees. If you’ve got something to say about the proposals, you’ve got until May 31, 2012 to file comment with the Commission. Reply comments may be filed until June 7

Over and above the fees themselves, this year’s Notice of Proposed Rulemaking (NPRM) contains a couple of elements of interest.

First, as the Commission hinted last year, this year’s fee calculations are based on 2010 U.S. Census data. That’s particularly important for AM and FM stations, since their fees vary based on the population each station serves. The 2010 Census data hadn’t been fully firmed up and finalized as of last year, so the Commission opted to use 2000 data to calculate the populations served for the 2011 fees. But now the 2010 data are set, so they’re the ones the Commission has used for this year’s fees. Anybody who disagrees with this should feel free to file comments letting the FCC know.

And as was the case last year, with respect to Class A, LPTV and TV Translator stations

a fee will be assessed for each facility operating either in an analog or digital mode. In instances in which a licensee is simulcasting in both analog and digital modes, a single regulatory fee will be assessed for the analog facility and its corresponding digital component.

This approach is likely to change as “greater number of facilities convert to digital mode”. Still, for the time being – and, apparently, at least for this year – it looks like the policy of exacting only one reg fee per Class A, LPTV and TV Translator license will stay in place.

The Commission has proposed an interesting new procedural wrinkle. It’s planning on requiring that any request for a refund, waiver, fee reduction or deferment of any reg fee (or apparently, any application fee) be submitted electronically, rather than the old-fashion hard copy way. This change is part of an agency effort to improve the way it provides public information about the filing and disposition of waiver requests. The NPRM doesn’t go into any detail about the mechanics of any particular electronic filing system the Commission may have in mind. Rather, the NPRM just asks for comments on the general concept of mandatory electronic filing of waiver requests and the like.

Again, the NPRM – and the fees described in it – are still only proposals. We won’t know the final fees until sometime this summer, although experience suggests that the final fees aren’t likely to stray too far from the initial proposals.

Check back here at CommLawBlog.com for updates.

The Quinquennial Question: Should the Ban on Exclusive Program Access Deals Stay or Go?

Tempus fugit! Time for the next five-year assessment of the ban on certain exclusive program access deals – Comments are due by June 22, 2012.

Hard to believe, but it’s that time again – time for the Commission to take a look at competition in the multichannel video programming distribution (MVPD) industry to determine whether the 20-year-old ban on certain exclusive program access deals is still necessary. With the release of a Notice of Proposed Rulemaking (NPRM), the Commission has started that ball rolling again. Interested parties have until June 22 to let the FCC know their thoughts on the issue.

The last two times the Commission considered this question, it concluded that the ban should remain in place. Thanks to at least one intervening court decision, though, this time could be different.

Back in 1992, Congress was concerned about the choke-hold that the largely monopolistic cable industry then had on video delivery in many markets. Congress understood from the FCC that that choke-hold was at least partly the result of the fact that competitors couldn’t secure programming owned by “vertically integrated cable companies”. (In this context, “vertically integrated cable companies” are cable operators that own attributable interests in companies that provide cable programming.)  So Congress just said “no”.

It ordered the Commission (among other things) to prohibit certain exclusivity agreements between a cable operator and a cable program provider in which the operator has an attributable interest. The idea was to assure that all competing cable operators would have access to the primo types of programs most attractive to subscribers.

Congress was aware that the video delivery industry was developing rapidly and that the need for the ban might decline over time. So Congress included a sunset provision: while the 1992 Cable Act required the imposition of the ban, it also required that the FCC revisit the ban in 2002 after the enactment of the Cable Act. Unless the FCC were then to determine that the ban continued to be necessary to protect competition and diversity, the ban would automatically expire. And even if the ban survived the 2002 review, it would be subject to similar reviews every five years thereafter. 

The ban did indeed survive the 2002 review, and the 2007 review as well. But the latter decision was appealed to the U.S. Court of Appeals for the D.C. Circuit in 2010. While the court affirmed the FCC’s decision to leave the ban in place for another five years, the court expressed concern because (a) Congress had clearly intended that the ban go away at some point and (b) the video delivery market has “changed drastically” since 1992. One of the three judges issued a dissenting opinion buying into the appellants’ argument that the ban raised serious First Amendment concerns.

Against that backdrop comes the NPRM.

This time around the Commission appears to be taking to heart the messages from  the Court of Appeals. In contemplation of a possible sunsetting, the Commission is seeking suggestions for how best it could preserve competition and diversity if the ban were finally to be tossed. 

And to those who would urge that the ban be kept in place – at least for another five years – the Commission cautions that it will be looking for specific data and empirical analyses showing that lifting the ban would harm competition. In the past, the ban’s supporters have tended to rely on generalized claims that certain programming controlled by cable-affiliated entities is “must have” and should not be subject to access exclusivity deals. It appears from the NPRM that that won’t cut it anymore.

As a preliminary observation, the Commission notes that, since 2007, there have been at least three developments that might affect the questions at issue: 

The separation of Time Warner Cable Inc. (TWC), a cable operator, from Time Warner Inc. (Time Warner), an owner of satellite-delivered, national programming networks. As a result of the separation, Time Warner’s programming networks are no longer affiliated with TWC, thus reducing the number of satellite-delivered, national programming networks that are cable-affiliated. This is significant because the FCC has historically compared the total number of satellite-delivered channels with the number of those channels affiliated with a cable operator. The actual significance of that comparative approach is not entirely clear.

The joint venture between Comcast (a vertically integrated cable operator) and NBC Universal, Inc. (NBCU), an owner of broadcast stations and satellite-delivered, national programming networks). While this transaction led to an increase in satellite-delivered, national programming networks that are cable-affiliated, the NPRM suggests that the program access conditions of the merger agreement mitigate any adverse effects this deal might have on the video distribution market. (Of course, those merger conditions are in any event set to go away at the end of 2018, and they might be removed or revised earlier than that – so their permanent protective effect are neither as extensive nor as solid as a more general rule or policy applicable to all parties.)

The rapid growth of distributing and viewing of video programming over the Internet (OVD, or online video distribution). In assessing the Comcast/NBCU merger, the Commission acknowledged the potential effect of OVDs on programming choices, viewer flexibility, technological innovation and lower prices. In the Comcast/NBCU Merger Order, the Commission recognized that OVDs “can provide and promote more programming choices, viewing flexibility, technological innovation and lower prices.” According to the Commission, OVDs are a “potential competitive threat” that “must have a similar array of programming” if they are to “fully compete”.  The NPRM solicits information regarding the effect – historical or anticipated – of OVDs on nationwide and regional multichannel video distribution subscription rates. It also asks whether (and if so, how) the emergence of OVDs that could benefit from the exclusive contract prohibition should affect the Commission’s analysis.   (It’s interesting that the FCC may be looking at OVDs as a potential beneficiary of, rather than a reason for sunsetting, the exclusive contract prohibition.)

In view of all these factors, the NPRM asks whether it should: (a) sunset the ban on exclusive contracts involving satellite-delivered, cable-affiliated programming; (b) retain that ban as is, or (c) retain it with some relaxation. It also solicits comments on revisions to the program access rules that might allow it to address alleged violations (e.g., discriminatory volume discounts and uniform prices increases) more effectively.

Anyone looking for continuation of the prohibition – a universe likely to include non-vertically integrated MVPDs – will be expected to demonstrate, with hard data, either that (a) little has changed in the competitive dynamics of the video market since 2007, or (b) as a result of (or in spite of) changes, relaxing or sunsetting the prohibition would harm competition. Among the issues the FCC has teed up are the following:

What is the impact of the allegedly growing number of satellite-delivered national programming networks? According to the NPRM, the percentage of such networks that are cable-affiliated has significantly declined.   One difficult issue here is how to count programming. For example, should a network that provides its programming in standard definition, high definition, 3-D and video-on-demand formats be treated as four networks or one?   (While non-integrated MVPDs might be inclined to argue in this context that a multi-format network like this should really count as only one network, they argued otherwise in 2010 to get the Commission to force regional sports networks (RSNs) to provide access to HD feeds as well as SD feeds.)

Do integrated MVPD/programmers still have the ability to withhold programming from competitors in a manner that harms competition?   The NPRM appears to recognize the continued existence of some popular channels for which there are no current substitutes. The ability to withhold such “must have” channels has generally been viewed as anti-competitive. But the Commission is now looking for “reliable, empirical data” to establish conclusively the existence of such channels. While the notion of “must have” channels may seem obvious – even the Commission seems to acknowledge that RSNs are critical to a competitive MVPD service – proving their existence with facts and figures could be a difficult and expensive proposition.

Do integrated MVPD/programmers still have the incentive to withhold programming from competitors in a manner that harms competition? The historical theory has been that integrated companies are willing to forgo revenue from licensing programming to competitors because such integrated companies can profit more from increased revenues derived from subscribers who flock to the integrated MVPD to get the programming that’s unavailable from its competitors. The NPRM suggests that the decline in national penetration rate for cable operators (67% to 58.5%) may undermine that theory. Of course, presumably the integrated cable operators have lost subscribers to the very competitors to whom they already must make their programming available – so it’s not clear why a declining penetration rate might justify elimination of ban on exclusivity deals, but that’s a point that will presumably be made by commenters.

If, after reviewing all the comments and other record information, the Commission concludes that the prohibition on exclusive programming contracts should be tossed, the Commission will have to decide how, in the absence of the prohibition, it can and should protect and preserve competition. The FCC invites comments on a range of possible approaches, including:

Complete elimination of the prohibition, replaced by reliance other existing protections.    The Commission has complaint processes in place with respect to a variety of programming-related issues on the MVPD front. So even if the absolute ban on exclusive access deals were to be eliminated, aggrieved parties could theoretically still plead their case to the Commission through complaints. But the complainant would have the burden of proof. That would require the complainant to demonstrate the integrated MVPD had engaged in some “unfair act” the “purpose or effect” of which was to “significantly hinder or prevent” the complainant from providing programming to its subscribers. That’s a tough burden to meet, although the NPRM invites suggestions for easing that burden with respect to RSN, and possibly other, programming (through, perhaps, the establishment of rebuttable presumptions regarding the intent and effect of denying such programming to competitors).

Gradual elimination of the prohibition market-by-market. Under this approach, the prohibition would be left in place, but cable operators or satellite-delivered, cable-affiliated programmers would be permitted to file a Petition for Sunset seeking to remove the prohibition on a market-by-market basis based on the extent of competition in the market.

Retention of a more limited prohibition. If any problem arising from the kind of program exclusivity deals barred by the current prohibition is really limited to certain types of programming, the Commission is open to considering narrowing the scope of the prohibition to reach only RSNs and certain other so-called “must-have” programming.   Again, however, hard data is sought as to the alleged “must-have” nature of protected programming.

Finally, the Commission notes that elimination of the prohibition could cause substantial disruptions to cable subscribers. For example, some programming agreements entered into while the prohibition has been in effect might provide that, should the prohibition be eliminated, the cable-affiliated programmer could immediately terminate the agreement and instead enter into an exclusive arrangement with its cable affiliate. If such a provision were invoked, subscribers to non-affiliated MVPDs might suddenly lose access to desirable programming. What steps, if any, should the Commission take to minimize viewer disruptions if the prohibition is eliminated?

The NPRM is a wide-ranging invitation for comments on a host of issues, both general and detailed. It is dense with assertions and questions that demand considerable review and deliberation. Since the bottom line here is the possible elimination of a rule that has been in place for 20 years already, everyone affected by that rule should consider how they may be able to influence the final outcome here. 

The NPRM has been published in the Federal Register, which establishes the deadlines for comments and reply comments. Comments are due by June 22, 2012; replies are due by July 23.

Update: LPFM/FM Translator R&O Published in Federal Register . . .

. . . but with one exception, the new rules still aren’t effective

The FCC’s Fourth Report and Order and Third Order on Reconsideration (4th R&O) designed to break the longstanding logjam involving the LPFM and FM translator services has been published in the Federal Register.  (You can read more about the 4th R&O here.) While such publication would often mark the end of the rulemaking process by establishing the effective date of the newly-adopted rules, not so here. Since most of the new rules and policies adopted in the 4th R&O involve “information collections”, they all must first be run through the Office of Management and Budget’s Paperwork Reduction Act drill before the FCC can implement them. The Commission has not yet gotten that particular ball rolling, but we expect it to happen shortly, as the Commission seems highly motivated to wrap up the LPFM/FM translator imbroglio sooner rather than later. Check back here for updates.

The Federal Register publication does establish May 9, 2012 as the effective date of the amended Section 74.1232(d). That’s the rule that allows AM stations to rebroadcast their signals on FM translators. As we reported earlier, the 4th R&O expanded the universe of translators eligible for such cross-service operation. Despite the effective date, though, the rule revision is not likely to have much immediate effect. 

That’s because the rule as revised in the 4th R&O provides that AM signals can be broadcast not only on translators that were authorized as of May 1, 2009, but also on translators that had been applied for as of May 1, 2009. That tweak means that, once granted, any of the 6,500 or so translator applications still pending from the infamous 2003 window could be used for AM translation. However, since none of those applications will be granted until the rest of the 4th R&O takes effect, the May 9, 2012 effective date of the revised Section 74.1232(d) is largely symbolic for the time being.

LPFM - The Next Generation: FCC Invites Comment on Post-LCRA Regulation of LoPos

The Commission struggles to play the hand that Congress dealt it in the Local Community Radio Act

In this our third post in the last week on the subject of recent developments in the regulation of the low power FM (LPFM) service, we look at a number of rule changes proposed by the Commission in connection with its effort to clean up various aspects of that service. That effort, of course, was inspired (and in some respects mandated) by the Local Community Radio Act (LCRA). The proposals in question are contained in the “further notice of proposed rulemaking”  (NPRM) portion of the Fifth Report and Order, Fourth Further Notice of Proposed Rulemaking and Fourth Order on Reconsideration (5th R&O). They encompass a wide range of LPFM-related topics, many involving considerable complexity. 

We’ll try to hit the high points and make as much sense out of it all as possible, but anyone with a serious interest in the FCC’s LPFM proposals – or in LPFM generally – should be sure to read the full NPRM. Be forewarned, though: the NPRM is not light reading. Keep your NoDoz® handy.

The proposals entail two broad categories of regulations: first, issues arising from the interrelationships between LPFM stations and other stations operating in the FM band; second, issues relating to the process of initially licensing LPFM stations.

LPFMs vs. Other FM Band Users

Second-Adjacent Channel Separation Waivers

First out of the box is a proposed approach to requests by LPFM stations for waiver of otherwise applicable minimum second-adjacent channel separations. In the LCRA Congress expressly authorized the FCC to waive those spacing requirements in some circumstances. What circumstances? Congress thought second-adjacent waivers should be permitted as long as the LPFM applicant establishes that its proposal “will not result in interference to any authorized radio service”. That showing can be made “using methods of predicting interference taking into account all relevant factors, including terrain-sensitive propagation models”.

Of course, the Commission has had its own second adjacent waiver policy in place since 2007. But that policy (which involves a “balanc[ing]” of various interests) is a bit more loosey-goosey than what Congress seems to have had in mind. Congress’s approach requires first and foremost that the LPFM “will not result” in interference, regardless of whether the extent of possible interference might be said to be offset by any possible gains in service. So the Commission tentatively figures that its 2007 approach is history (although it still invites comments on that tentative conclusion).

How would an LPFM applicant demonstrate that its proposal would not “result in interference”? The Commission suggests that the undesired/desired signal strength ratio approach (used, for example, in assessing some translator applications) might be the way to go. It also suggests that LPFMs might be permitted to use directional antennas to protect second-adjacent stations.

The Commission also offers some other factors it might be inclined to consider in connection with second-adjacent waiver requests. For example, should LPFM applicants be required to show that no fully-spaced channels are available? Is it relevant that the LPFM proposal would eliminate or reduce interference received by the LPFM? How about looking at whether the proposal would result in “superior spacing” to other FM operations (full-service, translator, booster) on co-channel and first-adjacent channels? The FCC appears to be wide-open for further suggestions here.

With respect to handling complaints about interference caused by an LPFM station with a second-adjacent spacing waiver, the LCRA lays out a clear process to be followed. In the NPRM the FCC acknowledges that Congressionally-mandated process and proposes to incorporate it into the rules. But in doing so, the Commission solicits comments on some practical questions the LCRA doesn’t address – like how to define a “bona fide complaint”, and how the LPFM station accused of interference might demonstrate that it’s not the source of the complained-of interference.

Third-Adjacent Channel Interference

As previously reported, the Commission has – at Congress’s behest – deleted most (but not all) of the minimum separation requirements for third-adjacent channel LPFM operations. But that doesn’t mean that LPFM interference to third-adjacent stations is a thing of the past. To the contrary, it merely means that a threshold protective measure designed to prevent such interference has been removed. In ordering the deletion of the separations, Congress provided that LPFM stations would still be subject to interference limits. But in so doing, Congress managed to introduce an astonishing level of complexity which the Commission is now attempting to sort out.

Because of the language of the LCRA, the Commission finds itself required to establish two separate and distinct “LPFM interference protection and remediation regimes”. The first applies to LPFM stations that would have been short-spaced if the Commission had retained the minimum separation limits for third-adjacent operations; the second applies to LPFM stations that would not have been so short-spaced.

(Irony alert: Yes, it turns out that, even though the third-adjacent separation limits have been technically deleted from the rules, they will still be retained in the rules – but “solely for purposes of reference” to permit the Commission to determine which protection/remediation “regime” is to be implemented when third-adjacent interference rears its ugly head.)

Remediation Process for Section 7(1) Stations -For LPFM stations that would be short-spaced to third adjacent operations under the old spacings – what the Commission refers to as “Section 7(1) Stations” – the drill would track the process used for translators. Any actual interference from a Section 7(1) Station to the “direct reception by the public of the off-the-air signals of any authorized broadcast station” would be prohibited, regardless of where or when the interference occurs.  If such interference were to crop up, it would have to be eliminated or the LPFM would have to cease operation.

While the translator rules don’t say so in so many words, in order to warrant the Commission’s attention an interference complaint must be “bona fide”. In the FCC’s view, that means that the complainant must be “disinterested”, i.e., not having any “legal stake” in the matter.

Since the LCRA specifically instructs the Commission to use the translator interference remediation process (currently codified in Section 74.1203), it’s doubtful that the FCC has much room to change that process at all relative to LPFMs. Still, the Commission asks whether any changes might be possible and, if so, what they might be.

Remediation Process for non-Section 7(1) Stations – All LPFM stations that don’t qualify as “Section 7(1) Stations” would be treated as “Section 7(3) Stations”, which would enjoy a considerably more lenient process for dealing with interference. Where Section 7(1) Stations would have to either eliminate interference or turn themselves off regardless of where that interference might occur, Section 7(3) Stations would merely have to “address interference complaints within the protected contour” of the interfered-with third-adjacent station. (The LCRA also calls for the FCC to “encourage” Section 7(3) Stations to “address” any other complaints regardless of the locus of the interference.)

Of course, the statutory term “address” is not particularly specific. While it seems clear that “addressing interference complaints” does not require “eliminating” interference, “addressing” has still got to involve some action on the part of the LPFM station. But what exactly must an LPFM station do to “address” an interference complaint? The Commission’s not sure, so it has invited comment on that fundamental question, as well as other more practical issues (e.g., should complaints have to be filed with the Audio Division; should the complainant be required to provide contact information).

The LCRA does specify that newly-constructed Section 7(3) Stations must be required to broadcast, periodically during the first year following construction, announcements alerting listeners to the potential for interference. The announcements must instruct listeners to contact the LPFM station to report interference. (According to the LCRA, the LPFM station must in turn notify the FCC and any affected stations about any complaints within 48 hours of the time they roll in.)   The Commission is dutifully proposing to follow through with that, but it has a number of questions about the details – should the text of the announcements be specified by the Commission, when and how often should they be aired, etc. Oh, and the Commission is also thinking that it might impose the announcement requirement on newly-built Section 7(1) Stations, even though the LCRA does not expressly authorize such a requirement.

Translator Input Complaint Procedure

The LCRA requires the Commission to modify its rules to “address the potential for predicted interference to FM translator input signals on third-adjacent channels”. This is a significant change, since the Commission’s current policy is to require remediation of actual interference. That is, under the FCC's existing policy, questions of third-adjacent interference from an LPFM station to a translator’s input signal would be dealt with only if such interference actually arises; no consideration to the potential for such problems is given at the initial licensing stage.

Obviously, Congress’s approach – requiring the FCC to “address the potential” for such interference – means a change in the FCC’s SOP on this front. Rather than wait for an already authorized station to cause interference, the Commission will have to consider the possibility of interference before authorizing construction in the first place.

Accordingly, the Commission is proposing that any application for a new or modified LPFM station will be barred from using a transmitter site within a “potential interference area” of any FM translator station that receives the off-air signal of a third-adjacent channel FM station. Applications proposing such a site would be dismissed.

The term “potential interference area” would, for purposes of this policy, be defined as

any area within 2 km of the translator site or any area within 10 km of the translator site within the azimuths from -30 degrees to +30 degrees of the azimuth from the translator site to the site of the station being rebroadcast by the translator.

Applications specifying transmitter sites within “potential interference areas” could still be filed, as long as they include an exhibit demonstrating that no interference to off-air reception will be caused.  Applicants could make that demonstration by showing that the ratio of the proposed LPFM signal to the FM signal would be below 34 dB at all locations. Alternately, they could use an equation set out in Section 2.7 of “Experimental Measurements of the Third-Adjacent Channel Impacts of Low Power FM Stations, Volume One—Final Report (May 2003)”, which is a go-to resource when it comes to the technical aspects of LPFM.

I.F. Separation Requirements

The Commission is proposing to remove the requirement that LPFM stations operating with less than 100 watts protect full-service station on their intermediate (I.F.) frequencies. This change would bring LPFM into regulatory parity with FM translator stations and Class D FM stations, which are already exempt from I.F. when operating with less the 100 watts ERP.

LPFM Licensing Processes

Anyone who may be thinking about filing an application in the next LPFM window should pay particular attention Paragraphs 47-66 of the 5th R&O. There the Commission proposes a considerable number of changes to the some important aspects of the application and selection process. The proposals include:

Elimination of the LP10 class of service (i.e., LPFM stations with maximum power of 10 watts ERP at 30 meters HAAT), but creation of a new higher power class to operate with up to 250 watts ERP at 30 meters HAAT in certain smaller communities, rural areas, or “non-core” locations (i.e., outside population centers) in larger markets;

Clarifying that American Indian Tribes and Alaskan Native Villages (Native Nations) are both (a) eligible to apply for LPFM stations and (b) entitled to a point in the point system selection process. The NPRM also seeks comment on whether Native Nations should be permitted to exemptions from the multiple ownership and cross-ownership rules so that they might in some circumstances own more than one LPFM station and full-service stations at the same time;

Permitting cross-ownership of LPFM stations and one or more FM translator stations;

Jiggering with the process for selecting from among mutually exclusive applicants in various ways designed to further emphasize and enhance the “local” nature of LPFM licensees and the service they’re likely to provide;

Alternative ways of dealing with tie-breaker and time-share situations.

Again, the 5th R&O is dense with material and should be studied carefully by anyone concerned about LPFM service – or about FM service generally. That includes any potential applicant for an LPFM station as well as any existing full-service licensee who might suffer interference from new or modified LPFM operations nearby. While the Commission obviously has a lot of ideas of its own here, the agency appears to be wide-open to any alternative suggestions that interested parties might want to lob in. 

The LCRA clearly establishes that LPFM as a service enjoys substantial Congressional support – which means that it will have to be reckoned with. The 5th R&O’s NPRM reflects an important opportunity to define how the LPFM service is to be integrated into the panoply of other FM services going forward. For that reason it warrants the serious attention of anyone using, or thinking of using, the FM band.

The NPRM of the 5th R&O has been separately published in the Federal Register which, as we all know by now, sets the deadlines for comments and reply comments. If you want to file comments on any of the FCC’s proposals, you have until May 7, 2012. Reply comments are due by May 21. Since the proposals include some “information collection” requirements, you can also tell the FCC what you think about those, thanks to the Paperwork Reduction Act – comments in that vein are due by June 5.

Third-Adjacent LPFM Spacings Eliminated (Almost)

Most, but not all, third-adjacent separation requirements for LPFM stations set to go away as of June 4, 2012.

For those of you keeping score, the third-adjacent channel separation requirements for low power FM (LPFM) stations are about to be history – like they were back in 2000, before they were reinstated in 2001, at Congress’s express direction. But last year Congress had second thoughts, and so it’s “see ya” once again to the third-adjacent protections . . . except that some will still be with us.

As previously reported, the Commission has recently devised a complex Rubik’s Cube approach to sorting out the longstanding stalemate between FM translator applicants and the LPFM Insurgency (since LPFM is by definition a not-for-profit undertaking, it’s hard to call it an “industry”). But that was only part of the FCC’s recent LPFM-related work. In a separate decision – formally titled (deep breath first) the “Fifth Report and Order, Fourth Further Notice of Proposed Rulemaking and Fourth Order on Reconsideration” (5th R&O) – the Commission has complied with Congress’s “unambiguous” direction and has tossed the on-again-off-again third-adjacent channel separation requirements applicable to LPFM stations.

The resulting rule changes, set out in the “Report and Order” portion of the 5th R&O, have now been published in the Federal Register. That sets the effective date for those changes. Mark your calendars: the changes are scheduled to take effect on June 4, 2012. (The “Further Notice of Proposed Rulemaking” portion of the 5th R&O contains a welter of proposed rule changes. Those have not yet been published in the Federal Register. We’ll address them in a separate post.)

The changes that have just been adopted are relatively narrow. 

In the Local Community Radio Act of 2010 (LCRA), Congress told the Commission to get rid of the third-adjacent minimum spacing requirements between LPFM stations and other FM band occupants (i.e., full-service FM, FM translators and FM boosters). How hard can that be? Just hit the Delete button every time “third adjacent” shows up in the LPFM rules, right?

Not so fast.

While Congress “unambiguously” wanted the Commission to deep-six third-adjacent protections, Congress also wanted to protect radio reading services (RRS) that operate on subcarrier channels which are particularly susceptible to (wait for it) third adjacent interference. So if you eliminate all third-adjacent separation requirements, which Congress wants, you threaten RRS operations, which Congress doesn’t want. Oops.

No worries. As it turns out, the Commission’s rules already included extra protections for stations carrying RRS on their subcarriers. Those rules, initially adopted back when the FCC first abandoned third-adjacent protection requirements for LPFMs in 2000, had become “redundant” when the requirements were reinstated the next year (at Congress’s insistence). Despite their redundancy, the Commission never got around to deleting the RRS protection rules. Good thing, since they will come in handy now that Congress has ordered those protection un-reinstated. As a result, Sections 73.807(a)(2) and (b)(2) of the LPFM rules will continue to contain some third-adjacent limitations on LPFM stations.

Oh, one more thing. Third-adjacent channel protection requirements applicable to LPFM stations in border areas will also remain in place. Treaties with Canada and Mexico impose such requirements, and nothing in the LCRA suggests that Congress intended to unilaterally revise those treaties.

While prospective LPFM applicants can presumably figure out fairly easily whether they’re close enough to the border to have to worry about the residual third-adjacent limits, the RRS question is another problem entirely. The FCC generally doesn’t regulate, much less keep track of, subcarrier use. As a result, figuring out what stations are actually carrying RRS on their SCAs may be a tad problematic.

Bottom line: Consistent with the will of Congress, third-adjacent minimum distance separation requirements for LPFM stations have been tossed . . . except (a) in border areas or (b) when the third-adjacent full service station happens to be providing RRS. The elimination (or, more accurately, semi-elimination) of these requirements is set to take effect on June 4, 2012.

Translate This! FCC Breaks LPFM/FM Translator Logjam

Complex process aims to preserve LPFM opportunities while allowing grants of some long-pending translator apps

In 2003 the Commission opened its doors to new FM translator applicants – and more than 13,000 applications walked in. Now, nearly a decade later, some 6,500 of those applications are still pending. But never fear. With some Congressional prodding (in the Local Community Radio Act (LCRA)), the FCC has knuckled down and devised a complex system for processing the remaining translator applications while assuring that translators will not gobble up all the available spectrum to the exclusion of new low power FM (LPFM) applicants. That system, first proposed last summer, has now been officially adopted in a Fourth Report and Order and Third Order on Reconsideration (4th R&O).

Congress insisted in the LCRA that the LPFM service be treated as “equal in status” to FM translators and boosters. Congress was less clear as to what, precisely, it meant by the phrase “equal in status”. Sorting that out was left to the Commission. The first 14 or so pages of the 4th R&O are devoted to identifying the “broad interpretive principles” underlying the LCRA. Feel free to read through them if you’re interested. For our money, your time would be better spent on pages14-25, particularly starting on page 19. That’s where the Commission explains its “revised translator application processing and dismissal policies” – i.e., how it’s going to cull grantable translator applications without shutting out LPFM wannabes.

It’s not necessarily pretty, and it certainly isn’t easy, but the Commission’s system seems to do the trick, preserving theoretical opportunities for future LPFMs while still allowing relatively prompt grant of more than 1,000 (by the Commission’s estimate) new translators from the applications filed in 2003.

If you’ve got one or more translator applications pending from 2003, pay attention. You’ll be having to do some homework, probably in the not too distant future. (The effective date of the new processes won’t be set until the 4th R&O makes it into the Federal Register. Check back here for updates on that – and know that the Commission is planning to move forward quickly with its efforts to clear the translator backlog while opening a filing window for LPFMs.)

Processing Pending Translator Applications

Here’s how the newly-adopted process is going to work.

Market Definition – “Spectrum Limited” vs. “Spectrum Available”

As previewed in last summer’s Notice of Proposed Rulemaking, the Commission has studied the availability of LPFM opportunities in the top 150 Arbitron markets (and six additional markets where more than four translator applications are pending). It did this by examining, for each of those markets, a thirty-minute latitude by thirty-minute longitude grid laid out over the center-city coordinates. The grid consists of 961 points (i.e., 31x31), and for each point the Commission analyzed the availability of all 100 FM channels for LPFM use. 

To be deemed available for such use, a channel at any particular point in the grid had to fully satisfy co-channel, first- and second-adjacent channel LPFM spacing requirements with respect to all outstanding authorizations and pending applications (including pending translator apps).

From the grid analysis the Commission determined how many LPFM availabilities exist in each of the studied markets. (“Availabilities” in this sense include both vacant channels and channels currently used by LPFM stations.) Armed with those determinations, the Commission then made an initial rough cut, dividing the studied markets into two groups: the “spectrum limited” markets (initially referred to as “dismiss all” markets) and the “spectrum available” markets (initially known as “process all” markets). The former consisted of markets where the number of LPFM availabilities fell below a certain “floor”. For Markets 1-20, the floor is eight channels; for Markets 21-50, it’s seven; for Markets 51-100, it’s six; and for the rest of the studied markets, it’s five. (FYI – The floor numbers were based on a “rough approximation of the number of noncommercial educational stations in the top 150 markets”, according to the Commission.)

The rough cut was then further refined. All markets initially designated as “spectrum available” were analyzed to identify markets in which the population is centrally concentrated. This was done by laying a 21x21 grid (rather than the original 31x31) over the market and checking the population within that 21x21 grid. If the 21x21 grid population amounted to 75% or more of the population in the 31x31grid, then the relevant “floor” for that market was determined by reference to availabilities only within the 21x21 grid, rather than the 31x31 grid. That exercise moved some of the markets from the original “spectrum available” column over to the “spectrum limited” side of the ledger. (The rationale for this additional step is that LPFMs may be best suited for urban communities, and use of the wider 31x31 grid might not provide an accurate assessment of spectrum availability in the actual population center.)

Using the results of that further analysis – along with up-to-date BIA information – the Commission devised its final lists of “spectrum available” and “spectrum limited” markets.

The Culling Process

Now let’s look at the pending translator applications. 

As a threshold matter, the Commission has adopted in the 4th R&O two separate caps on pending translator applicants. First, there’s a nationwide limit of 50 applications (from the 2003 filing window) per applicant. Second, each applicant may prosecute only one application in each of the 156 markets analyzed by the Commission. So if you’re among the pending applicants and you have more than 50 applications and/or more than one application per market, you will need to decide which of your horses you want to keep riding. The Commission will issue a public notice alerting applicants when and how applicants in that situation will have to advise the FCC which applications they plan to stick with – but be alert: much of the procedural spade work on this has been started already (including the Paperwork Reduction Act process), so things could happen quickly. While some analytical tools have already been made available to help run preclusion studies, word is that more such tools will be released soon. (Anyone who has to worry about tossing applications overboard should be careful NOT to consult with other applicants in making the decision about which apps to toss: as indicated below, the anti-collusion rules are still in effect.)

