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The new Congress has started its oversight of the FCC, and one of the first topics to be brought up is the reintroduction of the Fairness Doctrine. Presidential candidate and head of the House of Representatives Domestic Policy Subcommittee of the House Government Reform Committee, Dennis Kucinich, was the first to call for hearings about the reintroduction of the doctrine.  Others have joined in that cry, including it in a bill introduced in the House and Senate to reform the media ownership rules. But do these perhaps well-intentioned Congressmen really remember what the Fairness Doctrine meant? Basically, bland broadcasting.

The Fairness Doctrine was, for the most part, declared unconstitutional by the FCC in the late 1980s (though some limited aspects of the policy have persisted until very recently). The Commission decision finding the Doctrine to be unconstitutional made sense, as its application clearly abridged the free speech rights of broadcasters. Basically, the Fairness Doctrine required fair and balanced coverage of all controversial issues of public importance. While that may sound like a good goal (one good enough to be adopted by Fox News), in fact it resulted in bland programming. 

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Yesterday, we wrote about a government task force, in which the FCC is playing a starring role, to study the media's impact on obesity.  Now, press reports indicate that violent programming on TV may be the subject of Congressional scrutiny this year.  An LA Times report cites a number of influential lawmakers as wanting to initiate a government review of violent programming and whether the FCC should regulate that programming.  A study from the FCC on violent programming is expected soon.  That study, coming on the heels of one released by the Parent's Television Council, which we reported on here, may well fuel this Congressional action.

There seems to be an unending list of complaints about the broadcast media, and for each complaint, there seems to be someone ready to introduce a law to do something about it.  Broadcasters need to be diligent and restrained in their conduct, as one Janet Jackson-like incident could result in new legislation getting the momentum necessary to become something more than a line in a campaign speech.  In an editorial, Broadcasting and Cable has urged such restraint.  With an election less than two years away that already appears to be featuring an unprecedented number of Presidential candidates and a large number of fiercely contested Senate races, no one wants to become that campaign issue that results in new regulations on broadcaster's freedoms. 

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The FCC yesterday adopted two orders approving the initiation of operations by Qualcomm of its MediaFLO wireless multimedia system on television channel 55 in the Richmond/Norfolk area of Virginia, and in St. Louis Missouri.  Qualcomm purchased the nationwide rights to use Channel 55 in an FCC spectrum auction several years ago.  At the end of the digital transition, channels 52 and above will no longer be used by television broadcasters, but instead will be used for wireless services (as well as some public safety users).  The channels between 52 and 59 have already been auctioned, and can be used if they don't cause interference to current television users.  In these two cases, Qualcomm was able to reach agreements with broadcasters in adjacent markets to agree to accept minimal amounts of interference so that Qualcomm could initiate its MediaFLO service.  The FCC found that the minimal interference to these stations would not significantly affect television viewers, and granted Qualcomm authority to commence operations.

According to the Qualcomm website, their MediaFLO service will provide interactive audio and video to handheld devices - essentially mobile phones optimized for multimedia content.  While the website seems to imply that this will be a closed system with content provided by a limited number of providers or partners, it will operate with a IP type technology, which could allow a more open system in the future.  Other users are apparently planning to use these channels for high speed wireless Internet services.  So, perhaps ironically, as free over-the-air TV abandons these channels in the next two years as the digital transition nears its end, a new subscription audio and video service will take its place.  Progress?

 

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In a Public Notice issued today, the FCC announced the membership of a Task Force to study how the Media affects childhood obesity.  We reported on the formation of the task force in October, but its membership is just being announced, and its first meeting will be taking place on Valentines Day (probably without red hearts filled with chocolates for the members).  The task force is comprised of representatives of various public interest groups, food and media industry representatives, two FCC Commissioners and Senators Brownback and Harkin.  The Public Notice states that the Task Force will focus on voluntary means by which the media can help fight childhood obesity.  At the end of their study, the Task Force will issue a report on its findings.

This issue is one which the broadcaster should follow closely.  Senator Brownback has made this issue his own and, with his announcement this week that he is exploring a run for President, we can be sure that more will be heard about this issue.  We reported in August on his initial attempts to have the industry adopt guidelines to limit the advertising to children of unhealthy foods.  Also, Commissioner Tate has enthusiastically promoted this task force, issuing a statement today applauding the start of its important business of addressing this societal problem.  With these officials invested in this issue, broadcasters will no doubt face pressures to restrict their advertising of unhealthy food.  Watch for the results and recommendations of this Task Force in the next year.

