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The President has nominated Thomas Wheeler as the next FCC Chairman, to become effective after confirmation by the US Senate. What does this mean for broadcasters? As we have said before, one never really knows what issues will drive a Chairman’s agenda. For this Chair, some issues are clear – like dealing with the incentive auction to reclaim some TV spectrum for wireless use, which is inevitably marching forward. Other issues are forced on the FCC – like dealing with the indecency issues still pending after Supreme Court remand, or the multiple ownership quadrennial review still pending at the Commission while waiting for the MMTC study on the effects of media cross ownership on the ability of minorities and other new entrants to get into broadcast ownership. And some are issues that for one reason or another capture the interest or attention or concern of the FCC Chair. Usually, these issues don’t become clear until after the Chairman assumes his position, but that has not stopped many in Washington from speculating what the new Chairman will do once he is confirmed.

Interestingly, the speculation ranges the gamut, from Free Press fearing that he will be too friendly to big business because of his past service as the head of two trade associations – NCTA (the cable television industry trade association) and CTIA (the wireless industry association), to the statement of Republican leaders of the House Energy and Commerce Committee, fearing that he will impose too many regulations on these same big business organizations. In short, the perspective on the nomination seems to be based, at least in part, on the initial perspective of those who muse about what it means.

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We’ve written extensively about copyright issues for audio services, but the big copyright decision that recently made headlines is a TV issue, though one that could have an impact on audio as well. That was the Second Circuit decision in the Aereo case – upholding a lower court decision allowing a company to retransmit over-the-air TV signals to consumers over the Internet – without any royalties to the TV broadcasters or television program producers. The decision looked at the issue of what defines a “public performance” that would require the consent of the copyright owner. The Court found that there is no public performance of television programming where the service is set up so that the programming is streamed to the viewer individually, at their demand, rather than transmitted all at once to multiple consumers – as by a cable system or a  satellite television service. The decision is a controversial one – decided by a 2 to 1 vote with the dissenting judge issuing a strong dissent arguing that the Aereo service was nothing more than a “sham” designed to evade the royalty obligations or copyright permissions that would be necessary if the service were deemed a cable system or other type of multichannel video provider. What does this decision really mean for television stations, and could it have broader implications for the reuse of all sorts of broadcast content on the Internet?

The decision focused on the question of whether the Aereo service “publicly performs” the programming that it sends to its subscribers. Under the Copyright Act, a copyright owner has a bundle of rights which it has the exclusive ability to exploit. This includes the right to copy the copyrighted work, to distribute it, to make a “derivative work” (a work that uses the copyrighted material and changes it in some way - like putting new words to the melody of a copyrighted song), and the right to publicly perform it. The definition of a public performance includes any transmission or retransmission of a performance to multiple individuals at the same time or at different times. This language was added to the Copyright Act at the time of the advent of cable television, to make clear that services like cable, that take an existing performance (like that of a broadcast television station) and then further transmit it to other people (even people who could theoretically pick up the original performance) were themselves making a public performance that needed the consent of the copyright holder or a government-imposed statutory license (which allows the performance as long as the party making the performance pays the copyright holder an amount set by the government). From a cursory look, it would appear that Aereo is retransmitting the signal of the TV station to all of its customers. Why, then, did the Court rule that no public performance was involved?

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With broadcasters making their way to the NAB Convention in Las Vegas, the FCC on Friday provided one topic for conversation among TV broadcasters – issuing a Public Notice imposing a freeze – effective immediately – on the filing of any technical application by any licensee or permittee of a full power TV station or a Class A station if that application which would increase their protected service area. The freeze was imposed, in the words of the FCC, in order to “facilitate analysis of repacking methodologies and to assure that the objectives of the broadcast television incentive auction are not frustrated.”  In other words, the FCC wants a stable TV database from which it can begin the process of repacking TV stations into a smaller portion of the TV spectrum to facilitate the auction of parts of the TV spectrum recaptured after an incentive auction for wireless broadband purposes.

According to the notice, the Media Bureau will no longer accept the following types of applications:

·       Modification applications (and amendments to pending modification applications) by full power and Class A television broadcast licensees and permittees for changes to existing service areas that would increase a full power station's noise-limited contour, or a Class A station's protected contour, in one or more directions beyond the area resulting from the station's present parameters as represented in its authorizations (licenses and/or construction permits).

·       Class A displacement applications that would increase a station's protected contour.  (However, the Bureau will continue to accept Class A minor change applications to implement the digital transition (flash cut and digital companion channel) subject to current rule limitations.  

