CommLawBlog : Broadcast & Communications Lawyers & Attorneys : Fletcher Heald & Hildreth Law Firm : Telecommunications, FCC Regulation, Communications Act

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.

First off, the FCC is looking for tips on “the appropriate subject matter and scope of the study and report”. Presumably the Commission is as mystified by the terse and cryptic statutory directive as anybody. Congress wants a report on how LPFM stations WILL affect full-power folks, but (unless it’s managed to locate a really, really reliable crystal ball, or maybe a Ouija board) the Commission can’t just peer into the future and tell us what’s going to happen; rather, it’s stuck looking at historical, or at least currently available, data. What’s an agency to do?

The Commission also wants to know what “metrics” it should be considering. Its current thinking is that the study should focus on audience measurements and advertising revenues, since those are the two “most relevant available indicators” for assessing a commercial station’s economic performance. Of course, the Commission is wide open for suggestions of other factors to consider.

With respect to audience ratings, the Commission is looking for data demonstrating the effect LPFM operations have had, or are likely to have, on full-service stations’ audience shares. The Commission helpfully observes that more than half of all currently operating LPFM stations are located outside Arbitron “Metro” markets, which is likely to complicate this particular aspect of the Commission’s study.

The FCC’s inquiry about revenues is similarly vague: to what extent have LPFM stations had – or are likely to have – any “direct or indirect impact on the advertising revenues” of full-service commercial FM stations. Sure, LPFM stations are, by regulatory definition, non-commercial, but they can still air “underwriting” announcements that sound a lot like – and generate revenues like – advertising. Is there any way that the available data (whatever those may be) can be parsed to produce useful insight into the competitive interplay of LPFM and full-service FM stations with respect to revenues?

Geographically speaking, the Commission plans a two-prong approach. First, it will study the particular economic effects on commercial FM stations whose signals “significantly overlap or encompass” one or more LPFM stations. Second, it will at the overall impact that LPFMs have in Arbitron markets, regardless of whether or not the LPFMs are overlapped by full-service stations in those markets. Again, though, the Commission is looking for suggestions – particularly since (as noted above) the FCC knows that there aren’t that many LPFM stations in Arbitron markets, so the second geography-based aspect of the inquiry may be a bit trick to pull off.

Interestingly, the one thing the Commission says it does not plan to look at is the potential interference effect of LPFM stations on their full-service siblings. As the Commission sees it, the interference remediation provisions of the LCRA “adequately protect[ ]” full-service licensees from second- or third-adjacent interference and, anyway, Section 8 of the LCRA (you remember, that terse statutory instruction quoted above) “does not expressly require such an assessment”. True enough – but Congress’s instruction doesn’t really “expressly require” consideration of any particular factor; nor does it expressly exclude any particular factor. Why, then, should audience and revenues be deemed to be within the scope of the statutorily-mandated study, but not interference?

The Commission’s thinking on this point appears to be that, with the new LCRA remediation provisions in place and with a 2003 study in hand predicting that elimination of third-adjacent interference protections would not create any interference risk, there’s no reason to worry about interference. And with this convenient bit of wishful thinking, the Commission proposes to ignore what could be a highly contentious issue.

One might reasonably question the practical utility (let alone the reliability) of the study and follow-up report that the Commission is undertaking. After all, the FCC is starting with virtually no solid data, no established parameters, unclear “metrics”, and a potentially important factor (i.e., interference) simply written out of the game plan . . . and with a deadline which, by the time the public notice comment period wraps up, will be barely more than five months away.

But as was true of the Light Brigade, the Commission’s role here is not to reason why. Congress told it to do something, so the Commission’s got to do it. And once the study is completed and the report filed with Congress, it’s likely that we won’t be hearing any more about this for some time to come. Having enacted the LCRA and, in so doing, ordered up the study and report, Congress will probably figure that it’s done all it needs to do with respect to LPFM matters, and it will move on to other legislative pastures.

 Anyone possessing actual, reliable data about the interplay of LPFM and full-service stations would be doing everyone a public service by submitting it in response to the public notice, if only to build a factual record for future reference. While Congress may think that it’s put LPFM issues to bed for good, others may not be so sure of that.