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The Bipartisan Campaign Reform Act ("BCRA") adopted in 2002 prohibits the purchase of broadcast commercials by labor unions and corporations using their general funds during the 30 days before a Federal primary and the 60 days prior to a Federal general election. The Act prohibited these "electioneering communications," and essentially defined an electioneering communication as any mention of a Federal candidate. The Supreme Court this past week decided to hear the appeal of a US District Court decision which found the prohibition unconstitutional as applied to a Wisconsin Right to Life group, organized as a corporation, which had purchased ads mentioning a candidate in the 60 days prior to an election. If the Supreme Court upholds this decision, we may see more corporate and union money spent on advertising prior to the 2008 elections.

The District Court decision is not so broad so as to allow unlimited political advertising by these groups. Instead, the Court only held that advertising that was directed at specific issues (in this case Senate filibusters of judicial nominees) was not prohibited if the message was not directed at the election. In this case, the ads asked that residents call their Senators and tell them to stop delaying the judicial nominations, naming Senator Feingold, who was up for reelection. Perhaps not so coincidentally, Senator Feingold was one of the principal authors of BCRA (also known as the McCain-Feingold Act). The ads did not specifically tie this issue to the election, or mention Senator Feingold's candidacy at all. More on the case can be found in an article in Saturday's Washington Post.

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About this time every year, predictions are offered as to what will happen in the coming year.  Since everyone else does it, we've offered our own predictions as to what Washington has in store for the broadcast industry in 2007.  Find a copy of our predictions in the memo on our firm website, here.  The advisory offers our thoughts on many of the regulatory issues affecting broadcasters that may well come out of Washington this year.  Our observations are offered on the status of considerations including multiple ownership, the digital television transition, payola, indecency, Internet radio and even the political broadcasting rules. 

Let us know if you think our crystal ball is a little cloudy.

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On Friday, the FCC announced an extension of time in which comments can be filed in its proceeding to assess the impact of broadcast towers on migratory birds.  We reported on this proceeding here.  The order granting the extension noted that most of the active parties in the proceeding, including both conservation groups and communications trade associations, backed the extension.  Comments, which were due on January 22, will now be due April 23, with Reply Comments due May 23.

Together with the pending FAA proceeding which raised the possibility of requiring FAA approval for the addition of any new communications user on a tower (about which we reported here), the outcome of this proceeding is very important to all communications companies, as an adverse outcome could greatly complicate the already difficult process of constructing communications towers.

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In a report issued last week, the Parent's Television Council submits that there has been a significant increase in violent programming on television since 1998.  The report contends that violent programming has increased, and become more graphic and more sensationalized.  Will this report  mark the beginning of a new attempt to regulate television programming?

The FCC, because of a requirement imposed by Congress several years ago, already asks television broadcasters to report in license renewal applications all complaints they have received about violent TV programming.  Thus far, this question has not resulted in any action against any broadcaster.

The PTC has also been involved in the efforts to make the FCC take a more aggressive stance against indecency.  In fact, on it's website, it currently has a headline suggesting that readers file a complaint with the FCC about the appearance of the "F Word" on a spectator's tee shirt in one of the NFL telecasts of this past weekend. 

 Thus, violence may well join the growing list of programming issues (including indecency, children's educational programming, and advertising relating to unhealthy food) about which broadcasters may need to be concerned in the future.

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According to reports, the Commissioners are considering a proposal, circulated by the Enforcement Bureau, to settle the FCC’s ongoing payola investigation, which was prompted in part by Eliot Spitzer’s well-publicized settlements with various radio and record companies in New York State. The hollywoodreporteresq.com posted a story that cites industry and government sources as saying the FCC is close to resolving the investigation into alleged payola infractions by radio broadcasters and record labels. 

The article seems to confirm recent reports that the FCC has agreed to allow assignment applications to proceed even where they involved stations against which payola allegations were pending, as long as the seller agreed to remain liable for any FCC misconduct that was later found, even though the seller would no longer own the station.  Allowing sales to occur despite pending allegations of misconduct, through these so-called "tolling agreements," indicate that the Commission has determined that the misconduct (at least in the cases in which they were allowed) won't result in a license revocation (though a fine is still quite possible).

The Commission’s investigation has been underway for some time, after being prompted by Mr. Spitzer’s investigations. At the time the FCC’s investigation commenced in 2005, Commissioner Adelstein predicted that the practices unearthed “may represent the most widespread and flagrant violation of any FCC rules in the history of American broadcasting.” Early in 2006, letters of inquiry were issued to Clear Channel Communications Inc., CBS Radio Inc., Entercom Communications Corp. and Citadel Broadcasting, and the proposed settlement presumably would include some or all of these broadcasters. The story reports that the settlement calls for a commitment by the parties to better educate people in the industry about proper conduct and avoiding payola, as well as their commitment to dedicate some specific amount of airtime to independently produced music. In exchange, the broadcasters would avoid an admission of wrongdoing. 