The Notice states that the Bureau will consider requests for waivers of the freeze, on a case-by-case basis “when a modification application is necessary or otherwise in the public interest for technical or other reasons to maintain quality service to the public, such as when zoning restrictions preclude tower construction at a particular site or when unforeseen events, such as extreme weather events or other extraordinary circumstances, require relocation to a new tower site.” So, if your tower collapses and you need to move to a different site, a waiver may be possible, but improvements for the sake of improving a station’s signal will most likely be prohibited by the freeze.

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April is one of those months in which many FCC obligations are triggered for broadcasters. There are the normal obligations, like the Quarterly Issues Programs lists, that need to be in the public file of all broadcast stations, radio and TV, commercial and noncommercial, by April 10. Quarterly Children's television reports are due to be submitted by TV stations. And there are renewal obligations for stations in many states, as well as EEO Public File Reports that are due to be placed in station's public files and on their websites. The end of March also brings the obligation for television broadcasters to start captioning live and near-live programming that is captioned on air, and then rebroadcast on the Internet. Finally, there are comment deadlines on the FCC's proposal to relax the foreign ownership limits, and an FM auction and continuing FM translator filing requirements.

Radio stations in Texas and television stations in Tennessee, Kentucky and Indiana have renewal applications due on April 1. The license renewal pre-filing broadcast announcements for radio stations in Arizona, Idaho, Nevada, New Mexico, Utah and Wyoming, and for TV stations in Michigan and Ohio, must begin on April 1. All of these stations will be filing their renewals by June 1. EEO Annual Public file reports for all stations (radio and TV) with five or more full-time employees, which are located in Texas, Tennessee, Kentucky, Delaware, Pennsylvania or Indiana, must be placed in their public files (which are now online for TV broadcasters) by April 1.   Noncommercial radio stations in Texas, and noncommercial TV stations in Tennessee, Indiana Delaware, Pennsylvania, and Kentucky must also file their Biennial Ownership Reports by April 1. 

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Earlier today, we wrote about the FCC's reminder that TV broadcasters must, by February 4, complete the upload to their FCC-mandated online public inspection file all materials from the current renewal term that were created prior to the August 2 effective date of the online public inspection file requirement.  We noted that the FCC had not addressed the question of stations that had outstanding renewals from the last renewal term - which could potentially mandate that some stations upload as much as 16 years worth of material to their online files.  Well, today, the FCC issued another decision waiving its rules so that stations only need to post Quarterly Issues Programs lists from the current license term on their online public files - subject to some caveats.

There are certain limits on this waiver.  If the limits are not met, then all Quarterly Issues Programs lists, back to the last granted renewal, have to be posted to the online public file.  The limits include the following:

1. The last renewal cannot have been opposed by a member of the public.
2. The delay in the renewal cannot have been caused by issues relating to the public interest service of the station to its local service area
3. The station must continue to keep the Quarterly Issues Programs lists from the last renewal cycle at the station in a paper public file.

This decision does not relieve stations from all obligations to post materials from prior renewal terms, as described below.

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The six months that the FCC gave to television stations to upload the contents of their paper public files to their new online public file seemed like a long time back in August, when the deadline was announced and the online public file rule became effective. But that deadline is upon us, and the FCC yesterday issued a reminder that television broadcasters (full power and Class A stations) need to have all of their required documents uploaded to their online public file by Monday, February 4.  The 6 month deadline actually falls on the weekend, so the FCC has given stations to the end of the day on Monday to come into compliance. The Commission has even offered to have people at the FCC over the coming weekend to answer questions about the uploading process for all those waiting until the last-minute to comply. 

As made clear in the public notice, no broadcasters need to upload contents of their political files that existed prior to the August 2 effective date of the rules. TV Broadcasters who are affiliates of the Big 4 networks in the Top 50 markets should already be uploading new political file material onto their online files, while other TV broadcasters have until July 1, 2014 before they are subject to the requirement that they upload their new political materials to the online file. In neither case do stations have to upload political file materials that precede the date that the obligation applies to their station. 

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February is almost upon us, and it brings a host of regulatory obligations for broadcasters – as well as the filing deadline for those interested in pursuing new FM channels in an upcoming auction, and a number of opportunities to comment on important FCC proceedings. The week before last, TV NewsCheck published our latest quarterly update on the regulatory issues facing television broadcasters – and these include several with February dates. Most importantly (at least in the short term), there is the obligation for television broadcasters to upload to their Online Public Inspection file all documents created before the August 2 effective date of the rules (but for documents relating to political broadcasting).   So documents that had been kept in paper – like Annual EEO Public Inspection File Reports and Quarterly Issues Programs Lists – need to be in the Online Public File by the beginning of the month. 