Once that winnowing process has been completed, all remaining applications in “spectrum available” markets will be processed, starting with any singletons and moving through the remainder of the mutually exclusive (MX) groups. MX applicants will be given an opportunity (probably no more than 90 days) to work out their mutual exclusivity by amendment or settlement – after which, it’s on to the auctions. Of course, amendments cannot preclude any LPFM availability identified in the grid studies. Amendments will be processed first-come/first-served, but unamended applications will enjoy cut-off protection against amendments filed during the settlement window.

As far as applications in “spectrum limited” markets go, there’s good news and bad news. The good news is that, contrary to the FCC’s original proposal last summer, all translator applications in “spectrum limited” markets will not be automatically dismissed. 

The bad news is that, to avoid dismissal, such applicants will have to demonstrate that they don’t cause any “preclusive impact” on protected LPFM channel/point combinations. There’ll be one opportunity to amend pending proposals to avoid such “preclusive impact”. It’s theoretically possible that some translator applications in some “spectrum limited” markets could squeeze themselves through the LPFM screen the Commission has established. For that reason, the elimination of the initially-proposed automatic universal dismissal is good, especially for proposals outside any market grid. (In-grid proposals, however, are less likely to make the cut.)

And there’s more bad news for any translator applicant proposing facilities outside the 31x31 grid in one of the Top 50 “spectrum limited” markets. If that’s you, you will also have to make a “Top 50 Market Preclusion Showing”, i.e., a demonstration that either:

(a) no LPFM station could be licensed at the translator’s proposed transmitter site or,

(b) if an LPFM station could be licensed at the site, an additional channel remains available for a future LPFM station at the same site.

Good luck with that.

A couple more tips on dealing with markets and grids.

First, deciding what’s a “protected LPFM channel/point combination” will vary, depending on whether you’re in a “spectrum limited” or “spectrum available” market. 

For “spectrum available” markets, an LPFM channel/point combination is entitled to protection only if an LPFM station at that site would meet all spacing requirements, including full spacing to all pending translator applications on co-channel, first- and second-adjacent channels. A pending translator application automatically meets that standard since, by definition, the hypothetical LPFM would have to be fully spaced to the pending application already. But note that, if the translator application is amended, all bets are off as far as the amendment goes: the amendment would have to demonstrate adequate spacing to all LPFM channel/point combinations.

For “spectrum limited” markets, on the other hand, the calculation (for both channel/point and Top 50 Market Preclusion studies) will “assume the dismissal of all translator applications in the market”. Also, neither of those calculations will take into account either (a) second-adjacent spacings to authorized stations or pending applications or (b) I.F. spacing requirements. In other words, the Commission is assuming that all LPFM applicants would be able to qualify for waiver of the second-adjacent spacing requirement, and it apparently doesn’t care about potential I.F. short-spacing.

Second, bear in mind that the grid for any particular market may be smaller than the market itself. LPFM opportunities that might exist outside the grid are not entitled to protection in either “spectrum limited” or “spectrum available” markets. So a translator application in any “spectrum available” market or any “spectrum limited” market below the Top 50 will be grantable if it specifies a site which meets the minimum LPFM-translator spacings. (And don’t forget that translator applicants in the Top 50 “spectrum limited” markets must also make that pesky preclusion showing.)

Other Matters

AM on FM Translators – The 4th R&O strikes a blow for the AM industry by expanding the universe of FM translators eligible to rebroadcast AM signals. In 2009, when such cross-service rebroadcasting was first permitted, the Commission limited eligibility for AM rebroadcasts to FM translators already authorized as of May 1, 2009. That meant that the 1,000 or so new translators which the Commission expects to grant out of the still-pending vintage 2003 applications would not have been available for AMers. The 4th R&O, recognizing that the cross-service option has been a “very successful deregulatory policy”, takes care of the problem by specifying that rebroadcast of AM stations will be permitted on any translator the initial application for which was pending as of May 1, 2009.

Since there haven’t been any new FM translator windows since May, 2009, that revised date limitation encompasses all currently existing and applied-for translators. As a practical matter, that may be all the translators there are likely to be. The Commission has committed to opening a new LPFM window before any further translator filing opportunities arise. The effect that that LPFM window will have on possible future translator opportunities isn’t clear. While a tsunami of LoPo applications could clog things up a lot, the flexibility of the translator rules may still afford plenty of opportunities down the line. We’ll just have to wait and see.

Freezes on New and Mod Translator Grants – Since 2005 there has been a freeze on grants of any of the 2003 translator applications, and since last year there has been a freeze on the filing of any translator “move-in” applications (other than relocations within the same “Spectrum Limited” market). Those freezes appear now to have been lifted. The 4th R&O expressly lifts the freeze on acting on any of the 2003 applications. It seems also to indicate that the move-in freeze is similarly lifted, although the 4th R&O is not as clear and unequivocal on that point as one might like. (Look for a clarifying notice on this, and possibly other aspects of the 4th R&O, at some point down the line.) 

Heads up, though. New move-in and mod applications that would bring a translator into a “spectrum limited” market will have to demonstrate that they will have no “preclusive impact” on protected LPFM channel/point combinations.

Anti-collusion Prohibitions Still In Effect – Translator applicants from the Class of 2003 should be aware that they are still subject to the anti-collusion rules, and will remain so at least through the process of identifying which applications they will continue to prosecute notwithstanding the application caps described above. As we have frequently cautioned prospective auction participants, those anti-collusion rules are strict, not necessarily intuitively obvious, and often unforgiving. Before discussing your plans and strategies with any third parties, you would be well advised to check those rules over to be sure that you’re not digging yourself into an unfortunate hole.

The Commission (and, in particular, the folks in the Audio Division) have completed a truly herculean task here. Sorting out the conflicting interests of translator and LPFM proponents was difficult enough, but doing so against the backdrop of 6,500 or so long-pending translator applications screaming for attention and Congressional direction that provided little useful, er, direction makes the accomplishment even more impressive. The way is now clear for the processing of a significant number of those translator applications. While it seems fairly obvious that few new translators will be authorized in the middle of major markets, that shouldn’t surprise anybody: the translator service was, after all, not designed for major markets.

Again, if you have one or more translator applications pending, you should be sure to get with your consulting engineer and start looking closely at the information from the FCC’s grids. It’s likely that you’ll be needing to make some decisions in the not-too-distant future, and the more time you give yourself to figure out your best move(s), the better off you’ll be when the time comes to make those moves.

FCC's USF/ICC Order: How It Affects Wireless Providers

A semi-brief overview, from the wireless perspective, of the massive order overhauling the Universal Service Fund and Intercarrier Compensation system

The FCC released its historic 751-page Report and Order and Further Notice of Proposed Rulemaking on the Universal Service Fund (USF) and Intercarrier Compensation on November 18, providing a sumptuous repast for the communications industry to feast on over the Thanksgiving holiday.   It took many readers a few weeks to fully digest the vast smorgasbord of items resolved by the Commission in this one proceeding.   But having pushed ourselves away from the table at last, we can now comment on particulars of the Order that most affect wireless providers.   The Order also very radically affects the rules governing intercarrier compensation and USF for wireline service, but we are reporting on those developments separately out of compassion for our readers.

Definition of Supported Services. The first big step taken by the Commission was to bring broadband within the universe of services supported under the USF umbrella. The FCC chose not to simply define broadband as a supported service, but instead to expand its definition of supported “voice telephony” to include VoIP. At the same time, the FCC is requiring supported voice telephony providers to provide broadband.  

This awkward dance permits the Commission to continue ducking the issue of whether broadband should be re-classified as a “telecom” service regulated under the common carrier regime of the Communications Act or an “information” service regulated only under the FCC’s ancillary jurisdiction. But this dance creates problems of its own.

Because USF support is expressly targeted at “telecommunications services,” the FCC jeopardizes its whole scheme for supporting broadband. For example, the FCC relies on Section 706 of the Act as a source of authority to support broadband through the USF. That section directs the Commission to accelerate the deployment of advanced telecommunications capabilities regardless of whether they are strictly “telecom” services. However, the Commission then imposes on non-telecom service broadband providers the same requirements that apply to regular eligible telecommunications carriers (ETCs) who of course are telecom service providers. 

One of the requirements so imposed is that an ETC must provide stand-alone voice telephony throughout its “designated service area,” yet many non-telecom broadband providers will not have designated service areas. Similarly, many broadband providers simply offer a broadband data pipe and do not care what particular applications (such as a VoIP application) their customers use over the pipe. Although it would make sense for such service providers to qualify for USF support, the Commission’s scheme would exclude them.

Required service levelsUSF fixed service recipients must provide broadband at speeds of 4 Mbps downstream and 1 Mbps up. This represents a great leap upward in the minimum speed expected of a broadband provider. Latency of less than 100 milliseconds is expected and, while monthly capacity requirements are not specified, the FCC expects wireless broadband providers to offer capacity limits consistent with those offered in urban areas. 

Build-out areas and “unsubsidized competitors”. USF support will be offered for the build-out of areas now unserved by an unsubsidized competitor.  The definition of an “unsubsidized competitor” is critical here because there are many areas where mobile wireless providers offer service and landline providers do not. This would prevent landline providers from receiving build-out support in those areas. The Commission protected local exchange carriers (LECs), however, by defining an “unsubsidized competitor” as a “facilities-based provider of residential fixed voice and broadband services.” Fixed voice and broadband service is defined as service to end users primarily at fixed endpoints using stationary equipment. This limitation to fixed services is curious since so many people these days are now cutting the cord not only for voice service but for data service as well.

Broadband service to end users primarily using mobile stations would not qualify. However, the FCC did note that a mobile services provider could become an unsubsidized competitor by offering fixed service that guarantees that the speed, latency and capacity minima applicable to fixed providers will be met throughout the relevant area. 

Elimination of identical support rule. The FCC has done away with the identical support rule which subsidized multiple carriers in any given area. This action alone hacks several hundred million dollars in support away from competitive ETCs (CETCs) because they now no longer qualify for duplicate payments. 

Strangely, the FCC did not seem to even consider the possibility that a CETC, whether wired or wireless, should be the surviving single recipient of the funding instead of the LEC.  It simply provided for a phase-out of support to existing non-LEC recipients by mid-2016. In addition to retaining their current subsidies (as revised to cut out certain support mechanisms), LECs also get the privilege of offering to be the sole provider of basic services in currently unserved areas in each part of a state where they provide service. That is, an existing LEC ETC may propose to provide the full panoply of supported services everywhere – but not less than everywhere – in the state where it is the designated LEC. 

If the LEC picks up that option, obviously no other carrier would be designated to provide fixed service in those areas. If no LEC picks up the challenge, then there will be unserved areas in each state where USF support will be offered by a reverse auction mechanism. Build-out in these currently unserved areas will be supported by a one-time distribution of up to $300 million to price cap LECs.

Mobility Fund (Phase I). The FCC is also offering a one-time build-out subsidy to mobile services providers via a Mobility Fund (Phase I). Under this program, up to $300 million will be distributed to companies willing to provide service to areas currently without 3G or better wireless service. (An additional $50 million is made available for build-out of unserved tribal areas.)  These funds are expected to be up for grabs by a reverse auction to be conducted in the third quarter of 2012. Several components of participating in this auction involve considerable lead time.

  • Identifying unserved areas. The FCC has promised to identify, prior to the auction, the areas that are actually currently unserved. This is a big improvement over the 2009 federal stimulus plan process where each individual applicant had to figure out for itself whether an area was unserved or not. In determining whether an area is unserved, the FCC will take into account commitments to provide service in an area (including stimulus fund-based commitments) made prior to the end of 2012. 

Unserved areas will be determined on a census block basis using road miles as the marker of mobile service. A tentative map of unserved areas will be posted prior to the auction, with the public given an opportunity to point out that areas have not been accurately characterized. A final map of unserved areas will be posted prior to the auction (typically a couple of months before), but that poses an obvious logistical problem: most interested parties will not have enough time to apply for ETC designation in those unserved areas.

  • Auction eligibility requirements. To participate in the auction, an entity must: (1) be an ETC; (2) have access to spectrum by ownership or lease; and (3) be financially qualified to provide service after the build out takes place. This raises a host of chicken and egg problems that the FCC does not seem to have adequately considered.  

First, in some states the ETC designation process can take years. By imposing this hurdle, the FCC is precluding perfectly capable and willing carriers from participation. 

Second, in many instances it may be impossible to serve as an ETC unless one is receiving USF support. One would be loathe to take on ETC responsibilities without knowing beforehand that the support money will be available, but the rules are set up backwards. The Commission alludes cryptically at one point in the Order to a “conditional” ETC designation where one could be designated as an ETC conditioned on receipt of USF support. This process would partly solve the problem, if both the FCC and the states will grant provisional ETC designations – something that is far from clear. In any case, interested parties should start thinking about applying for ETC designation now if they hope to participate in the auction.

Third, a prospective service provider whose viability depends on whether it will be receiving USF money might not be want to buy or lease the necessary spectrum without that assurance. Yet the Commission’s rules require that the spectrum be in hand. The sole break here is that the spectrum acquisition or lease may be conditioned on receipt of Phase I USF support.    

And fourth, the auction participant must not only certify that it is financially capable of providing service in the area after the build-out is complete, but also secure its obligation by posting a letter of credit in favor of the FCC. This unusual arrangement might preclude all but very financially well-heeled companies from being able to participate.

  • Obligations of winners.   Winners in the reverse auction will have to provide either 3G service (200kbps down/50 kbps up) or 4G service. The service provided must be measured by drive tests and reported to the FCC. Winners must also: allow collocation at reasonable rates on towers constructed with USF money; allow voice and data roaming; and charge rates comparable to urban rates.   Winning bidders who fail to meet their build-out obligation will default on their Line of Credit to the FCC and be required to repay all monies received under the program.
  • Auction procedures. Most of the details of the reverse auction have been left to the FCC’s auction staff to hash out, but the FCC did express a preference for a single-round sealed bid auction, as distinct from its normal multiple round bid process. This would obviously require bidders to make their single best bid at the outset with no opportunity to drop the bid lower in reaction to other bids.

Mobility Fund (Phase II). In addition to the one-time Phase I funding opportunity, the FCC plans a Phase II program providing funds to cover on-going costs of providing mobile service to areas requiring subsidies. $500 million has been allocated for this purpose, of which up to $100 million is prioritized for tribal needs.   This money will be awarded by a reverse auction process similar to that used for Phase II.  

The specifics of which areas – unserved? underserved? high cost? – will qualify for such subsidies are not yet clearly defined. In particular, if Phase II support is limited to unserved areas, that would seem to preclude recipients of Phase I build-out funding from qualifying for Phase II operations funding, particularly since they would have been required as a Phase I condition to attest that they have the financial wherewithal to operate without such support. Phase II will be fleshed out by the further rulemaking portion of the FCC action.

Intercarrier compensation (wireless issues only).   The second major subject area of the FCC’s order is intercarrier compensation, a field which spans all exchange of traffic between carriers and, now, some non-carriers. Because of the sweeping extent of the changes regarding intercarrier compensation, we will limit this discussion to items particular affecting wireless interests.

The FCC’s Order here is a genuine and fundamental sea change in the way traffic exchanges have been handled for generations.   Specifically, the FCC has adopted as its root principle that “bill-and-keep” should be the basis for exchanges. This principle – that each carrier should charge its own customers for service provided to them and not be compensated by other carriers that interconnect with it – represents a repudiation of the previously prevailing concept that the calling party is the party who benefits by a communication. Instead, the FCC now recognizes that both the called and calling party benefit by connection to the network and that each party should bear its own costs for participating. 

This radical reform at one swoop would erase a myriad of complex payment structures that have governed intercarrier relationships for years. To minimize the trauma of this upheaval, the FCC has provided a six-to-ten year transition period for LECs who have depended on these intrinsic subsidies. The ultimate effect of this reform should be positive for wireless carriers, since various access charges will be reduced or eliminated over time.  To be sure, the FCC did confirm that non-access traffic exchanged between wireless carriers and LECs (typically intraMTA traffic) is to be exchanged on the basis of interconnection agreements between the parties. But with bill-and-keep as the default payment model, non-LECs have a significant leg up in such negotiations. A few other points to be aware of:

  • The Commission did not immediately impose the bill-and-keep regime on originating access charges, though it capped those charges and signaled that intends to move in that direction.
  • The Commission intends its bill-and-keep principle to apply to both intrastate and interstate communications, but the Commission’s authority to impose this rule on intrastate communications is questionable. This issue will certainly be hashed out in the appeals that have already been filed in court.
  • Reciprocal compensation rates between CMRS carriers must be consistent with the rate model adopted for price cap carriers.
  • The FCC decided to treat all VoIP-to-PSTN traffic similarly, regardless of whether it is fully interconnected on a two-way basis. Such VoIP traffic is subject, in the case of toll traffic, to the same rates applicable to non-VoIP traffic, and in the case of other traffic, to reciprocal compensation agreements. This reform is intended to eliminate the widely decried disparity in treatment between VoIP and non-VoIP traffic. Here again the Commission’s refusal to denominate VoIP traffic as telecommunications could undercut its regulatory effort.

We have gone on at greater length here than is our wont, but only because the scope of the FCC’s order is so vast. We expect to be providing further guidance on some of the elements of the USF/ICC Order in the weeks ahead. 

In the meantime, interested parties should be aware that, since FCC’s magnum opus was published in the Federal Register on November 29, the date for seeking reconsideration of any part of the FCC’s action is December 29. Comments on the rate represcription, Connect America Fund, ETC, and auction refinement elements of the Further Notice of Proposed Rulemaking are due by January 18, 2012, and reply comments by February 17. Comments on the intercarrier compensation portion of the rulemaking are due by February 24. with replies by March 30.  

Judicial appeals are due no later than January 30.  Anyone thinking about taking the new rules to court should be aware that a number of other parties have already headed down that path – and, thanks to the U.S. Judicial Panel on Multi-District Litigation, it has been decided that the U.S. Court of Appeals for the Tenth Circuit, headquartered in Denver, will be the court to hear all such appeals in a consolidated proceeding.

FCC Issues Behemoth USF Order

759-page tome hits the streets, with surprisingly brief comment periods

Call me Ishmael! 

That’s how the Commission might have opened its leviathan Report and Order and Further Notice of Proposed Rulemaking (R&O/FNPRM) in the proceeding to overhaul the Universal Service Fund.  Weighing in at a hefty 489 pages – with an additional 16 appendices and four separate Commissioners’ statements bringing the total package to a whopping 759 pages – the document is physically daunting.  And to be perfectly honest, we haven’t read it yet.  But we plan to, and we expect to get a summary of it posted as soon as possible.

However, in a time-honored Washington tradition, the Commission unleashed the R&O/FNPRM at about 6:00 p.m. on a Friday evening.  That would be the Friday before Thanksgiving.  So the prospects for getting a post up in the next couple of days are limited. 

But we have previously reported on an “executive summary” released by the Commission last month, describing the outlines of the ambitious R&O/FNPRM, so interested readers may use that as a sort of Cliff’s Notes intro to the full version for the time being.  And anyone interested in participating in the proposed rulemaking portion of the proceeding better get reading.  Comments on some aspects of the FNPRM are currently due to be filed by January 18, 2012, with replies by February 17.  Comments on other aspects aren’t due until February 24, with replies by March 30.  With Thanksgiving and the year-end holidays fast approaching, those deadlines will arrive sooner than you know it.

Check back here for updates and further information.

FCC Launches Historic Reform of USF and Intercarrier Compensation Regimes

After one of the most hotly and intensely lobbied proceedings in its history, the FCC has adopted a framework by which to (a) reform and re-purpose the distribution of billions of dollars in Universal Service Fund (USF) money and (b) revise the financial arrangements governing the exchange of traffic between all categories of carriers. The stakes in this game are huge, because the FCC’s action upsets, albeit gradually, a generation of expectations about who receives and who pays for hundreds of billions of dollars in telecommunications services -- and how they pay for it. The sweep of the FCC’s action is so broad that there is something almost every industry player will love and something they will hate just as much.

At this writing, the FCC has not yet issued its magnum opus, a tome likely to reach Moby Dick-like proportions. The FCC’s action included both a Report and Order (R&O) adopting many new rules that will go into effect after publication in the Federal Register, and a Further Notice of Proposed Rulemaking (FNPRM) seeking comment on some important loose ends left hanging by the Report and Order.   A myriad of the details of the plan will be known only when the full text of the R&O is released; in the meantime, however, the FCC has released a brief Executive Summary outlining the most important provisions of the new regime. These include:

  • Redistribution of USF funds.   Acting more like Congress than an administrative agency, the FCC is re-purposing what we have known as the USF. Till now, the USF was a vehicle used to subsidize voice service in high cost areas and to low income consumers which was funded by contributions from customers. The FCC has re-dubbed this $4.5 billion pool of cash as the Connect America Fund, with the mission of assuring universal reasonably priced services that include both voice and broadband, with broadband now at least as important as voice, if not more so.   The Commission attacks the problem of excessive growth in the Fund by capping it at 2011 levels for six years. Although Christmas and Hannukah are still months away, the FCC plans to dole out: $300 million in one-time grants to price cap carriers to subsidize broadband build-out in areas unserved by any unsubsidized carrier; $300 million in one-time grants to wireless carriers to provide mobile broadband in unserved areas; and $50 million in funding for mobile service to tribal lands. All of these build-outs, we are earnestly told, are going to be subject to strict deadlines and quality control. The Mobility Fund will in addition get $500 million per year in on-going support, including $100 million for tribal areas. Another $100 million will go for annual support for the most remote, high cost areas. A hundred million here, a hundred million there. . . .
  • Price cap carrier reform. Price cap carriers will have their current high cost support frozen; support levels will be reduced where price cap companies charge artificially low rates; a forward-looking cost model will be generated to establish reasonable levels of high cost support going forward; and price cap carriers will be encouraged to make a state-wide commitment to provide affordable broadband service in most of their high cost service areas in a state.
  • Rate of return carrier reform. The FCC will require rate of return carriers, like price cap carriers, to deliver broadband at actual speeds of 4 Mbps down and 1 Mbps up if they expect to continue receiving subsidies. The FCC will gradually eliminate numerous programs of existing high cost support that allegedly have encouraged inefficiency, gold-plating and redundant services.   The FCC will look at reducing the current 11.25% rate of return which these carriers enjoy, while observing that they will take a second hit through reduced current intercarrier compensation revenues.
  • Identical support rule.   As expected, the FCC is eliminating the identical support rule via a gradual five-year phase-out.
  • Snuffing traffic pumping and phantom traffic.   The FCC blocks these two abuses by requiring: (a) LECs to lower their access tariffs in circumstances where it is clear that traffic pumping is going on (presumed if inbound traffic is three times or more the outbound traffic, or there is revenue sharing with a customer); and (b) all carriers and interconnected VoIP providers to include calling party number info in the signaling stream.
  • Fundamental Intercarrier Compensation reform. Here the FCC acted very boldly by adopting a bill-and-keep framework for exchange of all traffic with LECs. This dramatic step will significantly simplify intercarrier relations, though some will raise questions because costs differ among carriers. Since this new policy can be imposed only on interstate traffic, it will be up to the states to follow the FCC’s lead on this for intrastate traffic – or not. The FCC will effect a multi-year transition by first capping ICC rates, then bringing interstate and intrastate terminating end office rates into parity, then going to bill-and-keep after six years (for price cap carriers) and nine years (for rate of return carriers). These generous transition periods should ease the blow considerably for the carriers involved.
  • New recovery mechanism. Having eliminated some forms of subsidy to carriers, the FCC now establishes a new one. It will permit carriers to charge an ARC (Access Recovery Charge) not to exceed $1.20 -$1.80 for consumers (not including revenue recovered by existing SLC charges) and $12.20 for multi-line businesses (including the existing SLC). These charges are to be phased out over time and not applied to Lifeline customers.
  • VoIP and CMRS traffic. Toll VoIP to PSTN traffic will be treated like non-VoIP traffic, and non-toll traffic will be handled on a reciprocal compensation basis, ending claims by some VoIP carriers that they are not obligated to pay carriers who deliver their traffic to end users.   CMRS-LEC traffic will be handled on a bill-and-keep basis.

We have been critical over the years of the Genachowski Commission’s failings, but in this instance we have to credit it with finally taking on a many-headed monster that had defied regulatory reform for years, even though everyone agreed reform was needed.   There will still be plenty of argument and a spate of appeals before any of this is finally settled, but the FCC has at last set a firm course for USF and ICC reform and gotten the ship underway.

"Bill Shock" Off the Docket

FCC proceeding placed on hold as wireless industry adopts voluntary measures to reduce bill shock

As we reported a little less than a year ago, the FCC released a Notice of Proposed Rulemaking proposing that wireless carriers be required to take steps to avoid “bill shock”.  Readers with good memories will recall that in the summer of 2010, Congress, the Administration and the FCC were highly exercised about the heartbreak of bill shock. Numerous complaints were rolling in from parents of teenagers and international travelers, among others, who were shocked to discover that they had somehow exceeded their plan limits or incurred international roaming charges which they had not expected. Horror stories of phone bills of $34,000 and $18,000 prompted our trusty regulators to leap into action with a plan to make carriers warn consumers of impending danger before it strikes.

That was then; this is now.

The furor over bill shock died down in 2011, with the FCC turning its attention to other matters, and what had seemed to be a major consumer crisis in 2010 faded from the spotlight entirely.   Some carriers, chastened by the bad publicity and customer relations resulting from the horror stories, started voluntarily warning their customers about impending surcharges. Now that voluntary movement has crystallized into an industry standard.   CTIA (official name: “CTIA – The Wireless Association®” – don’t forget the ®, please), which is comprised of companies serving the vast majority of American wireless customers, announced that it has adopted new guidelines as part of its Consumer Code for Wireless Service. Dubbed the “Wireless Consumer Usage Notification Guidelines” (and appended to the Consumer Code as the eleventh provision), the CTIA’s standards appear largely to track the proposals put forth by the Commission last year. The plan calls for notification to consumers that they are about to exceed and/or have exceeded the minutes of use included in their plans, and notification when international roaming charges will be assessed. All notifications will be cost-free to the consumer, and they will be provided on an “opt-out” basis – i.e., unless Joe or Loretta Cell-User expressly chooses not to receive the notices, he/she can expect to be getting them.   

The guidelines are, of course, voluntary. No carrier has to abide by them, unless it voluntarily subscribes to the CTIA’s Consumer Code.  The notifications are to be phased in over the next couple of years. By October, 2012, participating wireless providers will be providing required alerts relative to at least two of the four service categories (i.e., voice, text, data and international use); full compliance is not due until April, 2013. The fine print on the guidelines has yet to be revealed – for example, how and when is the consumer supposed to receive these warnings?   Nevertheless, the FCC breathed a sigh of relief at not having to impose new regulations on an already highly regulated industry. If the industry is willing to police itself, all the better. So the FCC put its proposed anti-bill shock regulations back in the freezer in the hope and expectation that the industry guidelines will eliminate the problem.

This observer can attest that he has already gotten a timely warning from AT&T that his daughter was fast approaching the data limit on her smart phone plan. That warning resulted in a rather more forceful and dire warning being delivered to the daughter in question. Disaster safely averted. And possibly proof that common sense, bad publicity and the mere threat of regulatory intervention can sometimes work as well as actual governmental regulation in addressing social ills.

Closed Captions for the Open Internet?

The FCC proposes to require closed captioning for TV programming transmitted via the Internet; comment deadlines already set

The FCC has launched a rulemaking to implement the closed captioning sections of the 21st Century Communications and Video Accessibility Act (CVAA). The new rules will impose closed captioning requirements on certain online television programming; they will also require captioning capability for a wide variety of devices that are designed to receive or play back video, potentially including smartphones, computers, tablets, game consoles, video recorders, and set-top boxes.

Closed captioning is the text on a television screen that transcribes the audio portion of the program. (“Closed” means that viewers can turn the captioning on and off at will.) Today most television programming, whether delivered via broadcast, cable, or satellite, must carry closed captioning, and television sets 13 inches or larger must be capable of displaying the captions. But online television – think Hulu – has not been subject to these rules. And the rapidly-proliferating variety of non-television video display devices, like tablets, have not been required to have the technical capability to display captioning.

That’s about to change. Congress gave the Commission until January 12, 2012, to bring the closed captioning rules into the era of mobile and Internet television.

Online Video Captioning

The proposed rules would require captioning only for on-line television programming: i.e., programming offered by a television broadcast station “or generally considered comparable to programming provided by a television broadcast station.” This does not include “consumer-generated media,” so the FCC will not require closed captioning for the funny cat videos you post to YouTube. The FCC seeks comment on the scope of the new rule, asking, for example, what would constitute IP-delivered video programming that is not comparable to programming provided by a television broadcast station.

Furthermore, and importantly, the closed captioning requirement will apply only to programming that was previously shown with captions over traditional media such as broadcast or cable. The Commission proposes to create a mechanism through which distributors can find out whether programs they intend to show online have been previously shown on television with captions.

In contrast to the current closed captioning rules (the ones that apply to 20th century media, like broadcast and cable), the proposed rules place the primary responsibility for providing closed captioning of online video on content owners – the persons or entities actually holding the copyright, rather than the distributors. Video programming owners will be required to send program files with all required captions to video provider/distributors, who will then have to pass the captioned programming through to the end user. Either the content owner or the distributor can petition for relief based on a showing that compliance would be “economically burdensome.”

The NPRM follows the Act’s propensity to play fast and easy with the term “IP-delivered”, using it to mean, generally, “over the Internet.” Of course, data transmitted over the Internet uses Internet protocol (IP). But there is an ongoing transition to networks that deliver all content via IP, regardless of the communications channel. Some providers, for example, operate “triple play” lines to the home that deliver telephone, television, and Internet access using a single IP stream. The TV component of this service could be considered “IP-delivered” video, but it’s not over the Internet. To avoid unintended, duplicative, or confusing obligations, the Commission should clarify how the new rules will relate to these services.

Captioning Capability of Video Devices

The CVAA requires that, if technically feasible, any “apparatus” designed to receive or play back video programming, as well as any “interconnection mechanisms or standards,” must be able to display closed captions (or transmit them, as the case may be). The only exceptions are for: (1) display-only monitors; (2) devices with a picture screen less than 13 inches for which closed captioning capability is not “achievable”; and (3) devices for which the Commission has waived the requirement because they derive their essential utility from non-video purposes.

On the one hand, this represents a stunning expansion of FCC jurisdiction over a vast host of devices it has not previously regulated (except as to stray radio-frequency emissions). Device manufacturers may well become alarmed. On the other hand, except for PCs and larger laptops, most display devices may be able to claim an "achievability" exemption, an exemption available only for devices with less-than-13-inch screens. The iPad, for example, comes in at 9.7 inches, well under the limit, and most competing tablets are smaller. Furthermore, if the industry can settle on a standard file format for IP captions, a simple software switch would be enough to toggle the captions on and off. Added requirements for hardware display devices would then be essentially zero.

The FCC seeks comment on the definitions, terminology, and scope of the requirement, as well as the parameters of each of the exemption categories. Does “apparatus” include software? Are computer monitors exempt? How is “achievable” different from “technically feasible”? Is there a particular file delivery format that devices should support? What multi-purpose devices, or categories of devices, should be waived? And so on. Commenters should note the specific rule provisions set out in Appendix A that are not addressed in the text: for example, requirements allowing users to select the appearance and other properties of the closed captioning display.

The NPRM also proposes procedures for complaint and enforcement of the new rules, including a stipulation that “de minimis” failures will not be treated as rule violations.

This proceeding is set to move quickly, mainly because of the Congressionally-imposed deadline (January 12, 2012) for getting the rules adopted. The Commission’s Notice of Proposed Rulemaking got hustled into the Federal Register, as a result of which comments are due by October 18, 2011, and reply comments by October 28.

Update: New E911 Rules to Take Effect in November

Can you find me NOW? Come November, the chances may be better.

Back in July we reported on the adoption of some new rules designed to make it easier to monitor your location (ours too, but we're more concerned about our readers than ourselves) more precisely through your personal communications devices. The Commission’s Report and Order has now been published in the Federal Register, establishing November 28, 2011 as the effective date of the new rules (not including Section 20.18(h)(2), which has to go through OMB's Paperwork Reduction Act drill first). Some of those rules will be phased in over a multi-year period; others may have a more immediate impact on carriers subject to the more stringent testing regimen and the higher level of location-finding accuracy. Whether or not you the mobile device user will notice any difference is not clear, and probably won’t be until (a) you want to be located or (b) somebody wants to locate you. If the former, let’s hope the new rules work; if the latter, well, it probably depends on who wants to locate you and why.