 

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The new FCC Form 301 application is now available, both as a pdf on the Commission's forms page, and in the CDBS filing system.  The Form has been revised to take into account changes made in FCC rules which allow changes in the city of license of AM and FM stations to be made as a "minor change" that can be processed relatively quickly.  The rules also permit changes in the channels of FM stations, even to non-adjacent channels, as a minor change without a rulemaking.  We wrote about that proceeding most recently here.  The new rules are effective on January 19, except for changes in noncommercial FM reserved-band stations. 

Applications for reserved-band stations must be filed on a revised version of FCC Form 340, which may not be available for another month or two.  Under the FCC's order, noncommercial reserved-band stations are supposed to wait until the new Form 340 is available before filing an application under the new rules.  As applications filed on January 19 could theoretically preclude a change planned by a noncommercial station, that delay could be a problem.  It is possible that noncommercial applicants may submit filings on the January 19 deadline asking that the FCC reconsider this disparate treatment of commercial and noncommercial stations.

The FCC is supposed to release a series of questions and answers on the new procedures in the next few days.  Applicants planning to file on the 19th should be alert for that release, as it may provide information that is important for the new filings. 

 

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For those of you still poring over the Commission's proposed new DTV Table of Allotments, the FCC has granted a brief extension of time for filing comments and reply comments in response to this NPRM.  By its Order released yesterday, the FCC extended the date for Comments to January 25, 2007 and the date for Reply Comments to February 26, 2007.  As mentioned in our earlier entry, this proposed DTV Table is the beginning of the end for the DTV transition, and interested parties can comment on the proposed arrangement of channels as the Commission finalizes the Table.  Comments can be filed in paper or electronically through ECFS. 

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Chairman Martin yesterday announced the appointment of a new Chief of the Media Bureau, the FCC Bureau which directly regulates broadcasters.  The Media Bureau processes broadcast technical applications, approves sales of stations, and takes the first draft of most policy issues which affect broadcasters.  Donna Gregg, who has held that position since 2005, is moving on to become the policy adviser to the US Delegation to the World Administrative Radio Conference. 

The new chief, Monica Shah Desai, is an FCC veteran, who most recently was the Chief of the FCC's Consumer and Government Affairs Bureau, the Bureau responsible for dealing with consumers and other governmental agencies - presenting, explaining and often implementing the FCC's positions and programs.  That bureau also works to develop consumer policy to be implemented by other Commission bureaus.

What will this change in leadership mean to the broadcaster?  Probably, not much.  Many remember the long Media Bureau leadership of Roy Stewart, who was very visible around the country, meeting with broadcasters, and exerting a long institutional memory and strong policy position on broadcast matters.  Under Chairman Powell, the Media Bureau also was very visible developing policy proposals.  In one of those cyclical variations that the FCC routinely goes through, in recent years, more decision-making has been centered on "the Eighth Floor," i.e. among the FCC Commissioners.  Whether a new Media Bureau chief changes that recent dynamic remains to be seen. 

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In a recent article from the Boston Globe, an interview with the new manger of WBZ-TV in Boston stressed the importance of the stations call letters.  The article talks about the connection that the local audience had to the well-known station call letters , and how the station had suffered to some degree by de-emphasizing those call letters while using other station branding.  That story, to me, raises the question of whether stations have taken the necessary steps to protect their brand by protecting the use of their call letters.

Since 1983, the FCC has left disputes about the use of confusingly similar call letters to local courts.  Thus, if a competitor picks a set of call letters that could confuse the public about the relationship of their station to yours, you may need to sue to stop that use.  And now, when stations often keep alive formats that have been dropped by moving the formats onto Internet Radio Stations or to HD Radio subchannels, the call sign may well live on even after it has been dropped from a primary on-air station.  Thus, it needs protections other than those provided by the FCC.

In 1983, the FCC stated that stations had a sufficient interest in call letters to obtain a service mark.  A service mark gives the call letters the protection of Federal law, and may impose penalties on a competitor who tries to infringe on those call letters.  To protect that brand, the investment of a few hundred dollars to file a service mark application may well be worth it, and something that more stations should consider.

