FCC Has Had Enough of These Commercial Overages, Young Man

Fines in the tens of thousands are intended to get broadcasters' attention regarding limitations on commercials during children's television programs

When you got in trouble as child, your defense probably involved either: (1) pleading a lack of criminal mindset or claiming this was an aberration, while highlighting your otherwise good behavior ("I didn't mean to do it, it was an accident"); or (2) seeking safety in numbers ("Timmy was doing it too").

Neither ever really worked, did it? (For the record, as you moved into your adult years, you quickly realized they don't work on trafffic cops either:  "I swear, officer, I didn't realize I was doing 75, I never go that fast. I was just keeping up with traffic").

Add the FCC to the list of unsympathetic audiences.

The Commission took action last week  against seven major television stations which had copped to exceeding at one time or another the FCC's rules limiting commercial matter in children's television programming to  10.5 minutes an hour on weekends and 12 minutes an hour on weekdays.  (Anyone interested in either (a) seeing precisely what the FCC had to say or (b) seeking the thrill of schadenfreude can read the decisions here, here, here, here, here, here and here.)

In admitting to these infractions in their license renewal applications, some stations plead innocence, claiming that the overages were attributable to inadvertent staff errors, the departure of key employees, misunderstandings by staff, failure to review programming and scheduling errors. Others tried to highlight their general dedication to children's programming and a good track record at the FCC. The fact that "everyone was doing it" (not, to our knowledge, raised as a defense) didn't help either. Though the overages were often very slight -- seconds in duration -- the FCC noted a cumulative effect that required strong, deterrent action. Citing anywhere from 86 to 164 violations per station, the FCC decided that the problem was speeding wildly out of control.

The FCC concluded that the substantial increase in violations could only have resulted from a lack of oversight by licensees who weren't sufficiently deterred by previous forfeitures.   Thinking something stronger than "go to your room and think about what you've done" was in order, the Commission assessed forfeitures ranging from $25,000 to $70,000 against each station.

The FCC is sending a clear message to broadcasters, one they should be hearing loud and clear: "We don't care if you're generally a good licensee, you have to pay attention to the rules. When we say 'no more than 10.5/12 minutes', by golly, we mean no more than 10.5/12 minutes. And we don't care what that TV station across town is doing. If it said it was going to jump off a bridge, would you jump off a bridge too? Of course not, so just because they may be violating Children's TV rules doesn't mean you can."

Broadcasting In The Wake Of Comcast

The aftershocks of Comcast could reach well beyond broadband and net neutrality

While most attention on the aftermath of the Comcast decision has tended to focus on the decision’s impact on net neutrality and the implementation of the National Broadband Plan (NBP), the seismic wave from Comcast and its aftershocks could reach well beyond those obvious targets. Local TV broadcasters, in particular, might want to pay attention to how Comcast might play out in their corner of the regulatory universe.

 For example, the NBP contemplates that spectrum currently in use by TV stations might be re-purposed for broadband. To wrest that spectrum away from the television operators who now hold it, the Commission has suggested that it might work some kind of deal in which: (a) the spectrum would be “voluntarily” relinquished by the broadcasters; (b) the re-captured spectrum would then be auctioned off; and (c) the broadcaster would be entitled to a portion of the auction proceeds.

But the FCC’s authority to cut this kind of deal in any event is far from clear. While the Commission is unquestionably authorized to conduct spectrum auctions, that authority does not obviously extend to cutting deals to kick-back auction proceeds to private parties. And any hope that such deals might be seen as “ancillary” to other authority is dimmed by Comcast.   That in turn means that the FCC’s ability to secure spectrum commitments from broadcasters is likely diminished. Why, after all, would a broadcaster commit to turning in its spectrum if the FCC is not in a position to guarantee any repayment that might be part of the deal? As a result, the Commission should not expect much enthusiasm from broadcasters unless and until the Commission can demonstrate that it will be able to make good on any payment deals it may try to cut.

Another possible ripple effect of Comcast on the broadcasting terrain: let’s not forget that Comcast, the folks who landed the knock-out punch on the FCC in the eponymous Comcast case, are also the folks who are currently trying to get the FCC to approve a massive merger with NBC Universal. Now that Comcast’s ability to restrict, legally, Internet traffic contrary to the FCC’s preference has been established (thanks to the D.C. Circuit), the FCC (and other governmental authorities) may not be especially gung-ho about giving Comcast even greater control of more media than it already holds. If Comcast’s practice of jiggering with its subscribers’ Internet access is deemed potentially anti-competitive, the Feds might be expected to be reluctant to increase any perceived competitive advantages for Comcast.

Of course, in light of such concerns, the Powers That Be (whether that might be the FCC, DOJ or Congress) might attempt to extract “voluntary” commitments from Comcast and NBC, much as they did in connection with the Sirius/XM merger. Could the Commission then impose conditions that look remarkably like net neutrality requirements – even though the FCC might not have the authority to impose such requirements industry-wide? Conceivably, since the FCC’s clear authority to act on the merger request would arguably provide it the related authority to impose conditions on any grant of that request. Such conditions could have an impact on competition in both the online media and the cable industries, not to mention the broadcast business – in all of which Comcast plays a major role.

On the other hand, even if the Commission were to offer grant of the merger in return for concessions or commitments from Comcast, who’s to say that Comcast would accept the deal? Presumably, Comcast would not do so unless the deal made good business sense.

Another possible impact zone from Comcast: retransmission consent. As has been widely reported, the cable industry has filed a petition for rulemaking seeking overhaul of the current retransmission consent process. Thus far the FCC has appeared to be receptive to the idea. But a large number of fixed broadband service providers are cable companies, and those companies can now restrict internet traffic (thanks to Comcast), giving them a potential competitive advantage. How eager will (or should) the Commission be to give the cable industry a further leg up over competitors in the retrans consent process?

At this point we can only guess about how any or all of this will shake out.  But it is important to recognize that the impact of Comcast is not likely to be limited to issues of net neutrality.  In any event, television broadcasters should keep a wary eye on their own situation.  They may still be looking at a decidedly unattractive future: packed tighter than ever in the broadcast band, stiffed by the FCC on any kick-back payments from spectrum auctions, and losing a steady source of revenue to the network, which just merged with the largest cable company.

New Meaning For Digital TV?

Bird flipped on the Peacock, complaints ensue

When is a finger just a finger, and when is it a potentially multi-million dollar fine? NBC may well find out soon enough.  At least 18 complaints have reportedly been lodged with the FCC for the Peacock Net’s live broadcast of the Golden Globe Awards on January 11. The gripes involve actor Mickey Rourke’s acceptance speech and, more specifically, producer Darren Aronofsky’s pantomimed response during that speech, a response which NBC dutifully broadcast (for those of you on the West Coast who got a two-second black screen, YouTube is your friend – for research only, of course).

We can’t recall a single instance in the indecency era in which a televised image of a middle finger provoked an enforcement response from the Commission. While we highly doubt that the airwaves have been completely void of such gestures over the last 30 years, the lack of any cases involving such a gesture shouldn’t be surprising: after all, the FCC’s rules define broadcast indecency as “language or material that, in context, depicts or describes, in terms patently offensive as measured by contemporary community standards for the broadcast medium, sexual or excretory organs or activities.” Does flipping the bird really fit in there? We would think not, but then again, we thought that a millisecond flash of nipple was OK and a fleeting view of an attractive woman’s buttocks might be, too . . . and the FCC disagreed. So who knows?

There’s no word yet whether the FCC will take any action at all here, but the stage has been set. Just how far will the Commission be inclined to stretch the long arm (or finger) of the law?

New DTV Search Page Unveiled on CDBS

Another omen of the coming DTV Transition – the FCC has added a new search option to its CDBS Public Access menu. Now you have the option of clicking on “Search for DTV Station Information”, which will whisk you to a query page that permits searches based on call sign, facility ID number, channel, city/state of license, network affiliation and even Nielsen DMA. You can also opt to include or exclude LPTV and Class A stations from your search. Interestingly, while you can include “network” as part of your search, the results do not identify any station’s network. For example, you can insert “ABC” in the network search field and the system will throw up a list of stations, all of them presumably ABC affiliates. But if you simply search for, say, “KABC-TV”, it will find that station, but will not identify it as an ABC affiliate. Also, the results table does not list the states or the Nielsen markets in which the found stations are located.

This is, presumably, a work in progress, so we might see some changes in it as people try it out and bugs get worked out. We have one request of any debuggers who might be reading this – could you please make the wild card character “%”, rather than “*”. It’s not that we’re in love with “%”, but “%” is the wild card character that is (and has historically been) used on all other CDBS Public Access search pages, and it seems a bit silly to use a different one for this particular page. We’re just sayin’ . . .

Ordure in the Court?

