Broadcast Law Blog : Broadcast Lawyer & Attorney : Broadcast Law Blog : Seattle, Los Angeles, Washington D.C., New York, San Francisco, Shanghai

Effective on Monday, April 2, the Washington DC office of Davis Wright Tremaine LLP that was located at 1500 K Street has changed locations.  We are joining our colleagues from the law firm that was formerly known as Cole Raywid & Braverman, and moving into their office at the following address:

Davis Wright Tremaine LLP, 1919 Pennsylvania Avenue NW, Suite 200, Washington, D.C. 20006-3402

New phone numbers for our broadcast attorneys will also be in place starting on Monday.  Those include the following new direct dial numbers:

David Oxenford  202-973-4256            Robert Corn-Revere  202-973-4225

David Silverman  202-973-4200           Bryan McGinnis  202-973-4285

Ronald London  202-973-4235              Brendan Holland  202-973-4244 

Karen Ross  202-973-4269                    Amber Husbands  202-973-4219

The main office number is 202-973-4200.  The fax is 202-973-4499.

Please update your contact information, as calling the old phone numbers will just give you a recording. 

• Email This
• Print
• Comments
• Share Link

The FCC yesterday released a Public Notice announcing that the new Form 340 - Application for Construction Permit for Noncommercial Station - has been approved and is now effective.  This is the revised form that allows noncommercial FM stations operating in the educational reserved band to file for city of license changes as minor changes, rather than having to wait for major change filing windows - which historically have been rare for noncommercial operators.  So, noncommercial FM licensees who have been contemplating city of license changes - or commercial licensees looking at noncommercial city of license changes to "back fill" for their own proposed city of license change applications - are now free to file. 

Commercial FM operators have been free to file city of license changes as minor changes since January 19.  Many such applications have been filed, and they are being quickly processed by the FCC. For details about the new city-of-license-change procedure, see our posts here and here. 

• Email This
• Print
• Comments
• Share Link

In a recent press release, Clear Channel Communications announced an agreement with mSpot Radio to provide the programming of over 100 Clear Channel radio stations to mobile phone users.  Interestingly, this announcement comes in he thick of the battle over the new royalty rates for the streaming of music on the Internet.  In recent pleadings seeking rehearing of  the decision of the Copyright Royalty Board setting those rates, SoundExchange (the collective that collects the royalties on behalf of Copyright owners and musicians) raised only one issue.  The sole issue on which SoundExchange requested clarification was whether the royalties that were recently adopted would apply to mobile phone transmissions of programming containing music. 

A brave move in light of the current royalty decision - one perhaps reflecting the desire to have radio programming everywhere a listener wants it, or one that foresees revenues from the wireless phone companies compensating the parties for the costs involved.  It will be interesting to see how this roll out of radio stations on mobile phones progresses.

• Email This
• Print
• Comments
• Share Link

The FCC yesterday approved the sale of the stock of Univision Communications to a consortium of private equity companies.  In order to approve the deal, the FCC agreed to a $24 million dollar payment to the US Treasury by Univision as part of a consent decree for alleged violations of the children's television rules.  The consent decree, attached to the FCC decision on the sale, while providing for one of the largest fines ever paid to the FCC, provides little guidance to broadcasters on what constitutes educational and informational programming directed to children, the source of the violation found by the FCC. But the separate Statement of Commissioner Copps raises a new issue - one he looks for the FCC to study and report on - the effect of private equity and debt on the ability of broadcasters to operate in the public interest. 

The Copps opinion suggests that the debt incurred in connection with acquisitions by private equity companies may impair the ability of broadcast stations to operate in the public interest, as money needed for operations is instead funneled into debt repayment.  Of course, private equity firms are not the first owners of broadcast companies to incur debt, nor is there any evidence that I have seen that private equity companies which own broadcast companies have proportionally more debt than other broadcast owners.  What would the FCC hope to accomplish through such an investigation?  I can't see the FCC evaluating each transaction that comes before it to determine if the proposed debt structure would be too much of a burden on the operations of a station.  Nor could I foresee the FCC putting broadcast ownership restrictions on certain classes of otherwise qualified potential broadcast owners.