In the longer term, while not due in February, comments to be filed this Friday (January 25) on the television incentive auction process, will need to be analyzed in preparation for the Reply comments due on March 12 in this most important proceeding which may well define the composition of over-the-air television in the coming years. Comments on the FCC proceeding on expanding the information gathered in the Form 323 Biennial Ownership Reports are also due in February – just in time for Valentine's Day on the 14^th. 

 

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Every year, about this time, I dust off the crystal ball to offer a look at the year ahead to see what Washington has in store for broadcasters. This year, like many in the recent past, Washington will consider important issues for both radio and TV, as well as issues affecting the growing on-line presence of broadcasters. The FCC, Congress, and other government agencies are never afraid to provide their views on what the industry should be doing but, unlike other members of the broadcasters' audience, they can force broadcasters to pay attention to their views by way of new laws and regulations. And there is never a shortage of ideas from Washington as to how broadcasters should act. Some of the issues discussed below are perennials, coming back over and over again on my yearly list (often without resolution), while others are unique to this coming year.

Last week, we published a calendar of regulatory deadlines for broadcasters.  This article looks ahead, providing a preview of what other changes might be coming for broadcasters this year – but these are delivered with no guarantees that the issues listed will in fact bubble up to the top of the FCC's long list of pending items, or that they will be resolved when we predict. But at least this gives you some warning of what might be coming your way this year. Issues unique to radio and TV, and those that could affect the broadcast industry generally, are addressed below.

General Broadcast Issues

 

There are numerous issues before the FCC that affect both radio and television broadcasters, some of which have been pending for many years and are ripe for resolution, while others are raised in proceedings that are just beginning. These include:

 

Multiple Ownership Rules Review: The FCC is very close to resolving its Quadrennial review of its multiple ownership proceeding, officially begun in 2011 with a Notice of Proposed Rulemaking. The rumors were that the FCC was ready to issue an order at the end of 2012 relaxing the rules against the cross-ownership of broadcast stations and newspapers, as well as the radio-television cross-interest prohibitions, while leaving most other rules in place. TV Joint Sales Agreements were also rumored to be part of the FCC's considerations – perhaps making some or all of these agreements attributable. But even these modest changes in the rules are now on hold, while parties submit comments on the impact of any relaxation of the ownership rules on minority ownership. Still, we would expect that some decision on changes to the ownership rules should be expected at some point this year – probably early in the year. 

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The care and feeding of the broadcaster's public file is a hot topic once again. For many years, the public file was often overlooked, being visited most often by competing broadcasters looking for dirt on their cross-town rivals, or by college journalism students assigned a project by their professor requiring the review of local stations' files. But, with the debate that occurred earlier this year over the online public file for television stations, the file has received much publicity, being the subject of review and analysis in the popular and academic press, as well as in the broadcast trade journals. This week, the FCC issued a reminder about the obligations of a television broadcaster for complying with the public file rules (see that reminder here). In the past two weeks, I've conducted two seminars for broadcast groups on the public file obligations of stations. The first was a webinar for 20 state broadcast associations and their members, organized by the Michigan Association of Broadcasters. The PowerPoint slides used in that presentation are available here.

The slides set out information about the importance of the file, and provide some description of the required contents of the file, and the retention period for documents that need to be contained in the file. Radio stations have the obligation to place all of the required documents in their local, paper files and maintain them there for the appropriate period of time. TV stations, with the advent of the FCC-hosted public file (see one of our previous posts on the mechanics of the online file here), actually have a somewhat easier time in meeting some of their obligations – as the FCC itself will post to the file all documents that stations are required to file with the FCC – including renewal and technical applications, ownership reports, children's television reports, coverage maps, the station license and the Public and Broadcasting procedure manual. Radio stations need to find all of these documents and manually place them into their files. TV stations need only upload other information that is not filed at the FCC – like Quarterly Issues Programs lists, annual EEO Public File Reports, and certifications as to the station's compliance with the Children's television commercial limits. Beyond these basics, in the seminars that I recently conducted, several other interesting questions were raised.

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The CALM Act, meant to end the dreaded "loud commercial," is set to go into effect tomorrow, December 13. We summarized the requirements for compliance with the Act here. Basically, TV stations must adopt certain practices set out in a series of standards known as A/85 Recommended Practice, adopted by the ATSC (the Advanced Television Standards Committee). As we advised stations, the rules initially required any station needing more time was supposed to ask for a waiver of the rules by October 12. In an Order released on Tuesday, the FCC granted two waivers, and also decided that any other station needing more time could request a waiver as late as the compliance deadline date.

In the order, the Commission granted two waiver requests - one for just a month and a half as the cable system simply had a misunderstanding of what they needed to do to achieve compliance, and the second until the end of May because a TV station was in the middle of a studio move, and promised to install the new compliant equipment at the new studio. The Commission also reminded stations that there are two kinds of waivers available – automatic waivers, upon request, for small stations (those with under $14 million in annual revenue or in a TV market from number 150 to market 210) and small cable systems; and other waivers for stations facing specific problems, including financial hardships. Those who do not qualify as small stations would need to demonstrate the specific hardship justifying the waiver. So any stations or systems seeking a waiver have a last chance to do so, by Thursday.