Fox oral argument in Supremes set for November 4

In planning your Election Day activities this Fall, you might want to pencil in a stop by the U.S. Supreme Court to catch the oral argument in the Fox v. FCC indecency case. (Read about the case in our earlier post.)  It’s currently scheduled for the first argument slot of the day on Tuesday, November 4. On argument days the Court convenes promptly at 10:00 a.m. Doors open at 9:30 a.m., but the line generally starts to form long before that – so vote super early and then drop on by the Court to stand in line, soak up some atmosphere, and hope to get a good seat.  Need directions?  Check out the Court's website for maps, directions and other useful information.  But heads up -- you are not permitted to carry ANYTHING into the courtroom, so leave those Blackberrys, cellphones, umbrellas, newspapers, lunch boxes, brief cases, etc., etc., etc. back at home.  (The Court does provide a coat-check service, if you don't mind fighting through a rugby-like scrum to try to retrieve your belongings.)

The Commissioners Are Coming!! The Commissioners Are Coming!!

Vacuum the red carpet, gas up the welcome wagon, get a couple of keys to the city copied up and notify the media.  The FCC has announced that, between now and February 17, 2009, the Commissioners themselves are hitting the road, “fan[ning] out” across the country to “raise awareness and educate consumers” about the coming DTV transition.  Each stop will feature a “public event”, such as a town hall meeting, workshop or roundtable with a Commissioner, who will (the FCC assures us) also “be available to local press”.

A phalanx of FCC staffers will precede by a couple of days the arrival of a Commissioner in each town.  The staffers will provide technical and outreach assistance to broadcasters, local officials and others interested in a smooth transition.

Targeted markets include all markets in which more than 100,000 households or at least 15% of the households rely solely on over-the-air signals. The Commission has released a list of 81 markets that will be visited between now and February.  Dates for 23 of the visits have been released. Perhaps not surprisingly, the

visit to Anchorage and Fairbanks is set for August, while the trip to Phoenix is scheduled for the end of December.  Details of the visits will be released by the FCC later.

Meanwhile, the Commission has announced that the Wilmington, NC DTV test will commence on September 8 at noon, at which point the local commercial network affiliates and the local Trinity Broadcasting low-power station will broadcast their standard programming on digital channels only.  BUT the Commission has carved out an exception that will permit the participating to broadcast emergency information in analog should the need arise – for example, if a hurricane should threaten the area.  (Note that, when the transition does finally arrive in February, 2009, stations will not be permitted to broadcast anything – emergency or not – on their analog channels.) In addition, during the Wilmington test period the participating stations will be broadcasting, in analog, a message advising viewers of the test and alerting them that, if they are seeing the message, they need to upgrade to digital.

And one more thing – the Commission has established a Speakers Bureau which will arrange DTV-related presentations, free of charge, to any group anywhere in the country requesting one. Just go to www.fcc.gov and click on the “Request A Speaker” button.

 

A Midsummer Surprise From The FCC: A Revised Version Of The Public and Broadcasting!!!

The Commission has released a new version of The Public and Broadcasting, revised as of July, 2008. All full-service radio and television licensees (commercial and noncommercial) and Class A television licensees should have a copy of this latest version in their local public inspection files. You can download a PDF copy from the Commission’s website, or we can send you a hard copy, if you would prefer. 

The fact that the Commission has revised its manual at this time comes as something of a surprise for a couple of reasons. First, the document had just been revised in April, 2008 – for the first time since 1999. Since nearly a decade had passed between revisions, a new update within three months of the April, 2008, revision was certainly not expected. 

Moreover, when the April, 2008, revision was issued, the Media Bureau released a public notice specifically alerting everyone to the availability of the new version. To the best of our knowledge, no such public notice heralded the release of the July, 2008, edition.

To be sure, the April, 2008, public notice included the following tip: 

The Media Bureau will periodically update “The Public and Broadcasting” to reflect pertinent developments in the law, providing the date of the update on the front cover of the publication. Licensees should check the Commission's website for the current version (at http://www.fcc.gov/mb/audio/decdoc/public_and_broadcasting.html) when they undertake regular updates of their public files. 

So the Bureau may now be expecting each licensee with a public file, as a part of the routine maintenance of that file, to check the FCC’s website for updates. Of course, the Commission hasn’t incorporated any such requirement into its rules, but that doesn’t appear to faze the Bureau. 

Despite the fact that the size of the PDF file currently comprising the July, 2008, version is nearly 100 times bigger than the PDF of the April, 2008, edition (an incredibly whopping 14 MB compared to the far more reasonable 190 kB), it does not appear that there are any major substantive changes in the new version. In fact, the only truly substantive addition appears to be a reference to the new Form 388 which full-service TV licensees are required to file to report on their efforts to educate the public about the DTV transition. (The new version also updates a couple of addresses for FCC contact people and makes a couple of very slight language changes which do not affect the overall substance of the information.) 

We suppose that we might applaud the FCC for being diligent about updating its own materials. But we can’t shake the notion that, when the Commission tinkers (and tinkering probably overstates what the FCC had done in this revision) with a document which EVERY FULL SERVICE LICENSEE is required to have in its public file, the Commission might want to think twice. At a minimum, the Commission should alert broadcasters of the availability of the revised edition. That alert should delineate the particular revisions being made, and might also advise affected licensees whether any earlier version will do the trick or, alternatively, whether it is absolutely essential to download the revised version. (Absent any contrary indication, the safest course will always be to download the latest and greatest, even if the new version does not materially differ from the older version.) And the Commission might also want to give thought to precisely what changes will warrant a whole new edition. 

Unfortunately, this may just be harbinger of what life will be like as the Commission wades deeper into the “localism” thicket: substanceless messing around with “localism”-oriented documents which have very little actual significance at the local level, but messing around which imposes a significant burden throughout the broadcast industry. 

We can only hope that, at a minimum, somebody at the Commission will eventually figure out how to reduce the file size of The Public and Broadcasting PDF so that it doesn’t clog up too many Internet connections during the download.

Third Circuit Decision in CBS/Jackson Appeal

Indecency appeals – FCC now 0-2 – In a long-awaited decision, the U.S. Court of Appeals for the Third Circuit reversed the FCC’s order holding that CBS and its affiliates had broadcast indecency in the notorious 2004 Super Bowl half-time show featuring Janet Jackson and Justin Timberlake.  The Court found that the FCC had had a longstanding policy not to penalize the occasional fleeting instance of possible indecency and that the Commission had not adequately explained why it chose to depart from that policy when it whacked the CBS folks for the half-second exposure of La Jackson’s right breast.  The Court’s decision was consistent with the Second Circuit’s decision in the Fox case, although unlike the Second Circuit, the Third Circuit did not suggest that the Commission’s indecency policy is unconstitutional.

 

It’s not clear where this case will go from here.  The Court remanded the matter back to the FCC for further consideration – so if the FCC wants to try to take another crack at explaining its abandonment of the fleeting expletive policy, it could conceivably do so.  But that policy is already before the U.S. Supreme Court in the Fox case, so it’s unlikely that the Commission will bother to try to tweak its policy before Chief Justice

Roberts and his pals get their crack at it.  It would seem more likely that the Commission might try to bring the CBS case up to the Supremes, to be heard at the same time as the Second Circuit/Fox case which is already there.  There is, of course, no guarantee that the Supremes would take the CBS case, but the FCC might think that the image of Ms. Jackson’s anatomy broadcast out to gazillions of football fans presents a stronger case for heavy-handed enforcement than does the situation in Fox (which, you will recall, involves ad lib remarks by Cher and Nicole Richie).  Another theory is that the FCC will just sit tight and do nothing with the CBS/Jackson case until the Supremes have issued their decision in Fox, which will probably occur sometime in the first half of 2009.

 

Whatever happens, the Third Circuit’s decision provides further confirmation that the Commission’s indecency policy in the wake of the 2004 Super Bowl has been a dramatic, and unjustified, over-reaction.

Embedded Advertising Proceeding Deadlines Set

Last month, we reported on the Notice of Inquiry and Notice of Proposed Rule Making (NOI/NPRM) launched by the Commission to examine "embedded advertising" in light of the dramatic increase in the use of "product placement" and "product integration." Advertisers have become increasingly reliant on such techniques as technology has enabled viewers to circumvent traditional commercial breaks with ease.

Through the NOI/NPRM, the Commission is attempting to determine whether changes to the current sponsorship rules are necessary in today's environment, while proposing new sponsorship identification announcement requirements designed to make embedded advertising more obvious to the consumer.

Comment deadlines for the proceeding have been announced for those wishing to participate.  Comments must be received by the Commission by September 22, and Reply Comments are due October 22, 2008.

Federal Appeals Court Overturns CBS Super Bowl Indecency Fine

Earlier today, the federal court of appeals for the 3rd Circuit overturned the FCC's $550,000 fine on CBS for the broadcast of Janet Jackson's infamous 2004 Super Bowl Halftime Show.

The Third Circuit overturned the FCC's decision on much the same grounds as the Court of Appeals for the Second Circuit overturned the FCC's "Golden Globes" decision. Specifically, the Third Circuit held that the FCC could not abruptly abandon its long-standing policy of restrained enforcement of its indecency rules without sufficient notice of the change in policy or a reasonable justification for the change. Because the FCC failed to provide such notice or justification, its decision could not stand.