The deadline for comments is June 24, 2011; the deadline for reply comments is July 25, 2011.

First, the full Commission still has to act on various petitions for reconsideration relative to its 2007 overhaul of the LPFM rules. Those petitions have been gathering dust since early 2008. While the Media Bureau reportedly prepared a draft order for the full Commission’s consideration some time ago, that draft has also been gathering dust – possibly because everyone was waiting to see whether Congress would act. 

Now that Congress has acted, the Commission will have to go back to the drawing boards, reviewing all of its LPFM-related rules and pending proceedings and working to conform those rules/proceedings to the changes imposed by the new Act. That will entail, at a minimum, preparation of a new order (or possibly a revision of the reported draft) disposing of the 2008 recons. It’s a reasonable guess that this will be among the Commission’s highest priorities.

While it’s at it, the Commission will also have to initiate a separate rulemaking to get the ball rolling on the rule changes mandated by Congress. Sure, Congress may have spelled out in considerable detail the rule revisions it wants to see, but those rules don’t just change themselves. Rather, a notice of proposed rulemaking must be drafted and issued, opportunity for comments and reply comments must be provided, a report and order must be prepared, etc. 

Even with maximum prodding (and maximum cooperation) from the full Commission, it would be ambitious to expect the Commission to wrap up all of this much before the end of 2011 – and that’s not counting the time (probably in the 12-18 month range, minimum) it would likely take to resolve any appeals that might get filed along the way.

Let’s say that the Commission does get all its homework done by the end of 2011 (and, to make things easy, let’s also say that no appeals get filed). The next step toward authorizing new LPFM service would be the opening of a filing window. Even if the Commission wants to move super-fast, it would still have to give all LPFM wannabes enough time to prepare for such a window . . . which means that a springtime, 2012, timeframe would probably be the earliest such a window might open. Factor in processing time, construction time, etc., and you’re probably not going to be hearing any new LPFM stations actually taking to the airwaves until early 2013, at the earliest.

And we haven’t even focused on the pending translator applications yet.

The disposition of those translator apps looms large. Back in its 2007 LPFM overhaul, the Commission figured that one way to thin the herd of pending applications would be to impose a ten-application cap. That meant that any applicant with more than ten pending applications would have to select which ten it wanted to preserve; the rest would then be dismissed. But barely a month after the cap process was set in motion, it screeched to a halt. Since a number of folks sought reconsideration of the imposition of the cap, the Commission concluded that it should hold off on the culling process until the recon petitions had been disposed of. Those petitions are the same ones described above (the ones that the FCC still hasn’t gotten to, but probably will now) – in other words, the mass of pending applications remains as it has for the last three-four years.

And that mass is not likely to go anywhere until the Commission disposes of the recon petitions. Once that happens, the winnowing of the pending applications could go forward (using one or more available devices, including caps, or settlements, or engineering amendments, etc.). That, in turn, would facilitate the final processing and disposition of the remaining translator applications, which would facilitate the preparation of LPFM applications once the LPFM window opens.

But what about the fact that grant of the pending translator applications would severely limit the spectrum available for new LPFMs? The LPFM folks may object that it would be inappropriate to grant a boatload of new translator applications because of that potential preclusive effect. The trouble there is that (as we have previously noted) the new Act expressly states that translators and LPFMs are “equal in status”. That would seem to prohibit the Commission from holding up grant of pending and cut-off translator applications just because of possible LPFM preclusion, since any such hold-up would suggest that LPFMs are somehow higher on the spectrum pecking order than translators – and Congress has unequivocally nixed that notion. Of course, if Lo-Po folks attempt to challenge any effort by the Commission to move the translator applications through the processing mill, that would only further complicate, and prolong, the ultimate resolution of an already prolonged, and complicated, morass.

The bottom line here is that the Commission and the Bureau have their work cut out for them, with no quick and easy solutions in sight. Any high hopes that the new Act might automatically and instantaneously clear things up would be unrealistic, to say the least. But the Act does provide much-needed impetus to get the Commission moving . . . and that’s something. Check back here for updates.

But it then authorizes the Commission to grant waivers of the second-adjacent spacings when the LPFM applicant can establish that its proposed operation won’t cause interference. (Rolling up its legislative sleeves and getting its legislative fingernails dirty, Congress goes so far as to specifically permit the use of “terrain-sensitive propagation models” and other interference prediction methods for such showings.) That’s the bad news for full service licensees.

