Broadcast Law Blog

In two recent FCC decisions, one dealing with a commercial operator and that other with a noncommercial licensee, the Commission's staff addressed the issue of how large an FCC fine could be imposed on a broadcaster without that fine being subject to reduction because of the licensee's inability to pay.  In the first case, a commercial station was fined for violations of the EAS rules.  As we've written before, EAS seems to be the most common violation found at broadcast stations by FCC inspectors.  However, what is most notable about this decision is not the violation, but the Commission's discussion of the penalty for that violation.  As in many cases, the licensee argued that, as it had experienced several years of financial losses, the amount of its fine should be reduced as the payment of that fine would impose a financial burden on it.  The FCC rejected the argument, finding that as the fine was less than 2% of the licensee's gross revenues, it was not excessive.  The Commission stated that, while profits and losses may be important in determining whether a licensee can pay a fine, in most cases, if the fine is less than 2% of gross revenues, it will not be considered excessive even if the licensee has not been making a profit as it it not a significant overall expense.  Therefore, the Commission refused to reduce the fine because of financial hardship argument.

In the noncommercial case, the applicant claimed that a fine that it was issued for not having any quarterly programs issues lists in it public file should have been reduced because that fine would significantly deplete the station's budget that had been allocated to it by the School District with which it was associated.  However, the licensee only provided the FCC with information concerning the budget allotted to the radio station, and it did not provide any financial information about finances of the licensee school district.  Without that information, the Commission stated that it could not determine that the fine was excessive, so it did not reduce the fine on the basis of financial hardship.  Clearly, the Commission is not anxious to reduce a fine based on the licensees financial inability to pay, so a licensee looking for such a reduction must carefully document its request showing that the fine would impose a financial hardship.

Posted By David Oxenford In Emergency Communications , FCC Fines , Noncommercial Broadcasting | Permalink | 0 Comments | Email entry

The processing of the applications for new noncommercial FM stations marches on.  This week, the FCC released a list of groups of Mutually Exclusive applications (commonly known by those who regularly deal with the FCC as "MX groups"), i.e. applications that are linked together in that, because of interference concerns, not all can be granted.  In some cases, all of the applications in an MX group overlap with each other so that only one can be granted.  In other cases, referred to as "daisy chains", you have a situation where Application A precludes Application B from being granted, and Application B prevents Application C from being granted.  While A and C could be granted if not for B, all three end up in a single MX group.  According to the Public Notice released with the list of MX groups, the applications on this list are all situations were there are 13 or fewer applicants in the MX group.  MX groups with a greater number of applications will appear on a subsequent public notice.  MX Groups with 4 or fewer applications were identified back in March.

The Commission has advised all applicants to review the lists to see if they were included in an MX group erroneously or omitted from an MX group in which they should have been included.  If they discover a mistake, the applicant should file, within 30 days, notice with the FCC so that its application can be processed with the group to which it belongs.  Applicants can also try to work out settlements during the 30 day comment period (or notify the FCC at the end of the period that they are still working on a settlement).  Otherwise, at the end of the 30 day period the FCC promises to begin work to resolve the MX cases through the use of the point system (which we explained, here).  So the process marches on, and we should start to see more applications from the noncommercial filing window acted on in the coming months.

Posted By David Oxenford In Noncommercial Broadcasting | Permalink | 0 Comments | Email entry

In a decision released late on Friday, the FCC upheld a $9,000 fine on a noncommercial television operator who broadcast underwriting announcements which, in the opinion of the Commission, were too much like commercials and thus were impermissible on a noncommercial station.  Under the Commission's policies governing the noncommercial nature of noncommercial stations, it is permissible to air an underwriting announcement acknowledging a commercial entity that makes a financial contribution to the station.  And it is permissible to state the nature of the business, where it is located, and to air the slogan of the company.  What is not permissible is when the underwriting announcement contains "calls to action," qualitative or comparative claims, price information, or other inducements to do business with this particular company.  In this case, the Commission felt that the announcements crossed some or all of these lines.