In addition, the Third Circuit found that the FCC improperly held the CBS stations liable for the actions of Ms. Jackson and fellow performer Justin Timberlake. CBS argued (the Third Circuit agreed) that Ms. Jackson and Mr. Timberlake were independent contractors and not employees for the purposes of that broadcast. Thus, CBS argued, the CBS stations should not have been held responsible for actions of individuals that were not its employees.
The FCC argued that, regardless of whether or not Ms. Jackson and Mr. Timberlake were employees, a broadcast licensee is in and of itself responsible for what is broadcast on its station. Although the Third Circuit found that such "strict liability" was appropriate in some circumstances, cases involving the First Amendment require the FCC to prove some degree of "scienter". "Scienter" roughly means "prior knowledge" or "prior intent", although the Third Circuit acknowledged that it is possible to find scienter even without actual prior knowledge if the party in question acts recklessly with regard what is being broadcast. For instance, according to the Third Circuit, a broadcaster's failure to use available preventative technology, such as a delay for live programming, might be reckless and the broadcaster might have sufficient scienter to be held liable for anything contained in the live broadcast. With respect to CBS, the Third Circuit found that the evidence was insufficient for the court to make a determination.

The Third Circuit vacated the FCC's order imposing the forfeiture on CBS and sent the case back to the FCC for further consideration. However, as the Supreme Court agreed to hear the FCC's appeal on the substantially similar "Golden Globes" case from the Second Circuit, it seems likely that the FCC would want to consolidate that case with the Third Circuit's decision and seek review of both at the same time.

Embedded advertising in the cross-hairs

The Commission has released a Notice of Inquiry and Notice of Proposed Rule Making (NOI/NPRM) in which it expresses concern about the practice of "embedded advertising"- and its two primary components, "product placement" and "product integration"- in current programming, particularly as those practices implicate the sponsorship identification rules.  According to the Commission, "product placement" involves the mere use of commercial products as props, while "product integration" entails the inclusion of such products in the dialogue and/or plot of a program.  Various trade press sources have reported that, with the increased use of digital recording devices, television audiences in particular are affirmatively skipping traditional commercial breaks; accordingly, advertisers, with the cooperation of program producers, have gravitated toward embedding techniques to assure access to the audience.  The Commission is concerned that such embedding, when combined with established sponsorship identification techniques, may not adequately inform the public of the nature - or even the fact - of the embedded advertising.

The NOI/NPRM is short on detail.  It simply describes the concerns which have been expressed by some groups about embedded advertising, and seeks comments on those concerns.  For example, how extensive is the practice of embedding?  Are existing sponsorship ID rules effective with respect to embedding?  Interestingly, the Commission does include, in the NPRM portion of the item the suggestion that sponsorship ID notifications on TV be required to be of a certain minimum size and on-air for a particular length of time.  The NPRM does not indicate what size/length the Commission might have in mind, although it does allude to political broadcasting requirements, which specify lettering at least four percent of the vertical picture height and duration of at least four seconds.

The NOI/NPRM also specifically mentions the possibility of "concurrent" sponsorship ID's, by which it presumably means some disclosure to be made to the audience simultaneously with the embedded product reference.  How such concurrent mentions might work for radio programming (and yes, the NOI/NPRM is directed to both TV and radio) is not at all clear.  And while concurrent mentions might strike one as obviously intrusive and distracting on television, the Commission notes the "apparently common existing practice of superimposing unrelated promotional material at the bottom of the screen during a running program", and suggests that that practice undercuts any claim that concurrent announcements would infringe on the program's artistic integrity.

The Commission has demonstrated an overheated interest in "sponsorship identification" for the last several years - recall the multiple VNR inquiries, as the most obvious example.  The NOI/NPRM is in line with that interest, but it extends it in a way which could have a serious adverse impact on broadcast operations.  Having to determine which products happen to be identifiable by commercial design, and then having to announce each of those products concurrently with their on-air appearance, would likely create a substantial impediment to the development and broadcast of programming.  Imagine, for example, what a TV screen would look like during an NFL or MLB game, when every piece of logo-identifiable athletic gear (helmets, shoes, bats, balls, gloves, shirts, etc., etc.) and every off-field amenity (Gatorade, Motorola, etc.) would presumably be subject to the sponsorship ID requirement.  And let's not even start to talk about a NASCAR race.

One might also legitimately ask what purpose would be served by such a requirement?  While the NOI/NPRM invokes the "public's right to know who is paying", the NOI/NPRM does not dwell on the questions of whether the public is perhaps smart enough to realize that the Coke cups in front of Paula, Simon and Randy aren't there by accident, or that there is a reason that Nike has chosen to put its logo where it does.  At bottom, the Commission appears to assume that there is in fact some overriding public interest in requiring sponsorship identification - but the Commission fails to explore exactly what that public interest might be. Increased regulation of embedded advertising will inevitably draw the Commission even more deeply into content regulation than it has previously ventured - and, as a result, the Commission will be drawn even closer to obvious First Amendment issues that should not, cannot, be resolved by broad platitudinous references to "the public's right to know".

Ideally, the Commission will in the end seek to avoid the treacherous constitutional waters toward which it has set sail.  But if it does not, the substantial burdens on broadcasters which would likely flow from increased sponsorship ID requirements, combined with the substantial content-regulation that would necessarily accompany such requirements, will ultimately require far greater justification than the Commission has thus far demonstrated.

The comment and reply comment deadlines for the NOI/NPRM have not yet been established.  Check back to our blog for updated information which will be posted when available.


A Legacy for Broadcasters

Comedian George Carlin has passed away, but he will live on in many ways.  For broadcasters, Carlin's most noteworthy legacy is the FCC's indecency policy in all its tortured, blurred inconsistency.  It was Carlin, after all, who created the notion that there might be seven words that you couldn't say on the public airwaves.  The Commission had certainly never said anything close to that before Carlin created and recorded his piece, or before WBAI broadcast it.  But by crafting a comedic monologue based on the fictional premise that there did exist some absolute FCC ban against the broadcast of certain words, Carlin managed to draw the FCC into embracing his notion.  So Carlin's art became the FCC's reality. 

The irony, of course, is that Carlin's monologue itself illustrates the futility of any broadbrush governmental proscription on language.  As the routine hilariously - and irrefutably - demonstrates, words are just words, and they mean no more and no less than what the user intends them to mean.  It is a fool's errand to try to limit the ability of people to communicate their own ideas through words of their own choosing.  And it is fundamentally antithetical to the premise underlying the First Amendment and the ultimate strength of our democratic process.

The Commission has fumbled and stumbled in trying to develop some coherent indecency policy over the last 35 years or so, ever since Carlin fantasized that there might be some such policy and then proceeded to skewer that imagined policy in his monologue.   While the Supreme Court tried to do the FCC a favor in 1978 by interpreting the Commission's initial decision narrowly, the Commission has, over the years, largely ignored that narrowing.  The result is, among other things, the current Golden Globes policy that flatly criminalizes the broadcast utterance of "fuck" or "shit" - unless, of course, those words occur in Saving Private Ryan

Carlin got it right in his monologue.  Not that there was an FCC policy, or that there should be an FCC policy, but rather that such a policy would be pointless and meaningless and contrary to our ability to communicate with one another.  While Carlin probably did not approve of the path the FCC has taken in response to his monologue, Carlin must certainly have appreciated the rich irony of that path and the effectiveness with which it underscored his essential point.

DTV Freeze Lifted

The FCC has lifted the freeze on the submission of DTV maximization applications and channel changes, effective May 30, 2008.  Applications which expand the previously-authorized service area of the post-transition DTV station, or propose the change in the post-transition DTV channel, can now be submitted.  All applications and petitions submitted between May 30, 2008, and June 20, 2008, along with those previously-filed applications and petitions which also included a request for waiver of the filing freeze (in place since 2004), will be given the same cut-off date.  After June 20, 2008, applications and petitions will be considered filed as of the date they were submitted.  Requests to change the community of license of DTV stations will not be permitted at this time. 

In the event that two applications submitted during the window are mutually-exclusive, the Commission will grant otherwise-acceptable applications with a specific condition that the mutually-exclusive applicants resolve their conflict with a 30-day settlement window.  If the parties cannot resolve the mutual-exclusivity within this period, the applications will be dismissed.  Finally, the FCC warned potential filers not to attempt to seek extensions of the construction deadlines based on a pending request for channel change or maximization application.

While the lifting of the freeze is a welcome sight, potential applicants run the risk that they will submit an application that conflicts with those licensees with February, 2009 construction deadlines - some of whom may wait until June 19, 2008, to submit their construction permit applications to implement their post-transition facilities.  While the Commission's

Public Notice

is not entirely clear on this point, it is possible (if not likely) that applicants filing in this window will need to protect those initial construction permit applications submitted on June 19, 2008, and there is also a risk that a minor change application submitted on June 19th will conflict with a maximization application submitted during the window.  Therefore, applicants submitting maximization applications and freeze waivers should be sure to protect the Appendix B facilities (as opposed to the already-authorized facilities) of all stations.

New Version of Mandatory Public File Document Released

An updated version of "The Public and Broadcasting," a Commission publication which all broadcasters must place in their public inspection files, was released on April 24.  All broadcasters must replace the former version of the document with the revised version immediately and also must be prepared to provide copies to any member of the public who requests one.
 