Update: Reply Comment Deadline Extended (Again) in LPFM/FM Translator Rulemaking

If you’ve been burning the midnight oil working on reply comments in the LPFM/FM translator proceeding on the assumption that those reply comments are due on September 20, you can relax. The Media Bureau has extended the reply comment deadline by a week, to September 27, 2011. This comes at the joint request of the NAB and Educational Media Foundation, who observed that there are a boatload (that would be 47 in all) of comments to which to respond, several of which include extensive technical exhibits. Also, NAB/EMF pointed out that their counsel, and counsel for other interested parties, have been in Chicago at the NAB Radio Show this week.

NAB/EMF advised the Commission that several other parties – including Prometheus Radio Project – did not object to the requested extension. But hold on there, Sparky – it turns out that at least one party did object. That would be the Amherst Alliance, which lobbed in an opposition to the NAB/EMF request the same day that that request was filed. The Alliance (which describes itself as one of several “major LPFM advocacy groups”) took serious exception to any extension. Its concern is that deadline extensions will reduce the chances that the Commission may open an LPFM filing window next summer.

The Alliance’s fears about bureaucratic delay may be valid – but consider this: the NAB/EMF request was filed on September 15, and it was granted on September 16. Say what you will about bureaucratic delay, the Media Bureau can obviously move fast when it wants to.

Update: OMB Signs Off on Video Description Information Collections

It looks like all the pieces are now in place for the video description rules: OMB has signed off on the two information collection components of those rules, and that sign-off has made it into the Federal Register. So Sections 79.3(d) and (e) will become effective October 11, 2011. Those two sections involve, respectively: the process by which a video programming provider may request an exemption (based on “economic burden”) from the overall video description requirements; and the process by which anybody and his little brother may complain about perceived violations of the video description rules. As we have previously reported, broadcasters and MVPDs have until July 1, 2012 to bring themselves into full compliance with the overall video description regime.

Video Description: Back in the Books

All you TV broadcasters and MVPDs – mark your calendars! July 1, 2012 is the current deadline for full compliance.

Let’s have a big “welcome back” for the video description rules – they’ve been gone for years, but as we reported last March, Congress figured it was time to bring them back and now, voilà!

As required by the behemoth “21st Century Communications and Video Accessibility Act of 2010,” the FCC has adopted rules requiring the provision of video description.  (“Video description” involves voice-overs describing a program’s key visual elements. Check out our earlier post for a quick refresher course on video description.) The FCC tried almost ten years ago to impose such rules on broadcasters and certain multichannel video programming distributors (MVPDs), but the rules were struck down by the U.S. Court of Appeals for the D.C. Circuit. The court concluded that Congress hadn’t given the Commission the necessary authority.  That was then, this is now: the FCC now has authority in spades, with explicit instructions from Congress to reinstate the original rules – with a few tweaks.

The new rules are nominally “reinstated” as of October 8, 2011 – that’s what Congress required, and the Commission timed Federal Register publication of the rules accordingly. (One exception: Section 79.3(d) and (e) have to be run through the Paperwork Reduction Act drill before they can become effective.) But take heart – broadcasters and MVPDs have until July 1, 2012, to come into full compliance.

Broadcaster and MVPD obligations under the new rules include the following:

  •  ABC, CBS, Fox, and NBC affiliates located in the top 25 television markets (as of January 1, 2011) must provide 50 hours per calendar quarter of video-described prime time or children’s television. (Fuzzy on exactly current TV market rankings? Click here for the 2010-2011 Nielsen listings.) When the list of top 25 markets will be updated remains to be determined. Note that by the end of 2016, the 50-hour rule will apply to the top 60 television markets.

To count toward the 50-hour requirement, the programming must not have been previously aired with video description, on that particular channel or station, more than once. Only programming on the primary stream of digital broadcasters counts toward the 50-hour requirement. If another top-four network is carried on a secondary stream, however, it also must meet the 50-hour requirement, as though it were carried by a separate station. 

  • Multichannel video programming distributors (MVPDs) with more than 50,000 subscribers must also provide 50 hours per calendar quarter of video-described prime time or children’s television on the five most popular cable channels: USA, the Disney Channel, TNT, Nickelodeon, and TBS. (The list of “top five popular cable channels” will be revised at three year intervals, if ratings change.)  ESPN and Fox News are not on the list because they provide fewer than 50 hours per quarter of programming that is not live or near-live (i.e.,broadcast within 24 hours of recording).  Live and near-live programming is exempted from the rules due to the difficulty in furnishing video description in such a short time frame.
  • All network-affiliated broadcasters and all MVPDs must “pass through” video described-programming to their viewers if the network provides it, so long as it has the technical capability to do so and that capability is not being used for another purpose related to the programming (such as an audio stream in another language). “Technical capability” means having all the necessary equipment except for items that would be of minimal cost. This requirement extends to secondary digital streams and to low power broadcast stations. Any programming aired with description must always include description if re-aired on the same station or channel.

If a station or MVPD becomes newly-obligated to provide video description (through a new affiliation or by gaining more than 50,000 subscribers), it will have three months to come into compliance.

The Commission declined to carve out any special exemptions from the above obligations for local programming, news programming, and the like. The rationale: since only four hours of programming a week must be video described, and stations and systems can choose what programming to describe, they can simply choose not to describe any programming that poses any particular difficulty. However, if a video described program is interrupted by a breaking news bulletin, it will still count toward the 50 hours.

The rules are not without additional complexities, subtleties and possible surprises. They spread over six single-space pages, after all. So TV licensees and MVPDs would be well-advised to spend the next several months familiarizing themselves with the ins and outs of the new rules. Their requirements are likely to be with us with us for some time.

Update: Comment Deadlines Extended in LPFM/FM Translator Rulemaking

Forget about what they say about ill winds blowing no good. The East Coast’s recent encounter with Hurricane Irene has produced at least one arguable benefit: the Commission has announced that the deadlines for comments in the LPFM/FM translator proceeding have been extended for a week as a result of disruptions from the storm. The new deadlines: Comments are due September 6, 2011; reply comments are due September 20, 2011.

Update: Comment Deadlines Set re Proposed E-911 Rules

Last month we reported on the Commission’s proposal to enhance the location-identification accuracy of E-911 calls. That proposal has now been published in the Federal Register. As a result, the deadlines for comments and reply comments on that proposal have been established: comments are due by October 3, 2011; reply comments are due by November 2, 2011.

Update: Comment Deadlines Set in LPFM/FM Translator Rulemaking

With some proceedings, the FCC seems content to let its handiwork age tastefully before getting published in the Federal Register – like net neutrality, for example, or maybe the CableCARD report and order. That’s definitely not the case with the LPFM/FM Translator Third Further Notice of Proposed Rulemaking. Adopted on July 12, it’s already made it into the Register. That, in turn, establishes the deadlines for comments and reply comments. Get your calendars out: comments are due by August 29, 2011; reply comments are due by September 12, 2011.

New CALM Act Standard is Here! (Better get reading . . .)

As anticipated by the Commission (and reported by us), Advanced Television Systems Committee, Inc. has approved a successor to its A/85 Recommended Practice (A/85 RP).  Making it official, the Commission has issued a public notice alerting us all to the availability of the new version.

As we have also previously reported, Congress has ordered the Commission to incorporate A/85 RP into its rules in an effort to turn down the volume on “loud” commercials. The Commission, in turn, has dutifully proposed to amend its rules to include A/85 RP. But the initial comment date in that proceeding had already come and gone before the FCC announced that ATSC was expected to announce a “successor” to the version of A/85 RP described in the Commission’s NPRM. Not to worry – there’s still an opportunity to address the New and Improved version in reply comments. The Commission thoughtfully extended the deadline for reply comments in order to give interested parties the chance to mull over the new A/85 RP.

But don’t be mulling too long. The extended reply comment deadline is August 1 – six days from now.

2011 Reg Fees Set

No significant changes from May proposals; look for a September filing window

Sometimes the best surprise is no surprise at all. And the FCC has surprised at least some of us with its release of the final 2011 regulatory fee schedule. The surprise? As it turns out, with one very minor exception, the final fees are identical to the fees the Commission proposed back in May. (The one exception: the fee associated with satellite TV construction permits is $670, which is a whopping $5 less than the fee that was proposed back in May.)

Click here for a handy table listing the final 2011 reg fees. We’ve also included in the table listings of the differences between this year’s fees and last year’s, in case you’re interested in that kind of thing.

If you wade into the fine print of the Report and Order accompanying the new fee schedule, you find some routine caveats. For instance, you’ll be expected to use the FCC’s Fee Filer system to pay your reg fees (no real surprise there), and the Commission will not be sending out hard copy “pre-bills” to let everybody know what they’re on the hook for (ditto). (Helpful tip: the information that you would have received in a paper pre-bill will be available at Fee Filer, but don’t forget to doublecheck that information – the Commission has been known to make mistakes, and its calculations have historically not included fees for any auxiliary licenses you might have.)

The Report and Order does include an interesting statement relative to low power TV/Class A/TV translator fees.

Because of the on-going transition to digital operation in that particular sector, LPTV/Class A/Translator licensees may be operating a single analog station, or a single digital station, or two companion stations (one analog, one digital). Regardless of the mode you’re in (i.e., digital or analog), the FCC will be looking for a reg fee from you. That’s not unreasonable. But then the Commission adds: “In instances in which a licensee is operating in both an analog and digital mode as a simulcast, a single regulatory fee will be assessed for this analog facility that has a digital companion channel.” Note, in particular, the phrase “as a simulcast”. It’s not clear exactly what that is intended to mean. 

Presumably, if you have two companion channels, each broadcasting identical programming (one in analog, one in digital), you’d only owe a single reg fee. And if you have two such channels but provide completely different programming on each, we’re guessing that the Commission expects you to pay two separate fees, one for each.

But what if you’re using the digital station to provide not only a digital version of the analog’s programming, but also streams of other, completely separate programming? Arguably you’d be operating the two stations as a simulcast, meaning you’d only be stuck with a single fee. But the fact that you’re providing additional programming on the digital station might mean that it’s not a “simulcast” as the Commission means it.  We don’t know what the answer to this seeming conundrum is, but if you’re in this situation, it would probably be a good idea to get the answer tied down before you pay.

And speaking of paying, heads up. The Commission cautions that the fees are due when they are due, payable in full, thank you very much. (Late filers get hit with a 25% late fee.) If you think you’re entitled to a full waiver, or even just a reduction, you’re supposed to tender the full amount by the deadline, along with your request for waiver/reduction. If you’d rather not tender any payment at all with your request, you’ve got to request a deferral of the deadline – and that request must be accompanied by a showing of financial hardship. In other words, you can’t just plead poverty and expect to avoid having to pay by the deadline; rather, you have to document your hardship at the time you request the waiver/reduction.

Which brings us to the question of deadlines. When are this year’s fees due? The Commission hasn’t announced that yet, but it does allude in passing to a “September 2011 filing window”. Looks like we may not have to forfeit the deposit on that August beach house rental after all. (Check back here for updates on the deadline front.)

Finally, the Commission wraps up its Report and Order with a commitment to revisit “the nature and extent of all changes that need to be made to our regulatory fee schedule and calculations”. That inquiry – which the FCC assures us will be initiated before the end of 2011 – may lead to a “re-assess[ment of] the regulatory fee burden of all fee categories” as well as a “rebalancing of regulatory fees among existing service providers”. The Commission has been toying with the notion of such a proceeding for years, but this time it seems to be serious about it. We’ll see.

New CALM Act Standard Coming! (Take an Extra Six Days for Those Reply Comments)

Ten days after initial comments on proposed standard are filed, turns out there’s a different standard in the works

Talk about moving targets! The FCC has just extended (to August 1, 2011) the reply comment deadline in its CALM Act proceeding.  (For a trip down Memory Lane vis-à-vis the CALM Act, click here.) The original reply comments deadline had been July 18, but that had been extended at the last minute to July 21.

But the deadline, while obviously fluid, is not the most important moving target here.

The latest extension was granted at the request of the Advanced Television Systems Committee, Inc. (ATSC). ATSC, of course, are the folks who brought us the DTV technical standards. Those standards include the A/85 Recommended Practice (A/85 RP) which Congress has ordered the Commission to use as the regulatory standard for controlling loud commercials.  But get this – according to ATSC’s request for extension of the reply comment deadline, a new version of the A/85 RP is going to be approved (by ATSC) on July 26. (The Commission reports that the new A/85 RP will be available for review on the ATSC’s website on that date.) 

So it turns out that all the folks who filed comments addressing the proposed mandatory standard were addressing a standard that won’t be applicable after July 26.

Remind us again what the point of filing those initial comments was?

Of course, the new A/85 RP may not be substantially different from the old one. We won't know for sure because, as matters now stand, interested parties won't get their first official look at the revised A/85 RP until July 26.  Hey, isn't that a tad late?  No worries, since folks will now have until August 1 – that’s six days, total, including a weekend – to prepare and submit comments on it. Get out the Red Bull and stock up on No-Doz.

The Commission’s stuck between a rock and a hard place when it comes to the CALM Act. Congress has told the FCC (a) what to do (i.e., incorporate the A/85 RP into the rules, and then enforce it), and (b) when to do it by (i.e., December 15, 2011). But, through the Administrative Procedure Act, Congress has also instructed the FCC to engage in a notice-and-comment rulemaking proceeding as part of the process. Such a proceeding is designed – in theory, at least – to provide interested parties a meaningful opportunity to chip in their two cents’ worth on the proposed rule change.

When the guts of the proposed rule revision change on the eve of the final reply comment deadline (i.e., after comments have been filed), and when interested parties are then given less than a week to track down the revised proposal and get their thoughts together about it, it’s difficult to see that as a meaningful opportunity to comment. Rather, the Commission’s activities begin to resemble a parody of the administrative process.

Again, this is not entirely the Commission’s fault. But the Commission might have at least pretended to care about the interests of commenters by providing another week or two.

MORE New E-911 Rules: Can You Find Me NOW?

Never mind – the Man will know where you are, even if you don’t

Even as privacy advocates are getting increasingly nervous about the extent to which our communications devices keep tabs on our whereabouts, the FCC is looking to make it easier to monitor our location more precisely and over a broader range of devices.   In a combined Notice of Proposed Rulemaking, Third Report and Order, and Second Further Notice of Proposed Rulemaking (let's just go with R&O/NPRM for short), the FCC has taken steps to enhance E-911 accuracy in two respects.  

The new measures build upon rules adopted last year in which the FCC tightened and clarified the accuracy requirements for carriers who employ “handset” and “network” solutions for achieving specified location accuracy levels. (Handset carriers rely on the GPS capabilities of the customer’s handset to establish his or her location.   Network carriers rely on triangulation of radio signals among cell towers to find their customers.) By requiring accuracy levels to be met at the county or PSAP level, the Commission indirectly raised the accuracy bar by ensuring that high accuracy is achieved in all parts of a carrier’s service area. (The FCC provided exceptions for areas where dense forestation or the lack of triangulation would not permit these high levels to be reached.)   These accuracy requirements are to take effect over an eight-year period.

In the R&O/NPRM released July 13, the FCC has ordained that, following that eight-year implementation period, the Commission will do away with the separate network-based accuracy standard entirely.

The network solution was always less accurate and more problematic due to the need for at least three proximate towers to get a meaningful reading.   On the other hand, not all cell phones had GPS capability, so there had to be an alternative to the handset approach. But the FCC has determined that GPS capabilities have become so widespread – and are likely to become even more so – that exclusive reliance on the handset standard is appropriate.  Eight years, the Commission figures, should give the public plenty of time to wring the useful life out of their existing non-GPS-capable phones before those phones get turned in for something new. The FCC is, however, requiring CMRS systems coming on line after the effective date of the new rules to comply immediately with the more rigorous handset accuracy standard. (In any case carriers can continue to use whole or hybrid network- based location techniques – but they must nevertheless meet the stricter handset-based standard of accuracy.)

The new rules also mandate that carriers conduct periodic tests of their actual accuracy levels, with the results to be reported to local authorities and the Commission itself. The Commission feels, understandably, that if called upon to measure their performance regularly and be judged on the results, carriers will be more likely to make maintenance of accuracy a priority.   The exact nature of the tests to be conducted awaits recommendations from the Communications Security, Reliability and Interoperability Council.

Always looking for ways to further the reach of call location technology, the FCC is also seeking comment (in the NPRM portion of the R&O/NPRM) on whether it should extend the E-911 accuracy requirements to outbound-only interconnected voice services. (After much debate, the FCC a few years ago extended the location-identification rules to two-way, interconnected voice services provided over the Internet.  The problem was that a computer being used for VoIP doesn’t know where it is, nor does the network, so the customer has to affirmatively register his/her location so the system will know where he/she is. This is not a very good solution since it depends on the customer to vigilantly protect his/her own health and safety rather than making it the service provider’s responsibility.) 

So now the FCC is now asking: (a) if it should extend this requirement incrementally to include one-way VoIP calling (a “Skype-out” only situation); and also (b) whether there is some way technically to locate VoIP users that does not depend on registration by customers themselves.   No one yet has been able to figure out how over-the-top VoIP providers can possibly do the latter.  

The FCC is also seeking input on how indoor calling locations can be established more accurately. This capability will be increasingly helpful as more and more consumers use their mobile phones as their only phone. Locating a cell phone in a ten-story apartment building on a city block would be impossible even with the strictest outdoor standards adopted by the Commission. Finally, the FCC wants to see if WiFi hotspots can somehow be used to help locate callers.

Comments on this forward-looking part of the FCC's action are due 60 days after publication in the Federal Register, with replies 30 days later. (Check back here for updates on those deadlines.)

We cannot close without sounding a warning note on the civil liberties front. The FCC certainly means well in trying to compel carriers and VoIP providers to carefully, constantly and precisely track the location of their customers. But the potential for abuse is already apparent. Divorce lawyers have discovered that they can track an errant spouse's whereabouts by cell phone. Law enforcement now relies on cell phones to easily track not only fugitives from justice but also “persons of interest”. Merchants track people’s whereabouts so that coupons and promotional offerings can be sent to them when they are immediately next to the potential point of sale.  

Knowledge of a person’s location, it turns out, is a valuable commodity indeed.  

But we are being forced to give this knowledge away for free and without any opt-out choice. The Commission’s R&O/NPRM nods at the privacy concerns raised by the heightened location requirements, but also notes that consumers’ privacy rights are statutorily waived in connection with the delivery of emergency services.

Imagine if a chip were compulsorily implanted in each of us at birth that would permit a government computer to know where we are at all times. In some ways that would be very useful – no lost children, no missing persons, no wandering dementia victims – but the notion is an affront to the inviolability of our persons. Unfortunately, the cell phone, which has become a kind of externally-appended computer chip for many of us, will soon serve that exact function.   We are learning once again that “security” is too often purchased with a subtle loss of privacy, a loss of freedom, and a loss of that most  cherished right cited by Justice Brandeis in his dissent in Olmstead v. United States: the right to be let alone.

LPFM v. FM Translator: The FCC Moves to End the Stalemate

With Third Further Notice of Proposed Rulemaking, FCC looks to implement Local Community Radio Act, open LPFM window, and complete processing of long-pending translator applications

It looks like the long-running stand-off between FM translator applicants and low power FM (LPFM) applicants may finally be heading toward some resolution. And from initial indications, it looks like the LPFMers are likely to get the first crack at available spectrum, based on a just-adopted Third Further Notice of Proposed Rulemaking (3rd FNPRM). (As of this writing, the full text of the 3rd FNPRM hasn’t been released; the Commission has issued a public notice describing it.)

The FCC’s action is, of course, an upshot of the enactment of the Local Community Radio Act (LCRA). The LCRA was Congress’s effort to help sort out the translator/LPFM problem which has been festering for years. 

The 3rd FNPRM invites comments on ways to increase the available opportunities for LPFM applications.  In particular, the proposed new rules would favor LPFM over FM translators in the top 150 markets by ensuring some LPFM spectrum availability before any new translators are authorized. Score one for LPFM. But on the translator side, the Commission is proposing not to re-impose its on-again-off-again limit of 10 translator applications per party -- at least not in areas where translator applications survive the new rules. (The Commission imposed a 10-application limit back in March, 2008, only to suspend it a month later.) Additionally, the freeze on the processing of translator applications would be lifted in “smaller markets and rural communities”, i.e., in places where there’s space for both new LPFMs and new translators.

To determine where translators might be allowed, the 3rd FNPRM contemplates an LPFM channel “floor” in the top 150 markets: unless a certain number of channels are available for LPFM in any specific market, no new FM translator applications would be accepted in that market, and any pending translator applications for that market would be dismissed.  Comments are invited on various important details, presumably including how the floor number might be determined, how a “market” should be defined, and whether existing LPFM stations – or only channel availability for new stations – will be counted in determining whether the floor test has been met.

The Commission intends to open a window for new LPFM applications once the availability of spectrum has been established through the market-floor process. That could be the final window for either LPFMs or FM translators if, as anticipated, applications filed during the window completely exhaust the available spectrum.  The filing window won’t likely open until comments and reply comments in response to the 3rd FNPRM have been submitted and the Commission has released a report and order adopting new rules. 

While that process would ordinarily be expected to take a year or more, Chairman Genachowski expressed hope that the LPFM window could be opened in the summer of 2012.  That schedule is optimistic in any event – even more so in view of the fact that, in addition to the various questions posed in the 3rd FNPRM, the Commission will also have to resolve, in a separate proceeding, a number of other issues necessary for the implementation of provisions of the LCRA. And let’s not forget about the possibility of appeals that might interfere with (or at least discourage) the immediate implementation of any new rules that might be adopted within the next year or so.

Other to-be-resolved questions include: how the Commission plans to address the issue of second-adjacent channel protection for full-power stations, and the related issue of how LPFM applicants may use signal contour plotting (as opposed to fixed mileage separations) to demonstrate that they won’t cause interference. Once such issues have been ironed out, we should all have a better fix on precisely how many channels may be open for filing in the LPFM window (and, thus, about how many applications might be expected).

Processing of long-pending FM translator applications is expected to resume in rural areas and larger communities where the LPFM channel floor is met – but, again, that won’t happen in larger communities until the conclusion of the just-started rulemaking, at the earliest, and it will be tricky even in rural communities while open questions remain about how much spectrum will be reserved for LPFM.

The NPRM also includes proposed limitations on the sale of FM translator licenses. The FCC apparently believes that many FM translator applications were filed by speculators whose primary objective is to sell rather than to operate stations. Whether the FCC will require construction and operation for a minimum period of time or simply restrict sales as it does for LPFM stations remains to be seen. The Commission presumably hopes that it can discourage many such speculators into simply walking away from their applications.

The NPRM would also open up more translators for potential use by AM radio stations.  The present rule allows the rebroadcast of an AM station on an FM translator only if the translator’s underlying permit (or license) was issued prior to May 1, 2009. The Commission invites comment on whether to eliminate that restriction and allow AM stations to use any translator for which an application was filed in the 2003 window, no matter when granted. 

Since there remain a significant number of pending translator applications which might still be granted, the elimination of that restriction would obviously expand the universe of translators available to AM primary stations. Of course, since it’s reasonably certain that many FM translator applications will be dismissed to preserve room for LPFM stations in the top 150 markets, that expansion might be limited to very rural areas. And, since no new translator window is expected until after the next LPFM window – and, as noted, it’s entirely possible that there will be no further new windows for either LPFM or translators if the next LPFM window sucks up all the spectrum – it is extremely unlikely that AM licensees will have an opportunity to file for new translators of their own.

Outage Reports On the Horizon for Interconnected VoIP Providers?

Proposed extension of outage reporting requirements beyond traditional wireline and wireless providers underscores increasing significance of VoIP and Internet providers.

When communications systems go down, bad things can happen. Network system outages – be they wireless, wireline, satellite or cable – are more than an inconvenience. Those systems provide a vital link between consumers and the public safety services they depend on, particularly in emergencies.  Largely because of that, the Commission has, for nearly 20 years, sought to stay informed about network system outages. Starting with wireline carriers (in 1992) and expanding to include wireless, satellite and cable folks 12 years later, the Commission has required carriers to report network outages that reach certain levels of seriousness. According to the Commission, these reports permit the Commission to “address communication system vulnerabilities and help prevent future outages.” (The reporting requirements are set out in Part 4 of the FCC’s rules.)

As a further indication of the increasing significance of VoIP on the communications landscape -- and, consequently, VoIP's increased potential exposure to regulation -- the Commission has issued a Notice of Proposed Rulemaking (NPRM) which would extend its Part 4 outage reporting requirements to interconnected VoIP and broadband Internet access service providers (including Internet backbone network providers). The Part 4 rules require providers to report outages or serious degradations that last 30 minutes or longer and meet certain other thresholds (such as number of calling minutes affected).

The FCC sees this move as necessary because of the increasing number of people who depend on VoIP for all voice service, including 911 calls.  According to the Commission, market forces and network design have not been enough to ensure network reliability or prevent significant outages.  Rather, the Commission figures that intervention by the Commission itself affords the most effective means of reducing outages – and mandatory outage reporting gives it essential information in that mission.

To support this theory, the Commission offers the following: “[T]he frequency of wireline outages, which had spiked in 2008, has dramatically decreased since the issue was identified through the Commission’s ongoing, systematic analyses of monthly wireline outages.” That observation, while arguably true, is not necessarily persuasive. The wireline reporting rule, after all, has been in effect since 1992 – so it’s not clear how a spike in outages in 2008 and subsequent decrease can be said to demonstrate the rule’s effectiveness.   Likewise, the Commission’s claim that, in 2010, Commission staff finally discerned that outages were being caused by a relatively small number of factors – each of which could be addressed by applying a known best practice – suggests that the FCC may have fallen victim to the correlation/causation fallacy. (Wiki refers to that as “cum hoc ergo propter hoc”, which may thrill Latin scholars everywhere – but we prefer the XKCD illustration of the same phenomenon.)

While the NPRM seeks input on many particulars, the proposed new rules would essentially require both facilities-based and non-facilities-based VoIP providers, as well as broadband Internet access service providers, to report outages of at least 30 minutes or more that also meet certain other criteria. In keeping with the current rules, the FCC proposes to include degrees of degradation based on latency, jitter, and the like in the definition of “outage.” Timing would track the existing rules: a first report within 120 minutes of discovering the outage, with follow-up reports at 72 hours and 30 days. Reports are to be made electronically, through the Commission’s “Network Outage Reporting System” (NORS).

Commissioner McDowell concurred with the NPRM generally, even though he disagreed with his colleagues on the fundamental issue of whether the Commission has authority to do what it’s trying to do. In McDowell’s view, the FCC simply doesn’t have the authority to impose outage reporting rules on broadband Internet service providers. The majority, on the other hand, point to the FCC’s direct statutory authority to “protect and promote the availability of 9-1-1 services for customers of interconnected VoIP service,” noting that unless the FCC can guarantee the reliability of the underlying networks carrying VoIP service, it cannot fulfill its statutory mandate of ensuring that VoIP 911 calls will get through.   Despite his misgivings on this issue, McDowell was willing to open the question up for discussion, which is all the NPRM does at this point. Whether the ensuing discussion will persuade him that Congressional authority really is there remains to be seen.

Comments are due by August 8, 2011 and reply comments are due by October 7, 2011.

Update: Comment Deadlines Re Radar Rule Relaxation Set

Last month we reported on a Notice of Proposed Rulemaking looking (among other things) to ease power limits for vehicle-borne radar units – you know, the kind of gear designed to improve traffic safety by sensing nearby objects (like stopped cars ahead or traffic in your blind spot). The NPRM has now been published in the Federal Register, which establishes the deadlines for comments. The deadlines: comments are due by July 18, 2011; reply comments are due by August 1

Update: Comment Deadlines Set In BRS/EBS Rulemaking

Last week we reported on a proposal to relax out-of-band emission limits for the Broadband Radio Service (BRS) and the Educational Broadband Service (EBS), operating in the 2496-2690 MHz band (a/k/a the 2.5 GHz band). Acting with impressive speed, the Commission has now published that NPRM in the Federal Register. That, in turn, sets the dates for comments and reply comments. As we indicated in our original post, the comment periods seem somewhat abbreviated – comments are due by July 7, 2011, reply comments by July 22 – so if you’re of a mind to submit some thoughts to the Commission, you should probably get on it sooner rather later.

Update: CALM Act Comment Deadlines Set

Well, that didn’t take long. Barely a week after the release of the CALM Act Notice of Proposed Rulemaking, that NPRM has been published in the Federal Register. As a result, we now have comment/reply comment deadlines to pass along. Mark your calendars: comments are due July 5, 2011, and reply comments are due July 18.

As we noted in our post describing the NPRM, it’s probably best not to expect any extensions of these deadlines. Despite the fact that it took five months to crank out the NPRM, the Commission’s now in hurry-up mode, presumably because of the deadline that Congress imposed on the Commission. Under the CALM Act, the FCC has until mid-December to wrap the proceeding up and adopt new rules intended to put the kibosh on loud commercials. That means that, as of July 18 (the close of the reply comment period), the Commission will have a scant five months to get the job done. The pressure’s on.

TV folks would do well to get familiar with the NPRM’s proposals sooner rather than later. The new rules will affect all commercial TV broadcasters as well as MVPD operators, and it will affect them relatively soon (Congress specified that that new rules will have to be effective one year after the Commission adopts them, although individual waivers may be available).

Bear in mind, too, that the CALM Act’s proponents may have oversold the likely effects of the new law. (One example: Commissioner Copps’s bold assertion that “relief is on the way for viewers who have been complaining for nearly 50 years about loud commercials”.) As a result, a lot of the Public At Large may end up harboring the somewhat unrealistic notion that every time they hear something on TV that they think is too loud, they can get it corrected with a quick email to the FCC. The more that notion gains currency, the more complaints the Commission, and the industry, can expect to receive. But in view of the largely subjective nature of “loudness”, the new rules may not meet the happy expectations that are being loaded onto them.  When the rules finally take effect, it will not be surprising if the public experiences large measures of confusion, frustration and, in the end, disappointment. We shall see.

Broader Broadband For 4G Networks?

FCC contemplates relaxation of out-of-band emission limits in the 2.5 GHz band.

The FCC has proposed to relax out-of-band emission limits for the Broadband Radio Service (BRS) and the Educational Broadband Service (EBS), operating in the 2496-2690 MHz band (a/k/a the 2.5 GHz band). These services were formerly known as MMDS and ITFS. Their spectrum is now largely leased to Clearwire, Nextwave, and others for 4G mobile broadband services.

Clearwire is the largest current user of the band. It relies on WiMAX technology, which typically utilizes 10 MHz channels. But Clearwire and other service providers are thinking that wider bandwidths might be in order. Clearwire would like to migrate to WiMAX2, while other service providers (and maybe Clearwire as well in the future) are considering Long Term Evolution-Avanced (LTE). Both WiMAX2 and LTE contemplate channel bandwidths of 40-100 MHz.

At first blush, there doesn’t seem to be much reason why the FCC should not allow operators to choose their own bandwidth, and thereby improve 4G broadband performance. Except for one thing: it isn’t as easy – or cheap – to mask out-of-band emissions as sharply when using a broader desired bandwidth as it is when using narrower bandwidth. Faced with this conundrum, the Wireless Communications Association International (WCAI) asked the FCC to loosen the mask.

Ouch! cried some of the people who use adjacent bands for things like Mobile Satellite and TV Broadcast Auxiliary Services. Don’t tread on me!  Spicing things up, one developer/manufacturer of LTE-Advanced gear chimed in that it can produce 20 MHz bandwidth equipment that complies with the existing out-of-band limits. In this manufacturer’s view, no relaxation of the current mask is necessary because the equipment it makes will take care of the problem even at the broader bandwidths. 

According to WCAI, however, other equipment manufacturers support the proposed relaxation as “an appropriate and reasonable trade-off between form factor, battery consumption, and performance”. Worry not, says WCAI, because our mobile units normally don’t occupy the entire bandwidth, and they keep their power low to conserve battery capacity – so overall, the benefits of a relaxed mask outweigh the risks.