In the initial Notice of Apparent Liability in this case, released in late 2004, the text of the announcements at issue are set out.  In last week's order, phrases such as "planning a special occasion?" as the intro line to an announcement about an Ice cream store were deemed to be calls to action, and the description of the ice cream cakes that the store made as "tastefully decorated" were deemed to be qualitative.  Similarly, statements about a real estate company that "we're all about family" and "we love selling real estate" were deemed to be comparative in nature, trying to distinguish this particular agent from other competitors.  In only one of ten ads, one for a school supply store, did the Commission overturn its previous determination, finding that an announcement for "creative learning materials" was arguably descriptive and not qualitative.

Posted By David Oxenford In Noncommercial Broadcasting | Permalink | 0 Comments | Email entry

Channel 6 of the television band is immediately adjacent to the lower end of the FM band.  Noncommercial FM radio stations, located at the lower end of the FM band (88.1 FM to 91.9), have the potential to interfere with television stations on that channel.  Thus, FCC rules require that noncommercial FM stations protect Channel 6 stations that are in their area, often limiting their power unless they can work out interference agreements with the local TV station.  As the FCC has tried to vacate Channel 6 as part of the digital transition, some noncommercial FM applicants, including some who filed during the recent filing window for new Noncommercial FM stations, have filed applications seeking construction permits at power levels that ignore the Channel 6 station, on the theory that, by the time the noncommercial station is on the air, the TV station will have vacated Channel 6.  In a decision issued on Friday, the Commission rejected one such application, finding that the acceptance of the application premised on an event that has not yet occurred would be unfair to potential applicants who were waiting to file applications until the television stations actually changed channels.

The decision, in a footnote, noted another problematic issue raised by these applications.  As only some applicants filed their applications in the recent NCE window premised on the disappearance of the Channel 6 TV stations, those that had not take that tact would be at a comparative disadvantage in assessing their applications under the NCE selection criteria.  As the comparative position of NCE applicants was supposed to have been frozen at the time the window applications were filed, those relying on a future event would seem to get an unfair advantage.  Thus, it appears that, in time, similar actions will be taken with respect to other similarly situated applicants, clearing up a source of concern or consternation for many who filed during that window.

Posted By David Oxenford In Noncommercial Broadcasting , Television | Permalink | 0 Comments | Email entry

On Friday, the FCC released a Public Notice setting out several groups of applications for new noncommercial FM stations which are mutually exclusive with each other.  These applications were filed in the October window for new noncommercial FM stations (information about which can be found here).  According to the Public Notice, the identified groups are those where there are 4 or fewer applications which are mutually exclusive with each other.  The list can be found here.   The Commission is asking that applicants named on this list advise the Commission within 30 days whether the FCC's determination of mutual exclusivity is correct, and also whether the named applicants anticipate reaching a settlement or share time agreement. If nothing is filed within that 30 day period, the Commission's staff will start applying the point system to determine which of these applicants should be preferred and granted.

The Public Notice also makes clear that there are other applications which are part of larger mutually exclusive groups.  These applications will be dealt with at a later date.  The Commission has already processed over 800 other applications which were either granted as "singletons", not mutually-exclusive with other applications, or which were dismissed because the applicant exceeded the 5 station filing cap.  Thus, the FCC is moving quickly to process these applications for new noncommercial stations.  Applicants should carefully review their options in light of this new public notice. 

Posted By David Oxenford In Noncommercial Broadcasting | Permalink | 0 Comments | Email entry

This afternoon, FCC today released a Public Notice regarding the recent NCE FM filing window during which the FCC accepted applications for new noncommercial FM radio stations.  By this Public Notice, the Commission has opened a 60-day settlement period for parties to resolve any technical conflicts between their applications, either by making technical amendments or by reaching a settlement with the other parties.  Instead of providing lists indicating the applications filed in response to the window that are Singletons (i.e., don't have any conflicts and can go straight to processing), dismissed outright,  or mutually exclusive with other applications as it has done in the past, the FCC instead leaves it to the applicants to figure out which category they are in and to identify any other mutually exclusive proposals that might be blocking their proposal.

This, of course, can only be accomplished if the FCC makes the applications available in their databases, which it started to do this afternoon.  Thus, the next step is for applicants to check the FCC's CDBS database and see if their application is either:  1.) Dismissed, 2.) Accepted for Filing, or 3.) Tendered for Filing.  Dismissed is self-explanatory.  Accepted for Filing means that there were no initial conflicts and that the application will progress through the normal processing procedures, hopefully to be granted in due course.  These applications will appear as accepted for filing in the FCC's daily public notices some time next week and move on from there. 