• Email This
• Print
• Comments
• Share Link

Two press releases on the Internet radio music royalty controversy were issued late last week from groups appealing to musicians  - and they couldn't have been more different in tone.  The Future of Music Coalition, a group dedicated to voicing the opinions of musicians and citizens on Washington policy decisions regarding copyright and technology issues, released a well considered  position statement finding that webcasters - especially small commercial webcasters and noncommercial entities - "represent a rich and diverse set of listening opportunities" which provide opportunities for musicians by exposing listeners to music that is not heard elsewhere.  FMC suggests that multiple tiers of licensing are necessary so that all kinds of webcasters can continue to exist (unlike the one size fits all scheme adopted by the Copyright Royalty Board).  FMC urges SoundExchange and the webcasters to come to a settlement that will preserve webcasting while fairly compensating musicians.

By contrast, SoundExchange argues in its press release that some webcasters are acting in bad faith in arguing that the rates are too high - and are "engaged in a campaign of misinformation about the process, the decision itself, and the impact of the decision on the participants."  The Press Release itself is subtitled "Suggests Some Webcasters Not Telling the Truth About the Royalty Process."  The release promises an attached summary of the Board's decision but, at the time of this posting, that summary was not apparent on the SoundExchange website.  The only misrepresentation cited by SoundExchange is the claim by webcasters that the process which arrived at the rates was unfair.  However, as pointed out by editor Kurt Hanson (a client of mine in this proceeding) on the Radio and Internet Newsletter site, here, a decision that overlooks its real world effects can fairly be characterized as being unfair.  Information about the real economics of the industry, which SoundExchange may not have appreciated, demonstrates that unfairness.

• Email This
• Print
• Comments
• Share Link

This article is no longer available. For more information on this topic, see A Summary of Privacy Issues for Broadcasters and Other Media Companies - A Presentation to the Texas Association of Broadcasters 

• Email This
• Print
• Comments
• Share Link

This article is no longer available. For more information on this topic, see FCC Clarifies Rules for LPFM - Part 1 - What to Do With FM Translator Applications From the 2003 Filing Window, and Using Translators for the Rebroadcasting of AM Stations  

• Email This
• Print
• Comments
• Share Link

This article is no longer available. For more information on this topic, see  FCC Issues Rules on Digital Radio - With Some Surprises that Could Eventually Impact Analog Operations 

• Email This
• Print
• Comments
• Share Link

This article is no longer available. For more information on this topic, see FCC Deadlines in January - Quarterly Issues Programs Lists, Children's Program Reports, Comments on TV Online Public File and Public Interest Obligation Proposals, FM Window and More  

• Email This
• Print
• Comments
• Share Link

At the Oklahoma Association of Broadcasters meeting last week, David Donovan, President of the Association for Maximum Service Television, discussed the digital television transition, and the significant issues that face television broadcasters as the February 17, 2009 deadline for the transition to digital television approaches. The theme of David’s message was that, for the transition to go smoothly, television broadcasters need to be actively planning now for that end date. Without planning and coordination now, some broadcasters won’t be ready for the transition deadline, and others may have difficulty operating interference-free because of the actions of others.