What shall we do with no consensus, the FCC asks? A mitigation rule is already in place that requires base stations to comply with a tighter emission mask within 60 days of receiving a documented interference complaint. Mobile devices operate with lower power and do seem to be less of a threat. So the Commission reasons that maybe it can lighten up – but should it also anticipate future bandwidths even wider than 20 MHz, and should it change mobile mask limits to make it easier and cheaper to make those ever-smarter devices without which no self-respecting teenager or twenty-something would be seen on the street?

Comments will be due 30 days after the proposals are published in the Federal Register, with Reply Comments only 15 days later. Those short times suggest the FCC does not expect a major brouhaha. It remains to be seen whether they guessed right.

The CALM Act: The Next Step

FCC NPRM seeks input on implementation of legislation targeting “loud commercials”

As we noted back in December, when the President signed the CALM Act into law, the action on the loud commercial front shifted from Congress to the FCC. The CALM Act, intended to lower the volume (or more accurately, the “loudness”) of commercials on television, did not itself change any rules. Instead, the Act merely instructed the FCC to change the rules. To move things along quickly, Congress spelled out, in considerably more detail than is often the case, just how the Commission is supposed to lower the Cone of Silence onto the TV industry (including broadcasters and MVPDs) – and Congress imposed a tight schedule for getting things done. Now, nearly six months later, with the issuance of a Notice of Proposed Rulemaking (NPRM) the FCC has taken its first formal step toward meeting that schedule.

If you’re not up to speed on all this, you can find a number of posts tracking the history of the CALM Act here.

The vexatious problem of seemingly loud commercials has been around for decades, chronically confounding would-be regulators. The breakthrough that led to the CALM Act arrived with the transition to digital television technology, which affords considerably greater control over the various components of the transmitted signal. As part of their effort to develop the technical standards governing DTV, the Advanced Television Systems Committee (ATSC) devised a “recommended practice” (RP) for “establishing and maintaining audio loudness”. That RP – dubbed ATSC A/85 – can be found here. While the ATSC A/85 RP was initially just “recommended”, Congress stepped in (via the CALM Act) and ordered the FCC to impose that RP as a mandatory standard.

The FCC’s NPRM is the next step in that process. And while you might think that the process would be simple – since Congress (by incorporating ATSC’s work) has spelled out the technical details to be imposed – the project turns out to be somewhat more complicated.

The NPRM proposes to explicitly include the ATSC A/85 RP in the technical rules governing over-the-air and MVPD television. No surprise there – it’s what Congress ordered. But the ATSC A/85 RP assumes that the transmission system includes audio compression capability consistent with the Dolby AC-3 DTV audio standard. Since that standard is included in ATSC Standard A/53 (the overall Digital Television Standard incorporated by reference in Section 73.682(d) of the Commission’s rules), DTV broadcasters are already subject to the standard. Some, but not all, MVPDs (e.g., cable and satellite operators) also use that standard, but the fact that some don’t complicates things. Additionally, programming is often not produced by the broadcaster or MVPD operator who would ultimately be subject to the new rules – that, too, adds a level of complexity to the implementation of the CALM Act.

As best we can tell – and, frankly, there’s a reason that some of us went into communications law rather than psycho-acoustics – the ATSC A/85 RP is based on a recommended “measurement algorithm” developed by the International Telecommunication Union Radiocommunications Sector. That algorithm (“ITU-R Recommended BS.1770”) provides a “loudness measure standard”, i.e., a numerical value indicating the “perceived loudness” of any particular audio content. That value is then encoded as a metadata parameter – called the “dialog normalization”, or “dialnorm” – in the audio content of the programming. According to the Commission,

[t]he “golden rule” of the ATSC A/85 RP is that the dialnorm value must correctly identify the perceived loudness of the content it accompanies in order to prevent loudness variation during content transitions on a channel (e.g., TV program to commercial) or when changing channels.

If the dialnorm parameter is set properly, the transmitted signal (which includes the dialnorm metadata) instructs the AC-3 audio decoder in the consumer’s home receiver to automatically adjust the volume to eliminate loudness spikes during content transitions such as commercial breaks.

So commercial TV stations and MVPDs will have to be able to insure that the dialnorm settings for their commercial content are set right. This can be done through loudness measurement devices and/or software, file based scaling devices, or real time loudness processing devices – as long as the chosen mechanism can measure loudness using the ITU-R BS.1770 algorithm. (The FCC observes in passing that it does not plan to provide any equipment authorization or verification system, although the FCC does solicit comments on the steps affected video providers may be required to take to confirm that their gear will do the trick.) The good news is that, if such providers do install proper equipment – and utilize and maintain that equipment, all “in a commercially reasonable manner” – they will enjoy a “safe harbor”. That is, they will be deemed to be in compliance should any complaints about loud commercials roll in the door. 

The bad news is that the equipment needed to control all this could cost anywhere from a few thousand bucks up to $20K per device, depending on a number of factors.

Over and above this “safe harbor” approach, the Commission suggests that it might permit TV stations and MVPDs to demonstrate, in response to a complaint about loud commercials, that the dialnorm of the complained-of commercial did in fact match the algorithm-generated perceived loudness value for that commercial.

The issue of who is in fact responsible for loud commercials raises some thorny questions. The CALM Act explicitly places that burden on the TV licensees and MVPDs whose programming is received by the consumer. But, as we all know, those licensees and MVPDs rely on a variety of others to produce the programming that they transmit. In addition to their own productions, TV stations get their programming from networks, syndicators and other program producers. MVPDs similarly get theirs from the same sources, and from TV licensees. Mindful of that fact of video life, the Commission suggests that TV licensees and MVPDs may want to include contractual provisions (including indemnification clauses) in their programming contracts. That would not completely relieve the licensee/MVPD of responsibility – since the statute expressly puts them on the hook for it – but such a contractual approach might help demonstrate compliance with the ATSC A/85 RP.

The NPRM is dense with technical information. All licensees and MVPDs who might be affected by it should be sure to review the NPRM in detail with their engineering consultants to make sure that you have a handle on the nitty-gritty. Other questions posed by the Commission include:

  • Since the CALM Act is addressed only to loud “commercials”, how should that word be defined? For example, does it include station programming promotional announcements? How about political advertising?
  • Also in light of the “commercial” focus of the Act, should noncommercial TV licensees be exempt from the loudness rule? (The Commission suggests that noncommercial TV licensees will “largely” not be affected by any of this because, by definition, noncommercial stations are prohibited from broadcasting “commercials”.)
  • How should the term “commercially reasonable” be defined when it comes to installation, utilization and maintenance of the equipment relied on to claim “safe haven” status?

Note also that the ATSC A/85 RP – that is, the recommended practice that forms the core of the proposed rule change – is itself a work in progress. ATSC continues to review and refine its various recommendations. The A/85 RP was first adopted in 2009, but was most recently revised in May, 2011. Since the CALM Act requires incorporation of the ATSC A/85 RP into the rules, the Commission understands that Congress intends the rules to be updated as required to reflect any future revisions of the RP.

Looking down the road, the Commission also solicits comments on how the complaint process should work. The current thinking is that complainants would file online (or by fax or letter), clearly indicating: (a) the complainant’s contact information; (b) the name/call sign of the broadcast station or the name/type of MVPD against whom the complaint is directed; (c) the date/time of the loud commercial complained of; (d) the channel/network involved; (e) the name of the TV program during which the incident occurred; (f) the name of the commercial advertiser or product involved; and (g) a “description of the loud commercial problem”. The Commission would then conclude whether “a possible violation of our rules” has occurred, although the NPRM doesn’t let on how that determination might be reached. Complaints will be forwarded to the targeted station or MVPD for appropriate response.

Since compliance with the loudness requirements will likely involve some not-insubstantial costs, the Commission (at Congress’s direction) is also looking into financial hardship waivers. The NPRM proposes that any station or MVPD asserting such hardship be required to provide, at least 180 days prior to the effective date of the rules: (a) evidenced of its financial condition; (b) a cost estimate for the equipment necessary to assure compliance; (c) a detailed explanation of why postponement of compliance is warranted; and (d) an estimate of how long it will take to comply. The Commission is also open to considering a “streamlined financial hardship waiver approach” for small market broadcast stations and small MVPD systems.

The comment and reply comment deadlines have not yet been set; they will be 30 days and 45 days, respectively, after the NPRM is published in the Federal Register. (Check back here for updates.) Don’t expect any extensions of the deadlines: the CALM Act mandates that the new rules be adopted within one year of the Act’s enactment, which means that the Commission will have to wrap up this proceeding by early December, a scant six months from now. Once the new rules are adopted, they will have to take effect within a year, i.e., by early December, 2012.

While all the nifty, whizbang technology on the table here – ATSC A/85 RP, Dolby AC-3, ITU-R BS.1770 algorithms, etc. – may promise blessed relief from the scourge of loud commercials, there is reason for skepticism. Unlike “volume”, which is an objective, readily measurable characteristic, “loudness” is not an objective feature that is easily susceptible to measurement. Rather, it’s the subjective effect that occurs when sound reaches an ear. That’s why the ATSC had to rely on algorithms – essentially, a model or estimate based on the results of group studies – to come up with the dialnorm factor on which the ATSC A/85 RP depends.

But the vast majority of TV viewers are in all likelihood blissfully unaware of the algorithms and other technology, and those viewers will certainly not undertake any objective measurements on their own. Rather, to identify “loud” commercials, we can reasonably expect most viewers to use a variation of Potter Stewart’s hard-core pornography test: they will know it when they hear it . . . or, rather, when they think they hear it.

So while the new technology may provide TV stations and MVPDs a defense against claims of loudness, it’s a near certainty (to this observer, at least) that complaints will continue to roll in. Indeed, the extensive publicity likely to accompany the adoption and effectiveness of “loud commercial” rules can’t help but increase the expectations of the public, creating the impression that “loud commercials” – however each individual viewer may define “loud commercials” – have been legislated away. We can thus probably expect a substantial increase in complaints. That in turn would chew up the time of FCC staffers and TV/MVPD personnel. And while some complaints may in fact identify actual violations of the rules, we will not be surprised if the vast majority of complainants end up being told that, contrary to their heart-felt belief, the commercial(s) of which they complained were not, in fact, “loud”.

Still, it’s probably worth the effort. With DTV technology the FCC has tools not previously available to it to try to address the problem of loud commercials. Let’s see if those tools can get the job done. But let’s not be surprised if, once the new rules are in place, we all find ourselves not much better off than we are now on the “loud commercial” front.

FCC Proposes to Ease Radar Rules at 76-77 GHz

Good news for people in the car just ahead of the driver who is texting.

It’s the future, now, for those of us who were kids several decades ago, looking forward eagerly to having flying cars. We’re still waiting. But another automotive promise of that era – self-driving cars – is coming closer to reality. And self-stopping cars are here. You can be behind the wheel at 75 mph, unaware the semi in front of you has come to a sudden halt because you are busy texting, or watching that video of a surprised kitten, when the car knows enough to jam on the brakes by itself, with no help from you.

That technology just got a little help from the FCC.

The car knows about the stopped semi ahead because it scans the road with radar. One of the favored frequency bands for this application is 76-77 GHz, well up into the nosebleed spectrum. Radio waves in that range can use small antennas and give precise radar readings. They also form tight beams and don’t travel far, which helps to keep the radars in nearby cars from interfering with each other.

The current FCC rules for this band are complicated. Power limits depend on whether the vehicle is stopped or moving, and on whether the radar is aimed forward or in some other direction.

The FCC now proposes to set the same 100 watt power limit for vehicle radars aimed in any direction, all the time, moving or stopped. This should simplify the design of the radars and thus bring the cost down, which might eventually help to make them available in more cars. (We hope so, because we’d like the car behind us to have one.)

The same FCC notice also responds to a request to allow stationary versions of a similar radar technology for use in tracking ground vehicles around airport ramp and gate areas, as we reported a couple of years ago. The FCC now proposes to allow the same 100 watt power limit for any fixed 76-77 GHz radar anywhere, not just at airports, and for any purpose.

Early opposition to the change in rules for the vehicle radars came from a radio astronomy group, whose members fear interference to their observations in the band.

The FCC’s Notice of Proposed Rulemaking is here. Comments and replies will be due 30 and 45 days, respectively, after publication in the Federal Register. We will let you know.

Update: Comment Deadlines Set In Wireless Signal Booster Rulemaking

A couple of weeks ago we reported on an Notice of Proposed Rulemaking (NPRM) proposing to allow consumers to purchase and use boosters to improve their wireless reception.  The NPRM has now been published in the Federal Register, which sets the deadlines for comments on the proposals. Comments are due on June 24, 2011, and reply comments on July 25, 2011.

2011 Reg Fees Proposed: Going Up!

Remember last Spring, when the FCC issued its proposed 2010 reg fees and they had all gone down from the previous year, so we got all excited, and then when the final 2010 fees were announced, they had gone back up again and we were disappointed? Good news! This year, the FCC is sparing us that emotional whipsaw. It has just released its proposed 2011 regulatory fees, and with only few exceptions, they reflect increases – in some cases, significant increases – over last year’s numbers. This way, we won’t be surprised and disappointed in a couple of months when the final fees are announced.

While pretty much everybody’s fees are proposed to go up, the folks who would get hit hardest are full service UHF TV in Markets 11-25 and Market 26-50. Their fees would increase by 9.5% and 10.8%, respectively. We have prepared a table reflecting the proposed 2011 reg fees here. The numbers in parentheses reflect the amount of the proposed changes from last year’s fees – as a visual aid, we have indicated proposed fee increases in red, and proposed reductions in cool green.

As always, the Commission is giving everybody a chance to comment on this year’s proposed fees, but you’ll have to act fast. The deadline for comments on the proposed fees is May 24, 2011; reply comments may be filed through June 1.

This year’s notice includes a couple of noteworthy points.

First, in recognition of the fact that the digital TV transition continues on for LPTV, TV Translator and Class A licensees, the Commission observes that

a fee will be assessed for each facility operating either in an analog or digital mode. In instances in which a licensee is operating in both an analog and digital mode as a simulcast, a single regulatory fee will be assessed for this analog facility that has a digital companion channel.

The Commission may revisit its instructions on this point “[a]s greater numbers of facilities convert to digital mode”.

Second, this year the FCC will not be sending out “pre-bill” reminders to broadcasters advising them of the fees they’re being assessed. All that information should be available on the FCC’s website, though.

Third, on the AM/FM side, the Commission notes that a station’s fee is based in part on the population it serves. Populations tend to change every ten years when the Census is completed and released, and such changes could affect radio licensees’ reg fees. But not this year. Even though the latest Census was technically completed last year, its results are still unofficial and subject to change – which means that this year’s regulatory fees will be based on the 2000 Census, not the 2010. (Additional rationale: since 2011 reg fees are calculated based on the subject station’s status as of October 1, 2010, the FCC thinks it would be “inappropriate” to rely on incomplete 2010 population figures.)

The proposed fees are just that – proposals. We won’t know the final fees until sometime this summer, although historically the final fees tend not to stray too far from the initial proposals. We also do not yet know when the fees will be due, although that tends to be in August or September. Look for an announcement sometime mid-Summer.

FCC Proposes To Give Cell Phones A Boost

Unlicensed boosters could improve reception but could also increase interference

When you’re trying to make a cell phone call, have you ever been thwarted by those pesky laws of physics? You know, those ones that cause signals to fade at long distances from base stations or impede signals in tunnels, buildings or dense foliage. If so, the FCC thinks it may have an answer to your problems – wireless consumer signal boosters. While signal boosters have been an option for certain FCC wireless licensees for a while, the FCC recently issued a Notice of Proposed Rulemaking (NPRM) kicking off a proceeding designed to allow individual consumers to purchase and use such boosters. 

The NPRM was released both in response to a number of petitions filed by private parties and as part of the Commission’s overarching effort to deploy wireless and broadband services. In it, the Commission recognizes not only the potential value in signal boosters, but also the significant potential for interference created by poorly designed or installed boosters. To attempt to ensure that boosters are deployed effectively and safely, the Commission proposes to impose requirements on the manufacture and marketing of boosters themselves, rather than adopting a licensing regime for their use. The NPRM seeks comment generally on this approach, as well as on a number of more discrete issues.

The type of wireless signal booster contemplated by the NPRM is essentially a system consisting of an inside antenna paired with an amplifier and an outside antenna. The inside antenna communicates with the user’s cell phone or other wireless device and the outside antenna with a wireless service provider’s base station, with the amplifier boosting the signal to improve the connection.  Such boosters could be designed for either fixed use, such as in a building or tunnel, or mobile use, such as in a car. The NPRM notes that such devices would be particularly useful in rural areas where wireless coverage gaps exist, and in other difficult-to-serve indoor areas. Signal boosters could also provide public safety benefits by allowing users to connect to 911 and emergency services where their wireless signals would otherwise be blocked (e.g., tunnels, garages, inside buildings). 

While the benefit of wireless signal boosters seems clear, their use also creates a number of potential problems. The FCC identified five primary issues in the NPRM, four of them involving different types of interference. Those four types of interference are:

  • “Near-far” interference. This type of interference arises when a signal booster is closer to a base station on an adjacent channel than to the base station with which it is attempting to communicate. In some applications, particular mobile, an improperly designed booster may amplify and interfere with communications on that adjacent channel.
  • Oscillation. This arises when the booster’s signal level remains elevated as it approaches the base station with which it is communicating, creating an effect similar to that of moving a microphone too close to a speaker.
  • Base station overload. This affects base stations that use dynamic power control to maximize performance by adjusting the power of both the base station and the handsets with which they are communicating. Boosters which are not dynamically controlled by the base station may continue to provide amplification when it is not necessary, interfering with the base station’s efficient operation and potentially causing an overload.
  • 800 MHz spectrum interference. This arises in the 800 MHZ spectrum band, where channels used commercially, primarily by Sprint Nextel, are interleaved with public safety channels. Unless there is proper coordination between the two, use of a wideband signal booster by either type of user may overload base stations operating on the adjacent channels, causing dropped calls and reduced network capacity. 

The fifth booster-related problem identified in the NPRM is not an interference problem, but a distortion of network-based E- 911 systems. These systems determine the location of handsets used to call 911 by measuring the time it takes for the handsets signal to reach units installed at the operators’ base stations. If the handsets signals are amplified by a signal booster, this may lead to inaccurate location estimates. 

The Commission in the NPRM discusses some “real-world” examples of these problems identified by Verizon, AT&T, and other operators, noting that the interference issues can have wide-ranging effects, sometimes entirely disabling a base station. According to the NPRM, operators claim that it is often extremely difficult to identify a specific signal booster as the source of these problems, particularly where the signal booster may be used in a mobile setting. 

Despite these issues, the Commission believes that there is a genuine need for “well-designed” signal boosters. It therefore proposes a regulatory regime which will allow for their use while avoiding the various harms they may cause. The Commission’s proposal is to regulate consumer signal boosters through a “license by rule” regime. Under such a regime, no individual licenses are issued for consumer signal boosters; rather, rules are adopted setting the technical parameters such boosters must satisfy before being marketed or sold. The NPRM generally seeks comment on whether this type of regulation is appropriate for signal boosters. Assuming this is the appropriate means by which to regulate boosters, the NPRM provides the broad outlines of its proposed technical requirements, seeking further comment on the appropriateness of these requirements. 

First, the NPRM proposes requiring all signal boosters operated in a given band to satisfy the existing technical requirements (e.g., power, out-of-band emissions) for mobile units (not base stations) operating in that band. The NPRM also proposes requiring signal boosters to be designed to “self-monitor” to ensure their compliance with these rules and to automatically shut down if they detect any non-compliance. Similarly, boosters would be required to automatically shut-down if they were to detect any feedback or oscillation. The NPRM requests comment on:  the effectiveness of such a requirement; the appropriate specific triggers for shut-down; and whether a booster’s power should be measured by effective radiated power (ERP) or transmitter output power.

The NPRM proposes to ensure compliance with radiofrequency (RF) exposure limits through existing procedures, requiring all applications for equipment authorization for signal boosters to demonstrate compliance with the RF exposure limits applicable to the device’s intended use. As with existing devices, the NPRM proposes requiring labeling and clear instructions for end users regarding appropriate use and installation of signal boosters. 

In addition to labeling related to potential RF exposure, the NPRM proposes requiring labeling regarding the responsibility of the signal booster owner and installer to ensure that the booster does not cause interference and, for fixed boosters, to coordinate the booster’s installation and use with the appropriate local wireless carrier. The NPRM proposes that for fixed boosters, this label include reference to an FCC website where licensee information will be available (www.fcc.gov/signalboosters – as of this writing, this site is not active). 

The NPRM further proposes requiring the operator of any signal booster to immediately cease operations if the booster is causing harmful interference. The NPRM also seeks comment on whether and how signal boosters should be regulated to prevent interference between and among boosters themselves. 

In addition to the above proposals, which would apply to all signal boosters, the NPRM proposes additional requirements that would apply only to fixed or mobile boosters. The NPRM would require that all fixed signal boosters coordinate frequency selection and power levels with local wireless carriers before use; it seeks comments on what specific coordination procedures should be required. The NPRM specifically asks how, under any coordination procedure, to ensure that the wireless carrier responds to any coordination requests in a timely manner. 

The Commission recognizes that for mobile signal boosters, the type of advance coordination appropriate for fixed boosters may be impossible. Rather than requiring such coordination, the NRPM proposes requiring mobile boosters to automatically reduce power as they approach the base station with which they are communicating; it also seeks further comment on how to address interference concerns, particularly the “near-far” interference issue identified above. 

The Commission also generally requests comment on any other issues related to signal boosters, in particular seeking input on whether, and if so how, it should require remote shut-off capability, location detection features, and activation of boosters by wireless carriers before use. Recognizing that signal boosters are already in use in many areas, the Commission requests comment on how to treat these existing boosters, suggesting that it may allow their use to continue, at least for some period of time, although it might require that they be registered. 

The Commission also notes that many wireless providers have expressed concerns that interfering boosters are often difficult to locate. Accordingly, the NRPM proposes setting up a national clearinghouse for registration of boosters and suggests including features in boosters that would prevent them from operating unless they were first registered in this clearinghouse.

Finally, the NPRM proposes some additional requirements that would apply only to non-consumer signal boosters operated by wireless licensees under Part 90 of the Commission’s Rules. Under Part 90, certain signal boosters have been allowed since 1996, generally for internal, non-public communications. The NPRM generally proposes to retain the existing rules for such Part 90 boosters, with certain modifications to prevent interference. Although narrower in application than the changes proposed in the rest of the NPRM, any parties who currently operate Part 90 boosters should review these proposals. 

Comments will be due to the FCC 45 days after the NPRM is published in the Federal Register, with reply comments due 30 days later. Check back here for updates on that front.

Update: Reply Comment Deadline Extended In TV Spectrum Re-Purposing Proceeding

If you’ve been planning on filing reply comments in response to the FCC’s TV spectrum re-purposing NPRM but you haven’t gotten around to it yet, you’re in luck! Everybody’s been given an extra week, thanks to an extension that pushes the reply comment deadline to next Friday, April 25. The extension comes at the request of several broadcasters and state broadcast associations concerned that the original reply comment deadline fell immediately after the close of the NAB convention in Las Vegas. 

Spectrum auctions and repacking were among the biggest items on the convention agenda for all concerned – FCC staff, Commissioners and industry alike. As a result of that opportunity to share information and insights, many interested parties are now in a better position to formulate reply comments that can contribute significantly to the Commission’s on-going consideration of the complicated issues on the table.

The last chance to say your piece (at least at this stage of the proceeding) is now fast approaching.

The spectrum re-purposing NPRM, released last November, was the opening barrage in the FCC’s campaign for full implementation of the National Broadband Plan – a plan which calls for the “repurposing” of 120 MHz of prime spectrum real estate from television broadcasters to wireless broadband providers.  Among other things, the FCC is proposing to: (a) loosen service rules to permit wireless uses of broadcast spectrum on a co-primary basis with television stations; (b) establish a framework for two or more television stations to share a single six-megahertz channel; and (c) explore opportunities to increase the viability and attractiveness of VHF channels to folks might move on down the band. The FCC claims these steps are necessary to increase the efficient use of the TV spectrum (both UHF and VHF) and facilitate ongoing wireless innovation.

In their initial comments, as might be expected, many wireless providers and wireless equipment manufacturers have heartily agreed with the Commission’s plans. (They even hosted a pow-wow with FCC staffers at CTIA’s headquarters.) 

Broadcasters, on the other hand, have been less receptive to the FCC's ideas. They have questioned whether the incentive auction would truly be voluntary and expressed concern over the potential impact of repacking on a wide range of factors (e.g., service contours, availability of minority-focused programming, ownership limits, disruption of nascent mobile TV services).

Other commenters have urged the FCC to look beyond a strictly auction scenario. Perhaps, for one example, stations could be allowed to use their spectrum flexibly, providing both wireless broadband and over-the-air TV.  Or maybe broadcasters could be permitted to negotiate directly with broadband providers to lease/sell portions of their spectrum.   

If you have an interest in the outcome of this proceeding – and, frankly, who doesn’t? – you should take this opportunity to join the debate. Check out the comments that have been filed thus far in the docket and then take the time to let the FCC know your thoughts. Again, the reply comment deadline has been extended to that anyone looking to participate may submit their reply comments electronically by 11:59 p.m. on April 25, 2011.  If you have any questions about this or would like any help, feel free to let us know.

Update: New Comment Deadlines In VoIP/Accessibility Proceeding

On March 31 we reported on a couple of VoIP-related NPRMs, including one item looking toward making VoIP and similar services easily accessible to and usable by persons with disabilities.  Despite the fact that that NPRM proposes sweeping changes in the nature of VoIP obligations and even the scope of the FCC’s regulatory reach (which would be extended into considerable technical minutiae), the deadline for comments on the proposals was originally set for April 13. But now, at the request of a number of organizations, the Commission has extended the comment deadline to April 25, 2011, and the reply deadline to May 23, 2011. That’s still not a lot of time, but it does provide some breathing room.

Update: Comment Deadlines Set In VoIP/TRS Contributions Rulemaking

Last week we posted about an NPRM proposing to expand the requirement that VoIP providers contribute to the Telecommunications Relay Service (TRS) Fund.  The requirement, already applicable to connected VoIP operators, would be broadened to include non-VoIP as well. See the original post for details.

The NPRM has now been published in the Federal Register, which sets the deadlines for comments on the proposals. Comments are due on May 4, 2011, and reply comments on May 19, 2011. And if you feel like commenting on the “information collection” aspects of the proposal (as you are entitled to do, thanks to the Paperwork Reduction Act), you’ve got until June 3, 2011, to do so.

Extreme Makeover - USF: Looking At Lifeline/Link Up

Sweeping NPRM proposes changes in implementation in low income programs, possible integration of broadband

As part of its ongoing effort to modernize (and rationalize) the various elements of the Universal Service Fund (USF), the FCC has now turned its attention to Lifeline and Link Up. These two programs make up USF’s Low Income component, which seeks to make telecommunications accessible to those with low incomes.  In a 98-page Notice of Proposed Rulemaking (NPRM) released March 4, the FCC has set out a number of proposals for possibly significant changes to its current approach. Many of those proposals implement recommendations from the Federal-State Joint Board on Universal Service (which we reported on here last fall), the Government Accountability Office, and the National Broadband Plan.

To get a better feel for the nature and extent of the proposed changes, it may be useful first to get a sense of the way the Lifeline and Link Up programs work.

The goal of the programs is to insure that “quality telecommunications services” are available to low-income customers at “reasonable and affordable” rates. To that end, the government does not reimburse the low-income customers directly; rather, it reimburses eligible telecommunications carriers (ETCs) who provide service to low-income customers. The ETCs submit quarterly forms reflecting the extent of low income support they have provided. In 2010, the cost of the Lifeline/Link Up programs was $1.3 billion (roughly five times its 2007 size) – in other words, there’s a serious pot of cash to dip into.

There is no uniform, nation-wide set of standards and procedures by which ETCs identify eligible “low-income” customers. Standards and procedures vary among the various states. In many instances, verifying documentation is not required. The potential for innocent error or less innocent fraud is not insubstantial.

The focal points of the FCC’s Lifeline/Link Up reform efforts described in the NPRM are:

  • eliminating fraud, waste and abuse;
  • capping the Low Income Fund;
  • improving program administration; and
  • modernizing Lifeline and Link Up (including reimbursement for broadband, of course).

Out of the hundreds of discrete issues teed up for comment, we have selected a few highlights below.

Fraud, waste and abuse. The FCC is confident that it can reduce fraud, waste, and abuse in the Lifeline and Link Up programs. (It’s so confident, in fact, that it’s already planning a broadband adoption pilot program on which it can spend the money it’s going to save.  See below for more details). To do that, it proposes to eliminate a number of problem areas in the way the programs are implemented. For example, the following would be axed by the Commission:

  • Link Up (activation) reimbursement for carriers that do not routinely impose activation charges on all customers within a state;
  • Duplicate discounts going to the same household (under the rules, each household may only receive one telephone line, either wireline or wireless). To prevent duplication, the FCC proposes to require carriers to obtain a certification from consumers that there is only one Lifeline service per address;
  • Self-certifying for eligibility by consumers (instead, the FCC proposes to require carriers to demand documentation);
  • Inadequate verification sampling (the FCC may require larger sample groups or a census of all customers if an initial sample group reveals too many ineligible customers);
  • Reimbursement for services unused for 60 days (a particular concern for prepaid services);
  • Complete – as opposed to pro rata – reimbursement for subscribers who enroll or disconnect during the month; and
  • Toll limitation service reimbursement (obsolete and susceptible to over-reimbursement).

To ensure that eligible telecommunications carriers (ETCs) providing Lifeline are on board with these goals, the FCC proposes a “more rigorous” approach – including more, and more expanded, audits – to the management of the program.

Capping the Low Income Fund. The NPRM seeks comment on various issues relating to capping the size of the Low Income Fund, for example at the 2010 disbursement level.  It recognizes that the Fund already has an ultimate cap in the sense that only a defined population of eligible households may participate, and support is limited to $10 per month per household.

Program administration. The NRPM suggests various ways to improve program administration, such as: 

  • Adopting a one-per-residence (i.e., U.S. Postal Service address) eligibility rule;
  • Clarifying the eligibility rules for residents of Tribal lands  and proposing eligibility through participation in federal Tribal low income programs;
  • Imposing federal baseline eligibility criteria, including perhaps raising the cutoff from 135% of the Federal Poverty Guidelines to 150%;
  • Coordinating enrollment with other social service assistance programs;
  • Developing a national database to prevent duplicate claims and verify eligibility (anyone who has worked with the FCC’s CORES database will likely be amused at the idea of the FCC creating a database intended to eliminate duplication); and
  • Imposing mandatory outreach requirements.

Broadband.  In keeping with its conviction that broadband service should be universally available, the FCC also proposes to extend the Lifeline program to include broadband. It seeks comment on whether a Lifeline discount should be available for any plan that includes a local voice component, including bundled voice and broadband.  It queries further whether broadband itself should be eligible for Lifeline support (note that this is a separate query from whether broadband should be a required supported service) – and, if so, how can broadband costs be integrated into the program in a way that minimizes (if not avoids) additional waste, fraud or inefficiencies?

Demonstrating that even imaginary money can burn a real hole in a governmental pocket, the FCC already has plans for how to spend the cash that it will save. Of course, any actual savings will require, first, that the proposals be adopted and implemented and, second, that those proposals in fact be effective. Apparently taking for granted that all those pieces will fall happily into place, the Commission has its heart set on indulging its compulsion to pocket funds to feed its broadband habit: it plans to set aside its savings to create a pilot broadband program. The pilot program will test different approaches to providing support for broadband to low-income consumers across different geographic areas and demographics. In particular, the Commission is looking to test how much of a factor hardware is in broadband adoption.

Of particular interest to Lifeline carriers. Carriers considering the daunting prospect of applying for Lifeline-only ETC designation through the forbearance process will be cheered that the FCC is considering doing away with the own-facilities and rural areas redefinition requirements. These requirements are designed to prevent cream-skimming in a High Cost context and don’t make sense in a Low Income-only situation. The Commission is considering codifying the conditions that it has been applying to forbearance grants instead. Even more radical, but strangely sensible, is the Commission’s apparent interest in AT&T’s proposal to allow any carrier to provide Lifeline discounts at a flat rate.

However, the Commission somewhat grimly notes that the fact that “numerous carriers are seeking designation as Lifeline-only ETCs . . . suggests that the current structure of the program may present an attractive business opportunity for firms that employ different business models than traditional wireline carriers.” To prevent funds going to carriers rather consumers, the FCC seeks comment on whether there is a more appropriate reimbursement framework than the current four-tier system based on an ILEC’s subscriber line charge. Furthermore, to protect Low Income consumers from receiving less-than-adequate service, the FCC asks if there should be minimum service requirements for prepaid ETCs (or for other carriers), such as a minimum number of monthly minutes.