The Commission also announced that it will provide two "Broadcast Information Specialists," one in the Media Bureau's Audio Division and the other in its Video Division, to serve as contact points for the public to answer questions regarding becoming involved in the Commission's processes.
 
Anyone with questions regarding the updated version of "The Public and Broadcasting" and/or other questions concerning local public file requirements are welcome to call their FHH attorney for more information.

Form 355 and Website Public File Posting: Soon in the Crosshairs at OMB

Last November, the FCC announced that it had adopted a new "enhanced" programming report for TV licensees, and also that it would require TV licensees to post pretty much all of the local public files on their respective websites.  From March 13 until May 12, we all have an opportunity to send comments on the resulting paperwork to the FCC, which will then pass the comments on to the Office of Management and Budget (OMB) to let them how we feel about these new burdens.

OMB gets involved because the new reporting and website posting requirements are what the Federal government calls "information collection" activities.  Under the Paperwork Reduction Act, before an agency like the FCC can impose new information collection activities, it has to get OMB to bless them.  So the FCC has now had a notice published in the Federal Register to solicit comments related to the Paperwork Reduction Act, which then will be added to its own presentation and forwarded to OMB for its consideration.

We strongly encourage everyone to take advantage of this opportunity.  It is at least possible that a compelling showing of the extreme burdens imposed by the new FCC requirements could force the government to re-think them.

Technically, comments should address the need for the information to be collected, the accuracy of the Commission's estimate of the burden of the collection, ways to improve the information collection requirement, and ways to reduce the burden on respondents.  Any comments are due to be filed by May 12, 2008.

It seems to us that the Commission has grossly underestimated the burdens imposed by the new rules and overestimated the utility of the information to be collected and/or posted.  For example, the FCC's estimate of the time which would be required to complete Form 355 is rather fuzzy and shows significant costs to each station, costs which will be repeated quarterly - a fact which the FCC does not readily admit.  According to the Commission, filling out the form may take anywhere from 2.5 to 52 hours, a rather broad range to say the least.  The Commission has not explained how this new requirement will generate any more interest from the public, or otherwise promote the Commission's localism goals, any better than similar requirements in the past have done.  Taking the Commission's own estimate, the imposition of a new filing that could require more than a work week's time to complete should require some justification - and that's EVERY QUARTER!

If there are multiple comments from affected parties (i.e., television licensees) pointing out these flaws, the FCC might be forced to come up with some justification for its rules and to explain how the new burdens comport with the Paperwork Reduction Act.  The entertainment value alone of watching the FCC make this effort could be substantial, and a serious inquiry could even force some re-thinking.

For those inclined to try to get the FCC to reconsider outside of the OMB process, the March 13 Federal Register publication also establishes the deadline for filing petitions for reconsideration, and that deadline is now April 14, 2008.

 

Commission Releases Much-Anticipated DTV Order

The Commission has released the long-awaited Seventh Memorandum Opinion and Order and Eight Report and Order (7th MO&O) in the DTV proceeding.

The 7th MO&O addresses petitions for reconsideration filed last Fall with respect to the DTV Table of Allotments adopted in August, 2007 (the infamous "Appendix B" Table).  The Commission grants more than 120 requests to change the DTV facilities specified in last August's Appendix B.  In other cases, the Commission denies certain specific requests, suggesting instead that those particular requests can be dealt with through the flexible procedures set out in the Third Report and Order adopted on December 31, 2007.  (For example, in several cases where petitioners sought to change channels and transmitter sites, the Commission granted the request to change channels if no interference would be caused by the switch, but declined to make changes to the transmitter site.  The Commission indicated that the petitioner could attempt to file a minor change application - if the proposal did not violate Commission's freeze order - or wait until the freeze on maximization applications is lifted.  The staff has informally indicated that it expects the freeze to be lifted in August, 2008.)

The Commission stated (seemingly with a sigh of relief) that, with the release of the 7th MO&O and last December's Third Report and Order, "the ball is now in the broadcasters' court".  If you filed a petition for reconsideration of the Appendix B Table last Fall, we recommend that you check with the attorney or engineer you normally work with to determine how (if at all) the 7th MO&O affects your situation.

Deadline For Localism Comments Extended To April 28

If you are thinking about filing comments in response to the FCC's Localism Report and Notice of Proposed Rulemaking (MB Docket No.04-233), be advised that the deadline for those comments has been extended by the Commission to April 28, 2008.  The extended date for reply comments is June 11.  As we have observed in previous postings here and in the FHH Memo to Clients, this proceeding is extremely important and could end up imposing very substantial new burdens on all broadcasters.  We urge all broadcasters to take a close look at the FCC's proposals and to make their feelings about those proposals known as clearly and forcefully as possible.  FHH will be preparing comments on behalf of a number of clients - if you would like to join in that effort, please give us a call.

 

DTV Public Outreach Outlined

The Commission released an Order on Monday, March 3rd requiring broadcasters, MVPDs (i.e., cable, satellite), manufacturers and wireless service providers to commence specific public outreach initiatives to educate the public on DTV Transition matters.  The Commission had released proposed rules in July, 2007, and has now taken steps to implement several of the proposed rules.  
 
On the broadcast side, the Commission will require TV licensees to select one of three outreach programs.  Each of the options includes a mix of Program Service Announcements (PSAs) and video crawls - all of which must be reported back to the FCC on a new form (FCC Form 388) describing the efforts.  For example, under the first option, television stations would be required to air 15-second PSAs and run one 15-second video crawl four times a day, totaling 28 of each during the week.  The second option would require only an average of 16 30-second video crawls and an average of 16 30-second PSAs each week, along with additional announcements in the last 100 days prior to the end of the Transition, and a "bug" on the screen that will provide a countdown to the end of the transition.  The third option will be available only to noncommercial broadcasters, and would require them to air 60 seconds per day of consumer educational programming between now and April 1, and then 120 seconds per ay from May 1, 2008 to October 31, and finally 180 seconds per day from November 1 until the Transition.  The Commission is not placing any requirements on Low Power and Class A television broadcasters, but urges them to commence educating the public with regard to the end of the DTV Transition.

On the MVPD side, the Commission will require that notices be placed in the monthly consumer bills, providing notice of the DTV Transition, and referring the consumer to other sources of information, including www.DTV.org.  The Commission will require telecommunications carriers that provide Lifeline/Link-Up services to also include similar notices with their monthly bills.  As for equipment manufacturers, each television receiver or other device intended to work with television receivers (i.e., converter boxes) shipped after the effective date of the rules must include information relating to the DTV transition, including how the transition will affect the use of the purchased device.  Finally, the Commission committed to work with NTIA on making sure that their consumer help desks are staffed with persons knowledgeable about the transition. 
  
The rules adopted in the order will become effective as soon as they are published in the Federal Register.  The forms that are required to be filed will not become effective until after OMB approves them.

Localism NPRM Published in Federal Register; Comment Deadline Set

With the publication of the Commission's Notice of Proposed Rulemaking on localism in the February 13, 2008 Federal Register, the deadline to submit Comments in the proceeding has been set for March 14, 2008.  Reply Comments will be due on April 14, 2008.

As discussed previously on this blog, the NPRM presents a laundry list of tentative conclusions and proposed rules that would turn the clock back nearly three decades, forcing broadcasters to comply with costly and burdensome requirements, including a return to ascertainment requirements similar to those required of licensees through the early-1980's.

The Commission is expected to receive a barrage of opposition from the broadcast community, including a challenge by the National Association of Broadcasters and many of FHH's broadcast clients.

If you have questions or wish to participate in the proceeding, you should contact your FHH attorney immediately.

FCC's Localism Proposed Rules/Tentative Conclusions Present Significant Burden for Broadcasters

The release of the Commission's January 24, 2008 Notice of Proposed Rulemaking ("NPRM") announcing a laundry list of tentative conclusions and proposed rules concerning localism sent immediate shockwaves throughout the broadcast industry.  Reaction was particularly strong in view of the recently released Television Standardized and Enhanced Disclosure Requirement ("Enhanced Disclosure Order") Report & Order (see our coverage of this R&O here, and more in depth coverage in the January edition of Memorandum to Clients).  Many observers have suggested that if the NPRM's proposed rules/tentative conclusions are adopted, the FCC will be turning back the clock nearly three decades, when licensees were forced to comply with burdensome ascertainment requirements.

According to the Commission, the proposed rules are designed to address the perception that broadcasters may not be addressing the needs and interests of their communities sufficiently.  Over the past several years, the Commission has solicited comments from the public and engaged in localism hearings at venues all over the country.  From comments received through that process, the Commission has determined that "many stations do not engage in the necessary public dialogue as to community needs and interests and that members of the public are not fully aware of the local issue-responsive programming that their local stations have aired."

(Note that, while the Commission refers to some "necessary public dialogue," there is no requirement for any such dialogue in the Commission's rules, nor has there been for more than 25 years.  Also, while members of the public may not be "fully aware" of available programming, that would appear to be more the fault of the "unaware" pubic than of broadcasters.  After all, broadcast programming is, well, broadcast -- meaning that it's available for one and all to receive, at no cost).