David’s presentation, DTV – When the Rubber Meets the Road - can be found on the MSTV website. Among David’s key points was that the Table of Television Allotments as adopted by the FCC, in order to compress all existing stations into the smaller television spectrum that will exist after the transition, relies on re-using channels that are currently being used by one station as the ultimate digital channel of another station in the same or adjacent market. Unless these stations coordinate their transition to digital, interference issues can result and, in some cases, the transition may be delayed. In the simplest example, a station might have both its analog and digital operations outside the “core” channels that will be available for television use after the February 19, 2009 deadline. In the Table of Allotments, that station may have been assigned as its digital channel for post-2009 operations a channel currently being used by another station in the market. If the station currently using that channel does not move to its own digital channel on time, the out-of-core station cannot begin its in-core digital operations. In some cases, as many as five or six stations' ultimate digital operations may be mutually dependent, and will need to be coordinated, perhaps on the last day of the digital transition. Problems with one station’s transition may prevent the conversion of all of the other related stations. Thus, it will be in each station’s mutual interest to assist all other related stations to make sure that all are ready to meet the transition deadline.

• Email This
• Print
• Comments
• Share Link

Monday was the deadline for the filing of Motions for Rehearing of the decision of the Copyright Royalty Board decision on Internet radio music royalties for 2006-2010.  As we have written before, the decision proposes significant increases in the royalties, particularly for independent webcasters who have up to now paid royalties on a percentage of revenue basis, rather than on the per song per listener basis set out in the CRB decision.  In motions filed today, many of the webcasters challenged specific aspects of the CRB decision.  And at least one party raised an issue that seems to contradict the very foundation of the Board's decision.  Plus, in virtually all of the rehearing motions, the parties noted that additional issues may be raised on appeal to the US Court of Appeals, which do not need to be filed for several weeks.  

In the Motion filed by the Broadcasters' group, it was argued that an expert witness offered by SoundExchange in the proceeding which is now underway to determine royalty rates for satellite radio contradicted some of the basic assumptions used by SoundExchange's witness in this proceeding.  If the assumptions used by SoundExchange's expert in the satellite proceeding were to be applied in this case, the royalties would actually decrease from those that were in effect before the Board's decision. The assumptions used by the expert in the satellite proceeding seemed to confirm the claims offered by the webcaster's witnesses in this proceeding.  Could this be a smoking gun that could undermine the decision of the Board?  We'll have to see if the Board accepts this new evidence which seems to challenge the very foundation of the webcasting decision.

As the appeals are addressed to the CRB itself, asking that it reconsider or review its own decision, most of the other issues focused on limited matters that the parties thought that the Board might want to clarify as to avoid unintended consequences.  For instance, the appeals of the DiMA group, representing large webcasters, and the appeal that I worked on for the small commercial webcasters, both addressed the issue of the $500 per channel minimum fee which, if it was to be paid on literally every unique channel streamed by a service, could mean that some webcasters could pay hundreds of thousands or even millions of dollars as a minimum fee.  Some webcasters (like Pandora) serve up a unique stream for every listener.  Virtually all of the parties also addressed the question of whether most webcasters could even compute a royalty based on a per song per listener basis.  This is especially true for retroactive payments, when many webcasters did not keep such records (especially those small commercial webcasters paying on a percentage of revenue basis, or noncommercial webcasters who had payed on a flat fee basis). 

• Email This
• Print
• Comments
• Share Link

We have been covering the controversy over the rise in the royalties for all those who are providing an Internet radio service, whether they be over-the-air broadcasters streaming their signals on the Internet or pure webcasters whose stations are only available on the web.  Our previous postings on the topic can be found here.  Today, National Public Radio's program, On the Media, is airing an interview that they did with me on this topic.  You can listen to the Interview, here. 

A number of major media sources are doing stories on the impact of these royalties on small webcasters.  The Wall Street Journal yesterday ran a story focusing on the impact on the royalties on small webcaster, WOXY.  That story can be found here (subscription required for full story).  The Boston Globe also ran a story focusing on two Boston area webcasters.  As those stories set forth, while all webcasters are hit hard by the royalty, small independent webcasters face the most immediate crisis, as their royalty obligations will exceed their total revenues.  The first royalty payment under the new royalty rates is due on May 15, so the clock is ticking for these webcasters.

Requests for rehearing to be filed with the Copyright Royalty Board will be filed on Monday, so coverage of this story will continue.