The design and implementation of modified Lifeline/Link Up programs present problems of immense complexity for the Commission. Besides the enormity of the project – the raw numbers of eligible customers, the multiple mechanisms for determining eligibility, the detailed auditing process already in place – the Commission must also deal with the concept of grafting a new service (broadband) onto the system. Additionally, the underlying business of delivering telecommunications services is itself developing rapidly, creating new and different business models that may or may not be easily integrated into the Commission’s approach either now or in the future. The preferences of the consuming public also come into play. And don’t forget that we’re talking about a pool of funds that already exceeds one billion dollars, a tempting target for less-than-honest entities.

The scope of the NPRM suggests that the Commission recognizes the daunting nature of the challenge it is undertaking. Whether – and if so, when – the Commission will ever be able to claim that it has met that challenge remains to be seen. But at least the FCC has made the first move in its quest.

The NPRM was published in the Federal Register on March 23. Comments on the proposals in the NPRM are currently due to be submitted by April 21, 2011; reply comments on Sections IV, V (Subsection A) and VII (Subsections B and D) are due by May10, 2011. Reply comments on the remaining sections are due by May 25, 2011.

For VoIP Providers: Warning - Steep (Regulatory) Incline Ahead

More burdens just up the road, thanks to two Congressionally-ordered NPRMs

The FCC’s release of two Notices of Proposed Rulemaking (NPRMs) on March 3 will give VoIP providers a familiar sinking feeling – that is, the feeling of sinking ever deeper into the quicksand of FCC regulation.   At Congress’s direction, the FCC is looking both to expand TRS contribution obligations and to impose additional accessibility rules on all VoIP providers. As we describe below, the new accessibility standard for VoIP (as well as email and video conferencing) will be even higher than that already imposed on most telecommunications services.

The NPRMs (along with the video description NPRM about which we’ve already reported) are some of the first regulatory offspring of the 21st Century Communications and Video Accessibility Act of 2010 (CVAA). Because the CVAA is clear in its mandate, the Commission has little choice with respect to the major points on the table – but it does have discretion relative to a number of the ancillary and administrative aspects. (And, given the scope of CVAA’s ambition to modernize the nation’s accessibility laws, we expect more NPRMs to follow in the months to come.)

TRS contributions.  Section 103(b) of the CVAA requires that all VoIP providers contribute to the Telecommunications Relay Service (TRS) Fund.  (The TRS Fund supports services that allow deaf people or people with speech disabilities to communicate by phone.)  Of course, interconnected VoIP providers are already contributing (as our readers should be aware).  One of the two NPRMs addresses the Section 103(b) mandate by proposing to expand that requirement to non-interconnected VoIP providers, that is, VoIP that doesn’t interconnect with the regular telephone network.  We’re looking at you, Skype et al.

While the CVAA requires all VoIP providers to contribute to TRS, it leaves the FCC some discretion as to details. Accordingly, the Commission asks for comment on specific issues such as:

  • Should the VoIP safe harbor apply to non-interconnected VoIP? (The “safe harbor” allows carriers to report a specified fixed percentage of revenue as interstate if they are unable or unwilling to measure interstate and intrastate traffic separately.)
  • What revenues should be included in calculating TRS contributions (just revenues from interstate end-user calls, or revenues from all sources?)
  • Should providers of free services, that have no end-user revenues, be required to make any contributions to the TRS fund?

Clearly the FCC is focused on how to treat free, non-interconnected Internet voice services (again, that’s Skype-to-Skype et al.). Some such services are supported by advertising, and the FCC suggests that it might require TRS contributions based on those revenues, in place of or in addition to subscriber revenues. The answers to these questions will significantly affect contribution amounts; affected companies will want to express their viewpoints when the docket is open for comments. 

Accessibility. As required by Section 104 of the CVAA, the FCC proposes to make VoIP, electronic messaging (emails, IMs, etc), and video conferencing “accessible to and usable by” persons with disabilities. Naturally, a new rule needs a new acronym – we must learn to call these types of services “advanced communications services” (ACS).

ACS will be subject to a higher standard of achievement than “telecommunications services” under the existing Section 255 of the Communications Act. Section 255 requires telecommunications manufacturers and providers (including interconnected VoIP but not including non-interconnected VoIP) to provide accessibility if readily achievable. For ACS manufacturers and providers, on the other hand, the presumption is reversed; they must make their services and products accessible to people with disabilities, unless it is not achievable to do so. (According to the CVAA, “achievable” means “with reasonable effort or expense, as determined by the Commission” taking into account a list of certain factors.)

Further, ACS providers may not install network features, functions, or capabilities that impede accessibility or usability. Finally, all equipment and networks used to provide ACS services must allow information content that has already been made accessible to pass through in accessible form. The NPRM seeks comment on definitions of relevant terms (e.g., what is “achievable”?) as well as input regarding matters such as:

  • the standards that would apply to requests for waivers for equipment designed for non-ACS purposes but having incidental ACS capability
  • whether any exemption(s) for small entities might be warranted
  • obligations for applications or services accessed over service provider networks rather than based on user hardware features
  • recordkeeping and enforcement 

Mobile web access. The ACS NPRM also gets a head start on assuring that Internet browsers built into mobile phones will be accessible to those with visual impairments. As with ACS services, mobile Internet browsers must be “accessible to and usable by individuals who are blind or have a visual impairment, unless doing so is not achievable.” The statutory requirements do not take effect for three years, but the FCC seeks input now on how best to get everyone up to speed before then.

Some ramp-up time may be needed, because ACS and browser accessibility raise practical difficulties. Accessibility functions will work only if they are supported by each component or layer of the device: i.e.,the hardware, the operating system, the user interface, the application, and the network. This practical reality has at least two major consequences: (1) a broad array of entities will be affected, some of whom may not have previously fallen under FCC jurisdiction and may not be habituated to regulatory compliance matters; and (2) various entities will have to cooperate with each other on technical standards, without much market motivation to do so.

So the FCC will have to get in the business of compelling information-sharing: mandating industry standards, setting up industry forums and working groups, and so on. Yes, even Apple may have to share information about iPhone design, which is certainly not their custom. This process inevitably raises hard questions. For example: Who will develop and enforce compatibility standards? What is the appropriate balance between the necessary sharing and protecting proprietary, confidential technical information? Will components have to be compatible only with existing fellow components, or also with potential future components? At what stage of development should accessibility be considered?

The FCC has tackled tough inter-industry compatibility issues before, with some success. Doing so in this case, however, will certainly require the agency to delve into technical minutiae generally outside its usual expertise (such as software). It will also require constant calibration to keep things running smoothly in the future.

The bottom line here is that Congress, through the CVAA, is determined to impose new and substantial burdens on VoIP providers in order to ensure technological access for people who are deaf, blind or subject to other disabilities or impairments. That means that the FCC has little discretion going forward with these two NPRMs, at least with respect to the Big Picture aspects. Congress did, however, give the Commission some leeway in working out the operational details, and it’s there that affected parties (including, particularly, VoIP providers) may have their best chance to ease the ultimate burden. Given that, VoIP providers should give serious thought to submitting helpful comments in these proceedings.

Update: Comment Deadlines Set In Retransmission Consent Rulemaking

Three weeks ago we reported on the release of a Notice of Proposed Rulemaking (NPRM) addressing the thorny issue of retransmission consent.  With the publication of the NPRM in the Federal Register, the deadlines for comments and reply comments have now been set. Comments are due by May 27, 2011; reply comments are due by June 27, 2011. Additionally, if you would like to comment on the “information collection” aspects of the Commission’s proposals (in connection with the Paperwork Reduction Act), you have until May 27, 2011. Check out the Federal Register notice for details.

A Look At The FCC's Proposed Overhaul Of USF And Intercarrier Compensation Regimes

Weighing in at 228 pages (not including an extra 61 pages of appendices and separate Commissioners’ statements), the NPRM illustrates the complexity of the problems facing the Commission.

A journey of a thousand miles begins with a single step. As reported here, last month the FCC began its own long, long march to the Promised Land of USF/ICC reform by issuing a massive 289-page tome that promises to revisit, reassess, restructure and revitalize virtually every aspect of universal service support and intercarrier compensation as we know it.  

The task is a daunting one. Perhaps for that reason, the Commission has been putting it off for more than a decade, tweaking this or that and putting out small brushfires as they’ve arisen, but never tackling the fundamental reform that virtually everyone agrees is desperately needed.   Complicating the task is the fact that USF reform and ICC reform are inextricably related – you can’t reform one without reforming the other.   So the FCC has correctly chosen to attack the two behemoths – each of which has proven remarkably impervious to reform – in a single charge.   This multiplies the complexity and size of the proceeding exponentially, but is the intellectually honest way to approach the matter.

In truth, just reading the Notice of Proposed Rulemaking (whose formal, if somewhat redundant, title is “Notice of Proposed Rulemaking and Further Notice of Proposed Rulemaking”) (NPRM) was a major undertaking. The document inquires into literally scores of existing policy issues, from questions as fundamental as the FCC’s jurisdiction to regulate VoIP to details as granular as benchmark rate levels. So far-reaching is the inquiry that we estimate that more than a thousand distinct questions or issues were posed for industry input.  Recognizing the logistical problem of arranging the myriad number of meetings necessary to garner the expected input from all parties, the Commission has taken the unusual step of establishing formal procedures for scheduling meetings with the staff.

On the other hand, the Commission has somewhat unrealistically allocated only 45 days for initial comments on the majority of the NPRM and 35 days thereafter for replies.  (Note: a separate abbreviated comment period was established for the part of the NPRM addressing pressing abuses of the existing system such as traffic pumping and phantom traffic.)  As we have previously reported, preliminary comment deadlines have already been established: April 18 for comments on all but Section XV; May 23 for reply comments.  Given the breadth of the inquiry and the years it took to bring this NPRM to term, the comment period strikes us as a bit stingy.   The FCC supposedly has this on a fast track, but there are simply too many moving parts in this vast proceeding for everyone to get their two cents worth in in this timeframe. Expect these dates to be extended

In approaching the reform effort, the Commission will be guided by four prinicples: (i) modernization of the USF and ICC for broadband, (ii) fiscal responsibility, (iii) accountability, and (iv) market-driven policies.   Turning these noble principles into concrete regulations is the hard part. As we’ve indicated, the scope of the proceeding is too all-encompassing to permit detailed treatment of every aspect of it here, but the highlights are outlined below.  

Short Term/Long Term Solutions: Recognizing that billions of dollars have been invested in, and depend on, the existing regulatory regime, the FCC proposes to adopt remedial measures for the most obvious abuses and inefficiencies in the short term, while putting in place long term permanent reforms that come into play gradually over a period of years. While it is understandable that the Commission might not want to upset settled investment expectations (particularly of ILECs), the Commission demonstrated precious little solicitude to CLECs in 2008 when it abruptly capped their access to USF funds in a single stroke, leaving them well short of the support presumptively necessary to meet their ETC obligations. Be that as it may, the FCC contemplates comfortable “glidepaths” and phased transitions to ease the pain of companies accustomed to feeding at the USF and ICC troughs.

Short Term Universal Service Solutions.  In the short term, the FCC proposes to:

  • circumscribe or eliminate several high-cost support programs which may have outlived or outspent their usefulness, including high-cost loop support, local switching support, interstate common line support, and interstate access support. The FCC asserts that these programs as currently structured reward inefficiency and actually discourage movement to more advanced technologies. 
  • not only develop benchmarks for capital and operating expenses fundable under the high-cost programs, but also cap the amount of support per line that can be received by any one carrier at $250. (There are horror stories of carriers receiving as much as $2,000 per month per line in support!) 
  • change its procedures to encourage rational consolidation of service areas eligible for support in order to reflect operational efficiencies rather than USF gaming.
  • eliminate the identical support rule. This rule, which somewhat nonsensically ascribes the same high-cost reimbursement to a CLEC as to the ILEC in the same market, has been long due for change.
  • stimulate broadband build-out by a one-time disbursement (between $500 million and one billion dollars) based on a reverse auction. The funds recipient in each area would be the carrier willing to build broadband facilities in unserved parts of the country at the lowest cost. Broadband service under this proposal could be provided by either wireline or wireless technology or even by satellite (on an ancillary basis) if that proved most efficient for remote areas. This program is apparently a complement to the Mobility Fund proposed last year to disburse $500 million via a reverse auction to construct mobile broadband facilities in needy areas.

Long Term Universal Service Solutions. The Commission’s long term vision for USF involves phasing out all of the existing support mechanisms entirely and replacing them with the Connect America Fund (CAF), a mechanism for supporting broadband in areas of the country where broadband is not economically sustainable without such support. Voice service would simply be a component of the larger broadband service. Support under the CAF regime would be determined in one of two ways.  

Under Plan A, there would be a reverse auction in which any carrier using any technology (wireline, wireless or satellite) could bid on the right to provide broadband (or voice only) service in given regions. A single low bidder would receive the funding and have the obligation to provide supported basic services. The Commission envisions satellite service as being a part of the mix since some areas are so remote as to be most economically servable only by satellite, while other areas are more conducive to terrestrial coverage. The most efficient plan would incorporate both technologies to reach everyone at the lowest overall price. The reverse bidding process should ensure that the level of support provided is directly related to the actual costs associated with providing service without the need for bureaucratic review of cost components to determine if the costs are justified or reasonable. This plan has immediate appeal since on its face it ensures that the basic telecom service needed by people in high-cost areas is delivered at the lowest price without redundancy.

No doubt to mollify ILECs concerned about the possible loss of support through such a process, the Commission also floated Plan B. Under this option, current carriers of last resort would have a right of first refusal to take on the obligation of providing broadband/voice service throughout their area.   While this would ensure that such carriers (invariably ILECs) continue to receive not just some but all of the subsidies available for their areas, it would also require the Commission to establish and administer a detailed cost recovery model and continuing oversight to preclude padding of expenses. In a highly competitive carrier environment, such cost recovery models seem antiquated. Moreover, this option seems like a step backward to what was essentially the monopoly subsidization system that existed prior to the introduction of competition into the USF scheme. So it’s hard to see this as a meaningful reform in any sense.  

Finally, the Commission mentions a third option for rate of return carriers only: maintaining the current system but capping elements such as ICLS in order to incentivize the carriers to reduce costs. It is unclear why this is even part of the long term reform vision since a reform like this could be imposed on rate of return carriers in the near term to good effect.

Short Term ICC Reform.  The FCC’s immediate reform of the Intercarrier Compensation regime would deal with what are recurring abuses of the system. The current regulatory scheme creates opportunities for arbitrage that have resulted in unnatural schemes of a different nature – phantom traffic, access stimulation, traffic pumping. When millions of dollars are to be had by simply structuring a phone call in one way rather than another, the human capacity for innovation and ingenuity is marvelous indeed.  The Commission proposes to forestall the access stimulation device by requiring rate of return carriers who enter into “revenue sharing” arrangements such as chat lines to modify their tariffs to account for the new traffic.  Competitive carriers would have to benchmark their rates to the largest ILEC in the state, thus ensuring a more normal rate. The problem of phantom traffic (traffic which is passed on to a connecting carrier without sufficient information to identify the party to be billed) would be addressed by requiring all calls, including VoIP calls, to carry the necessary identifying info.  

Long Term ICC Reform. The deeper problem of how to handle VoIP traffic (which now sometimes goes unbilled) is part of the FCC’s long-term solution. Clearly all traffic will eventually be IP and the current regulatory distinction between IP traffic and circuit-switched traffic will have to be erased. For more than a decade, the FCC has danced around the issue of whether VoIP should constitute a telecom service or an information service – a distinction that has enormous consequences for the regulatory treatment which it gets. The FCC has so far handled the problem by using its non-Title II authority (i.e., sources of jurisdiction not based on telecommunications carrier status) to make VoIP carriers comply with many of the same obligations as regular carriers.  This evasion of the issue continues, with the Commission concocting new ways of regulating broadband or IP traffic without actually denominating such traffic as telecommunications. 

Ultimately, this dance will have to come to an end. In the context of this overall reform effort, the Commission should certainly have teed up the issue for resolution. Its failure to do so (the Commission devotes a single paragraph out of 703 paragraphs to this fundamental question) unfortunately casts a shadow on all of its other more specific proposals to rationalize the treatment of VoIP traffic by treating such traffic the same as circuit-switched traffic.  Until the Commission bites the bullet and reclassifies VoIP, VoIP can’t be treated exactly the same as other traffic since it falls into a different regulatory peg hole.

Long term ICC reform also presents other fundamental jurisdictional problems, the foremost being the historical division of regulatory authority between interstate and intrastate traffic.   Those distinctions (which made sense back in 1934) make no sense at all today.   Without a single nationwide regulatory framework, possibilities for arbitrage and discriminatory intrastate rates continue. The FCC struggles with this problem by proposing different hooks on which it can hang a pre-emptive hat (such as its plenary authority over CMRS rates), but it also suggests ways in which it can induce states to toe the federal line by moving up subsidies or other means. Ultimately, this division of regulatory authority is an obstacle to a consistent nationwide regulatory framework that requires a fundamental change in the Act; in the meantime, the Commission can only do what its limited authority allows.

If it can find the jurisdictional ground to stand on, the FCC proposes to reduce access charges across the board by getting away from per minute charges. It could do so by simply mandating a bill-and-keep approach (where neither connecting carrier charges the other) or flat-rate connection not based on volume. It could also, either on an interim basis or permanently, establish rate benchmarks which would keep the size of access charges within reasonable bounds while also permitting carriers’ costs to be recovered. Shortfalls arising in high-cost areas would be dealt with through explicit subsidies from the CAF rather than through invisible overcharges for access.  

Given the combination of jurisdictional hurdles and billions of dollars that will move from one company’s pocket to another’s as a result of ICC reform, the likelihood of paralysis on this issue is high. Yet it is here that reform is most needed because the current market for telecommunications traffic is artificially distorted by the feudal system that still prevails.

We expect to be providing more targeted thoughts on some of the Commission’s specific proposals in the weeks ahead. In the meantime, interested parties are encouraged to weigh in at the Commission to make it aware of particular problems and abuses and to suggest possible alternatives.

Update: Comment Deadlines Set In Video Description Rulemaking

A week or two ago we reported on the release of a Notice of Proposed Rulemaking (NPRM) which will lead eventually to the reimposition of video description rules. Those rules have been effectively mandated by Congress, so it’s just a matter of when, not whether, they will return. Still, anyone hoping to influence the ultimate shape of the video description rules – and that universe could include TV broadcasters and multichannel video programming distributors, among others – may submit comments or reply comments in response to the NPRM. And with the publication of the NPRM in the Federal Register, the deadlines for comments and reply comments have now been set. Comments are due by April 18, 2011; reply comments are due by May 17, 2011.

Additionally, if you would like to comment on the “information collection” aspects of the Commission’s proposals (in connection with the Paperwork Reduction Act), you have until May 17, 2011.

Update: OET Issues Erratum To Experimental Licensing Overhaul NPRM

 Last December we reported on a Notice of Proposed Rulemaking (NPRM) in which the Commission proposed to overhaul the experimental licensing rules. The deadline for comments on the various proposals has come and gone (it was March 10), but you still have time to file reply comments, which are due by April 11. Be careful, though. The Office of Engineering and Technology has just released an Erratum to its NPRM advising that one of the two docket numbers listed in the caption of the NPRM was wrong. According to the text of the Erratum, the second of the two numbers should read “ET Docket No. 06-155”

This information may be important to anyone planning to file reply comments: having the correct docket number in the caption should help to get the filing into the proper bureaucratic pigeonhole in the FCC’s filing system.

Of course, this doesn’t help folks who filed comments using, presumably, the incorrect docket number – although there’s a reasonable chance that, if they used the correct lead docket number (that would be ET Docket No. 10-236), there shouldn’t be any problem.

Now that the Commission has spread the word to the public about the mistaken docket number, it might also want to do the same internally. The caption of the Erratum still includes the incorrect number.

Video Description, On The Comeback Trail

FCC looks to resuscitate rules rejected by Court in 2002 – but unlike last time, the rules now have Congress’s explicit blessing

They’re baaaaack . . . almost. The video description rules, dealt a death blow by a federal appeals court nearly a decade ago, are one step closer to resurrection with the release of a Notice of Proposed Rulemaking (NPRM) looking to their reimposition. 

As we reported previously, the FCC’s original video description rules were struck down by the U.S. Court of Appeals for the D.C. Circuit in 2002. According to the Court, the FCC did not have the requisite statutory authority to impose such rules.   (Quick refresher course on video description: it’s a process that gives blind and visually impaired people a way to “watch” video programming by adding a spoken narrative describing the visual elements of a scene during natural pauses in dialog. Example: “Workers throw Kane’s belongings into a burning furnace. One item is a sled with the word ‘Rosebud’ stenciled on it.”)

In light of the 2002 decision, only Congress has the power to rescue the rules by granting the Commission the authority it was (and has since been) lacking. Congress did so last October, in a sweeping omnibus disabilities law: the “21st Century Communications and Video Accessibility Act of 2010.” (Back then we coined the abbreviation “21CenComVidAccAct”, but the FCC has since opted for “CVAA”. Even though the FCC’s choice of abbreviation seems a bit too abbreviated – what century are we talking about again? – we’ll bow to their will and use “CVAA”. )

In the CVAA, Congress directed the Commission to reinstate its rules more or less exactly as they were in 2000, with certain mandated changes. One might ask, why go through a rulemaking at all, if all the agency has to do is find a copy of the old rules, cut-and-paste them into a new order, and insert the necessary changes? It turns out, though, that the Commission does have some discretion this time around. In particular, the CVAA leaves it to the FCC to decide what entities – broadcast stations, multichannel video programming distributors (MVPDs), networks – are to be subject to the video description rules. Accordingly, the Commission would like public input on a limited number of points.

So, if you’re a broadcaster or an MVPD, you may want to refresh your memory of the original rules and consider commenting if you might be affected by the proposed modifications.

The Basics

As in the first go-round with video description, the rules this time around will have two main components: the “50-Hour Rule” and the “Pass-Through Rule”.

The “50-Hour Rule” will apply to broadcast stations that are: (a) affiliated with the top four national commercial networks (ABC, CBS, Fox, and NBC); and (b) located in the top 25 markets (per the 2011 Nielson rankings). Such stations must provide 50 hours per calendar quarter of video-described programming during prime time – although any children’s programming can also be included in the 50 hours, regardless of when it happens to be aired. A program can be counted twice – but only twice – if it is re-run. A station can count a program even if the program has previously been telecast elsewhere, so long as the program is airing for the first or second time on that station. [Note: the CVAA requires the Commission to expand this requirement to the top 60 markets by October 2016].

MVPDs (cable, satellite, etc) with 50,000 or more subscribers must also provide 50 hours per calendar quarter of video-described prime time and/or children’s programming on each channel on which they carry one of the top five national non-broadcast networks.  (FYI: the FCC figures that the top five currently are USA, the Disney Channel, ESPN, TNT, and Nickelodeon’s Nick at Nite.  But heads up – Fox News, TBS, A&E, History, the Cartoon Network’s Adult Swim, the Family Channel, and HGTV could also be contenders if any of the top five come up short on the non-exempt programming front.)

Under the “pass-through” rule, broadcasters affiliated with any network and all MVPDs will have to pass through any video description that they receive from a broadcast station or network or a cable network channel, including re-airings, so long as they have the technical capability to do so. And yes, providers subject to the 50-hour rule must also pass through video description programming.

Questions For Comment

These two basic requirements are not up for discussion. However, the FCC would like input on a number of questions regarding their implementation:

  • What is “near-live” programming? The CVAA exempts “live” and “near-live” programming from the new rules. This exemption seems superfluous given that video providers already have latitude in selecting which 50 hours will have video description.  Presumably, the exemption would mainly come into play if a top five cable channel had so much live programming that there weren’t 50 hours left over for video description. The FCC logically proposes, in that case, to exclude the channel from the top five list. It also proposes that “near-live” programming would mean programming produced no more than 24 hours prior to its telecast.
  • How often, if at all, should the list of top 25 markets be updated? As the FCC aptly notes, while market rankings routinely change over time, constant revision of the list would burden and aggravate everyone concerned. Therefore it seeks comment on whether, and how often, to reconsider the top 25 rankings.
  • What equipment would be needed to comply with the pass-through requirement, and how much it would cost?
  • How much would the 50-hour rule cost, per program or hour described? The FCC would like to hear from both the purchasers and producers of video description on this point.
  • Under what circumstances would the rules become so “economically burdensome” to providers to warrant an exemption? The prior version of the rules allowed exemptions when the rules posed an “undue burden.” The CVAA changed the exemption standard to “economically burdensome.” The FCC is not fazed by this change and proposes to use the same factors it used in the previous version.
  • Should the 50-hour and pass-through rules apply to commercial low power stations?
  • Is there a continuing need for the previous “another program-related service” exception?  The former version of the pass-through rule did not apply in situations where the second audio program (SAP) equipment and channel were being used to provide some other program-related service. But a digital universe permits numerous audio channels for any video stream – meaning that there may be no continuing need for an exception. The Commission seeks comments on that question.
  • What digital stream should the rules apply to? For the 50-hour rule, the Commission would for sure count programming carried on the primary stream. But it also proposes to apply the rule to each separate stream which carries another top-four network’s programming. The pass-through rule would apply to all network-provided programming on all digital streams.
  • Should the Commission adopt quality standards for video description?
  • How should programs be selected and advertised?
  • Should the new ATSC standard be incorporated to ensure that video description can be received by all DTV receivers?
  • Should children’s programming mean programming directed at children 16 years old and under?

Finally, the FCC proposes to require compliance with the video description rules (subject, of course, to any OMB approval that may be required for any of the rules) starting January 1, 2012, 85 days after they are scheduled to be adopted and published.

The proposed video description requirements present virtually all of the serious practical difficulties, as well as potential First Amendment arguments, that the earlier version did. The last time around, though, the Court didn’t have to address those considerations because the wholesale lack of statutory authority eliminated the need to do so. Now that the CVAA has plugged that hole, it will be interesting to see whether any appellant(s) raise other, still undecided, issues.

Comments will be due 30 days after publication in the Federal Register. Check back here for updates on that front.

Revising Retrans: The Process Starts

FCC proposes modest – but possibly significant – changes to rules regulating MVPD/broadcaster retransmission consent negotiations

The long-awaited Notice of Proposed Rulemaking (NPRM) addressing the thorny issue of retransmission consent has been released. When it comes to the ebb and flow of the on-going debate about the retrans system, some had hoped that the Commission might jump into the deep end while others had hoped that it would stay comfortably high and dry in the lifeguard’s chair – but it looks like the FCC isn’t inclined toward either of those options. Instead, it proposes, in effect, to dip its toe, maybe even roll up its pants to wade in a bit. In other words, even if some change in the retransmission consent negotiation process is possible, the likely scope of the change on the immediate horizon appears limited. 

Then again, the Commission has invited comments, so who knows where this may end up?

Retransmission consent is one component of the perennial tug-of-war between television broadcasters and multichannel video program distributors (MVPDs, i.e., cable, satellite systems, and the like) relative to carriage of broadcast programming on MVPD systems. Broadcasters periodically elect either “must carry” or “retransmission consent” status. Must carry status more or less guarantees carriage within the stations’ local markets, but without compensation to the broadcaster for such carriage. 

By contrast, retransmission consent allows broadcasters to negotiate for compensation for carriage, the risk being that carriage must cease if the parties can’t come to terms. Occasionally a broadcaster and a cable operator fail to reach an agreement; in that case, the cable operator must cease carriage of the station at issue, which in turn deprives cable subscribers of cable-fed access to the programming (including, in some instances, high profile items like the World Series, football play-offs, special award shows and the like). This typically results in a burst of consumer outrage, a bout of finger pointing between the cable operator and broadcaster, and a round of concerned statements from elected officials and the FCC.

Such disputes have been rare. But last year, after some particularly noisy set-tos, a group of cable operators asked the FCC to devise new rules governing retransmission consent negotiations. The petitioners wanted the Commission to block broadcasters from withdrawing retransmission consent during negotiations and to order binding arbitration in the event negotiations did not produce a result. Broadcasters countered that such requirements would undermine the free market nature of retransmission consent negotiations.

Responding to the petition, the NPRM recognizes that the FCC’s authority to involve itself in retrans negotiations is limited. Since 1999, the Communications Act has required broadcasters to negotiate with MVPDs in good faith – but it gave the Commission only a limited role in determining what “good faith” might involve in this context.   Acknowledging that limitation, the FCC in the NPRM rejects as beyond its statutory authority the ideas of imposing either (a) “interim” retransmission consent (providing the MVPD with a right to carry programming despite the broadcaster’s refusal) or (b) mandatory arbitration. 

Rather, the FCC focuses on tweaking existing rules that affect how parties to retransmission consent negotiations conduct themselves. Specifically, the FCC’s proposals address possible changes in rules relating to: (1) “strengthening” the “good faith” standard governing negotiations; (2) notice to subscribers; (3) deletion of channels during “sweeps” periods; and (4) syndicated exclusivity and network non-duplication rules.

Good Faith Negotiations. The FCC’s current rules require parties to engage in “good faith” negotiations for retransmission consent. Not surprisingly, then, the FCC’s proposals focus on whether the “good faith” rules might be strengthened by adding to the list of actions that are considered “per se” violations of the rules. For instance, should a station giving its network the right to approve retrans agreements be considered a “per se” violation of the station’s duty to negotiate in good faith? How about a station appointing another licensee (pursuant, say, to a JSA or LMA) to negotiate the retrans terms? Should one party’s refusal to agree to non-binding mediation in the event of a negotiation impasse be deemed a “per se” violation? The NPRM seeks comment on a range of conduct which might be deemed “per se” violations of the good faith requirement.

Notice to Subscribers. Noting that adequate warnings of impending retransmission consent disputes might help consumers prepare for disruptions, the NPRM looks at the Commission’s rules governing notices to subscribers. The rules currently require that cable operators give their subscribers 30 days prior notice before deleting channels or changing channel lineups. But the uncertainty produced by retransmission consent negotiations makes it difficult for cable operators to know 30 days in advance whether or not a particular broadcast channel is going to be deleted. Accordingly, the NPRM questions whether the rules should be amended to require notice of potential deletions in advance of retransmission consent negotiations and whether the notice requirements should extend to broadcasters, as well.

“Sweeps” Prohibition. Cable operators – but not other MVPDs (i.e., satellite providers) – are prohibited from deleting or repositioning channels during “sweeps” periods (i.e., when rating companies conduct audience measurements and, consequently, the networks roll out all the good episodes of your favorite shows). That could affect retrans negotiations, since the disparity accords non-cable MVPDs some greater freedom than their cable compatriots. The Commission questions whether it would be appropriate to put all MVPDs on an equal footing by extending the “sweeps” prohibition to non-cable MVPDs. The NPRM also raises the possibility of imposing a corresponding prohibition on broadcasters. On that point the Commission tentatively concludes that it doesn’t have the authority to do so; nevertheless, the FCC invites comment on whether or not it does have the authority.

Syndex/Network Non-dupe. Finally, and perhaps most significantly, the NPRM seeks comment on the possible elimination of the current rules governing syndicated programming exclusivity and network non-duplication. These rules generally protect the contractual rights of broadcasters in their programming by requiring cable and satellite operators to black out programming on other channels that duplicate programming for which a broadcaster holds exclusive rights. Since the exclusive programming rights they hold provide much of the broadcasters’ leverage in retransmission consent negotiations, changes to the FCC rules relating to those rights could affect the dynamics of retransmission consent negotiations. The underlying contractual rights to exclusivity would, of course, remain unchanged. But the elimination of the FCC’s rules would eliminate the FCC as a forum in which the parties’ rights could be adjudicated – meaning that parties would likely have to go to court in the first instance to enforce their rights. Whether that would really be a preferable alternative to either side in a retransmission dispute is far from clear.

Comments in this proceeding will be due 60 days after the NPRM is published in the Federal Register and reply comments will be due 30 days after that. Check back here for updates on that front. As this proceeding is certain to attract a lot of attention from all sides, interested parties should strongly consider making their views known.