Many feel the Commission has gone overboard with the tentative conclusions presented in the NPRM (adopted on December 18, 2007).

  We can look for considerable resistance to the proposals from a variety of sources, including the

National Association of Broadcasters, once comments start to roll in. 

Comments will be due 30 days following publication in the Federal Register, with reply comments due 30 days following the initial comment deadline. 

Check back on this blog for updates.

The following is a summary of the nitty-gritty of the NPRM.  Broadcasters in particular should recognize that, if the FCC's proposals are adopted, the broadcast industry will be subject to very substantial new paperwork and recordkeeping obligations.  Moreover, those obligations will almost certainly give rise to an increase in public involvement -- both pre-broadcast and post-broadcast -- in each broadcasters' programming decisions.  While such involvement is not necessarily a bad thing, the potential for mischief and worse is substantial.

  • The Commission has tentatively concluded that each licensee should be required to convene a permanent advisory board consisting of community leaders and officials.  Regular, quarterly licensee meetings with this board would be mandatory.  These meetings would assist each licensee in ascertaining the issues of primary interest in its community, leading to more localism and diversity-focused programming.

The Commission is also considering the adoption of additional rules/guidelines to foster improved communication between licensees and their communities, including the following:

i.    Ad hoc viewer surveys via telephone or Internet

ii.    Focus sessions or "town hall" meetings with viewers to help prioritize issues to be covered through news, public affairs, public service, and special programming

iii.   Participation by station managers/personnel on community boards, councils and commissions

iv.   Dedicated telephone numbers, websites and email addresses, publicized during programming, to facilitate community dialogue

  • The Commission referenced the Enhanced Disclosure Order released simultaneously (see above for links to further coverage), which among other things, introduced a brand-new comprehensive disclosure form (Form 355) and implemented a requirement that stations post the majority of their public files on their websites.  While the rules adopted in the Enhanced Disclosure Order apply solely to television, the NPRM suggests that the same rules might soon apply to radio.  The NPRM repeatedly cites to the Commission's Digital Audio proceeding (in which the Commission adopted the IBOC standard for digital broadcasting by AM and FM stations).  In that proceeding, the Commission sought comment on similar enhanced disclosure requirements for radio.  But the window to participate in that proceeding is now closed.  One might fairly conclude that the Commission may intend to impose similar or identical enhanced disclosure requirements on radio broadcasters with no further opportunity for those broadcasters to object.
  • Stations may be required to have personnel staffing their facilities during all hours of operation, thereby eliminating remote control operations currently permitted.
  • The Commission has tentatively concluded that it will reintroduce renewal application processing guidelines incorporating a specified minimum percentage of programming aimed at addressing local issues.  Licensees meeting the requisite percentages would have their renewals processed by the Media Bureau on delegated authority, while those falling short would have their renewals considered by the full Commission.  The Commission is seeking comments on the content of these guidelines and how they would be measured.
  • The Commission is considering a reversion to its pre-1987 main studio rule, which required each station's main studio to be located within its community of license.  As a result of repeated relaxations of that rule over the last 20 years, under the current rule a station's main studio may be located within either (a) the principal community contour of any station, of any service, licensed to its community of license or (b) 25 miles from the reference coordinates of the center of its community of license.  Either way, the current rules plainly permit stations to locate their main studios at considerable distance from their communities of license.
  • The Commission is seeking comment on whether it should require website posting of the requisite on-air announcements concerning soon-to-be-filed and pending license renewal applications.
  • The Commission is seeking comment on whether it would be helpful for the Commission to introduce rules designed to allow stations to review network programming sufficiently in advance of airtime to determine whether the programming is unsatisfactory, unsuitable or contrary to the public interest.
  • The Commission is seeking comment on the prevalence of voice-tracking (i.e. customizing the content of programs featuring popular out-of-town personalities to make it appear as though the personalities are actually local to the station's area when, in fact, the programming is produced elsewhere) and whether anything can and/or should be done to limit its practice.
  • While rejecting the prohibition of national music playlists by licensees (and a corresponding requirement that stations give airplay to local artists), the Commission is seeking comment on whether it should require licensees to maintain and make available data regarding the airing of local music.  This disclosure would also include descriptions of how their playlists are compiled.  Their information would be used in consideration of renewal applications.
  • The Commission has tentatively concluded that it should allow additional qualified low power television ("LPTV") stations to be granted Class A status.  The Commission is seeking comment on its conclusion, how to define eligibility, and its statutory authority to take the action.
  • The Commission noted that it intends to commence a proceeding to propose rules promoting access by cable and satellite subscribers to the programming of television broadcast stations licensed to communities in the state in which they live.
  • The Commission directed its Media Bureau to develop a new computer program to assist potential radio applicants in identifying suitable available commercial FM spectrum in the location in which they want to operate.  This will alleviate the need to hire consulting engineers, which the Commission hopes will trigger increased localism in broadcasting, and diversity in radio ownership and programming.
  • The Commission also observed that it is important that broadcasters provide timely and accurate emergency information, which it will tackle in the pending Emergency Alert System Further Notice of Proposed Rulemaking, which the Commission stated it will take action on soon.
  • The Commission referenced its Further Notice of Proposed Rulemaking concerning LPTV stations and a number of potential rule changes which would promote localism, such as providing the stations additional protection from interference from full-power stations.
  • The NPRM referenced the Commission's December 18, 2007 Report and Order which introduced efforts and sought comment on actions to assist new entrants and small businesses (including minority- and women-owned businesses) to gain access to financing and spectrum opportunities, including station construction deadline extensions, while cracking down on race or gender discrimination in broadcast transactions and ownership representations.
  • The Commission is investigating violations of its sponsorship identification rules in numerous proceedings, and may soon launch a proceeding to tackle the issue of embedded advertising - i.e. product placement.

As always, we encourage anyone with questions regarding this proceeding to contact us via telephone or email. 

We also encourage discussion on the blog, as it's important for the broadcast community to discuss and sort out these issues in preparation for the comment/reply comment period, which will play a vital role in how these rules/proposed rules evolve.

And they're off !!!

On Wednesday, January 30, 2008, the FCC's Third Periodic Review was published in the Federal Register.  With that, the white flag has come down and the TV industry has entered the gun lap in the DTV transition.

The Federal Register publication also marks the effectiveness of the new interference standard of 0.5% and the permissible use of Longley-Rice and cell sizes of 0.5, 1, or 2 km.  More importantly, as a result of the Federal Register publication, a number of deadlines have now been established.

The most crucial dates are as follows:

ALL full-service TV stations - including licensees and permittees, commercials and noncommercials alike - will have to prepare and submit a Status Report (FCC Form 387) to the Commission no later than February 19, 2008. The new Form 387 may be reviewed at the FCC's website. It will also be available through each station's CDBS account.

Stations which are already operating on their final DTV channel but which still need a CP to enable them to build out to their Appendix B facilities must file for such a CP by March 17, 2008.

All other full-service TV stations which still need a construction permit in order to build out to their Appendix B facilities can and should file for such a permit as soon as possible.  The FCC has indicated that Form 301 (for commercial stations) and Form 340 (for NCE's) applications filed by such DTV stations by March 17, 2008 will be given expedited consideration and may be granted as quickly as within 10 days of filing.

Any station which is already operating on its final DTV channel and has at least a construction permit for its Appendix B facilities must complete construction by May 18, 2008.  If any such station will not be able to meet that deadline, it must file an extension application (FCC Form 337) no later than March 19, 2008.

Compliance with the new Program System and Information Protocol (PSIP) rules kicks in on May 29, 2008.

Stations which are not currently operating on their final DTV channels and which need permits authorizing construction of their Appendix B facilities must file applications for such permits no later than June 19, 2008.

If you are a full-service TV licensee or permittee, you should familiarize yourself with the upcoming schedule and confer with your communications counsel and consulting engineers to assure that you meet all necessary deadlines.

TV Rereg Order Released

On January 24, 2008, the Commission finally released the Report & Order (R&O) containing the standardized and enhanced disclosure requirements which it had decided to impose on the television broadcast industry last November.  In our November Memo to Clients we described the FCC's action based on the public notice issued by the Commission then. The release of the R&O provides us with the detailed nitty-gritty of what the FCC is imposing on the industry.  Among the new burdens are a new quarterly programming report and significantly greater public inspection file obligations.