• Email This
• Print
• Comments (1)
• Share Link

• Email This
• Print
• Comments
• Share Link

The Agenda for next week's FCC meeting includes the consideration of 76 groups of mutually exclusive applications for new noncommercial FM stations.  Many of the 200 or so applications contained in these groups have been pending at the FCC for almost 10 years.  Several years ago, the FCC adopted a point system to resolve cases involving these applications as many of the applications were mutually exclusive - meaning that technical considerations prevented more than one of the applications in each of these groups from being granted.  The point system awards each application points for perceived positive attributes such as being owned by a local organization or being part of a state-wide educational broadcasting network.    The adoption of the point system was supposed to speed the processing of these applications, and many such applications were granted using the point system before the processing seemingly stopped last year.  If the remaining applications are all dealt with next week as announced, this should clear the way for the opening of a new window for the filing of applications for new noncommercial FM stations. 

As it has been years since such a window last opened, the FCC expects that there is significant pent-up demand for new noncommercial stations, and that many applications will be filed.  Questions remain as to when the window will open (we are hearing Fall of 2007), and if there will be any sort of limit on the number of applications that can be filed.  Watch for further information on a noncommercial filing window in the coming months.

• Email This
• Print
• Comments
• Share Link

In July, we wrote about that the FCC was about to adopt final rules for over-the-air digital radio.  But these expected final rules were pulled off the agenda of the FCC July meeting, and they remained in limbo for the last six months.  Finally, today, the FCC announced that it will consider these final rules at its open meeting next week.  The rules have reportedly been held up while considering requests by the Democratic Commissioners that specific public interest obligations be attached to any multi-cast digital streams that a broadcaster may offer.

But the rules will also consider interference issues, and may finally authorize AM digital operations at night.  The rules should also give permanent authority to all digital radio operations which have, up to this time, been conducted under experimental or temporary authority.  It will be interesting to see if the Commission will in fact finally reach a resolution of these issues at its March 22 meeting, and how they will resolve the question of the public interest obligations of digital broadcasters - probably through the Further Notice of Proposed Rulemaking that is also on the agenda for next week's meeting.

• Email This
• Print
• Comments
• Share Link

In a curious bit of timing, on the day after the NTIA released its Order setting out the process for providing consumers coupons to finance their purchase of converter boxes to allow their analog televisions to continue to receive a signal after the digital transition, a coalition of high-tech companies visited the FCC to promote the use of the television spectrum to provide a wireless broadband Internet service.  We wrote about the FCC proceeding to allow these uses, on a non-interference basis, here, when the FCC launched its "white spaces proceeding." 

The proposal by many of the leading high-tech companies, including Microsoft, Intel, Google and other computer manufacturers, would allow smart devices to operate in the television band to send and receive wireless Internet signals, without interfering with television users.  The NAB has expressed concerns about whether these devices could in fact operate without interference to television stations.  In a Washington Post story, it was reported that the companies provided the FCC with a prototype device for testing, and stated that the devices could be ready for consumers by 2009 - perfectly timed for the end of the digital television transition.

This is a proceeding that all television broadcasters should watch carefully.

• Email This
• Print
• Comments (1)
• Share Link

On March 12, the National Telecommunications and Information Administration ("NTIA") released its Final Rules for the Digital-to-Analog Converter Box Coupon Program (Coupon Program).  This program is designed to allow consumers to purchase converter boxes which will allow analog televisions to receive over-the-air broadcast signals after the February 17, 2009 transition date when all full-power television broadcasters will be broadcasting only in digital.  This was a long-awaited action that many view as a necessary step before the country can meet the February 2009 digital conversion deadline.  The Order gives details of the implementation of the converter box program, providing guidelines for consumers, retailers and equipment manufacturers.  Details of the program are set out below.