But it then provides that any LPFM station operating pursuant to such a waiver must suspend operation “immediately upon notification by the [FCC] that it is causing interference” to a full service station, “without regard to the location of the station receiving interference”. . . and it has to stay off the air until the interference is eliminated or the LPFM guy can demonstrate that the interference isn’t its fault. That’s the good news for full service licensees.

And more good news – the Commission is required to issue such notification “upon receipt of a complaint of interference”. The bill does not appear to require any “proof” of interference – just a complaint.

Full service FM licensees in densely-populated states also get something of a break.  (In this context, a state is densely populated if it has total population of more than 3,000,000 and a population density of more than 1,000 people per square mile.)  In such situations, H.R. 6533 requires the FCC to apply the interference remediation requirements currently applicable to translators and boosters to complaints of interference from new LPFMs on third-adjacent, second-adjacent, first-adjacent and co-channels. (The existing translator/booster remediation process is set out in Section 74.1203 of the Commission’s rules.) Under the new law, it matters not whether the complaints occur inside or outside the protected contours of the interfered-with station. However, interference arising outside the relevant distance specified in Section 73.807(a)(1) will not require remediation.

In another interesting addition to the earlier bills, H.R. 6533 includes a sentence providing that

FM translator stations, FM booster stations, and low-power FM stations remain equal in status and secondary to existing and modified full-service FM stations.

There was never really much doubt about that, but presumably that sentence may serve to discourage attempts to elevate LPFM stations over translators and boosters in the overall hierarchy of secondary FM services.

The new law requires the FCC to undertake an “economic study on the impact that low-power FM stations will have on full-service commercial FM stations” and to report its findings back to Congress in a year. That little chore will not, however, affect the licensing of new LPFM stations in the meantime, however, according to a new subsection.

The LPFM industry and its cheerleaders have been lobbying hard for this legislation for years, and they are likely to be pleased that it has finally negotiated the Congressional maze. Whether the new remediation provisions of H.R. 6533 will disappoint them remains to be seen.

But a big, if unheralded, winner here is the radio reading services (RRS) industry. The act expressly provides that existing distance separations – including, presumably, third adjacent separations – will still apply to all full-service FM, FM translator and FM booster stations that provide RRS by analog subcarrier. That provides a significant incentive for full-service licensees, in particular, to make room on their SCAs for RRS. Of course, the downside of this is likely to be increased reporting requirements to the Commission. Presently, licensees aren’t required to let the FCC know what they’re transmitting on their subcarriers. If the content of their SCAs will now affect the level of protection to which they’re entitled – as H.R. 6533 clearly provides – the Commission will presumably have to develop some mechanism for keeping track of SCA content going forward.

While the Act has now been passed by both Houses of Congress, it won’t be implemented until the President signs it and then the FCC takes the necessary steps to turn legislative language into regulatory action. But at this point, any uncertainty is limited to when, not whether: protection from third-adjacent LPFMs is, for most purposes, a thing of the past. And with the passage of the bill, we may also look for movement on the FM translator front. Recall that there remain several thousand translator applications still pending from the 2003 window. To some degree they have been caught in the on-going tug-of-war between LPFM and translator interests which has stalled out most LPFM and translator activity for years. The new act will likely provide the Commission with incentive to resolve the years-long impasse in the relatively short term. Stay tuned for further developments.

The Court also disagreed with NAB’s attack on the “rebuttable non-binding presumption” which (to the passing eye, at least) appears to be purely content-based, since it is triggered by the LPFM’s claim of having provided “locally originated programming”.  But in the Court’s view, the term “locally originated programming” refers to the “geographic location of the production of programming”, not the “substantive content of the programs.” (The Court did keep the NAB’s content-based argument alive for another day by dismissing it as unripe because “there is no clear indication that the Commission will regulate content in applying the presumption”.)

One more interesting point: the Court again cites the Supreme Court’s Fox opinion to give the Commission broad protection against garden-variety APA arbitrary-and-capricious arguments. We predicted such increasing reliance on the new APA standard articulated by the Supremes back in April.