Among the new public inspection file requirements are the following:

  • Stations with websites must post their public inspection files on their websites or on the website of their State Broadcast Association.
  • Stations must give notice twice daily (including at least once between 6 p.m. and midnight) that the station's public inspection file is available for inspection at the station's main studio and on its website.
  • While political files are not required to be posted, emails from the public are, and documents available on the Commission's site but not posted on the station's site must be linked to the station's site.  Stations must also retain hard copies of all letters and emails from the public in their public inspection files.
  • Stations must make the public inspection file portion of their websites accessible to the disabled, requiring compliance with specific Web Content Accessibility guidelines

Among the new reporting requirements are the following:

  • The current issues/programs lists required by TV licensees will be replaced by the all-new FCC Form 355 (available at Pg. 31 of the attached Report & Order), which will have to be filed with the Commission (electronically) each quarter on the 30th day of the succeeding calendar quarter - that is, the reports will have to be filed by April 30, July 30, October 30, and January 30 of each year.
  • In the quarterly reports, which cover not only the main broadcast channel but also all additional programming stream(s), each TV licensee is required to describe its programming in a laundry list of categories including national news, local news, local civic affairs, local electoral affairs, local programming, public service announcements, paid public service announcements, underserved communities programming, religious programming and independent produced programming.
  • Broadcasters must report information on closed captioning (including which programs were not closed captioned due to exemptions and the basis for each exemption), voluntary video description efforts, efforts to make emergency information available and access of the information to the disabled.
  • Broadcasters must certify that they have undertaken ascertainment efforts to assess the needs of their community, and must specify whether they have designed programming to address those needs.  The new rules do not mandate specific ascertainment efforts, although the new Form 355 does require the reporting licensee to describe (a) any ascertainment efforts it did take and (b) any programming designed to address any needs identified through such efforts.

The new rules will not go into effect until 60 days after notice of their approval by the Office of Management and Budget is published in the Federal Register.  Stations with existent websites must have their public inspection files posted online at that time.  Any websites later created must comply with the rules within 30 days after the sites are made available to the public.

We will have more on the new rules and potential challenges to their validity in the next edition of Memorandum to Clients.  In the meantime, if you have any questions please do not hesitate to contact your FHH attorney.

Heat on Martin Intensifies on Eve of Media Ownership Vote

One day before the December 18 FCC Open Meeting in which Chairman Kevin Martin planned to bring his media ownership proposal to a scheduled vote, 25 senators signed a letter to Martin issuing yet another warning from Congress that his actions are inappropriate.

The letter, organized by Senator Byron Dorgan (D-N.D.), stated that if the Commission proceeds with final action on the media ownership proposal on December 18, "we will immediately move legislation that will revoke and nullify the proposed rule.

The congressmen pointed out that just 28 days were allotted for comment between the issuance of a press release on November 13 and the close of the comment period, as compared to 90 days for the proposed new rule on the effects of communications towers on migratory birds. The letter rhetorically asked Martin to explain this inconsistency.

The letter stated that Martin knows that the Senate Commerce Committee has unanimously passed legislation asking him to defer action on December 18th, and that he has "shortchanged the comment process [before] forcing a vote."

"We are notifying you and others of this proposed action in order to make certain you understand the consequences of ignoring the need for and the right of the American people to play a constructive role in attempts by a federal agency to change rules that have a substantial impact on the American people."

 

Martin Facing Onslaught of Criticism

Just five days before the final FCC Open Meeting of 2007, the controversy surrounding Chairman Kevin Martin's media ownership proposal has reached a fever pitch. Martin's fellow Commissioners, many Congressmen and commenters on both sides of the issue have barraged Martin with an onslaught of criticism for the manner by which he released his proposal and his inclusion of the item on the Dec. 18 agenda. The proposal was announced on Nov. 13 in what a group of commenters including Common Cause, the National Organization for Women, and United Church of Christ labeled an "unusual and vaguely worded" news release that was not published in the Federal Register or voted on by the Commission.

Martin's proposal would amend the restriction on newspaper/broadcast cross-ownership to allow such cross-ownership in the top 20 markets, with built-in protections introduced to ensure editorial independence. Martin has been lambasted for what some deem a violation of the Administrative Procedure Act and other principles of administrative law for failing to afford sufficient time for public comment and review by his colleagues on the Commission.

When the December 12 "Sunshine Act" notice indicatedthat the item would be included on the Dec. 18 agenda - despite pleas from Congress, other Commissioners and members of the industry to postpone the vote - Commissioners Michael Copps and Jonathan Adelstein released a scathing joint statement expressing their deep disappointment at what they deem a "huge mistake."

"We have been engaged in internal discussions to try to get our processes back on track," Copps and Adelstein wrote. "We wish those discussions had led to better results. At this point, given the lateness of the hour, we hope that either we can turn this around internally, or that Congress can save the FCC from itself."

 

Congress might seek to do exactly that, as the Senate Commerce Committee summoned Martin and the other four Commissioners to the Hill to appear before the Committee on December 13. The Committee has already unanimously approved a bill introduced by Sen. Byron Dorgan (D-N.D.) that would require the Commission to open a 90-day comment period on a proposed rule and complete a study on localism. After publishing the result of the study, the Commission would then have to publish the final rules and allow 90 days for public comment. Members of the Committee have stated that they expect the bill to pass.

Public File Online, Main Studio Off-Line?

In addition to the new program reporting requirements the FCC is imposing on TV licensees, the FCC is introducing a new requirement that TV licensees post their public files on their websites (if they have websites). This raises an intriguing question: if a station's public file is readily accessible online, should the station be required to maintain a "main studio"?

Once upon a time, a station's main studio was a focus of its identity, serving as the place where programming was originated and where the public could find the station's local public inspection file. The program origination requirement went away decades ago (the FCC still requires main studios have the ability to originate programming, but the rules no longer require stations to use that ability). Nevertheless, the FCC held onto the public file requirement - possibly because the existence of the public file rule appeared to convince a skeptical appeals court to uphold the FCC's deregulation of radio and TV in the 1980s. The idea was that the local availability of a public file would provide members of the local audience important information that would empower them to act as "private attorneys-general" - bringing sub-par performance to the Commission's attention at renewal time.

But now that TV public files will be available online, what regulatory purpose is served by a "main studio"? After all, members of the public will be able to access all of that important information in the comfort of their homes - or in the comfort of their workplaces, public libraries, iPhones, etc. Indeed, because the FCC liberalized the main studio location rules to allow stations to locate their main studios 25 miles away from their communities of license, the nearest Internet access is almost certain to be closer than any given station's main studio. Why, then, should licensees be required to maintain an entire bricks-and-mortar facility that may not otherwise be necessary to their operation?

Eliminating the main studio rule probably isn't what the FCC had in mind when it created the new public file online requirement for TV stations, but it isn't that much of a leap. To the contrary, it seems like the next logical step. Under the current rules, stations must maintain a local or toll-free telephone number for communication with the public. If the public file is online and the station locally publicizes an email address for electronic correspondence and a physical address for correspondence by regular mail, the public would have all of the purported benefits of a locally-maintained main studio without requiring the station to have a potentially unnecessary office in any particular location. At the very least, the FCC could eliminate the main studio location rules, allowing stations to put their facilities wherever business requirements dictate, freeing stations from unnecessary expense and freeing the FCC from the need to police main studio locations. We would hope that the FCC would consider a move that would ease burdens on both licensees and the FCC's staff without compromising service to the public. Then again, we may be uncommonly hopeful people.

BACK TO THE FUTURE!!

Back to the future is where the Commission appears to be taking the television industry. The FCC has announced a major overhaul of the quarterly issues/programs list requirement for TV licensees. Instead of the quarterly report which stations have been required to compile (and place in their public inspection files) for a couple of decades, the Commission will now require the completion - and submission to the FCC - of a quarterly, FCC-designed form listing "various types of programming", including: local civic programming, local electoral affairs programming, public service announcements and "independently produced programming".

But wait, there's more.

The new form will also require "information about efforts that have been made to ascertain the programming needs of various segments of the community", as well as information "regarding closed captioning and video described content".

Over and above that new quarterly filing, the FCC is also requiring TV licensees to make their local inspection files ("with the exception of their political file") available online if they have Internet websites.

And finally, TV licensees will have to notify their audiences about the location of their public files twice daily.

And did we mention that these new rules are supposed to take effect within 60 days of their publication in the Federal Register?

The full text of the Commission's decision has not yet been released as of this writing, so it's impossible to know just now precisely how far the rules will drag the TV industry back in the direction of content regulation. (The FCC's news release describing the action may be found here. But the available signs are ominous. In separate concurring statements, both Commissioners Copps and Adelstein rattled the regulatory saber (Copps: "no public interest performance, no license"), suggesting that the new reporting requirements may just be a first step in the direction of more extensive programming review by the agency.

Of course, before that could occur, the Commission would presumably have to impose more specific record keeping requirements - like, f'rinstance, detailed program logging, so that licensees would have a common source from which to compile their reports. But before the Commission could impose a logging requirement, it would also have to define the various types of programming that would have to be separately logged. (From the available accounts of the new TV reporting requirements, that would include, at a minimum, "local civic programming", "local electoral affairs programming", and "independently produced programming".) And, if the Commission were going to be truly serious about threatening non-renewal based on programming performance, it would also have to announce reasonably specific quantitative and qualitative standards that would apply in such an analysis.

All of which would take the Commission perilously close to content regulation contrary to the First Amendment (and Section 326 of the Communications Act).

If it's any comfort, history strongly suggests that, despite its various fulminations and bloviations, in the end the Commission will stop short of involving itself with any depth in program content. In fact, the new rules are just the latest manifestation of a regulatory cycle that can be seen running its course since broadcast regulation began in the 1920s. (That cycle is describing in some detail in a law review article by FHH attorneys Harry Cole and Patrick Murck. But the fact that the Commission is starting down that road again means that the television industry - and, more than likely, the radio industry as well, although it has momentarily dodged the bullet - can expect increased regulatory noise about programming for the foreseeable future.