The heart of the program is the coupons to be distributed to consumers.  Starting January 1, 2008, all U.S. households can request up to two $40 coupons than can only be used toward the purchase of two digital-to-analog converter boxes. There is no needs test, i.e. any household that wants coupons can request them, regardless of household income.  Only one coupon can be used for each converter box.  The coupons will be in the form of an “electronic coupon card;” like a gift card, but they will not carry any value that can be used for anything but a converter box.  The coupons will expire three months (90 calendar days) after the coupon is placed in the U.S. mail. In no case may consumers receive any cash value for the coupon so, if the cost of a converter box is less than $40, consumers cannot receive a refund or credit towards the purchase of another item. Consumers are also prohibited from selling their coupons. If a converter box does not work properly, consumers will be permitted an exchange only for another converter box. Applications for coupons will be accepted only between January 1, 2008 and March 31, 2009 and will be able to be requested by mail, by phone, by fax, or through a website.

Only households are eligible for coupons. No business, schools, or similar entities are eligible. Also, multifamily residences (i.e., a residence occupied by more than one family unit) will not be eligible for more than two coupons unless each household has separate living quarters and has a separate U.S. postal address. Because Post Office Boxes are prevalent on Indian Reservations, Alaskan Native Villages and other rural areas, these households may be required to supply additional information to identify the physical location of the household.  An NTIA  fact sheet for consumers summarizing the above information can be found here.

• Email This
• Print
• Comments (3)
• Share Link

This article is no longer available. For more information on this topic, see Multiple Ownership Decision Delayed - What Issues Are Being Debated? 

• Email This
• Print
• Comments (1)
• Share Link

I've received several calls in the last week asking if the political broadcasting rules apply to municipal elections - such as elections for mayor, city council, or school board.  Even though this is an "off year" for Federal elections, many communities around the country have local elections, and in some of those elections, candidates have sought to purchase advertising time on broadcast stations.  Many stations don't seem to remember that the lowest unit rate rules do apply to local races.  The rules on rates, as well as the public file requirements, equal opportunities, and the no censorship rule all apply to state and local races, as well as to Federal candidates.

Only the reasonable access provisions of the FCC's political broadcasting rules do not apply to state and local candidates.  In other words, stations need not sell commercial time to candidates for any local political contest, or the station can set upfront limits on how much time will be sold in the race,  but, once the station decides to sell time, if the spots are to run in the 45 days before the primary or the 60 days before the general election, Lowest Unit Rates do apply.  And all candidates for the same office must be treated alike.  The rules are mandatory - if you sell ads to candidates for public office within the window, the sales must be at lowest unit rates.  So make sure that these rules are applied. 

• Email This
• Print
• Comments
• Share Link

For those of you tired of reading about the recent Copyright Royalty Board decision on Internet Radio royalties, you can instead listen to a discussion of those royalties.  An interview that I did with World Internet Radio is available to download and listen on their website, at http://www.wirnonline.com/downloads.php.  The interview covers questions about the royalties themselves, the process that went into their adoption, the likely effects of the new royalties if they are not modified, and the possible routes by which the royalties may be changed. 

And, if you are not tired of reading about the royalties, our stories and the dozens of comments that we have received are archived here.

• Email This
• Print
• Comments
• Share Link

The Commission recently issued an Order fining a Kansas broadcaster $4000 in connection with a station contest - "Guess What is in the Santa Sack."  The licensee was faulted for not giving away the prize to someone who correctly guessed what was in the sack, and for also for not broadcasting the rules of the content on the air.  Obviously, a broadcaster must comply with its contest rules and give away a prize as promised.  In fact, as the winner had to complain to the FCC in order to get her prize, broadcasters should know that, when a listener complains, they should investigate immediately, give away the prize if warranted, and avoid the FCC fine that might result if the listener does not get satisfaction and has to ask for the FCC's involvement.  This case also reminds broadcasters that the material terms of any contest must be announced on the air on a periodic basis.