In the event that the database reflects that an application is Tendered for Filing, this indicates that there is a conflict with at least one other application that was filed during the NCE FM window.  The next step in that case is to have your consulting engineer study the situation and see what the conflict is.  Once you have a sense of the conflicts you are facing, you can start to assess whether there is an engineering solution that might allow your application  to be granted, whether you could settle with the other applicants, or if your application could win on the basis of preferential service or a comparative point analysis.  The 60-day period for technical amendments and joint settlements starts today and will expire on January 7th.

Posted By Brendan Holland In FM Radio , Noncommercial Broadcasting | Permalink | 0 Comments | Email entry

The FCC today issued a Public Notice extending the NCE filing window, which was to end today, until this coming Monday, October 22.  All applications must be on file by 2 PM Eastern Time on Monday.  This short extension was apparently due to downtime on the FCC's electronic filing system last night, which precluded the filing of some applications during that period.  This is the window for filing applications seeking authority to construct new noncommercial educational FM stations, or for major changes in existing noncommercial FM stations.  For more details on this window, see our post, here. 

Posted By David Oxenford In Noncommercial Broadcasting | Permalink | 0 Comments | Email entry

In an Order released today, the FCC affirmed its tentative decision limiting the number of noncommercial FM applications that can be filed by one party in the upcoming window for new reserved educational band stations.  Applications for these stations can be submitted starting on Friday.  See our post, here, for details on the filing requirements.  The Commission upheld its tentative decision to retain a limit of 10 applications, despite requests by NPR, Minnesota Public Radio, and many religious broadcasters for higher limits.  The Commission cited thousands of individual comments in support of the 10 station limit, as well as those of a number of "public interest" groups.  Apparently, the flood of thousands of almost identical individual comments helped convince the Commission that the weight of the comments (perhaps literally) supported its decision.

The Commission did recognize some exceptions to the 10 station limit, exempting major change applications and applications that were originally filed under the old rules for FM educational processing (many of which have been languishing for almost 10 years) which must be refiled in the upcoming window.  In response to concerns that there might be sham applications that are filed to evade the limits, the Commission warned applicants that it retained the ability to investigate any application to make sure that the representations are true.  See our post on a recent case where the FCC rejected an applicant's claim to credit as a local applicant.  We will see if these efforts by the FCC in fact reduce the number of applications to a manageable number that can be quickly processed by the Commission.

Posted By David Oxenford In Noncommercial Broadcasting | Permalink | 0 Comments | Email entry

With the filing window for new noncommercial FM radio stations opening this coming week (see our summary of the process, here), some potential applicants may be wondering who qualifies as an established local organization entitled to points in the comparative analysis that takes place if applications that are mutually exclusive (both cannot be granted without creating prohibited interference) are filed during the window.  In a decision released this past week, the FCC clarified the rules as to what constitutes a local applicant - holding that simply having a mailing address for a headquarters in the proposed station's service area is not sufficient.

In this case, an applicant claimed to have an established local presence necessary to qualify for points as a local applicant based on its "headquarters" which it said had been located within 25 miles of the proposed city of license for two years prior to the relevant date for evaluating the applicant's comparative attributes, as required by the FCC's rules.  However, when a competing applicant visited the office building in which this supposed headquarters was located, there was no indication in the building directory or on any signs on any door in the building that the organization was located there, and no building personnel had any familiarity with the organization.  The applicant justified its claimed local credit by claiming that the "headquarters" was an office at the specified location that housed a number of businesses and organizations with which one of its Board members was affiliated, and that all of those businesses could not be listed on signage or on the building directory.  The Commission found that the mere presence of an office was insufficient to qualify for credit, citing the Order adopting the NCE point system which said that the headquarters must be the organization's principal place of business or the principal residence of one of its members, and not just a post office box, lawyer's office, branch office or vacation home.  To qualify for points as an established local organization, the applicant must have activities and familiarity with the local service area that will permit it to "hit the ground running" in serving the public.