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In a decision released last week on an increasingly common issue, the FCC refused to get involved in a retransmission consent negotiation dispute between a cable television system and a television station.  The dispute involved Sinclair Broadcasting's demands for cash consideration for the carriage of its television stations by cable systems owned by Mediacom Communications.  In a Petition filed with the FCC, Mediacom argued, among other things, that Sinclair was not asking for marketplace rates for the carriage of its stations, and thus was violating the duty of the television station to bargain in good faith with the cable system.

In the decision, the FCC's Media Bureau essentially concluded that there was no obligation of a television station to agree to marketplace rates in exchange for its agreement to provide the cable system with retransmission consent.  Essentially, the FCC said that as long as Sinclair did not offer only a take-it-or-leave-it proposal, the FCC would not get involved in deciding whether a proposed price was reasonable or not.  Sinclair owed no duty to disclose its other deals with other systems to establish what was a marketplace price for its signals, as long as it made offers to Mediacom.   If Sinclair wanted to hold out for more consideration than it had ever received from any other cable system before, that was it's decision.  As the FCC put it, one party was incorrectly valuing the television signal - and that party would ultimately pay in the marketplace if the station was not carried. 

This decision seems to signal the FCC's reluctance to get involved in retransmission consent negotiations.  As long as the parties talk, and make proposals to each other, the FCC will seemingly rarely intervene in evaluating the specifics of those proposals.  This decision can be appealed to the full Commission, though it will be interesting to see if the case is decided through that appeal or the parallel antitrust litigation that is going on, or whether the parties will heed the Media Bureau's admonition in the last paragraph of its decision - to reach a negotiated decision that both can live with, one which won't deprive cable subscribers of access to the signals of the television stations that are involved.

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In recent weeks, the FCC has been vigorously defending its indecency rules in Court.  First, oral arguments on the FCC's actions against Fox and NBC for "fleeting utterances," one-time unscripted airing of profanities during television coverage of live award programs, were held the week before Christmas - with a decision possible in the upcoming months.  At the same time, briefs are being filed in the case involving Janet Jackson and the Super Bowl clothing malfunctions.  But, with more and more video moving on-line, where the FCC's indecency rules don't reach, who is the FCC really protecting?

A recent article in the New York Times (subscription required for full archived content) reported on NBC's Saturday Night Live posting on the Internet an unedited copy of a partially censored animated feature that aired on its program.  If viewers can access complete, unedited content of a television program online, and that online content can be promoted on the air, unless there is some great expansion of the FCC's power in regulating on-line activity, it seems that the FCC's indecency crackdown doesn't accomplish much.  But, with the pending court actions, it may well be that the FCC's ability to regulate indecency shrinks before it increases.

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Two recent decisions show a stark divide in the approach of the Democratic and Republican FCC Commissioners which may indicate the difficulty of reaching consensus on any of the pressing issues which will be facing the FCC in this new year.  The FCC decision on the AT&T acquisition of BellSouth, approved by FCC action on Friday, was a result of AT&T throwing in the towel, surrendering to the demands of the two Democratic Commissioners who were seeking greater consumer protections before voting to approve the acquisition.  In that case, as one of the Republican Commissioners had removed himself from consideration of the matter due to a conflict from a previous job, the Democrats had an effective veto over any FCC decision. 

In the decision reached right before Christmas, requiring local municipalities to act quickly on new video franchise applications and restricting the conditions that could be put on such approvals, the Commissioners again split on party lines.  The three Republicans argued that the restrictions were necessary to encourage the entry of new competition in the multi-channel video world, resulting in the potential of lower prices to consumers.  Democrats, on the other hand, contended that the rules were beyond the FCC's power.  Beyond what some might see as the role reversal represented by the votes (the Republicans looking out for consumer interests while the Democrats were protecting states rights, with Commissioner Adelstein even quoting Ronald Reagan in his dissent), one wonders why these positions broke down on party line.  If the proposal really did exceed the Commission's power, shouldn't Republicans and Democrats alike refrain from acting?  And if the result of this action was really a benefit to consumers, shouldn't Commissioners of both parties have looked for ways that the rules could be adopted within legal bounds?

The seeming inability of the Commissioners to reach consensus on most big issues does not bode well for prompt action on some of the major broadcast issues facing the FCC.  We've already seen a decision on adopting final standards on digital radio (including authorizing nighttime digital operations for AM stations) postponed for over 6 months, reportedly based on arguments over the public service obligations of multicast channels.  And how will the contentious multiple ownership debate be resolved?  And what will happen should one of the Republican Commissioners leave the Commission during the course of the year?  It certainly will be interesting to see these issues play out during the course of this new year.

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