According to the FCC rules, "material terms" include those factors which define the operation of the contest and which how a listener can participate in the contest. Although the material terms may vary  depending upon the exact nature of the contest, they will generally include: how to enter or participate; eligibility restrictions; entry deadline dates; whether prizes can be won; when prizes can be won; the extent, nature and value of prizes; the basis for valuation of prizes; time and means of selection of winners; and/or tie-breaking procedures.   The broadcaster can make a good faith judgment as to how often the terms need to be broadcast .  They do not need to be broadcast every time the contest is mentioned, but should be aired often enough so that listeners can become familiar with the rules.  The complete rules should also be readily available to listeners.  We suggest that they be on the station's website, and hard copies should also be available at the main studio and at the business locations of any principal sponsors where contest entries can be made.  As we've written before, this is the year of the contest gone wrong, so broadcasters must be vigilant to avoid legal problems. 

• Email This
• Print
• Comments
• Share Link

• Email This
• Print
• Comments
• Share Link

This article is no longer available. For more information on this topic, see FCC Issues Emergency Communications Reminders to Broadcasters and Other Communications Entities in the Path of Hurricane Sandy 

• Email This
• Print
• Comments
• Share Link

This article is no longer available. For more information on this topic, see  AM Daytime Stations to Use October Power for PSSA and PSRA Until Daylight Savings Time Ends  

• Email This
• Print
• Comments
• Share Link

Following the recent Copyright Royalty Board decision, about which we have written several times this week, many individuals and companies have asked what can be done either to reverse the decision, or to operate in a world where the decision becomes effective.   While it is much too early to access all of the options, I thought that I would outline some of the possibilities.

First, Petitions for Rehearing of the Decision can be filed by the parties to the case within 15 days of the release of the decision – by March 19.   As such a Petition asks the Board to determine that the conclusions it reached after several months of deliberation were wrong, this is an uphill battle. There is, however, a much greater possibility that the Board will clarify some of the more onerous ambiguities of the decision – such as the issue of what constitutes a "channel" or "station" to which the minimum fee attaches. 

 After Petitions for Rehearing are dealt with, the Library of Congress must publish the decision in the Federal Register. Within 30 days of such publication, parties can appeal the case to the United States Court of Appeals for the District of Columbia. The filing of a Notice of Appeal by that deadline merely starts the appellate process. The Court will establish a schedule for the case – setting dates for the filing of full legal briefs and responses to those briefs. The Court will have an oral argument after the briefs are filed. A decision will follow. In appellate cases, this process can easily take a year to complete.   In order to overturn the decision, the court must find that the decision was arbitrary and capricious - in essence that, when presented with the facts, no there was no reasonable way for the decision to turn out the way it did.  This is a high standard that must be achieved, but not one so high that appeals are never successful.  So there is always hope.

• Email This
• Print
• Comments (10)
• Share Link

• Email This
• Print
• Comments
• Share Link

• Email This
• Print
• Comments
• Share Link

For weeks, there have been rumors that the FCC would soon settle allegations of payola against four of the nation's largest radio operators.  According to an article in the New York Times, a settlement has in fact been reached - resulting in a $12.5 million fine.  Coming on the heels of the rumored $24 million settlement with Univision for violations of the children's television rules, this may evidence a new "get tough" policy with rule violators by the FCC.

According to the Times article, the payola settlement agreement was reached at the same time as an agreement between these companies and the Association of Independent Music agreeing to devote substantial broadcast time to independent music.  The consent decree with the FCC also reportedly places a number of conditions on the broadcasters similar to those agreed to in consent decrees with then NY State Attorney General Eliot Spitzer.   We suggested a number of ways for broadcasters to avoid problems with the FCC rules dealing with payola issues in an advisory, here.  While payola has always been a serious issue - in fact one that could result in criminal time - the reported fines should make this a top-of-mind issue for all broadcasters.