Update: Comment Deadlines Set In USF/ICC Rulemaking

Last month we reported on the FCC’s adoption of a “Notice of Proposed Rulemaking and Further Notice of Proposed Rulemaking” (NPRM/FNPRM) kicking off a proceeding which looks to overhaul, from top to bottom, both the Universal Service Fund and the Intercarrier Compensation system.  The NPRM/FNPRM has now been published in the Federal Register, which sets the deadlines for comments and reply comments.  Get out your pencils and papers -- there are more deadlines than usual (probably because of the vast scope of the proceeding). 

If you want to comment on Section XV ("Reducing Inefficiencies and Waste by Curbing Arbitrage Opportunities"), you have until April 1, 2011 to file comments and April 18, 2011 to file replies.  [Note: Section XV comprises Paragraphs 603-677 of the original NPRM/FNPRM.  The summary of the NPRM/FNPRM as it appears in the Federal Register does not contain the full text of the NPRM/FNPRM and does not include the same paragraph numbering or section labeling as the original.]

Comments on the remaining sections are due no later than April 18, 2011; reply comments are due no later than May 23, 2011.  There's also a separate comment date for State Members of the Federal-State Joint Board on Universal Service -- that would be May 2, 2011.  And finally, if you'd like to offer the FCC comments on the information collection aspects of the proposal (in connection with the Paperwork Reduction Act), you have until May 2, 2011.

Next Candidates For Extreme Make-Overs: USF And ICC

FCC proposes major overhaul of Universal Service Fund, Inter-Carrier Compensation Systems

Perhaps inspired by the protesters in Egypt demanding the end to an outdated, bloated, aging, inefficient, and economically unsustainable regime, the FCC has finally taken up the task of systemic reform of the Universal Service Fund (USF) and Inter-Carrier Compensation (ICC).    These two mechanisms – one a product of the 1996 Telecom Act and the other a result of the break-up of the Bell System back in the ‘80s – allocate billions of dollars in telecommunications charges and revenues among carriers.   As with many grand failures, these systems were well intended. They were designed to compensate carriers fairly for routing traffic to and from each other, while also providing transparent subsidies to carriers who provide service in “high cost” areas.

Virtually everyone agrees that the systems do not accomplish their intended purposes either fairly or efficiently. But because there are so many parties that benefit one way or another – to the tune of billions of dollars – from the existing system, the FCC has been paralyzed for over a decade in its efforts to effect meaningful reform.   Now, flying the pennant of the National Broadband Plan (NBP) in which reform of these mechanisms was called for, the FCC has launched a top- to- bottom overhaul of the two systems.   The Commission’s original NBP action agenda called for these reforms to be initiated by the fourth quarter of 2010, but in the glacial scheme of action in Washington, a three-month delay counts as on-time. 

The full text of the catchily-titled “Notice of Proposed Rulemaking and Further Notice of Proposed Rulemaking” has just been released. It weighs in at a hefty 289 pages – which explains why we haven’t sifted through it in detail yet. (We plan to do so shortly and will report on our findings, of course.)

But from what we have read already, the outlines of the proposal look very promising.

  • The current system permits redundancy by funding multiple providers of basic service when one provider would be enough. The reform would eventually eliminate that problem by designating, based on reverse auctions, a single recipient of the USF support in any particular geographic area. That process should encourage providers to ask for the least amount of support they need to actually provide the required services.
  • The current subsidy system does not establish incentives for some providers to operate efficiently.  The reform will impose limits on reimbursement to address that problem.
  • There will be a measured transition to the new scheme to avoid disruption of current structures. Expect major battles over how long the transition will be, since subsidy recipients will have to have the subsidies pried from their fingers.
  • The Universal Service Fund will be re-dubbed the Connect America Fund in keeping with its new role in achieving the universal availability of broadband. This will require defining broadband for the first time as a supported service and repurposing current funding mechanisms toward broadband rather than plain old voice.
  • Several of the different USF support programs will be consolidated or eliminated to reduce overlap.
  • The ICC scheme will be revised to eliminate incentives for carriers to game the system by artificial arbitrage arrangements such as traffic pumping and phantom traffic.
  • The new ICC regime will recognize IP-based telecommunications as the wave of the future and the system will recognize such traffic while eliminating artificial incentives to maintain legacy networks.
  • The interplay between state and federal regulation of ICC will have to be rationalized. Some federal pre-emption of the field may be called for where permitted by the Communications Act.
  • Workshops will be held to get input from the public on the issues.  (Workshops are for some reason beloved by the Democrats on the Commission, though to us they often seem like an extremely inefficient way to gather data.)

Make no mistake: the task ahead is truly herculean (and here we’re thinking in particular of the Augean Stables). All of the entrenched interests which have so far barricaded themselves against change will be stacking their sandbags and summoning legions of lobbyists to their aid. But at least the battle is now joined.

Comment Dates Set In Proposed Overhaul Of Experimental Licensing

A couple of months ago we reported on a Notice of Proposed Rulemaking (NPRM) which could lead to dramatic changes in the experimental licensing processes. The NPRM has now been published in the Federal Register, which in turn establishes the deadlines for comments and reply comments relative to the NPRM.  Comments are due by March 10, 2011, and reply comments by April 11, 2011.

Comment Deadlines Set In TV Spectrum Re-Purposing Proceeding

Back in early December we reported on the release of the Notice of Proposed Rulemaking (NPRM) which kicked off the long-anticipated push to free up prime blocks of TV spectrum for broadband use. The NPRM has now been published in the Federal Register, which sets the comment and reply comment deadlines. Comments are currently due by March 18, 2011, and reply comments are due by April 18, 2011. Needless to say, this is a proceeding of major league significance to a wide array of current and potential spectrum users. Attention most certainly should be paid.

Comment Deadlines Set In TIS Overhaul Proceeding

A couple of weeks ago we reported on an Order and Notice of Proposed Rulemaking (NPRM) which could lead to a re-shaping of the Travelers Information Service. The NPRM has now been published in the Federal Register, which in turn establishes the deadlines for comments and reply comments relative to the NPRM. Comments are due by February 18, 2011, and reply comments by March 7, 2011.

Travelers Information Service Expansion Under Consideration

Longstanding limits on content, facilities under scrutiny in wide-ranging NPRM

If you (like most of your fellow citizens) spend much time on the highways and by-ways of our great country – or if you have an interest (commercial or otherwise) in reaching folks on those same highways and by-ways – listen up. The Commission has launched a rulemaking to explore possible changes in the Travelers Information Service (TIS), the AM-based low-power service that provides a constant diet of, um, travelers information along highways and near various travel-based locations. At the request of several associations of government officials and TIS operators, the FCC has issued an Order and Notice of Proposed Rulemaking (NPRM) to consider whether TIS stations should be permitted to air a greater range of information at greater power in a greater variety of locations. The range of possible changes includes, at one extreme, a substantial redefinition of the service itself.

The TIS has been around since 1977. TIS stations operate in the AM band, as a primary service on 530 kHz and on a secondary basis on 535-1705 kHz. With maximum power of 50 watts, they are low-power operations designed to reach a narrow audience of travelers passing in the immediate vicinity of each station. The content of their transmissions is limited to “noncommercial voice information” about traffic (including road conditions, hazards, advisories, directions), nearby options for lodging, rest stops and service stations, and descriptions of local points of interest. The strict limitations on the service were imposed out of concern about possible interference and competition with commercial broadcasters.

Citing broad changes that have occurred in the country in the three decades since TIS began, the petitioning associations of government officials and TIS operators suggest that the Commission:

  • re-name the TIS as the “Local Government Radio Service”;
  • eliminate certain site and power limitations; and
  • expand the permissible content of TIS messages to include, among other things, alerts concerning the safety of life or protection of property, such as NOAA weather radio transmissions, AMBER alerts and other civil defense announcements.

The key question posed by the NPRM is: “Should the Commission significantly expand the scope of permitted communications by local governments on TIS stations, or should it adopt more limited changes that are consistent with the traditional traveler-related focus of TIS?” In other words, does TIS get a comprehensive, possibly mission-changing overhaul, or should it just be tweaked here and there to preserve its “traditional” focus?

The proceeding started back in 2008, with a petition by Highway Information Systems, Inc., proposing sweeping changes to the TIS. Two months later, the American Association of Information Radio Operators (AAIRO, represented by Fletcher Heald) took a more measured approach: it asked the Commission simply to confirm that the permissible content of TIS stations includes “any message concerning the safety of life or protection of property that may affect any traveler or any individual in transit or soon to be in transit” – a reasonable interpretation of the notion of “travelers information”.

But other groups followed up with their own separate, and broader, suggestions. Declining to simply provide the confirmation that AAIRO had asked for in the first place, the Commission now asks whether the permissible content of TIS stations should be expanded to include such matters as NOAA Weather Radio retransmissions, AMBER Alerts, terror threat alert levels, civil defense announcements and the like. (How limited is the FCC’s view of existing content limitations? In 2007, the Enforcement Bureau issued a Notice of Violation to the City of Santa Monica for retransmitting NOAA weather broadcasts.)

Other questions up for discussion: If such expansion is permitted, what limits should be imposed? For example, should only non-routine NOAA reports be permitted, or could routine reports be included as well? Would the proposed changes adversely affect commercial broadcasting, as NAB maintains? One proponent goes so far as to suggest that TIS stations be permitted to “any information of a noncommercial nature”. Another emphasizes the possible use of TIS for general emergency-readiness information along with announcements about local history, environment and parks.

With respect to the technical aspects of TIS, the Commission is considering a variety of proposals advanced by the petitioners. Should TIS stations be untethered from their current geographical anchors (i.e., roads, highways, public transportation terminals, etc.) and allowed to be located pretty much anywhere? One prominent engineering firm has objected to that proposal, citing its potential adverse effect on nighttime interference in the medium wave AM band. With that in mind, the Commission seeks comments on whether and to what extent interference problems could arise and, if so, how they should be addressed.

Along the same lines, should TIS stations be given greater potential power to expand their service areas? One possible rationale for a power increase:  because of higher speed limits since 1977, vehicles are within TIS service areas for shorter durations, thus allowing only 90 seconds for transmission including station ID.

The Commission also addresses a proposal to allow networks or “ribbons” of TIS stations along a highway. It asks about the nature of the system proposed and how it would operate. On the one hand, such systems could be useful in, for instance, directing evacuation efforts along certain routes; on the other, they might attract travelers away from commercial stations with superfluous or redundant information.

The potentially far-reaching nature of the changes under consideration is revealed in the seemingly simple proposal to change the name of the service from the “Travelers Information Service” to the “Local Government Radio Service” (or some variant along those lines). While some might invoke Shakespeare to suggest that a mere name change would have little effect, the proposed change here reflects the fundamentally different view of the service envisioned by some of the petitioners. After all, a “travelers information service” by definition provides information to travelers. A “local government radio service”, on the other hand, would appear to re-focus the goal of the service away from its intended beneficiaries (i.e., travelers) and toward its operators (i.e., local governments). While local governments might still be inclined to provide travelers information, they might also be inclined to expand the content far beyond that traditional limitation.

The Commission does not appear to have developed strong preferences on any of these issues yet, so if you’re inclined to drive into the TIS debate, now’s your chance. Comments will be due 30 days after (and reply comments 45 days after) the NPRM is published in the Federal Register. Check back here for updates on that front. 

Meantime, be safe out there.

FCC Sets Out To Overhaul Experimental Licensing

New kinds of licensing promise innovators easy access to nearly all of the radio spectrum.

The FCC has always been friendly to experimenters, whether they are basement hobbyists or industrial researchers. Since 1934 the Communications Act has enjoined the FCC to “[s]tudy new uses for radio, provide for experimental uses of frequencies, and generally encourage the larger and more effective use of radio . . . .” Just as important, many of the engineers at the FCC who began as teenage hams and tinkerers are eager to encourage the next generation. The FCC imposes only minimal regulation on amateur radio equipment, allows DIYers to design and operate home-brew transmitters with hardly any regulation at all, and offers “experimental licensing” so researchers and commercial innovators can test out new devices.

Nonetheless, while the pace of innovation accelerates, the rules on experimental licensing have stagnated. They require, among other things, separate FCC approval for each individual project. Ironically, considering their purpose, the rules are highly hospitable to minor variations on established uses of radio, while experimental licenses for more creative technologies can be hard to obtain. The FCC staff who do this work are technically capable and usually sympathetic to the applicants, but they are bound by the rules on the books.

In a burst of candor that may surprise equipment manufacturers and scientists, the FCC now concedes that the process for issuing these licenses can be a “roadblock to innovation.”  With this new self-awareness comes a comprehensive Notice of Proposed Rulemaking (NPRM) on experimental licensing rules so the FCC can (in its own words) “inspire researchers to dream, discover, and deliver” innovations to promote “a better way of life for all Americans.” The path to this Norman Rockwell ideal entails both updating the current rules and creating new licensing arrangements for research and development.

Few would dispute that the current system has become an obstacle. The various regulations for experimental and developmental licenses are scattered haphazardly through eight different rule sections. But the biggest problem facing development efforts, whether corporate, educational, medical, or scientific, is the need for project-by-project approval. The process is not only slow, but uncertain as to the outcome. And all the more so, as the technology at issue departs from current practice.

To address these problems, the NPRM lays out six kinds of rule changes.

First, a new licensing scheme would allow universities and non-profit research facilities to conduct testing and experiments on almost all frequencies, without separate approval for each project. Special requirements would help to protect cell phone, 3G, 4G, and broadcast frequencies. Operation would be restricted to the licensee’s campus, with emissions limited at the campus boundaries. Licensees would have to register their operations seven days in advance on a publicly accessible FCC website, through which spectrum incumbents can raise concerns of harmful interference. The FCC invites comment on a great many specifics.

Second, the FCC would establish “Innovation Zones” – geographic areas, possibly away from population centers – within which multiple innovators would have flexibility to experiment without separate project approvals. Licensees would need technical credentials, but would not be limited to universities and non-profit facilities. A landlord-licensee might invite companies and entrepreneurs to the facility to conduct research and development. As above, the public would have seven days’ prior notice of operations. The FCC again leaves a lot of details open for discussion.

Third, the FCC would establish a new licensing program specifically for institutions conducting research into medical applications, under rules otherwise similar to those above. Questions here center on the institutions that would qualify, the kinds of applications that could be investigated, and the appropriate reporting requirements.

Fourth, the FCC would consolidate and clarify a confusing collection of rules that now govern in-the-field testing and market studies for new devices. The revision would, among other changes, allow a manufacturer to sell not-yet-certified devices to a service provider, which in turn could lease (but not sell) them to consumers wanting to try them out. Manufacturers could sell uncertified devices to developers and system integrators as evaluation kits. The FCC would ease the caps on the numbers of uncertified devices that can be imported for testing and evaluation.

Fifth, the FCC would consolidate and streamline the existing rules on experimental licensing. The presently separate category for developmental licenses, little used, would be folded into the experimental licensing regime.

Sixth, the FCC makes proposals relating to specific situations such as anechoic chambers, Faraday cages, and open area test sites.

The proposed rules, which run to 37 pages, will affect just about every current and prospective user of the spectrum. The FCC should expect vigorous and conflicting comments. We foresee a major divide between entities committed to innovation, which will want greater flexibility, and spectrum incumbents, who will each demand greater protection for their own particular operations.

In the first three categories above, the FCC proposes to allow licensees to use any frequencies except those few marked as “restricted” in the FCC rules. (Restricted bands correspond to certain services that use especially sensitive receivers, such as GPS, satellite downlinks, and radio astronomy bands.) Even though most frequencies above 38.6 GHz are restricted by default (a few have been exempted), most of these, too, would become available to experimental licensees. Expect large numbers of incumbents in non-restricted bands to push back, each arguing that the importance of its service entitles it to greater protection.

Comments and reply comments are due 30 and 60 days, respectively, after the NPRM appears in the Federal Register. Watch this space for updates.

TV Spectrum Re-Purposing Out For Comment

Proposed changes would pave the way for broadband occupation of TV bands

That muffled sound you might have heard on November 30 was the opening barrage in the long-anticipated struggle to revamp the TV spectrum. More than a mere warning shot but still well short of a coup de grâce, the FCC’s Notice of Proposed Rulemaking (NPRM) is certain to shake the foundation of the television industry – an industry which is still re-building itself in the wake of the DTV Transition tsunami that crested in 2009.

The FCC’s goal in the NPRM is to “lay important groundwork” (in Chairman Genachowski’s words) toward the ultimate goal of permitting fixed and mobile broadband use in the TV band. Such use is thought by the Commission to be necessary to deal with the all-but-certain “spectrum crunch” which is expected to result from burgeoning mobile broadband demands. 

The FCC’s ultimate game plan appears to include coaxing existing TV broadcast licensees off their current channels in order to free up blocks of prime spectrum which would then be auctioned off for broadband use. While the Commission does not have the authority to “incentivize” broadcasters through, e.g., the sharing of the proceeds from such auctions, a couple of bills pending in Congress would provide such authority. The NPRM is intended to put the Commission in a position to move as quickly as possible toward effective spectrum repurposing if and when Congress gives it the power to share auction proceeds with displaced broadcasters.

The NPRM proposes three significant changes to the FCC’s rules.

First, the Commission is proposing to include fixed and mobile wireless services as potential uses in the VHF and UHF spectrum blocks currently reserved primarily for television. This involves a simple amendment to the Table of Frequency Allocations (the Table), which can be found at 47 C.F.R. §2.106. The Table is the official master list of authorized uses of the spectrum. Spread over more than 40 pages of the FCC rule book, it consists of a chart reflecting (a) all of the blocks into which the radio spectrum has been divided and (b) the specific permitted uses for each of those blocks. The Commission is proposing to include “Fixed" and "Mobile” as additional uses for the spectrum currently assigned for television services. 

This change by itself would not mean that broadband uses would automatically flood that spectrum. Rather, it would mean that the Commission could authorize such uses in that spectrum. Of course, the conventional wisdom is that the FCC will authorize such uses once it gets the rest of its ducks in a row. In order to facilitate that eventual process, the Commission is proposing to take this initial reallocation step now.

Second, the Commission is proposing rule changes to permit two television licensees in the same market to “share” one of their 6 MHz channels, thereby freeing the second channel for broadband uses. (Under such a sharing arrangement, two stations would share a single transmitting facility – although each station would be separately licensed and, in principle, independent of the other.) Historically, each TV station has had a full 6 MHz channel to use. Analog operation generally consumed the entire 6 MHz for a single program service, but the advent of DTV service has allowed multiple program streams by a single station over a single 6 MHz channel. The Commission apparently views this arrangement as inefficient. If every station were willing to share channels, that would free up 50% of the spectrum currently devoted to television – leaving that freed-up spectrum available for broadband.

Such channel-sharing would entail a number of complexities, many of which are addressed in the NPRM. Most obviously, the rules would have to be revised to permit such sharing in the first place. But beyond that, channel-sharing raises a host of questions. For example, as envisioned by the Commission, the proposed channel-sharing approach would provide TV licensees who agree to share channels the same MVPD carriage rights they currently hold. Licensees who agree to share channels would not be removed from cable, satellite, or other MVPD systems (e.g., FIOS) for helping out the government. 

The Commission is also seeking comment on other nitty-gritty details of sharing: Should commercial and noncommercial stations be permitted to share common facilities? Should a potential for loss of service by stations seeking to share transmission facilities be considered in determining whether that sharing proposal should be permitted? Ironically, on this last point the Commission suggests that its policy for dealing with service loss is one of flexibility, with the Commission happy to consider “any counterbalancing factors” a licensee might advance. But it doesn’t take a particularly long memory to recall a completely different Commission approach during the DTV Transition, when the Commission routinely denied minor changes to DTV facilities where more than 1% of the population would lose service.

Finally, the Commission is proposing rules to “maximize” the usage of the VHF spectrum. During the DTV Transition, many concluded that the VHF spectrum was not as well-suited for DTV use as UHF. As a result, most full-power stations elected to move to the UHF band to ensure uniform coverage within their service areas. But the UHF spectrum is particularly good for broadband operation, which means that the Commission would now like to wrangle as many TV stations back into the VHF band as possible.

To make such a move more palatable, the Commission is proposing VHF power increases and other revisions to improve the performance of indoor antennas. The goal is to try to offset any disadvantages, perceived or real, in VHF operation. In particular, the Commission is seeking comment on the adoption of the baseline standards for indoor antennas based on the 2009 ANSI/CEA-2032 standard, which establishes testing and measurement procedures for indoor antennas. By taking these steps, the Commission would squeeze more television stations back into the VHF spectrum bands, and free up a larger contiguous block of spectrum adjacent to the 700 MHz A Block which was previously auctioned for wireless uses.

The deadlines for comments and reply comments on the Commission’s various proposals will not be set until the NPRM is published in the Federal Register. Comments will be due 45 days after publication, reply comments will be due 75 days after publication.  Check back here for updates.

While the NPRM clearly sets the stage for TV re-purposing, it’s only the first step in what will likely be a complicated and contentious process. After all, the re-packing of large numbers of TV operations into a tighter chunk of the spectrum will present thorny issues, including the development of a New And Improved DTV Table of Allotments. 

Here again the recent DTV Transition experience provides a glimpse of things to come. Back in the early days of the DTV Transition, the adoption of the first DTV Table of Allotments led to many a battle over which channel would be assigned to which station. Such struggles will likely be even more problematic in a repacking process because that process contemplates a reduced number of channels overall. With fewer options from which to pick, we can expect considerable competition for channels which may be perceived as somehow “better”. How the Commission plans to manage, and resolve, such competition is still a mystery. 

Another concern about repacking: Thousands of Low Power TV stations, Class A TV stations, and television translators are operating on channels not included on the current DTV Table of Allotments. They will face certain displacement during this repacking effort.  While some of these stations may be able to take advantage of the proposed channel-sharing rules, or perhaps participate in the incentive auction, the devil will be in the details.

One thing that sticks in this author’s craw is the suggestion – expressly advanced by Chairman Genachowski and Commission Copps – that the television industry has been sloth-like in taking advantage of the digital spectrum.  Genachowski laments that some stations are not “seizing the opportunity to offer multicast streams or mobile TV”. Copps says that he “would have little interest” in a repacking process if only TV spectrum had been put to “positive use” through the provision of “public interest multi-casting”. 

Such perceptions conveniently miss several important points. 

First, the DTV Transition is still relatively recent. The transition required the acquisition of billions of dollars of new equipment by broadcasters, who also took extensive steps to educate the public on the new technology. They universally accepted, and rose to, that challenge. 

But to create a second or third program stream, a broadcaster has to create, in effect, a second or third station. To be sure, the transmission plant is already in place, but what about the studios, production facilities, staff – and advertising support – for the new program streams? These do not come pre-packaged, available for instant deployment. Quality programming requires extraordinary effort under any circumstance. That is even more the case here, where the new multi-cast streams would not be based on existing network fare (since most network programming is already committed and, thus, often not available for such additional streams).

Additionally, the development of such additional programming is expensive. Let’s not forget that the recession which has plagued the U.S. economy got its start in 2007 and hit hard in 2008, mere months before the government-mandated DTV Transition.

And if you’re talking about supposedly inefficient use of spectrum, what about the fact that other portions of the wireless spectrum for new wireless broadband services (700 MHz D block, for one) lay unused. The current state of multi-cast broadcast television may not meet the halcyon expectations of Copps, Genachowski and others, but at least the television industry built out a nationwide digital television service with the spectrum available to it.

To say that the television industry has somehow come up short and blown its chance is, in my own personal view, demonstrably wrong.   To rely on that misperception as justification for a new repacking initiative strikes me as regrettable.

Be that as it may, the battle call has sounded and the FCC has made its first move. It’s time to fall in and prepare for the long haul. This is likely to be an extended engagement.

"Bill Shock" On The Docket

Usage alerts, other steps proposed to prevent unexpected phone charges 

After much public hand-wringing, the FCC has released a Notice of Proposed Rulemaking (NPRM) proposing new rules that would require mobile service operators to provide usage alerts and information to assist consumers in avoiding unexpected charges on their bills. 

Data indicate that many mobile consumers experience “bill shock,” a medical condition in which a sudden, unexpected increase in one’s monthly cellular bill causes massive trauma to a consumer’s wallet. Typically the increase results from unintentional usages outside the scope of the consumer’s service plan. According to the results of an FCC-conducted survey, as many as 30 million Americans have experienced bill shock, a condition which medical professionals believe could be prevented by timely and easily accessible usage information. Unfortunately, this condition does not fall within the new Health Care Law, so millions of consumers have been left unprotected.

The GAO released a report to Congress which estimated that 34 percent of wireless phone users received unexpected charges on their bills. Many of these consumers were not alerted by their provider before they incurred the charges even though the technology to prevent bill shock exists. That technology is not uniformly utilized by mobile service providers. 

As the Commission sees it, consumers are entitled to baseline information allowing them to control the costs they incur for mobile services. Accordingly, the FCC proposes requirements that will provide timely information to consumers about their usage, such as:

  • voice or text alerts when a customer approaches and reaches monthly limits triggering overage charges;
  • notification that international or other roaming charges not covered by their monthly plans are about to be incurred; and
  • disclosure of any tools offered by mobile providers to set usage limits or review usage balances (on this point, the Commission also suggests that it might be inclined to require all carriers to offer consumers the means of setting their own usage limits).

On the assumption that such limits will be imposed, the Commission is interested in suggestions about how the rules should be implemented. For example, should such notifications be provided in “real time”, and if so, what technical limitations might come into play? How should notifications be provided for multi-line family plans? What is the most effective way to provide the notification (e.g., via voice or text alerts)? 

Also, should the FCC establish a precise usage level at which the initial notification message would be triggered? For example, new EU regulations require that wireless providers notify a consumer using a data roaming service when the consumer has reached 80% of an agreed-upon limit. 

Also, should multiple alerts be provided (either at reaching the trigger amount, upon exceeding the monthly usage amount, or every time the charge is to be incurred) or would a one-time alert be enough to do the trick? In any scenario, should the exact amount of the soon-to-be-incurred charge be provided? How long should mobile providers be given to implement any usage alert requirements that might be adopted. What are the best methods to ensure that consumers are made aware of the available tools for monitoring usage balances and limiting usage? How can consumers access these tools and any applicable charges? Also, should all mobile service providers be required to comply with the proposed requirements? Should prepaid services be exempted from the alerting requirements?

The NPRM was published in the Federal Register on November 26. That establishes the deadlines for comments on the various proposals: Comments are due by December 27, 2010, and reply comments are due by January 25, 2011.

Deadlines For Comments in E911 Proceedings Set

Today appears to be E911 Day in the Federal Register. Two recent E911-related Notices of Proposed Rulemaking are published, which means that the deadlines for comments and reply comments in those proceedings have now been set. (The two NPRMs were separately released back in September, so you’re forgiven if they may have slipped your mind of late.)

The first (CG Docket No. 03-123/WC Docket No. 05-196/WC Docket No. 10-191) involves the issuance of toll-free numbers for iTRS use, a practice which can make it difficult for emergency response teams to respond as promptly as possible to E911 calls. We reported on it here, you can read the full text of the NPRM here, and the Federal Register version may be found here. Comments on the proposed rules are due by December 2, 2010, 2010, and reply comments are due by December 17, 2010. Note that this particular proceeding also involves proposed new “information collection” requirements, which triggers the Paperwork Reduction Act – and thus affords yet a third opportunity to comment. If you feel like commenting on the proposed information collection requirements, you may do so by January 3, 2011.

The second proceeding (PS Docket No. 07-114/WC Docket No. 05-196) involves standards for E911 location capability accuracy. We reported on that one here, you can read the full text of the NPRM here, and the Federal Register version may be found here. Comments in the matter are due by January 3, 2011, and reply comments by January 31, 2011.

Comment Deadlines Set In Analog LPTV Transition Proceeding

Deadlines have been set for comments and reply comments in the proceeding aimed at closing down the remaining analog over-the-air TV signals. We described the Further Notice of Proposed Rulemaking and Memorandum Opinion and Order when it was first released back in September. Now it has been published in the Federal Register, which means that comments are due by December 17, 2010, and replies are due by January 18, 2011. Since the transition of full-power television stations to digital back in June, 2009, the only analog OTA TV service has been provided by LPTV’s, Class A’s, and TV translators. The FCC’s initial thinking (as reflected in the NPRM) would have all remaining analog service terminate sometime in 2012 (and all analog operations in the 700 MHz band clear out by the end of 2011). Anyone who believes that those goals might be a trifle unrealistic should be sure to let the FCC know during the comment period.

New E-911 Rules: Can You Find Me Now?

FCC tightens location accuracy standards, provides relief for rural settings, inquires into possible additional steps

After two years of reflection on the matter, the FCC has decided to accept an industry/public safety community compromise on E-911 accuracy standards. At the same time, it has proposed to expand the reach of those standards to new categories of service providers while tightening the standards even further.

When last we talked about E-911, the FCC had adopted rules that required wireless carriers to achieve a high level of “ALI” accuracy (the ability to identify the location of a call) at the public safety answering point (PSAP) level. This development came about because the rules required emergency call location information to be provided with a high degree of accuracy (within 100 meters) for 67% of the calls received and within 300 meters for 95% of the calls, but the standard was being diluted by carriers calculating their level of compliance over large areas.

To plug this loophole, the FCC ordained that the requisite degree of reliability now had to be met on a PSAP level rather than the larger geographic areas which the rules previously permitted. This requirement was deemed difficult or impossible of compliance by many in the mobile communications industry. Carriers who used the “network” solution (which relies on triangulation of signals to achieve accuracy) complained that in areas with few cell sites, the necessary triangulation was simply not available. Appeals to the Court were duly filed, but before the Court could rule, the Public Safety community (APCO and NENA) indicated that they were amenable to liberalizing the measuring standard to a county level rather than the PSAP level. Further discussions with the largest carriers resulted in agreement by Public Safety that some additional leeway was appropriate in areas where heavy forestation impeded the ability to get extreme accuracy. Given the growing consensus that the standard which had been adopted might need revision, the FCC sought and was granted a remand from the Court so it could re-visit the issue.

After seeking further input, the FCC basically accepted the consensus of the industry and Public Safety as to what was both feasible and would provide a heightened degree of accuracy for first responders. While we are usually uncomfortable when the FCC lets AT&T, Verizon and a few other large carriers speak for “the industry,” in this case the FCC listened both to the largest carriers and to representatives of smaller carriers who moaned that they did not have the same access to new aGPS equipment as the majors. The resulting decision seems to reasonably reflect the needs and concerns of most parties.

The FCC afforded network-based carriers an unusual degree of flexibility in establishing compliance. They can elect to be measured over either counties or PSAPs in their service areas, whichever they desire. And they can use either network-based accuracy data, handset-based data (after a few years), or a combination of both. To further sweeten the deal, the FCC will permit carriers to exclude from the calculation counties or portions of counties where triangulation is not technically possible. The pertinent counties must be reported in the FCC Docket and sent to Public Safety.

This concession to the laws of physics is huge since the triangulation problem was a major impediment to compliance by rural carriers. In addition, even a network-based carrier may rely on handset-based accuracy data if it has a high degree of aGPS-equipped subscribers (85%) network-wide or if it gives aGPS equipment to subscribers in the area at no charge. Handset-based carriers also got some relief: they can exclude up to 15% of counties or PSAPs whose heavy forestation limits handset location accuracy.

All of this is not to say that the new rules do not impose significant burdens. They certainly do. To wit:

  • Carriers who use the network-based solution must meet the 100 meters/67% of calls metric over 60% of their counties or PSAPs within one year of the effective date of the new rules. The counties included must cover at least 70% of the counties covered by the carrier over its entire network. The 70% requirement is presumably there to preclude manipulation of the data, but the FCC offered no explanation for it whatsoever, so it is unclear whether the reference to a carrier’s “entire network” means its entire nationwide network or its network within the particular call sign being measured. Within three years, carriers must meet this metric in 70% of the counties or PSAPs, with 80% of the counties in the entire network being included. Finally, in five years carriers must meet the metric in 100% of the counties or PSAPs. At this point, handset-based accuracy data may also be used to demonstrate compliance, on the assumption that aGPS devices will be relatively widely available by that time.
  • Network-based carriers must meet the 300 meters/90%-of-calls metric on a three year – five year – eight year timetable. Note that the metric for this level of accuracy has been reduced from 95% of calls to 90%.
  • Meanwhile, handset-based carriers have two years to meet an accuracy metric of 50 meters/67% of calls and 150 meters/80% of calls. By year eight they must reach 150 meters accuracy for 90% of calls.
  • No self-respecting FCC regulation would be complete without a reporting requirement. Here the FCC is requiring the reporting of “confidence and uncertainty” data at the request of any PSAP. We appreciate this requirement because a fragile balance of confidence and uncertainty so defines the human condition. The precise nature of this data is notably unclear from the FCC's order, leaving us somewhat on the uncertainty side of the equation in this regard.
  • Finally, the FCC has clarified that the accuracy metrics noted above only apply to outdoor measurements. But how will the measurement process know whether any particular call originated from indoors or outdoors, and therefore whether it should be included in the accuracy calculations?