We will provide more detailed information about the new rules when the full text of the FCC's action is released. Until then, hold onto your flux capacitor.

Copps, Adelstein Blast Martin's Cross-Ownership Proposal

One day after Chairman Martin issued his proposal in which newspaper/broadcast cross-ownership would be allowable only in the top 20 markets (see Harry Cole's article on November 13, 2007 for details), FCC Democratic Commissioners Michael Copps and Jonathan Adelstein blasted the proposal in a joint statement.
 
The Commissioners labeled Martin's plan a "wolf in sheep's clothing," which could "propel a frenzy of competition-stifling mergers across the land."  The statement pointed out that the top 20 markets account for more than 43% of U.S. households, and that the proposal would permit a newspaper/broadcast combination in any market in the country, which they labeled "a loophole that Big Media will drive a truck through."
 
While the Martin proposal would contain a restriction that a newspaper could not be co-owned with one of the top four-rated stations in a given market, Copps and Adelstein argue that the stations outside the top four are typically those owned by small, independent broadcasters, and as a result, the Martin proposal could further decimate the "shamefully low levels of minority and female ownership."
 

According to Communications Daily, Martin wanted his fellow commissioners to vote on a public notice which would have been issued on Tuesday, launching a comment period that would extend until December 11.  When his colleagues refused to sign on, Martin decided to issue the notice himself, which has led to immediate, widespread criticism.

"The Martin rules are clearly not ready for prime time," Copps and Adelstein wrote. "Under the Chairman's timetable, we count 19 working days for public comment. That is grossly insufficient. The American people should have a minimum of 90 days to comment, just as many Members of Congress have requested."

Copps and Adelstein added that it is improper for Martin to be holding the proposed Tribune buyout "hostage" in order to press the issue of a media ownership vote.  "We are prepared to vote on the Tribune waiver requests within three working days after the Chairman circulates a draft decision," Copps and Adelstein said. "There is simply no excuse for using Tribune as a human shield."

The full Copps and Adelstein joint statement can be read here.

Martin Single-handedly Seeks To Solve Ownership Impasse

Chairman Kevin Martin has taken the extraordinary step of issuing what amounts to his own personal notice of proposed rulemaking in the long-running, highly contentious media ownership proceeding.  On November 13 - the same date that an op-ed piece by Martin was published in the New York Times - the Chairman's office issued a news release which spelled out Martin's personal proposal for bringing the media ownership provision to a close.  You can read the news release and NYT article here.

In Martin's view, the Commission should change one - and only one - aspect of the existing media ownership rules.  He proposes that the rules should be amended to permit common ownership of a daily newspaper and a broadcast station in the same market, BUT ONLY IF: 

  1. the market is one of the 20 largest Nielsen DBA's, and
  2. only one daily newspaper and one broadcast station (radio or TV) is involved; and
  3. where the station is a television station (i) at least eight independently owned and operating "major media voices" (defined as major newspapers and full-power commercial television stations) would remain in the market post-transaction; and (ii) the station is not among the top four ranked stations in the DMA.

Any other proposed newspaper/broadcast transaction would be presumed not to be in the public interest.  However, that presumption might be overcome after consideration of various factors, including: the "level of concentration in the DMA"; a demonstration that the proposed transaction would increase the amount of "local news" in the market; a commitment that the newspaper and the broadcast station would continue to "exercise its own independent news judgment"; and the financial condition of the newspaper and (if the paper is in financial distress) the "owner's commitment to invest significantly in newsroom operations."

According to the news release, Martin invites public comment on "his" proposals, but cautions that comments should be filed by December 11, 2007. The release does not mention reply comments.

No other aspects of the ownership rules would be changed, according to Martin's proposal.

It has been widely reported that the Chairman hopes to wrap up the ownership proceeding before the end of the year (December 18 has been mentioned as D-Day). By announcing, through this unusual press release, his own proposal for reaching a bottomline, Martin is presumably hoping to gain support from folks who might otherwise raise a ruckus (such as the ruckus that was raised back in 2003, when then-Chairman Powell forced the initial version of the new rules through the process, only to have it reversed in part by the courts). While his proposal would relax to some degree the newspaper/broadcast cross-ownership limitation, the relaxation would be considerably more modest than was originally proposed. Moreover, that would be the only change - in other words, the other multiple ownership limits would remain in place, unrelaxed.

If nothing else, it appears that the post-Thanksgiving/pre-Christmas period will be most interesting on the ownership front.

Broadcast localism hearing - trick or treat?

The Commission has announced a "localism hearing" to be held on Halloween - October 31 - in the Commission Meeting Room in Washington.  The stated purpose of the meeting is to "gather information from consumers, industry, civic organizations, and others on broadcasters' role in their local communities and proposed changes to our rules."  It may be interesting to attend just to find out what "proposed changes" the Commission might have in mind, because to date we are not aware of any specific proposals from the FCC on the "localism" front.

Anyone with more than a passing interest in the notion of "localism" as a factor in broadcast regulation might want to take a look at a law review article titled "The Myth of the Localism Mandate" by FHH's Harry Cole and Patrick Murck.  It appeared in the Commlaw Conspectus, a journal of communications law and policy published by the Columbus School of Law at the Catholic University of America.  The article examines the history of "localism" from the Radio Act of 1927 to current times.  The conclusion is that, while the FCC (as well as the Federal Radio Commission before it) has historically talked the talk about "localism", it has never walked the walk: the authors conclude that it is "idle for the Commission to believe that, just because the Commission raises its regulatory eyebrows and huffs and puffs about some localism obligation, there exists any such obligation which the Commission is able to articulate, much less enforce.  That has not been the case since the Federal Radio Commission eighty years ago, and it is not the case today."  You can find the article here.

FCC Considers Compelled Promotion of DTV Transition

By Michael Richards

TV broadcasters may need to adjust their budgets just a tad more for the upcoming DTV transition. It's possible that they'll be having to cough up air time for spots to inform the 10-to-15 percent of TV households without cable or satellite service that their 30-year-old Zeniths may show nothing but snow once D-Day arrives.

In defense of the FCC, the Commission did not come up with this idea - or, more accurately, this inchoate bundle of concepts that might someday congeal into a coherent idea - on its own. Rather, the idea arrived in the mail, in a letter from a couple of influential (read: Committee Chairmen) members of the House of Representatives. They suggested that, with the DTV transition fast approaching, it might be a good idea for the Commission to "require television broadcasters to air periodic public service announcements and a rolling scroll about the digital transition."

Demonstrating the propensity of semi-liquid substances to flow downhill, the Commission has passed that suggestion along to the broadcast industry in the form of a Notice of Proposed Rulemaking (NPRM). Obviously intent upon placating its Congressional overseers, the Commission makes clear that it does indeed plan to impose on TV licensees the obligation to conduct "on-air consumer education efforts". But what, exactly, does the FCC have in mind?

It's hard to say. Instead of outlining any specific proposals, the NPRM merely whips Congress's one-sentence vague suggestion into an impressive series of thirteen vague questions (see the NPRM excerpt quoted verbatim below) and directs the downhill flow to broadcasters. And then, recognizing that, notwithstanding the salutary effects anticipated from the sure-to-be-mandated "on-air consumer education efforts", many viewers will likely still need "additional assistance in preparing themselves" for the DTV transition, the NPRM asks for more suggestions on steps the Commission and industry might take to assure that consumers "have access to the information and assistance they need."

But wait, there's more. The Congressional letter also suggested that it might be a good idea for the FCC to impose a reporting requirement on broadcasters relative to their consumer education efforts - you know, maybe a report to be filed every 90 days, listing the "time, frequency and content" of all transition-related PSA's broadcast. Oh yeah, and Congress also suggested "civil penalties for noncompliance".

Needless to say, the Commission has included that suggestion in the stream of "proposals" set out in the NPRM. Again, the NPRM offers little of substance, relying instead on a series of vague questions. (See the aforementioned NPRM excerpt below.) The FCC also proposes similar informational obligations for multichannel video programming providers and consumer equipment manufacturers.

Of course, the TV industry has a horse in this race. The last thing anyone in the TV biz wants is to lose the eyeballs of consumers caught unaware by the coming DTV transition. There's money to be made - and potentially lost - from any transition failures.

But the crux of the rulemaking is to codify what the industry must do, by government fiat - and, consequently, what resources stations must cough up for public education, resources over and above of the millions of dollars already invested in new equipment and spent on maintaining duplicative digital transmissions long before DTV receivers were widespread. A number of smaller market operators, in particular, have struggled to meet these expensive technical demands given the smaller ratio between ad revenues and DTV equipment investments.

While it's true that digital multicasting may improve over-the-air TV's competitive position, many smaller operators have had to mortgage the farm in order to seed a not-yet-sure DTV harvest - a harvest which is particularly unsure as new digital technology increasingly makes video entertainment and information available from sources other than licensed stations.

On the other hand, it is in the broadcast industry's interests to make D-Day as painless as possible. In a world of 500 channels and virtually limitless Internet content choices, customer retention is not just a good idea, it is mandated by the unyielding laws of survival. So the industry should be taking steps. But whether FCC-mandated requirements will help out is another story entirely.