• Email This
• Print
• Comments
• Share Link

As we wrote on Friday, the Copyright Royalty Board released to the parties their decision setting the sound recording music royalties for Internet radio for the years 2006-2010 - and the rates will be increasing significantly (absent success on appeal or in settlement discussions). The rates and appeal process are set out in our post on Friday.  The parties have until Monday, March 5 at noon, to request that the Board keep portions of the decision that contain confidential proprietary information out of the public record. Thus, the text of the decision is not yet public. Nevertheless, many parties are asking for more specific information about the decision and its impact. Certainly, when the decision is public, everyone will want to make their own judgments. But, until that time (which should be soon as the Board was careful to avoid using any significant amount of confidential information), I offer some observations about the decision (from my vantage point as a party who represented some of the webcasters involved in the proceeding), as well as thoughts on some of the questions that I have seen posted on various discussion boards this weekend.

First, it is essential to understand exactly what this decision covers. The Board’s decision covers only non-interactive webcasters operating pursuant to the statutory license. Our memo, here, discusses the statutory licensing scheme, and what a webcasting service must do to qualify to pay the royalties due under this statutory license. Essentially, a webcaster covered by this decision is one which operates like a radio station – where no listener can dictate which artists or songs he or she will hear (some limited degree of consumer influence is permitted, but a webcaster must comply with the restrictions set out in our memo).  Also, the webcaster cannot notify their listeners when any specific song will play. The decision does cover the Internet transmissions of the over-the-air content of most broadcast stations. 

The royalties are paid to SoundExchange – a nonprofit corporation with a Board made up of representatives of artists and the record companies. The royalties go to the copyright holders in Sound Recordings and the performers on those recordings ( the copyright holder is usually the record label. Royalties are split 50/50 – and the artist royalties are further divided 45% to the featured artist and 5% to any background musicians featured on the recording). 

The decision by the Board was the result of a long proceeding – which began in 2005. A summary of the proceeding can be found in our posting, here. Satellite radio also has to pay similar royalties, as do services that provide background music to businesses ("business establishment services"). Separate proceedings are underway to determine rates for these services.

With that background – here are some more thoughts on the decision – obviously in very summary form. The Board is charged with determining the royalty rates that would be determined by a willing buyer and a willing seller in a marketplace transaction. The Board was clear in the decision that it would look simply for evidence of what such a deal would be – it would not look at policy reasons why certain groups of webcasters (including small commercial webcasters or noncommercial webcasters) should get some special rate.

• Email This
• Print
• Comments (20)
• Share Link

February 17, 2009 - the end of analog television.  When broadcast television stations cease their analog operations, making millions of television sets obsolete, will consumers be ready?  And how will Congress deal with the backlash if consumers are taken by surprise and their television reception disappears?  This week, these questions were being asked in Washington and elsewhere.

 At the NAB Broadcast Leadership meetings in Washington held this week, Congressman John Dingell expressed his concerns that the National Telecommunications and Information Administration (NTIA) is late in releasing guidelines for the government program that they are administering to provide subsidies to the public so that they can buy converter boxes to allow analog television sets to receive digital signals.  An article in Multichannel News gives further details on the Congressman's comments, and provides a history of the converter box program.  The article states that the $1.5 billion allocated to the program is half what is necessary to convert the 73 million analog sets that are estimated to exist.  However, it makes the point that as digital sets are sold, the need for the converter boxes may decrease, and assumption that "the country will need to deal with a massive analog-equipment-legacy problem could turn out to be incorrect."

While that may be the case, an article in the February 28 Portals column in the Wall Street Journal (subscription required to read the article) makes one wonder how ready the consumer really will be for the transition deadline.  That article cites a study by the Leichtman Research Group which found that half of the 24 million homes with HDTV sets don't watch HDTV because they haven't subscribed to the necessary service from a multichannel video provider, or don't know that they can pick up HDTV signals over the air.  About half the the viewers who are not watching HDTV don't even know it - thinking that because they bought the set, they should automatically have HDTV pictures.  This same kind of confusion no doubt exists with respect to the DTV transition.   