Having adopted these requirements, the FCC issued a companion notice of proposed rulemaking (NPRM) inquiring into a number of important issues:

  • Should there be single accuracy metric given the accelerating convergence of handset and network technology?
  • Can the level of accuracy required be stepped up even higher given the new technologies?
  • Should “Z-axis” (i.e., height above ground data) be added to the location requirement?
  • More broadly, should the Commission extend the current VoIP ALI rules to a wider universe of service providers?   The current rules require VoIP users to self-report their location since there is no other way for the network to know where a computer happens to be located. And even this requirement applies only where the customer originates and terminates calls to the PSTN in real time. But as the use of computers and computer-like devices with voice capability spreads, so too does the need to be able to locate 911 calls originated from such devices. The Commission recognizes that such an expansion of the E-911 process would be problematic since the new computing devices are themselves mobile – self-reporting one’s whereabouts would be impractical and would defeat the purpose of “automatic” location identification. This inquiry is plainly at its inception, but it will become more important as all communications move to an Internet-based model.

The deadlines for comments and reply comments have not yet been set. They will depend on the date the NPRM is published in the Federal Register (comments will be due 60 days after publication, replies 90 days after publication). Check back here for updates.

Analog LPTV: The End Is Near . . . Maybe Really Near

Among other transition-related details, Commission proposes 2012 termination for analog LPTV service, even earlier clearing of LPTV from 700 MHz band channels

The FCC says it’s time to close the lid on the analog TV coffin for good. In a Further Notice of Proposed Rulemaking and Memorandum Opinion and Order (NPRM), the Commission has started the ball rolling for the final shut down of all remaining analog Class A, LPTV and TV Translator stations (for convenience, we’ll simply refer to them all as “LPTV”). 

Full-power TV licensees were required to abandon analog and embrace digital no later than June 12, 2009. While the Commission has, since 2004, permitted LPTV stations to convert to digital, it has not made the conversion mandatory. But now that the full-power conversion deadline has come and gone, the Commission believes that LPTV operators should also be herded into the digital corral. So the Commission is seeking comment on a number of proposals for accomplishing that goal. 

The proposals include a hard – and fast-arriving – deadline for all LPTV stations to convert to digital operation. Another proposal would impose an equally hard – but faster-arriving – deadline for all LPTV stations (whether analog or digital) to clear out of Channels 52-69.  (Channels 52-60 comprise the 700 MHz band which was cleared of full-power TV stations and allocated to commercial and public safety wireless services years ago. LPTV stations have been permitted to stay on in that band on a non-interference basis – until now.)

The NPRM is light on the specifics of the final mandatory conversion process. As envisioned by the Commission, the Media Bureau would be responsible for devising and implementing the nitty-gritty details. But the Commission has laid out a number of questions for comment.

Digital Conversion Deadline – 2012. However the digital transition for LPTV stations may shake out, the FCC currently thinks that it should be wrapped up sometime in 2012 (i.e., “approximately three years after the June 12, 2009 full-power transition date”). 

A 2012 deadline for finishing the process? The FCC understands that this deadline may be a problem. But it figures that most, but not all, full-power stations made the transition in only about four-five years, and many LPTV stations have already availed themselves of the opportunity to convert to digital. With knowledge gleaned from that transition experience, the Commission speculates that three years might be enough finish up with LPTV. 

Of course, that three-year period would start as of the full-power transition date, June 12, 2009 – meaning that more than one-third of the time has already passed. Telling LPTV stations in September, 2010, that their digital transition countdown started 15 months ago is a bit of a stretch. On top of that, there are some 7,500 LPTV stations compared to only about 1,800 full-power stations. The logistics alone (e.g., equipment manufacture, installation, tower rigging) for all these stations are not likely to permit completion by a deadline barely two years away.

Further complicating matters is the National Broadband Plan (NBP).  Among its various ambitions, the NBP would repack the TV spectrum to free up 120 MHz of TV spectrum for broadband. That would reduce the spectrum available for all over-the-air TV considerably – so much so that many LPTV stations may not be able to find suitable new homes. The idea of spending a lot of money to convert to digital, only to have to change channels again or even be shut down a year or two later by broadband, is unsettling, if not terrifying. 

The FCC is not oblivious to these problems, but it may be a bit unrealistic about possible solutions. For example, the NPRM mentions an NTIA grant program to help pay for the cost of digital transmitters. But it fails to mention that: NTIA is limited by statute to funding rural stations; grant maximums are $6,000 and $20,000, far below the cost of a digital transmitter; and grants are made only after the grantee has shelled out its own cash to buy the equipment. (The NPRM does solicit comments detailing the anticipated practical considerations – including particularly conversion costs – that LPTV stations are likely to face.)

The Commission also wants to know what kind of community outreach efforts it should plan for the LPTV transition. How many of the bells and whistles imposed ad nauseam during the full-power transition (e.g., audience-education efforts, call-in centers, re-scanning instructions) should be dusted off and re-deployed?

And the FCC invites comments on whether the deadline should be later, perhaps 2015, and whether exceptions should be made in hardship cases or communities where LPTV is the only available over-the-air TV service.

However much LPTV stations may be quaking in their boots at this point, the fact remains that more than half have already applied to the FCC for some kind of digital conversion, and the current pace of digital applications is pretty brisk. The real question is how many stations still feel that there is any audience for their analog signals and, as a result, want to postpone conversion to continue to serve that analog audience. Some suggest that minority and niche audiences and rural residents often served by LPTV stations still have a lot of analog receivers, but statistics are not plentiful.

700 MHz Band Clear-Out Deadline – December 31, 2011. Turning to Channels 52-69, the FCC says that enough is enough. Whether or not those channels are being put to use by their non-broadcast licensees, it’s time to clear out the broadcast hold-overs – all of whom happen to be LPTVs. Now that the full-power transition has come and gone and full-power stations are no longer taking up two channels each, channels in “the core” (i.e., below 52) are as easy to come by as they are going be. 

Accordingly, the FCC proposes to require all LPTV stations on Channels 52-69 to apply to move to lower channels by June 30, 2011, and to move there by December 31, 2011. 

There may be some practical problems with that ambitious schedule. Can the FCC process all these applications in six months? How fast can the FCC resolve conflicts if two stations apply for the same channel? The answer, we suspect, is that those who wait until the last day to file applications will pay the price: earlier filers will have more time to work out kinks in their FCC applications and get grants, leaving them time to build; and since applications are processed on a first-come, first-served basis, conflicts should arise only if two stations file on the same day. 

Additionally, the NPB repacking plan could gum up the works here as well. The scope of the repacking proposal might be clear before June 30, 2011, but then again it might not – in which case the process of picking a lower channel, and then obtaining authority to use it, may turn out to be risky business.

The Freeze Is On. Effective immediately, no more applications will be accepted for new analog LPTV stations on any channel. Existing stations on Channel 52-69 may no longer request analog modifications except in extreme hardship cases (think involuntary loss of transmitter site), and no new digital companion applications will be accepted on Channels 52-69, even if no lower channel is available.

“Minor” Change?   The FCC proposes to limit transmitter site changes in “minor” change applications to 30 miles. Currently, a proposed change is “minor” if there is any overlap between the old and new service contours. By proposing a smidgen of overlap, some stations have succeeded in moving long distances into new markets, including urban markets. As proposed in the NPRM, moves of more than 30 miles would be deemed “major” changes, which are currently forbidden in urban areas. (The FCC says it plans to remove geographic restrictions on first come, first-served applications for new stations and major changes – although it doesn’t say when.)

VHF To The Rescue? With the likelihood of NBP-induced spectrum scarcity in mind, eyes are turning to VHF channels, which aren’t suitable for broadband (and not ideal for digital television, either). The FCC nevertheless asks whether VHF channels may become a good home for digital LPTV stations, and it offers the carrot of a power increase above the present 300-watt limit. VHF LPTV stations, particularly those on Channels 7-13, have been clamoring for more power for several years, and the door may now be open to meet that need. In fact, the FCC invites comments on whether power increases and/or changes in interference standards are needed for all digital LPTV stations.

Channel Surrender.  Analog LPTV stations with companion digital channels have, as a matter of policy, been permitted to terminate analog operation and either keep their companion digital or move their digital operation to their analog channel. The FCC proposes to make that policy permanent. In the past, Class A stations have not enjoyed the same degree of choice, because their companion channel was not afforded Class A spectrum priority. Now the FCC proposes to give Class A stations the same ability to choose to operate digitally on their analog channel or their companion channel, and whichever channel they select will be granted Class A status. This change will be of significant benefit to Class A stations whose analog channels are not suitable for digital operation and who thus have little choice but to stick with their companion channel and need a way to retain Class A status.

Vertical Radiation Patterns/Emission Masks. LPTV antennas do not always have the same horizontal and vertical radiation patterns, but FCC interference studies are based on only the horizontal plane and assumed vertical characteristics which may not accurately depict actual operation. The FCC now proposes to require vertical pattern information in applications for new or modified stations. Existing stations not making changes may either: (a) file their vertical pattern or (b) continue to rely on the old assumptions. 

The FCC also proposes to allow the use of a full-power TV digital emission mask by LPTV stations, in addition to the previously authorized simple and stringent masks. Because the full power mask exceeds the performance of a stringent mask, it will allow more digital LPTV stations to avoid predicted interference to first-adjacent channel stations, opening a door for some applications that were previously stymied.

Ancillary/Supplementary Services Fee. Digital stations – LPTV and full-power – are permitted to provide the same subscription-based, non-broadcast ancillary services on their spare digital capacity as their full-power colleagues. Since 2004, digital LPTV licensees have, just like full-powered licensees, had to pay the same annual fee of 5% of the gross revenue derived from such services.  But in 2007, the Commission expanded that fee obligation on the full-power side to include any authorized DTV stations, not just “licensees” (in other words, stations operating pursuant to an STA would be subject to the fee as well). The Commission now proposes to close the loop by extending that tweak to LPTVs as well. 

And finally, the NPRM notes that a petition asking that LPTV licenses be made secondary to “White Spaces” unlicensed broadband use of vacant TV channels was denied in the separate White Spaces rule making.

Comments will be due 60 days after the Notice of Proposed Rule Making appears in the Federal Register, with replies 30 days later. We will post the deadline when available. Of course, by the time the comment cycle has been completed, and a decision is reached, there will probably be less than one year left in the FCC’s theoretical three-year transition period if the proposed 2012 deadline sticks.

FCC Proposes Onerous Wireless Renewal Requirements

Applicants would have to track down and turn over multiple documents – all of which the FCC already has.

Wireless licensees take note: the FCC has proposed changes to its renewal procedures, changes that could mean a lot of extra work for you, with little clear public benefit. 

The Commission is proposing to require wireless licensees to submit, along with their renewal applications, copies of all FCC orders finding a violation or apparent violation issued with respect to the licensee during the license term, whether or not the violation(s) (or alleged violation(s)) relate to the license being renewed – and whether or not a violation was ultimately found. That’s right – the FCC wants more copies of its own documents. It also wants a list of petitions to deny filed for any reason against any application submitted by the licensee – again, even applications involving licenses that are not part of the subject renewal application.

But wait. It gets worse.

Not only would the licensee/renewal applicant have to produce its own documents, it would have to track down and turn over a similar universe of documents for each of its “affiliates” – “affiliates” not just in the usual sense of “under common control or management”, but in the very broad sense of sharing facilities, participating in joint venture arrangements, or even just having contractual relationships. (For all the unpleasant details, check out the definition of “affiliate” in Section 1.2110 (c)(5) of the FCC’s rules.) This broad definition normally applies in auctions, to avoid competitive bidding credits going to undeserving entities. It does not fit well in the renewal context, where the point is to assess the qualifications of the licensee, not entities that it can’t control. 

Worse, the proposed document production exercise would repeat each time any license held by the applicant and any of its affiliated entities comes up for renewal. Especially for larger entities, the procedure would result in a cascade of repeated document productions, in some cases involving hundreds of affiliates and thousands of licenses. No wonder AT&T and Sprint are worried. This type of due diligence is no cakewalk for smaller entities either, who will have fewer resources to put towards compiling the required information. 

Expensive, time-consuming – and probably unlawful.   The federal Paperwork Reduction Act (yes, it’s hard to tell, but there really is one) bars governmental agencies from requiring the filing of “unnecessarily duplicative” information otherwise reasonably accessible to the FCC. All of the requested paper is already in the FCC’s own files. If that isn’t unnecessarily duplicative, then nothing is.

After all that, if the Commission finds an applicant’s submission to be “insufficient”, the Commission will deny the application. Don’t ask us what “insufficient” means – the FCC isn’t saying. Apparently, like Justice Stewart in Jacobellis v. Ohio, it will know it when it sees it. Given that people’s livelihoods can be at stake, we expect a better articulation of what the Commission is looking for. We think the Administrative Procedures Act expects the same.

Reply comments about the proposed rule changes are due by August 23. The Commission will accept ex parte communications after that.

Part 17 Rulemaking Comment, Reply Comment Deadlines Set

A couple of weeks ago we reported on the FCC’s Notice of Proposed Rulemaking (NPRM) looking to overhaul the Commission’s regulation of towers, er, we mean “antenna structures”. The NPRM has now been published in the Federal Register, which establishes the deadlines for comments and reply comments in response to the NPRM. Mark your calendars: comments are due by July 20, 2010; reply comments are due by August 19, 2010.

Comment Deadlines Set In Video Navigation Proceedings

Yesterday we reported that the FCC has initiated a couple of proceedings relating to video connection/navigation devices. Both the Notice of Inquiry (NOI) and the Notice of Proposed Rulemaking (NPRM) have now been published in the Federal Register. As a result, the comment period deadlines for both are now set. 

Comments in response to the NOI are due by July 13, 2010 and reply comments are due by August 12, 2010. 

Comments in response to the NPRM are due by June 14, 2010 and reply comments are due by June 28, 2010. You may also file separate comments with respect to the proposed “information collection” aspects of the proposed rules described in the NPRM; those “PRA” (short for Paperwork Reduction Act) comments are due by July 13, 2010.

Pick A Card, Any Card

FCC looks to shuffle the video navigation deck from CableCARD to AllVid

In recent years, the number of new avenues to connect to the Internet for video programming has grown exponentially. Driving this, of course, is the availability of more and more video-based distribution services out there that will deliver video to the comfort and privacy of your living room. While folks previously watched YouTube only on their computers, recent technological developments have given us internet-accessible DVRs, Blue-Ray disc players, and gaming devices such as Wii and PlayStation that can access and deliver video programming from Netflix, Pandora, and Hulu. Even televisions themselves are being manufactured to access the internet and relay programming to the home viewer.

In this atmosphere of rapid growth, the Commission recently released two notices relating to set-top boxes and their progeny. The basis for the Commission’s interest in this area is the requirement contained in Section 629 of the Communications Act, which gave the Commission authority to develop rules to spur the development of devices used for multichannel video program distribution (MVPD). The over-arching goal was the creation of a free, open and competitive market for video connection devices similar to that which developed for CPE (“customer-provided equipment” or “customer premises equipment”) when the telephone network was thrown open to non-Bell devices.

The first notice, the Fourth Further Notice of Proposed Rulemaking, seeks to update the CableCARD rules and policies. The CableCARD is a device that, once installed into retail devices such as television or retail navigational devices (think TiVo), eliminates the need for a separate set-top box.   Section 629 was part of the Telecommunications Act of 1996, and it took seven years for the industry (MVPDs and manufacturers) to develop a standard for the device. However, the standard adopted in 2003 did not address two-way communications such as Video on Demand, and the device requires professional installation. 

In the National Broadband Plan, the Commission indicated that it would examine whether there should be changes to the existing rules to encourage the greater use of CableCARD devices.   In particular, the Commission is seeking comment on rules that would: (i) ensure that devices are able to access multi-stream video programming; (ii) make the pricing, billing and installation practices of CableCARD equipment transparent and similar to those for leased set-top boxes with the CableCARD already installed; and (iii) encourage the rapid development of new retail CableCARD devices. 

While the Commission recognizes that the CableCARD regime is somewhat outdated, it seeks to make these changes to its rules as an interim measure while it implements what it believes to be the next generation of devices, namely, the AllVid device. The second notice, a Notice of Inquiry, is intended to jumpstart the quest for such a device. The AllVid approach, still merely a “concept” developed by the Commission in the National Broadband Plan, would serve as a gateway between consumer premises equipment such as DVRs, computers, and televisions on one side, and the proprietary systems of MVPDs on the other side. While the Commission acknowledges that such a “gateway” device is in concept form only, it believes that the adoption of this concept would lead to a nationwide interoperability standard like Ethernet and the standard phone-jack of yesteryear.

Under the AllVid concept, MVPD’s would be able to deliver their services directly to a small device, which would connect to the navigational devices such as computers, DVRs, televisions, and gaming systems. The MVPD would not have the headaches of working with individual device manufacturers, and the Commission believes that this concept will spur development of a retail market for new devices without the need for the manufacturers to deal with the MVPDs. Just as fax machines and answering machines could perform different services so long as they could be plugged into the standard RJ-11 phone jack, the Commission believes that AllVid devices will free up parties on either end of the gateway device to develop new and innovative methods for delivering service to consumers.

The Commission envisions that this device could be installed either on the back-end of a television, or as a device to which multiple devices would be attached. But, as with most “concepts”, the Commission is seeking comment on almost all elements of how this device will operate, including communications protocols, content protection requirements, and whether the consumer market demands that these devices should be developed by the Commission. One potentially sticky aspect of the proposal is that the Commission envisions that there would be a uniform channel guide and navigational features across all devices. While the Commission notes that there is an inherent conflict between standardization and innovation, it does appear to favor a standardized user interface that would improve customer service and ease of use.

Since this proceeding is at the Notice of Inquiry stage, there is very little meat on the proposals offered by the Commission. Instead, much like the National Broadband Plan, the Commission has teed up the subject matter, and is interested in receiving comments on all aspects of the proposal. On the other hand, combined with the adoption of the Notice in the CableCARD proceeding, it is clear that the Commission believes both that (a) the MVPDs and manufacturers have not fully met the goals set forth in Section 629 of the Communications Act, and (b) some sort of Commission-directed nudge is necessary. 

Whether or not the final result is the adoption of the equivalent of the MVPD phone-jack is unknown, but we will keep you up-to-date as the proceedings move forward.

Part 17: Subject To Change

FCC looks to overhaul antenna structure strictures.

You know how people have been telling you for, like, years that you really ought to clean out your refrigerator? And when you finally get around to it, you find (among other things) that those fuzzy things that look like a science experiment sprouting behind the old jar of maraschino cherries at the back of the top shelf have sell-by dates that went by several years ago?

That’s what the FCC is experiencing right now – but instead of its refrigerator, what needs cleaning up are the rules governing antenna structure construction, lighting, marking and maintenance. 

And so the Commission has released a Notice of Proposed Rulemaking (NPRM) looking to overhaul its tower-related rules, which comprise Part 17 of the rules. While the Commission specifies a number of particular changes it has in mind (see below for examples), the proceeding appears to encompass the entire regulatory scheme of Part 17. Anyone who has an antenna structure or expects to build one may want to take the opportunity to offer their suggestions, since history suggests that, once the structure rules are revised, they’re likely to stay that way for a while.

The FCC, of course, has long required all of its regulatees to comply with various non-RF related aspects of their antenna structures.  (Insider tip: While you may want to refer to them as “towers”, don’t; the government prefers the more elegant term “antenna structures”.) And it routinely issues forfeitures for non-compliance with, e.g., lighting and painting specifications. The goal is to keep aviators and aviation passengers from flying into those structures.

But because the focus here is on aviation, the FCC shares antenna structure responsibilities with the Federal Aviation Administration (FAA). Historically, the FAA has set most of the substantive standards (for, e.g., lighting and painting), even though the FCC has the responsibility for enforcing those standards.  But the two agencies apparently don’t coordinate as well as they might – and, as a result, discrepancies between the FAA’s requirements and their FCC equivalents can develop.

For example, the FCC rule section on painting/lighting specifications currently requires conformance with an FAA circular that was superseded, by the FAA, more than six years ago. (This problem had been called to the FCC’s attention back in 2006.) The FCC proposes to fix the problem now by (a) deleting references to any circulars, and (b) requiring instead that structure owners comply with whatever determination the FAA issues with respect to their particular structures. 

Along the same lines, Sections 17.14 and 17.17 of the Commission’s rules – which specify (a) which structures are subject to notification to the FAA and (b) which are exempt – merely parrot the FAA’s rules. The FCC correctly observes that this approach “risks creating confusion in the event the FAA were to change its criteria”. So now the FCC proposes simply to cross-reference, in its own rules, the corresponding FAA rule.

Curiously, discrepancies within the FCC’s own rules have developed as well. Sections 17.2 and 1.907 both purport to define “antenna structure”, but they use slightly different language. The Commission asks whether the two should be “harmonized”. (Our suggested answer: “yes”.) And the FCC’s definition of “antenna structure owner” – i.e., the guy who bears ultimate responsibility for compliance with lighting/marking/etc. requirements – could be read to include not only the structure’s owner, but also the owners of any antennas that happen to be located on the structure. Since that reading would be inconsistent with longstanding Commission precedent, the FCC suggests that the definition should be clarified some.

Similarly, FCC rules currently require that each structure’s Antenna Structure Registration number be displayed “in a conspicuous place so that it is readily visible near the base” of the structure. But elsewhere the Commission has suggested that the number be displayed “along a perimeter fence” or “at the point of entry of the gate” – in both cases, places not necessarily “near the base” by any means. Since the purpose of the display is to provide the public information, the latter approach seems to make more sense than the one in the rules. The FCC proposes to resolve this by requiring the display to be visible from “the closest publicly accessible location[s]” near the base.

And if you’re looking for internal discrepancies, look no farther than Section 17.58, which requires compliance with Section 1.70 of the FCC’s rules. But check this out – Section 1.70 was deleted from the FCC’s rules in 1977! Not surprisingly (but without a hint of obvious embarrassment), the Commission now proposes to delete Section 17.58.

The Commission also proposes to streamline requirements regarding inspection and maintenance of marking and lighting by, e.g., eliminating the separate inspection component entirely while retaining the obligation to assure proper lighting at all times. Timely notification of outages would still have to be made to the FAA. As an alternative, if inspection requirements are retained, the FCC may consider exempting certain network operations control center-based monitoring systems.

Another proposal: defining what alterations to a structure would require a new FAA study. The Commission’s rules currently contain no such definition, even though the FCC has, since 1995, applied the informal standard that any change in height of one foot or more, or any change in location of one second or more, would trigger a new FAA study. The Commission now proposes to codify that standard.

And another: structure owners would have to keep records of observed or known lighting outages/improper functioning for two years.

Despite the Commission’s historical inclination to let the FAA call the shots vis-à-vis the substantive standards for antenna structure lighting/marking, a number of the NPRM’s proposals suggest a curious independence of spirit on the FCC’s part. 

For example, to determine the coordinates of a structure, the FCC suggests that it might insist on specific accuracy standards or survey methods. But the FAA has declined to impose such a requirement, and conflicts with the FAA’s process could arise if the FCC insists on specific standards/methods that yield results at odds with the FAA’s approach.

Along the same lines, the FAA requires structure owners to notify it of the structure’s construction or dismantlement within five days. The FCC, by contrast, provides only 24 hours for such notice and, without explanation, the Commission proposes to stick by that limit.

Since the NPRM is intended to “update and modernize” all of Part 17, there are more specific proposals, as well as broad invitations for comments and suggestions. This presents an excellent opportunity for anyone with an antenna structure to weigh in.

But one of the more intriguing aspects of the FAA/FCC relationship may be out of the FCC’s hands for now. The FAA has on occasion asserted authority over not only the physical nature of antenna structures, but also their RF characteristics as well. (The FAA’s approach is understandable in view of the fact that the FCC defines “antenna structure” to include not only the physical structure, but also any radiating and/or receive systems and related gear.)  In particular, at times the FAA has withheld “no hazard” determinations based on the particular frequencies to be transmitted from the structure – for example, where operation of a proposed FM station would interfere with navigation frequencies used at a nearby airport. Since 2006 the FAA has been considering its own NPRM which would expand its own notification requirement to include a range of frequency-specific limits.   In its NPRM the FCC now inquires whether the FCC’s rules or policies should be altered in the event the FAA adopts the proposals pending in its 2006 NPRM. It is not at all clear whether the Commission sees a possible inter-agency impasse here and, if so, what the prospects for resolution might be.

While we may welcome the opportunity to chip in our respective two cents’ worth to the FCC, all concerned might be better off if the Commission and the FAA were to commit themselves to ironing out, once and for all, all aspects of their shared responsibilities. Unilateral action by either agency creates the possibility of conflict with the other, with resulting confusion for the regulated masses. Of course, the FCC and FAA have been unable to resolve their relationship to date – as is evident throughout the FCC’s NPRM – so it may be idle to suggest that they should do so now. But there’s no harm in asking.

The deadlines for comments and reply comments have not yet been set. Check back here for updates.

NBP Lift-Off!

FCC launches five – uh, make that six – NBP-related items in one day

If you thought the FCC might have been kidding around when it promised quick action on the National Broadband Plan (NBP) agenda items, the FCC is working hard to move you off that thought. In an impressive display of regulatory shock and awe, the FCC has put a substantial dent in its NBP to-do list by launching six separate proceedings covering five discrete subjects. The items include:

The six items top out at a total of just over 250 pages in all, so you might want to start reading now.  If you just want to get a quick sense of what each involves, you might want to check out the public notices which recap each: Universal Service Fund; Roaming Obligations; Survivability; Cyber Security Certification; and Set-top Boxes.

 Each of the six items invites comments and reply comments, but don’t get your calendars out yet. The comment deadlines won’t be set until the various notices are published in the Federal Register. And to make it even trickier to start planning your early summer get-away, the Commission appears to contemplate an oddly diverse set of deadlines. For example, comments and replies in response to the Set-top Box NOI will be due a scant 30 days and 45 days, respectively, after that notice makes it into the Federal Register.  By contrast, comments/replies in the Cyber Security Certification proceeding won’t be due until 60/120 days after publication. And in between you’ve got the Set-top Box NPRM and USF combo NOI/NPRM (60/90 days for each), and the Survivability NOI and Roaming NPRM (45/75 days for each).

With this barrage – or is it a salvo? – the Commission is clearly signaling its determination to move forward with the ambitious campaign mapped out in the NBP, despite the major questions which loom large in the wake of the FCC’s setback in the Comcast case.  And don’t get comfortable, because these are just the beginning.  The NBP envisions more than 60 proceedings in the months to come.  Stay tuned . . .

2010 Reg Fees -- Trending Down!

If it’s Spring, it’s time for the FCC to propose new regulatory fees that will be payable in late Summer. And sure enough, the Commission has released its annual Notice of Proposed Rulemaking laying out a tentative fee schedule. The Commission invites comments on its proposals, but if you think you might want to throw in your two cents’ worth, you’ll have to act fast. The deadline for comments on the proposed fees is May 4, 2010; reply comments may be filed through May 11.

The good news is that, unless you’re a UHF TV licensee (or a VHF licensee in certain markets), you’re probably not going to have a problem with the proposed fees. All AM and FM license fees are proposed either to go down or to stay at last year’s levels. All VHF license fees for Markets 11-25 and Markets from 51 on down would also go down (as would the fees for all VHF CPs). No change is proposed for translators/boosters – FM or TV – or LPTVs; ditto for broadcast auxiliary licenses. UHF CPs would go up (but only by $75), as would AM CPs (by $20), while FM CP would go down by $20.

All you full service TV operators – heads up. The Commission has previously exempted digital TV operations from reg fees because the DTV transition was still underway. As we all know, the transition was completed as of June 12, 2009, so we can kiss good-bye to the digital exemption. And while reg fees will be determined by the status of your authorization as of October 1, 2009, note that a special temporary authorization for DTV operation in effect as of that date will count as a “license” for fee calculation purposes this year.

We have prepared a table reflecting the proposed 2010 reg fees here. The numbers in parentheses reflect the amount of the proposed changes from last year’s fees – and as a visual aid, we have indicated proposed fee increases in red, and proposed reductions in cool blue.

The proposed fees are just that – proposals. We won’t know the final fees until sometime this summer, although historically the final fees tend not to stray too far from the initial proposals. We also do not yet know when the fees will be due, although that tends to be in September (or possibly August). Look for an announcement sometime mid- to late Summer.

One last highlight of the NPRM. The Commission is proposing to do away with the postcard notification system by which it has, for several years, alerted broadcast licensees of their primary fees. The postcards will still go out this summer, but starting in 2011, media licensees would be on their own to determine the fees they owe. (This is part of an effort by the FCC to become “more electronic and less paper-oriented”.) If you would like to comment on this particular proposal, the Commission is going to leave the comment/reply comment period open until September 30, 2010 for that limited purpose.

Can Network Neutrality Survive Comcast v. FCC? (Spoiler Alert: Maybe.)

A look at successes of the past gives the FCC a way to move forward.

(Author’s note: Last November I posted an item here improvidently titled “How to Solve the Network Neutrality Problem.” My solution was overturned, along with the FCC’s efforts at Internet regulation, by the recent court decision in Comcast v. FCC. Below is a revised path to the same goal that still works after Comcast.)

Network neutrality advocates are in despair following the Comcast decision. That case arose when cable company Comcast selectively hindered customers’ access to certain file-sharing services. The FCC told it to stop. Comcast already had stopped, but went to court anyway to protest the FCC’s butting in. The court ruled for Comcast, asserting the FCC lacks authority to regulate Internet service providers. Comcast is free to decide what content to favor, impede, or block entirely. Read our account here

Network neutrality – the principle that Internet providers should treat content even-handedly – seems to be dead, waiting only for someone to close its eyes and straighten its tie.   The more desperate among its advocates – including at least one FCC Commissioner – speak openly about the nuclear option: a step called “reclassification.”  This means the FCC would reclassify broadband Internet service as a common carrier “telecommunications service,” thereby exposing it to a wide panoply of regulation. As my colleague Paul Feldman notes, reclassification would generate opposition from several industry segments and possibly Congress, and would certainly lead to protracted court appeals. Also the legality of reclassification is in doubt. Many components of Internet service simply do not fit the definition of telecommunications service (see below), and so are not plausibly subject to regulation.

Reclassification is a sledge-hammer. We need a scalpel. Fortunately, one is available.

Ah, the old days . . .

But first, a nagging question. The Internet has been popular for two decades. Why are we are talking about network neutrality only now? The anti-NN forces note that the stunning growth of the Internet occurred without regulation. Why not just continue?

True, there was no Internet regulation in the dial-up days, but an even stronger force was at work: competition.  The phone companies all had departments functioning as Internet service providers (ISPs). The FCC’s Computer III rules required the bigger phone companies to open their networks to competing ISPs. That gave most people dozens of ISPs to choose from. None of the ISPs dared tamper with customers’ content, because the customers could easily go elsewhere.

Then broadband appeared, and quickly became essential as web pages grew more complex. Most consumers have either one or two sources for broadband: the cable company, over the same wires that carry cable TV; and the phone company, first via DSL and later, in some areas, through fiber-optic cables. 

The DSL channel was originally subject to the Computer III sharing rules, but the cable never was. The FCC asked whether it should open the cable to competing ISPs, in the manner of Computer III.

Follow this part closely. To apply Computer III, the FCC would have to find that cable broadband is, or includes, a “telecommunications service” – that is, the pure transport of information, for payment, offered to the public. Common sense tells us that sending Internet pages over the cable has to involve a telecommunications service, among other things. But the FCC is not always bound by common sense. According to its 2002 order, the telecommunications component is not separable from the other components, such as interactive choice of content. The FCC resolved to treat the combined, non-separable service as non-telecommunications. That means Computer III does not apply. A cable operator need not open its facilities to competitors, and can require its Internet customers to use its own ISP service. Cable subscribers are not entitled to competition among ISPs.

The Supreme Court’s Brand X case subsequently upheld the FCC. But it did not say the FCC’s decision was the only right one. Rather – and this is the kind of thing that makes non-lawyers glad they picked some other line of work – the court deferred to the FCC’s right to make the decision. The distinction matters because, ruling the way it did, the Court could easily have supported even the opposite outcome from the FCC.