Posted By David Oxenford In Noncommercial Broadcasting | Permalink | 0 Comments | Email entry

The Commission's Public Notice proposing to limit the number of applications that a single party can file in the October Noncommercial ("NCE") FM filing window to ten applications has been published in the Federal Register.  The deadline for submitting Comments is September 6th, and the deadline for submitting Reply Comments is September 17th.  A copy of the Commission's Public Notice can be found here. By proposing to limit the number of applications that a single entity may file in the window, the FCC seeks to avoid parties filing a large number of speculative filings, which create the potential for extraordinary procedural delays.  All comments must be submitted in MM Docket No. 95-31, and can be filed either in paper or electronically through the FCC's Electronic Comment Filing System.

Further information regarding the October NCE FM filing window can be found in our earlier posts on the topic here. 

Posted By Brendan Holland In Noncommercial Broadcasting | Permalink | 0 Comments | Email entry

In its Public Notice setting out the rules governing the upcoming filing window for applicants seeking new noncommercial FM stations or major changes in existing stations, which we wrote about here, the FCC has put applicants on notice of the many requirements that must be met in order to have an application considered in the upcoming process.  This is the first opportunity in this century for the filing of applications for new noncommercial FM stations. In order to participate, all applicants must make sure that they follow the rules set out by the Commission.  Applications will be due in a filing window that will open on October 12 and close on October 19.

Fundamentally, the FCC's Public Notice reminds interested parties that, to be eligible, an applicant must be a noncommercial entity – a nonprofit corporation or a governmental organization.  Individual applicants or profit-making entities cannot participate.  As eligibility to participate and the comparative qualifications of all applicants are assessed at the time of filing, applicants need to assure their nonprofit status is in order before the upcoming filing window.

The Commission also sets out a number of other requirement for the applications that may be filed during the window. Applications submitted during the window will be filed electronically on FCC Form 340, and must contain very specific technical descriptions of the service they plan. The proposal must specify facilities that don’t interfere with other existing stations or pending “cut-off” noncommercial applications. The applicant must have received reasonable assurance of the availability of its proposed transmitter site (i.e. a legally binding contract is not necessary, but a commitment from the site owner that the site will be available and an idea of the terms on which that availability is premised must be obtained). 

Posted By David Oxenford In Noncommercial Broadcasting | Permalink | 0 Comments | Email entry

The Commission yesterday released two further Public Notices regarding the upcoming window for new noncommercial (NCE) FM radio stations.  As was previously announced, a filing window will be open from October 12 until October 19 during which time interested parties may submit applications for new NCE stations or for major changes to existing NCE stations.  This window is significant, because it marks the first time in seven years that parties have been able to file for a new NCE FM station.

The first of the public notices released yesterday, which is available here, contains further details about how to submit an application in the window.  Parties interested in learning more about filing an NCE FM application will find useful, step-by-step information about the application and licensing process here.  In addition, the notice announces a filing freeze prior to the opening of the window.  Beginning September 8, 2007 and continuing through the close of the window on October 19, there will be  freeze on the filing of minor change applications for all reserved band channels, and, due to their potential impact on the window filings, on Channel 221, 222, and 223 non-reserved band minor change applications and amendments.  This freeze will stabilize the database and allow applicants filing in the window to know what they need to protect. 

The second public notice released yesterday proposes to restrict the number of applications that a single party can file in the NCE window to ten, and seeks input from interest parties regarding that proposal.  A copy of the notice can be found here, and the deadline for comments is 15 days after the Notice has been published in the Federal Register, with reply comments due ten days after that.  By proposing to limit the number of applications that a single entity may file in  the window, the FCC seeks to avoid parties filing a large number of speculative filings, which create the potential for extraordinary procedural delays.  All filings must be submitted in MM Docket No. 95-31, and can be filed either in paper or electronically through the FCC's Electronic Comment Filing System. 