The FCC is seeking public comment on its "proposals" - i.e., the questions set out in the sidebars elsewhere on this page. If you would like to chip in your two cents' worth, the docket is open for comments until September 17, 2007. Replies to those comments are due by October 1, 2007.

PSA proposal:

We propose to require television broadcast licensees to conduct on-air consumer education efforts. Such on-air efforts, we believe, are the most effective and efficient way to reach over-the-air television viewers about the coming digital switch-over. What should these announcements include, and when and how often should they run? Should we impose similar requirements on all television broadcast licensees or should there be distinctions made among licensees? Should the Commission produce an announcement or group of announcements to be used by all broadcasters, or simply provide a list of points that must be conveyed in any compliant announcement? What text or images should the rolling scroll include? Would it be constant or intermittent? On what date would it begin to run, and during which hours would it be required? Would the on-air education requirements increase as the transition date approaches? How would we track the effectiveness of the outreach efforts? Should broadcasters be required to formally assess and report on consumer awareness and preparedness, particularly in certain communities? If so, which communities warrant special attention? Should there be some mechanism for making adjustments in our requirements to reflect these ongoing assessments? Should we adopt certification requirements to ensure that broadcasters are complying? Would forfeitures for noncompliance be appropriate in this area? If so, how would they be calculated?

Reporting proposal:

What level of detail should reports to the Commission on consumer education efforts contain? What additional burdens would preparing, submitting, and retaining such reports place on licensees and permittees? Could these burdens be met by small broadcasters and NCE stations? Is there an alternative to requiring the filing of such reports with the Commission? For example, could broadcasters publicly summarize and describe their consumer outreach efforts via web pages, press releases, in their public file, or otherwise? How would this approach be monitored and enforced by the Commission? What benefits would these reports create for the government and public? How should any forfeitures for noncompliance be calculated?

Sprint Agrees to Buy New Equipment for Television Broadcasters

By Raymond Quianzon

As many broadcasters are aware, Sprint has been negotiating with stations all over the nation to replace certain broadcast auxiliary equipment and reconfigure frequency use at 2 GHz.  While negotiations with full-power broadcasters have been underway for quite some time, discussions with other affected groups - including LPTV and translator licensees and operators of unlicensed remote pick-up equipment (under the 720 hour rule) - had not even begun as of July 31. But as of August 1 that has changed: Sprint has agreed to negotiate with the latter group but has set a very limited time frame for negotiations.  Anyone with any interest in this matter should read the following:
 
Full-Power and Class A Stations - Full-power television stations, including Class As, that have licenses for 2 GHz broadcast auxiliary equipment likely already have begun negotiations with Sprint or have attended a Market Kickoff meeting to discuss the migration process within their DMA.  Stations with 2 GHz licenses that have not yet begun the process should contact counsel or Sprint to get the process started.
 
Broadcast auxiliary service (BAS) equipment can include studio-to-transmitter links, relay stations and remote pickup units (usually vans, trucks or choppers).  Sprint reimburses television stations to stop using BAS channels 1 and 2 (which are located at 1990-2025 MHz).  Television stations must move off of these channels so that the spectrum can be used for mobile phone and other new operations.  The FCC has endorsed a plan that requires television stations to cooperate in the move but also requires Sprint to reimburse the television stations for their cooperation.
 

Most stations have licensed their BAS equipment with the FCC to ensure primary operations.  However, FCC rules allow full-power broadcasters to operate BAS equipment on a short-term basis of up to 720 hours per year without obtaining a BAS license.  Based upon a recent FCC ruling, Sprint has announced that it will reimburse stations with unlicensed BAS equipment that was purchased before November 22, 2004.

Before October 30, 2007, television stations must provide Sprint with an inventory and proof of pre-November 2004 purchase for unlicensed equipment.  Proposed costs, replacement timelines and other deal terms must be submitted to Sprint prior to March 12, 2008.  If a station does not meet these deadlines, it will still be required to discontinue use of the unlicensed equipment, BUT the cost of replacement equipment will NOT be reimbursed.
 
LPTV/Translator Stations - LPTV/translator station using auxiliary equipment in the 2 GHz  band have been provided a very limited window during which to acquire new equipment and have Sprint pay for it.  This opportunity arises as part of very detailed and lengthy negotiations between Sprint and the FCC which originally were designed to relocate certain Sprint mobile phone frequencies.
    
After several years of negotiations the LPTV/translator portion of this deal has finally been struck.  The FCC is reassigning the 1990-2025 MHz frequencies that broadcasters use for auxiliary operations.  In order to assist LPTV and translator broadcasters who are using these frequencies, the FCC has given Sprint the option of reimbursing LPTV and translator stations to move their equipment off of these frequencies.  In return, Sprint will be able to use part of the newly-cleared frequencies without any interference.
 
LPTV and translator stations who use broadcast auxiliary equipment should immediately verify the frequencies on which the equipment operates.  Broadcast auxiliary equipment can include studio-to-transmitter links, relay stations and either licensed or unlicensed remote pickup units (usually vans, trucks or choppers).  If you have equipment using 1990-2025 MHz, you should contact your counsel or Sprint as soon as possible.  Sprint needs to be advised of your intention to participate in the relocation program. A full inventory of your equipment must be submitted to Sprint by Friday, September 14, 2007. You must submit your proposed costs, timeline and other deal terms to Sprint by January 12, 2008.  Failure to meet the deadlines will not eliminate your obligation to move from the frequencies, but it will foreclose any opportunity for you to get Sprint to pay for the move.

 

Second Circuit Trashes FCC Indecency Policy

In a long-awaited decision, the U.S. Court of Appeals for the Second Circuit has finally dropped the hammer on the Commission's indecency policy. In an opinion issued on June 4, 2007, a three-judge panel (with one dissent) has held that the "fleeting expletive" policy invoked by the Commission in 2004 and then again in the 2006 "Omnibus" indecency decision is arbitrary and capricious. In the Court's view, the FCC's asserted justifications for the "fleeting expletive" policy were less than persuasive.

The "fleeting expletive" policy - as first announced in 2004 and then reaffirmed in 2006 - provided that any broadcast of the words "fuck" or "shit", in almost any context, would be deemed indecent. Historically, the Commission had been far more restrained, acknowledging that the occasional slip-up resulting in the broadcast of an isolated expletive should not warrant censure. But in the wake of the public uproar over the Janet Jackson/Super Bowl incident, the Commission suddenly reversed course and took an exceedingly hard line on indecency generally, and the use of those two words in particular.

The Court's decision is at first blush relatively narrow, finding only that the "fleeting expletive" policy is arbitrary and capricious and thus inconsistent with the Administrative Procedure Act. But in a surprising six-page portion of the opinion, the Court offered its very strong suggestion that the policy would not survive First Amendment analysis. (As a matter of practice, courts generally decline to delve into weighty constitutional issues if a case can be resolved on less radical grounds.)

The majority also indicates that the FCC's "profanity" policy - which first popped up in 2004 - essentially overlaps the indecency policy - which indicates that the profanity policy cannot survive, either.

The case is remanded to the Commission for further action consistent with the Court's decision - but the Court seems clearly to signal that if the Commission tries to shore up its policies on remand (as opposed to running up the white flag and abandoning them), the Court anticipates yet another appeal, the result of which would not be favorable to the Commission.

We are, of course, still awaiting further developments in the Janet Jackson case out of the Third Circuit, but oral argument there is not likely to happen for at least another couple of months.

FCC Introduces New EAS Rules

The Commission has adopted new rules designed to modernize the Emergency Alert System (EAS).  While the full text of the FCC's decision has yet to be released, in a public notice (http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-273458A1.pdf) the Commission makes clear that all EAS participants will be required to accept messages using the Common Alerting Protocol (CAP).
 
As described by the Commission back in 2004, when it first proposed upgrading the EAS, the CAP is a "standardized, non-proprietary, data interchange format that simultaneously disseminates consistent all-hazard emergency alerts or public warning messages over different kinds of communications networks and systems."  The idea is to have a standardized emergency alert so that the agency or individual issuing an alert need issue only a single alert which can then be received and processed by the widest variety of media (including, but not limited to, EAS participants) for re-transmission to their respective audiences.

While the CAP requirement may entail costs for EAS participants needing to upgrade their facilities, there is not likely to be any immediate hurry on that front.  The FCC's requirement will not kick in until 180 days after FEMA announces its adoption of standards.  So even if FEMA were to adopt such standards as of June 1, compliance with the FCC CAP requirement would not be necessary until late this year.
 
In addition to the CAP requirement the new rules require EAS participants to transmit state and locally targeted EAS alerts originated by governors or their designees.  (The Commission is also considering whether that requirement should be extended to alerts issued by local, county, tribal or other state governmental entities.)
 
The FCC is also looking at other EAS enhancements to improve the provision of emergency notifications to the disabled and to non-English speakers.  And to make sure that the whole system is working as designed, the Commission may require additional equipment testing, station certification and/or post hoc assessments of EAS effectiveness following alerts.  The Commission's decision included a second notice of proposed rule making addressing these various proposals.