In the meantime, phone companies answered the FCC’s 2002 cable ruling with outraged filings about a “level playing field.” They still had to put their ISP competitors on the broadband channel, while the cable companies enjoyed the exclusive use of their own cables. In 2005, just a few weeks after the Supreme Court handed down Brand X, the FCC ruled that phone-company broadband was, like cable broadband, a combined service to be regulated as non-telecommunications. No more Computer III; no more competing ISPs.

As a result, if you have broadband Internet service, it is very likely that your ISP is the cable company or the phone company. And, if both companies serve your location, odds are your provider has tried to lock you into a long-term deal with a stiff early termination fee. Unhappy with the service? Tough luck.

Still, some people don’t want the Government intruding into the market for Internet services. Others don’t want a near-monopoly provider deciding what content they should receive. After Comcast, is there any hope for the second camp?

A possible way out

Suppose the FCC were to revisit that 2002 cable decision, the one holding the telecommunications and non-telecommunications aspects of Internet service to be inseparable. Could the FCC now change its mind, and separate out the transport-for-pay component as a telecommunications service? Then, instead of applying the full weight of common carrier rules, it could impose just one: a requirement like that in Computer III, requiring the operator to allow competing ISP on the cable. That would bring back competition among ISPs, and create a major disincentive to tampering with content.

Until last year, this would not have been workable. An agency like the FCC could not change its position without an intervening change of circumstances, such as a major shift in the industry landscape. But last year’s Supreme Court case of Fox v. FCC changed the rules on changing the rules. 

After Fox, the FCC need show only that the new policy makes sense – not that it makes more sense than the old policy. Admittedly, abrupt reversals of established policy have historically been disfavored for many good reasons, and such reversals may – as Brother Feldman observes – still be subject to attack as unjustified. But Fox appears to given the agency considerably greater leeway to change its mind.

Had the FCC chosen to regulate the cable transport back in 2002, the cable companies would have gone to court, but they probably would have lost, under the reasoning in Brand X that defers to the FCC’s judgment. And if the FCC could have required ISP competition on the cable in 2002, then the Fox case strongly suggests they could do it today. 

The argument is even better for phone company broadband, which was subject to mandatory-competition rules until 2005. If anything, the case for requiring ISP competition is stronger now, in light of abuses by the providers, followed by the Comcast court’s closing off more direct remedies.

The process has one more step. The FCC can require ISP competition, as above, but not network neutrality, after Comcast. Either one – competition or neutrality – can protect consumers against content discrimination. So why not give the provider a choice? Undo the 2002 and 2005 broadband orders; regulate data transport as telecommunications; require providers to open their facilities to competitors – but waive that rule for providers that adopt network neutrality. Competition will flourish, or content will be available without discrimination. Either way, consumers come out ahead.

In The Wake Of Comcast: Quo Vadis?

FCC faces a range of options, none particularly attractive

As my colleague Mitchell Lazarus concisely analyzed here, the D.C. Circuit has vacated the FCC’s 2008 determination that Comcast’s network management practices violated the 2005 Internet Policy Statement. The Court held that the FCC’s attempt to enforce these particular “net neutrality” policies was invalid for lack of jurisdiction.

 Jurisdiction in this context means power or authority. An independent federal agency’s ability to take any action depends on the authority granted that agency by Congress. If Congress has authorized the agency to act, the agency may act; if Congress hasn’t authorized it, the agency may not act. Of course, things are seldom that cut and dried.  Sometimes Congress authorizes the agency to regulate in a general area but doesn’t mention anything about another, related, area.  (For example, prior to 1984 the Communications Act authorized the FCC to regulate broadcasting, but said nothing about regulating the cable TV industry.) The courts have agreed that, in such cases, the FCC may act in the not-specifically-mentioned area if such action is “reasonably ancillary” to the agency’s “statutorily mandated responsibilities”.

 In the Comcast case, the FCC claimed its regulation of Comcast’s practices was “reasonably ancillary” to a number of the Act’s provisions. But the D.C. Circuit concluded that none of the provisions cited by the FCC imposed any “statutorily mandated responsibility” to which the FCC’s regulation of Comcast might be deemed “reasonably ancillary”. And without that essential nexus, the FCC lacked the power, or jurisdiction, to do what it had done. As a result, the Court’s ruling also signaled that the FCC may lack the power to impose network neutrality principles.

 So where does the FCC go from here if it wants to promulgate net neutrality regulations? There appear to be four major options:

Appeal to the Supreme Court.  In its Comcast arguments, the FCC relied on the Supreme Court’s 2005 Brand X decision. That case involved the Commission’s determination that cable modem Internet access service is an “information service” subject to regulation under Title I of the Act, rather than a “telecommunications service” subject to Title II. In its Brand X

opinion, the Supreme Court observed that the FCC “remains free to impose special regulatory duties on [cable Internet access providers] under its Title I ancillary jurisdiction.” In Comcast, the FCC argued to the D.C. Circuit that that Supreme Court language established that the FCC could claim ancillary jurisdiction derived from Title I.

But the D.C. Circuit felt that the Commission was reading too much into that quotation. In the Circuit’s view, just because the Supreme Court said that the FCC had jurisdiction to impose some kind of regulation on ISPs under Title I doesn’t mean that the agency had jurisdiction to impose this particular regulation (i.e., “reasonable” traffic management); rather, the Circuit held, each claim for ancillary jurisdiction must be analyzed on its own merits.

Given that, the FCC could try to convince the Supreme Court to provide a broad interpretation of its Brand X language, broad enough to support the Commission’s claim of authority to regulate ISP traffic management. This would not be an easy case for the FCC. As the D.C. Circuit’s Comcast decision makes clear, the Supreme Court itself has, in a number of decisions, treated the concept of ancillary jurisdiction as narrow. Like the Circuit, the Supreme Court has held that each new assertion of such authority must be evaluated on its own terms.  So the prospects of a broad, result-changing opinion out of the Supreme Court are not good. Additionally, a trip to the Supreme Court would not be quick: it is unlikely that a decision would be released prior to June, 2011, even if the Supreme Court agreed to take the case (which it is not required to do – indeed, the Supreme Court routinely agrees to review only about 1% of the cases presented to it).

Go to Congress. Seemingly the most direct way to fix a lack of jurisdiction is to get Congress to eliminate that lack by enacting legislation specifically providing the Commission with the authority to do what it wants to do. While legislation is perhaps the most direct route, it is neither the quickest nor the surest. Bills designed to give the FCC such authority have been introduced over the last few years – but they have not progressed significantly. While it’s difficult (if not impossible) to pinpoint precisely why proposed legislation gets stalled, in this instance that may be attributable, at least  in part, to a preference by Congressional Democrats to give the FCC a chance to take a first shot at crafting net neutrality regulations. Another factor possibly staying Congress’s hand: a desire to wait and see what the D.C. Circuit would do in the Comcast case. But now that the D.C. Circuit has ruled against the FCC’s assertion of ancillary authority in this area, those two factors have been eliminated.  

While it may be possible to get legislation authorizing very narrow FCC regulation of Internet traffic management enacted before everyone’s attention turns to the November elections, that seems unlikely. Verizon has been calling for much broader legislation to re-write the Communications Act for the “Internet Age,” but that seems even less likely to occur before November, and Verizon’s proposal probably would not provide the FCC authority to adopt net neutrality rules. Indeed, it took years of work to get the last re-write of the Communications Act enacted in 1996.  

Re-classify the Transport Component of Internet Access to be a Title II Telecommunications Service.  The FCC has recognized for some time that their 2008 Comcast Order was in trouble (as anyone who attended the oral argument at the Circuit could have surmised).  Perhaps because of that, some Commissioners have been floating a possible alternative approach: re-classify at least some aspects of Internet access (including, e.g., the transport component) as a Title II telecommunications service. Since Title II unquestionably contains “statutorily mandated responsibilities” (more so than Title I), so the thinking goes, the Commission would be better able to establish that its regulation is “reasonably ancillary” to such responsibilities, thus avoiding the jurisdictional problem identified in the Comcast decision.

But this “re-classification” approach has its own problems. 

First, re-classification would require the reversal of multiple FCC decisions made between 2002 and 2006. Those decision classified cable modem, DSL, wireless broadband and broadband-over-powerline as “information services” rather than telecommunications services. To be sure, the FCC already has a pending “Open Internet” proceeding through which a record might be built in support of re-classification of Internet transport as a telecommunications service. But what would Net Neutrality advocates use to make the case that the Internet environment has changed so radically in the last couple of years: the growth of “edge” providers and third-party Internet applications? Another difficulty: the FCC’s reasoning back in 2002, upheld by the Supreme Court in Brand X, was that even accessing the world wide web required an integrated information service, not merely telecommunications transport. 

Further complicating matters is Congress. Would a majority of Congress be happy with the FCC taking things into its own hands, when many in Congress probably believe that re-classification (at least re-classification that involves increasing regulation on the re-classified service providers) is the responsibility of Congress, not the FCC.  

And, of course, re-classification would generate very strong resistance on all fronts from across many industry segments. Further lengthy court appeals would be certain. 

Build a Stronger Case for Title I Ancillary Authority.  In Comcast, the D.C. Circuit did not rule that it was impossible for the FCC to make the case for ancillary jurisdiction, just that the Commission had failed to do so here. The Court left open the alternative possibility that the FCC could assert jurisdiction over Internet traffic management if such regulation were in fact ancillary to the Commission’s responsibilities under Section 201 of the Communications Act (which requires that common carrier charges and practices must be just and reasonable). 

The potential for such an alternative arises from the fact that the Circuit declined to consider one line of argument presented by the Commission in support of its claim of ancillary jurisdiction. In its brief, the Commission argued that it could regulate Comcast’s practices because discriminatory practices that impact VoIP traffic affect the prices and practices of traditional telephone common carriers. But the FCC had not included that as a basis for its regulation back in its 2008 Comcast Order that was on review – and the Circuit (as well as most other courts) refuses to consider justifications for an agency action which are made only at the appeal stage, and not in the original action on review. So the ultimate strength of that particular argument has not yet been tested in court.

Accordingly, the FCC could use the pending Open Internet proceeding to build a record establishing a nexus to Section 201 responsibilities. However, the FCC’s Section 201 theories seem pretty far-fetched, and it is hard to conceive of other theories that could be stronger. And while the Court also left open the possibility that the FCC could try to show a nexus to its responsibilities to protect broadcast TV stations under Title III of the Communications Act, it is unclear if and how the FCC would take on that task.

Statements released by Democratic FCC Commissioners and legislators suggest that they are determined to move forward and find a way to enact net neutrality regulations. Of the alternatives set out above, re-classification of Internet transport as a Title II service currently seems to have the most momentum, but the Obama administration may choose to push one of the other alternatives, or perhaps to work on multiple paths at the same time.   Either way, we are sure to see the struggle over this issue continue.

Court Says No To FCC-Imposed Network Neutrality

FCC lacks authority from Congress to regulate provision of Internet services

Just three short weeks ago, the FCC took the Nation to the mountaintop and showed us the promised land of broadband – every man, woman, and child among us interconnected by high-speed Internet. Part of the dream foresees an Internet free of any provider’s control, giving everyone access to all of the content on the planet.

That last part – Commission-protected freedom from providers’ control – has now taken a serious hit from the U.S. Court of Appeals for the D.C. Circuit. The Court has concluded that the FCC lacks authority to require providers to treat Internet content even-handedly.

Comcast launched the case back in 2007, when it deliberately hindered its Internet customers’ access to certain file-sharing services (possibly, some critics thought, to protect its parent companies’ on-demand cable services from competition). Comcast stopped the practice after the story came out, and after its claims that it was “just controlling congestion” were shown to be untrue. The FCC subsequently imposed certain reporting and disclosure requirements on Comcast’s traffic management practices.  Comcast took the FCC to court, where we observed that the oral argument did not go well for the FCC.

The court has now ruled squarely for Comcast and against the FCC, holding that the powers granted to the FCC by Congress do not include the power to regulate Comcast’s provision of Internet service.

The FCC’s position was a little shaky from the start. It never had a rule prohibiting the Comcast action that caused all the trouble, just a loosely-worded policy statement. And nothing in the Communications Act, from which the FCC derives all of its authority, specifically authorizes control over Internet traffic. The FCC thus had to fall back on a claim of “ancillary authority,” based on a catch-all statutory provision that allows the FCC to do pretty much anything “as may be necessary in the execution of its functions.” 

But as the Court had previously held on a number of occasions, ancillary authority applies only if (1) some other statutory provision covers the subject matter, and (2) the challenged action is “reasonably ancillary” to the FCC’s exercising of its authority under (1). The FCC passed the first test, but not the second. The “other provisions” on which the FCC relied, said the Court, were either mere statements of congressional policy (which cannot support ancillary authority) or statutory provisions that miss the specific topics involved in Comcast’s behavior.

As a result, the FCC is legally barred from imposing or enforcing network neutrality.

The FCC still has a few options.  For example, it can ask the same court for a hearing en banc (Latin for “lots more judges”) or appeal to the Supreme Court. Or it can ask Congress for a law that gives it the authority it needs. There may be other alternatives as well, involving adjustments to the existing regulations for a better fit with the existing statutes, but their likelihood of success in court remains to be seen.

But right now, the view from the broadband mountaintop is a little murky. For the time being, at least, Internet providers are free to favor or block content as they choose. And no use complaining to the FCC.

Calendar Update

Robocall NPRM comment deadlines set

Two months ago we reported on a Notice of Proposed Rulemaking in which the FCC was looking to clamp down on unsolicited “robocalls”. That NPRM has at long last appeared in the Federal Register, which in turn establishes the deadlines for comments and reply comments on the Commission’s proposals. Comments are due by May 21, 2010, reply comments by June 21, 2010.

Calendar Changes

Not as momentous as the Julian-Gregorian shift, but changes you might want to note nonetheless

A couple of updates on comment deadlines that have changed since our last reports on the underlying proceeding:

Parental Empowerment – Back in November the FCC set comment dates in the “parental empowerment” inquiry. Those dates have since been extended. Comments are now due on February 24, and replies on March 26.

National EAS Test – And a couple of weeks ago we noted the issuance of an NPRM in which the Commission is proposing the establishment of an annual, nation-wide EAS test. The initial comment deadlines in that proceeding were announced on January 29: comments are due March 1, replies March 30.

FCC Clamps Down on Automated Dinner Interruptions

Proposed rules would increase FCC restrictions on “robocalls”

You would think marketing experts would realize that making you crawl off your couch to field an unsolicited phone solicitation – especially one delivered via prerecorded message (i.e., a “robocall”) – is a poor way to generate loyal customers. But the practice persists.

Robocalls and other forms of telephone solicitation have been such an irritant that Congress, over the years, has passed several laws to regulate them, giving both the FCC and the Federal Trade Commission (FTC) authority to adopt telemarketing regulations. The two agencies’ regulations generally track one another, but sometimes gaps appear.

The FTC recently amended its rules to tighten the robocall restrictions. The FCC now wants to come into sync with the FTC, and accordingly released a detailed Notice of Proposed Rulemaking

You might ask: Why do we need both agencies to adopt regulations? Can’t we just rely on the FTC? Well, you probably could, if things were set up differently. But as it is, the FTC’s jurisdiction to regulate telemarketing, oddly enough, is less than universal: it doesn’t cover common carriers (e.g., telephone companies or airlines) when they are “engaged in common carrier activity”. Similarly, the FTC telemarketing rule does not reach banks, federal credit unions, federal savings and loans, or non-profit organizations. The FCC’s telemarketing jurisdiction, by contrast, covers promotions by all those industries.  Moreover the FCC has jurisdiction over both interstate and intrastate telephone solicitations, while the FTC’s rules cover only interstate telemarketing.

Under the proposed the FCC’s proposed new rules:

  • Robocallers would be required to get “express written consent” before delivering prerecorded telemarketing messages to any residential customer, whether or not he/she has registered on the FTC’s “do not call” list. (Current FCC rules require such written consent only for those on the “do not call” list.) The proposed requirement would apply even if an established business relationship exists between the caller and the customer which otherwise permits live telemarketing calls. Under the FCC’s proposal, “written” consent for robocalls would not actually need to be “written”, but could also be obtained in other ways, including pressing a particular number on the phone keypad. That flexibility would, of course, cushion the blow for telemarketers. BUT the written “consent” would have to: (a) reflect that the telemarketer had provided “clear and conspicuous notice” to the consumer that he/she was authorizing delivery of robocalls and that the consumer is willing to receive such calls; and (b) make clear that the consent was not obtained as a condition to the purchase of any good or service; and (c) include the consumer’s phone number.
  • Robocaller messages would be required to include an automated, interactive mechanism to allow consumers to opt out of receiving future robocalls from that particular company.
  • During any one campaign, telemarketers using automated dialing equipment to connect consumers to live pitchmen (or pitchwomen) would be permitted to abandon no more than three percent of the calls that people answer. (A call is abandoned, according to the FCC, if the consumer is not connected with a sales representative within two seconds after the end of the greeting.) The FCC’s current rule allows the same abandonment rate over a 30-day period, thereby permitting the telemarketer to average its rate over multiple campaigns.
  • Healthcare-related prerecorded messages from certain federally regulated entities would be exempt. This includes messages such as flu shot and prescription refill reminders, requests for documents needed for insurance billing, and calls to encourage enrollment in treatment programs.

The proposed amendments would not change other robocall exemptions, such as fundraising calls from non-profit organizations, calls from politicians or political campaigns, and calls from commercial entities that are purely informational, such as airline flight cancellation notices. Emergency alerts are also exempt.

Comments regarding the proposed rules are due 60 days after the Notice of Proposed Rulemaking is published in the Federal Register, which has not yet occurred. Reply comments are due 30 days after the comment deadline.   We will publish the dates when they become available.

Court Challenges FCC in Early Network Neutrality Test

Chief Judge to FCC lawyer: “How do you want to lose?”

If a recent oral argument before the U.S. Court of Appeals for the D.C. Circuit is any guide, the FCC may have a tough time imposing its proposed network neutrality policies. Unless Congress steps in to give it a hand.

The case (argued on January 8) arose from complaints that Comcast’s Internet service had deliberately and selectively interfered with BitTorrent file-sharing services. Comcast claimed it was just managing traffic on the network; opponents suspected Comcast of trying to shield the parent company’s cable operations from competition.

The FCC sided with the complainants. It did not fine Comcast, but imposed conditions intended to ensure that the practice had ended. Read the details here.

Comcast brought an appeal to the D.C. Circuit, raising two main grounds: (1) the FCC had no actual rule in place prohibiting what Comcast did (due process argument); and (2) the FCC could not have had such a rule because it lacks authority over an Internet provider’s handling of content (jurisdictional argument).

While it is always risky to predict the outcome of a case on the basis of oral argument, things look bad for the FCC – not only as to the Comcast case, but also in regards to its stated goal of adopting network neutrality rules.

The judges seemed to feed “softballs” to the attorney for Comcast, while giving the FCC lawyer a much harder time. We noted three particularly telling moments:

  • The Chief Judge asking the FCC lawyer, “How would you prefer to lose – [on due process or on jurisdiction]?”
  • Another judge pointedly asking the FCC lawyer, “Are there any limits” to the FCC’s jurisdictional claim? The lawyer seemed unable to come up with an answer that both satisfied the court and squared with his own theory.
  • The Chief Judge remarking, “The impact of our decision [on the FCC’s pending network neutrality rules] will be perfectly clear,” in a context suggesting the court expects to undercut the FCC’s ability to adopt those rules.

But even if the FCC loses this case, it would be a mistake to suppose that marks the end of network neutrality. There are two points to remember.

First, the FCC believes it has a decent argument for jurisdiction based on the Supreme Court’s Brand X decision, which has language supporting the FCC’s authority to regulate at least some aspects of Internet service.  The Comcast court appeared uninterested in hearing about Brand X. But the FCC could ask the Supreme Court to rule in its favor under that precedent.

Second, a loss here on jurisdictional grounds will be an invitation to Congress to step in and give the FCC whatever authority it needs to impose network neutrality. Recent congressional proposals have been a lot tougher than the FCC’s proposed rules.

Either way, an FCC loss in this court will only set off the next stage of the dispute.

Power To The Parents Re-redux

Comment deadlines set in “parental empowerment” inquiry

Last month we reported on the FCC’s Notice of Inquiry into parental empowerment. That notice has now made it into the Federal Register, which in turn establishes the comment and reply comment deadlines. If you’re moved for whatever reason to chime in on any or all of the questions posed in the notice – sample question: Is there “a minimum level of media literacy that parents, teachers, and children must have to ensure that children can participate effectively in modern society and enjoy the benefits of electronic media while avoiding the potential harms” – you have until January 25, 2010. Reply comments are due on February 22, 2010.

Power To The Parents Redux

Trouble in River City?

If you’re looking for a good example of your tax dollars being spent – spent, yes, but not necessarily being put to work – you should check out the Notice of Inquiry (NOI) issued by the Commission on October 23. Entitled “Empowering Parents and Protecting Children in an Evolving Media Landscape”, it reads like a cross between an undergraduate course in child psychology and a weekend program on “modern parenting” that might be offered at the local community center. 

While no one can fault the Good Intentions presumably underlying the NOI – after all, Looking Out For The Kids ranks right up there with apple pie, the flag and motherhood in the pantheon of unassailable motivations – the NOI is grossly flawed in numerous ways. It lacks legislative authority, raises the specter of unconstitutionality, largely duplicates an inquiry just completed by the Commission, inserts the FCC into a regulatory area which other, presumably better suited, agencies are already working, and asks questions which are unanswerable.

If this is how the Genachowski Commission plans to deploy its resources, we’d all better fasten our seatbelts – it could be a bumpy night.

Just two months ago, the FCC issued a Report to Congress relative to parental controls on video and audio programming (regardless of source).  (We blogged about it back in March when the Commission initiated the proceeding leading to the report. A follow-up account of the report itself was carried in the September issue of our Memo to Clients, which you can read here.)  The preparation of that report was ordered by Congress, which is the boss of the FCC, so the Commission had no choice but to invite and review public comments and prepare the report.

In its report the Commission mentioned that it planned to issue its own NOI following up on its 87-page magnum opus to Congress. Little did we know that that NOI would be released less than two months after the report to Congress.

The stated goal of the NOI is to “develop a record that will help [the Commission] answer the question of how to empower parents to help their children take advantage of these opportunities [presented by technological developments], while at the same time protecting children from the risks inherent in use of these platforms.” Bear in mind, just last March the Commission issued an inquiry into essentially the same questions relating to “advanced blocking technologies and existing parental empowerment tools” and looking to “improve or enhance the ability of a parent to protect his or her child”. And the Commission managed to generate nearly 100 pages of report in response. While the NOI supposedly “picks up where the [earlier report] left off”, it’s difficult to imagine exactly what more the Commission expects to learn that it did not already learn in response to the broad inquiry it posed last March (which resulted in the report to Congress).

But before delving into such practical questions, let’s focus on a more fundamental threshold question: where does the Commission think it gets the authority to sprawl itself out into the area of child-raising? After all, the FCC is not a free-wheeling operation that can take up any subject matter it chooses. Rather, it’s a federal agency whose range of activities is strictly limited by Congress and the Constitution. Before an agency can act at all, it must first determine whether it has the necessary authority to take the action, and it should always be mindful of whether the Constitution permits it to take the action.

And yet, in the NOI, the Commission makes no such determination. To the contrary, it isn’t until Page 3 of the NOI that the FCC acknowledges any concern about such niggling details. And there it merely asks commenters to “discuss whether the Commission has the statutory authority to take any proposed actions and whether those actions would be consistent with the First Amendment”. (On the third-from-the-last page of the NOI, the Commission circles back around to the questions of statutory and Constitutional authority. Again, though, it declines to offer its own analysis, but instead simply asks for suggestions as to where the Commission might look for such authority.)

It’s not like the Commission is putting the cart before the horse here; it’s more like the Commission has started pulling the cart down the road while it asks passersby whether they happen to have seen a horse anywhere nearby.

And as to the Constitution – it does not appear to be much of a concern to the Commission. The NOI refers repeatedly to the risks or threats posed by (among other things) “inappropriate content” (which includes such non-specific concepts as “offensive language” and “hate speech”), as if the Commission (or any governmental agency, for that matter) could regulate “inappropriate content” for being, well, “inappropriate”. Maybe we missed something back in Constitutional Law 101, but it’s news to us that the government might be able to regulate speech simply by characterizing that speech as “inappropriate”. There is, of course, a set of well-established constitutional standards for defining “obscenity”. But beyond that, the government’s ability to regulate speech is far less clear. 

That’s especially so when the trigger for such regulation is the dramatically imprecise concept of “inappropriate” – and when that concept is used in connection with child-raising. It is difficult to imagine a subject more private and less susceptible to definition (much less control) by a federal agency than what may be deemed “appropriate” for children. Perhaps the paramount privilege and responsibility of parenthood is the task of instilling one’s children with standards and values of the parents’ choosing. Does the First Amendment countenance governmental intrusion into the ultra-private realm of child-raising in the name of controlling the “inappropriate”? We doubt it, and the NOI provides no analysis to support the contrary position.

Still, the Commission plunges deeply into the inner sanctum of the family, even going so far as to ask about “household media rules”, by which it means rules which parents establish to govern their own children’s media use.

Putting aside the threshold question of statutory and Constitutional authority, we should also note – as the Commission itself does – that “other federal agencies are addressing some of the same issues” presented in the NOI. But if that’s the case, why should the FCC feel the need to weigh in? It is, after all, the Federal Communications Commission, not the Federal Child-Raising-and-Protecting Commission. Of course, if other agencies with more direct interest in this area – say, the Department of Education, or maybe the Department of Health and Human Services, for two – call on the FCC for input relative to areas within the FCC’s particular area of expertise, the FCC should assist. But it’s unclear why the FCC believes that it can or should be in the forefront of any such effort.

The NOI consists of 25 single-spaced pages chock-a-block full of questions along the following lines:

  • What is “the level of awareness among parents, teachers, and children of the benefits of electronic media”?
  • “Is there a sufficient amount of cognitive/intellectual children’s programming available today?”
  • “What options are there to protect [certain] children from the risks of exposure to electronic media?”
  • Is there “a minimum level of media literacy that parents, teachers, and children must have to ensure that children can participate effectively in modern society and enjoy the benefits of electronic media while avoiding the potential harms”? (Note that responding to this particular question will be complicated by the fact that the NOI fails to define (a) “media literacy” or (b) “effective participation in modern society”.)

We could go on, but you get the point: these are not questions which are likely to generate any seriously useful answers.

Oh, and in case the questions posed by the Commission aren’t enough, the NOI also invites comments to “ask and answer any other questions that this NOI fails to raise which they believe would help inform [the FCC’s] inquiry.” Talk about open-ended! 

The deadlines for comments and replies have not yet been set – they depend on when the NOI is published in the Federal Register. Since the Commission’s inquiry last March attracted more than 10,000 comments, we may see the same here. On the other hand, since that last inquiry covered largely the same turf as the NOI, maybe not; but in view of the vastness of the questions posed, the NOI may attract more. We’ll have to wait and see.

While perhaps well-intentioned, the NOI is reminiscent of the presentation made by Professor Harold Hill to the parents in River City, Iowa. Hill (the central character in The Music Man) wanted to convince the town’s parents that a serious problem existed among the town’s youth, a problem for which he, conveniently enough, had the solution. Was there really a problem? Probably not, but you never know. Did Hill have the solution to the possibly non-existent problem? Again, probably not, but he managed to convince the parents that he did. The analogy to the NOI is tempting, but it isn’t perfect. Perhaps there is indeed some trouble in our River City – but that would be trouble with a “T”, and that rhymes with “FCC” and that stands for . . . well, you know the tune.

FCC Releases Net Neutrality NPRM - Let the Jousting Begin!

Regular readers of the CommLawBlog who know a lot about Network Neutrality (see, e.g., recent posts here, here and here) also knew the FCC planned to open a proceeding to adopt formal Net Neutrality rules. True to its word, on October 22 it issued a Notice of Proposed Rulemaking (NPRM) that did just that.

In 61 pages of detailed legal, economic, technical and policy analysis, the FCC proposed:

  • to codify the four principles the Commission previously articulated in its 2005 Internet Policy Statement;
  • to codify a fifth principle that would require a broadband Internet access service provider (IASP) to treat lawful content, applications, and services in a nondiscriminatory manner;
  • to codify a sixth principle that would require an IASP to disclose information concerning network management and other practices reasonably required for users and providers of content, applications and services to enjoy the protections specified in this rulemaking; and
  • to make clear that the principles are subject to reasonable network management, and would not limit an IASP in delivering emergency communications or addressing the needs of law enforcement, public safety, or national or homeland security.

The NPRM also requests comments on:

  • a category of “managed” or “specialized” services, how to define them, and what principles or rules, if any, should apply;
  • how the new rules should govern non-wireline forms of Internet access, such as mobile wireless (an especially fertile ground for dispute), unlicensed wireless, licensed fixed wireless, and satellite; and
  • enforcement procedures that the Commission should use to ensure compliance.

Some noteworthy details:

  • While the proposed rules would apply to broadband Internet access, they would not apply to dial-up Internet access, or to private “intranets.” The exemption for dial-up may offer some comfort to small and rural Internet service providers.
  • Unlike the FCC’s existing Internet Principles – which state what “consumers are entitled to” – the proposed rules are phrased as obligations imposed on IASPs. But this raises the issue of what sorts of entities the rules should apply to. AT&T has called on the FCC to apply Net Neutrality rules to application service providers such as Google, as well IASPs. While the NPRM seeks comments on that idea, the rules as proposed would apply only to IASPs.
  • The proposed Non-Discrimination Rule would prohibit IASPs from charging content, application, and service providers for enhanced or prioritized access to subscribers, but makes no mention of charges to the end users. This might allow, for example, the end user to subscribe to a service that increases throughput (and hence quality) for a video channel, even if it reduces throughput to the same user’s other applications. The Chairman did say at the meeting that users should have the final say on their own Internet experience.
  • The NPRM tees up the issue of whether so-called “managed services” should be exempt from some or all of the Net Neutrality rules. Examples include IP-enabled cable television-like services (AT&T’s U-verse, Verizon’s FIOS video), facilities-based VoIP services, and telemedicine applications. These are delivered over the same network facilities as Internet access, but are not themselves traditional Internet services. This issue will almost certainly be hotly contested.
  • The NPRM asks whether only “unreasonable” discrimination should be prohibited. Such a limitation would allow forms of discrimination that may be desirable for end users (e.g., to promote quality of service for a particular application). While the IASPs can be expected to support that approach, there may be a catch: the concept of prohibiting “unreasonable discrimination” has traditionally be a fundamental component of common carrier regulation, and IASPs do not want to be treated as common carriers. Additionally, drawing the line that defines “unreasonable” will be a contentious task.
  • In exploring the “transparency” rule, the NPRM seeks comment on the proper balance between giving consumers the information that they need and overwhelming them with detail. The NPRM also asks whether the transparency rule should require IASPs to give details of network management to content/application/service providers, and/or to the FCC. While the IASPs may have limited concerns about providing this information to consumers, they will likely fight this extension of the concept.
  • There will be numerous FCC “workshops” in this proceeding, and more importantly, a formal process of technical outreach led by the FCC’s Office of Engineering and Technology. The latter seeks details on what is reasonable network management, what is workable in terms of transparency, and how the FCC can prevent the rules from having detrimental impact.
  • Commissioners McDowell and Baker dissented in part, laying down their “markers” as to how they would oppose the Chairman’s proposal with the “factual and legal predicates” of the NPRM. Commissioner McDowell agreed on the need to preserve an open Internet, but wanted it done through non-government management entities such as ICANN and other voluntary entities – a “bottom up” rather than a “top down” approach. He argued that countries that regulate the Internet more than the U.S. tend to be less free than the U.S., and are waiting for the U.S. to enact more regulation in order to justify their own more intrusive and political regimes. And while the Chairman has stated that a goal of Net Neutrality is to protect innovation at the “edge” of the network, McDowell noted an unprecedented overlap between “edge” applications and “core” ISPs. He also suggested that any anti-competitive conduct by IASPs could be addressed by anti-trust laws.

Comments on the NPRM are due to be filed by January 14, 2010. Reply comments are due March 5, 2010.

Recent history suggests that the proceeding will be a titanic battleground. Time to strap on your armor, grab your lance, and head to the field of combat.  Let the tilting begin!