Posted By Brendan Holland In FM Radio , Noncommercial Broadcasting | Permalink | 0 Comments | Email entry

The past few days have been eventful ones in the battle over Internet radio royalties.  Appeals from the decision of the Copyright Royalty Board decision (see our memo explaining that decision, as well as our coverage of the history of this case) were submitted by virtually all of the parties to the case.  In addition, the National Association of Broadcasters, which had not previously been a party to the case, filed a request to intervene in the appeal to argue that the CRB decision adversely affects its members.  Also in Court, a Motion for Stay of the decision was submitted, asking that the CRB decision be held in abeyance while the appeal progresses.  The "appeals" that were filed last week are simply notices that parties dispute the legal basis for the decision, and that they are asking that the Court review that decision.  These filings don't contain any substantive arguments.  Those come later, once the Court sets up a briefing schedule and a date for oral arguments - all of which will occur much later in the year.  As the CRB decision goes into effect on July 15, absent a Stay, the appeal would have no effect on the obligations to begin to pay royalties at the new rates.

The Stay was filed by the large webcasters represented by DiMA, the smaller independent webcasters that I have represented in this case, and NPR.  To be granted a stay, the Court must look at a number of factors.  These include the likelihood that the party seeking the stay will be successful on appeal, the fact that irreparable harm will occur if the stay is not granted, the harm that would be caused by the grant of a stay, and the public interest benefits that would be advanced by the stay.  The Motion filed last week addressed these points.  It raised a number of substantive issues including the minimum per channel fee  set by the CRB decision, the lack of a percentage of revenue fee for smaller webcasters, and issues about the ability of NPR stations to track the metrics necessary to comply with the CRB decision.  The Motion raised the prospect of immediate and irreparable harm that would occur if the decision was not stayed, as several webcasters stated that enforcement of the new rates could put them out of business.

Posted By David Oxenford In Internet Radio , Noncommercial Broadcasting | Permalink | 0 Comments | Email entry

The FCC today issued the long-awaited text of its decision on Digital Audio radio - the so-called IBOC system.  As we have written, while adopted at its March meeting, the text of the decision has been missing in action.  With the release of the decision, which is available here, the effective date of the new rules can be set in the near future - 30 days after its publication in the Federal Register.  With the Order, the Commission also released its Second Further Notice of Proposed Rulemaking, addressing a host of new issues - some not confined to digital radio, but instead affecting the obligations of all radio operations.

The text provides the details for many of the actions that were announced at the March meeting, including authorizing the operation of AM stations in a digital mode at night, and the elimination of the requirements that stations ask permission for experimental operations before commencing multicast operations.  The Order also permits the use of dual antennas - one to be used solely for digital use - upon notification to the FCC.  In addition, the order addresses several other matters not discussed at the meeting, as set forth below. 

Posted By David Oxenford In AM Radio , Digital Radio , Emergency Communications , FM Radio , Multiple Ownership Rules , Noncommercial Broadcasting , Payola and Sponsorship Identification , Political Broadcasting , Programming Regulations , Public Interest Obligations/Localism | Permalink | 2 Comments | Email entry

The FCC announced that it will open a window for new noncommercial FM stations and major changes in noncommercial stations - with all applications to be filed between October 12 and October 19.  This is the first filing window to be opened for new noncommercial stations in almost 7 years, so the demand for these channels will no doubt be high.  The FCC's Public Notice just announces that the window will open, but does not provide any specifics - which are promised in a later public notice.

There are many issues that will need to be discussed in any subsequent notice.  First, the Notice released today indicates that the window will cover applications for stations in the noncommercial reserved band  - between 88.1 and 91.9 on the FM band.  However, since the last noncommercial window, the FCC has also reserved a number of allotted channels in the commercial band for noncommercial use - and these do not appear to be covered by the window notice.

Also, there have been discussions of the possibility of limiting applicants to a certain number of applications, or taking other actions to restrict the number of applications for these channels.  With the new point system adopted by the FCC since the last filing window, local applicants are favored over national groups that may file applications - so if applications are limited, these national groups may well be effectively foreclosed from obtaining any channels in the window, as the choice of  a limited number of channels may end up forcing these applicants to pick channels where there are local applicants who will prevail in any point system analysis.

We will see how this window develops in the coming months. 

Posted By David Oxenford In Noncommercial Broadcasting | Permalink | 0 Comments | Email entry

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. 

Posted By David Oxenford In FM Radio , Noncommercial Broadcasting | Permalink | 0 Comments | Email entry