• Email This
• Print
• Comments
• Share Link

The Copyright Royalty Board decision on the royalties for to be paid by Internet Radio stations for streaming music during the years 2006-2010 was released to the participants in the proceeding today.  And the rates are going up significantly over the next few years.  More importantly, especially for smaller entities, there are no royalty rates based on a percentage of revenue as were in effect for small webcasters under the Small Webcasters Settlement Act.  Instead, all royalties are given as a per performance number, i.e. a payment for each song every time a listener hears that song

In a 100 page decision, the Board essentially adopted the royalty rate advanced by SoundExchange (the collective that receives the royalties and distributes the money to copyright holders and performers) in the litigation.  It denied all proposals for a percentage of revenue royalty (including a proposal that SoundExchange itself advanced).  The Board also rejected any premium for streams received by a wireless service, as SoundExchange had suggested.

The rates set by the Board for commercial webcasters, including broadcasters retransmitting their over-the-air signals on the Internet, are as follows:

2006 - $.0008 per performance

2007 - $.0011 per performance

2008 - $.0014 per performance

2009 - $.0018 per performance

2010 - $.0019 per performance

The minimum fee is $500 per channel per year. There is no clear definition of what a "channel" is for services that make up individualized playlists for listeners.

• Email This
• Print
• Comments (42)
• Share Link

At yesterday's NAB Leadership Conference in Washington, FCC Commissioner Robert McDowell stated that he thought that broadcasters would be pleased with the outcome of the Commission's action on the NAB proposal to allow AM stations to use FM translators to fill in holes in their coverage, or to provide nighttime coverage for daytime stations.  The Commissioner said that the proposal was working its way through the FCC.  While he would not commit to a date when action could be expected, he thought something should come out soon.  In the interim, the FCC has granted at least one AM Station Temporary Authority to use an FM translator to rebroadcast its signal - apparently as a result of a Congressional request. 

We wrote, here, about the NAB proposal when it was first advanced back in August.  Broadcasters then had hopes for quick FCC action.  While it is good news that the FCC seems to be moving on the NAB proposal, broadcasters should not think that relief for all AM stations is coming soon.  Instead, the FCC will simply release a Notice of Proposed Rulemaking, opening a formal comment window in which parties can state their support for the proposal.  There may be others who oppose the proposal - particularly the supporters of Low Power FM stations.  Given that the FCC already has an open proceeding dealing with the relationship between FM translators and LPFM stations, the proposal to give AM operators FM translators will have to be linked in some way to this other proceeding.  And, were the FCC to decide that LPFM stations have a priority over FM translators, any victory for AM stations might be hollow, as LPFM stations could preclude the operation of many FM translators.

• Email This
• Print
• Comments
• Share Link

As we've written before, when Congress passed a new law extending Daylight Savings Time, AM stations that adjust power levels at sunrise and sunset would be affected.  Today, the FCC took action to adjust to those differences by announcing changes in Pre-Sunrise (PSRA) and Post-Sunset (PSSA) authority for all AM stations that have such authority.  Effective March 11, the first day of Daylight Savings Time under the new law, all stations with PSRA or PSSA have to begin operating with new parameters announced by the FCC today.

Any station operating with such authority should check the FCC Public Notice, and follow the link set out in that notice, to receive their new operating authority.  Stations should print out their new authorizations from that site, post the new PSSA or PSRA with their other operating licenses, and place a copy of the new authorization in their Public File with all of their other authorizations.  As all old PSSA and PSRA authorizations will be void as of March 11, stations should be sure to check this site and obtain their new authorizations and make sure that they are operating with the proper operating power.  With the FCC's recent propensity to fine stations which are not in full compliance with the FCC rules and their authorizations, stations don't want to take the risk of not operating in compliance with these new standards.

• Email This
• Print
• Comments
• Share Link