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With Hurricane Sandy bearing down on the US East Coast, the FCC has issued reminders to consumers and communications companies about what to do in areas affected by the storm. Late Friday, it issued two public notices. The first public notice advised broadcasters and other communications companies that the FCC will be available 24-7 over the weekend and during the storm to answer calls about service outages, to assist where possible in restoring any lost service, and to issue emergency authorizations for temporary facilities.  As we have written before, the FCC has been helpful in past disasters - seemingly able to bridge bureaucratic barriers that might otherwise delay the restoration of communications services.  The second public notice was directed to consumers, telling them to try a variety of means to communicate if one service is not working, suggesting text messages if mobile networks are affected by the storm, and urging that communications be kept short and limited to immediate needs so as not to overload any communications systems.

The FCC did not issue another notice that is usually issued in these circumstances, but we will remind television broadcasters and other video providers of their obligations to visually present any information that identifies an immediate threat or which conveys actionable information about an emergency to the public.  This information was related to broadcasters in a Public Notice issued just before Hurricane Isaac reminding video providers - particularly television stations, but other video providers as well - that they need to visually present emergency information that they may be conveying verbally on the air so that the hearing impaired have access to that information, and similarly that information that is provided visually (e.g. through a crawl), be also provided aurally, or at least alert tones must be used to put the visually-impaired on notice of the fact that emergency information is running on the station.  It is important that video providers remember this obligation, as many complaints are filed with the FCC each year by groups who represent those with a disability, calling television stations to task for not meeting their captioning obligations.

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This Friday (October 12) is the deadline for requesting a waiver under the FCC’s Commercial Advertisement Loudness Mitigation (“CALM”) Act implementing procedures, intended to combat "loud commercials."  We wrote about the implementing rules and the obligations of television stations to come into compliance with the standards set out in the rules, adopting a protocol that seeks to maintain consistency between commercials and surrounding programs, here. The Commission’s order allowed for waiver requests by stations that would have a financial hardship in complying – with such waivers being due 60 days before the compliance deadline. As that deadline for compliance is December 13, the waiver requests are due on Friday.

All such waiver requests must be submitted through the FCC’s Electronic Comment Filing System.  Waiver applicants must demonstrate that purchasing the required equipment would result in “financial hardship.”  Such waivers, if granted, will be valid for one year and may be renewed for one additional year.  The FCC also retains the authority to issue a waiver for good cause.  “Small stations” are eligible for a streamlined waiver process for demonstrating financial hardship.

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The FCC has released its agenda for its September meeting, and it is an important one for television broadcasters. On the agenda for the meeting to be held this Friday, September 28, is a Notice of Proposed Rulemaking to seek comments on its proposals to implement the Congressional authority to hold incentive auctions to clear part of the television spectrum so that the spectrum can be used for wireless broadband purposes (see our summary of the legislative authority here). Obviously, this will decision will be important for the television industry, as well as for companies looking to deploy additional wireless broadband and those hoping to reach consumers using wireless broadband.

This proceeding will necessarily be very complex, as it will need to design a system that will take into account many moving parts. First, it will need to take bids from those television stations that are willing to turn in their licenses, or to share spectrum with another station or move to a VHF channel – all of which might qualify the station for compensation. While keeping these bids secret, the Commission must also take bids to buy the cleared spectrum from wireless companies.  The Commission needs to determine if enough money will be received from these bids to pay for stations to turn in their licenses, to repack the remaining TV stations into a smaller television band that will free some television channels to allow for a contiguous swath of spectrum that the wireless operators can use, to pay the auction costs, and to pay for certain public safety wireless uses that are to be subsidized by the auction proceeds. The Commission will also have to design a process for repacking TV stations into a smaller television band, in many ways replicating the process that the FCC went through when it compacted the TV spectrum during the digital transition.

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With Hurricane Isaac soon to make landfall on the Gulf Coast, the FCC is issuing its usual reminders to broadcasters and other communications facilities in areas that are likely to be affected by the storm.  It has today issued two public notices.  The first Public Notice reminds video providers - particularly television stations, but other video providers as well - that they need to present visually emergency information that they may be conveying verbally on the air so that those that are hearing impaired have access to that information, and similarly that information that is provided visually (e.g. through a crawl), be also provided aurally, or at least alert tones must be used to put the visually-impaired on notice of the fact that emergency information is running on the station.  A second public notice tells communications users that they can use the FCC's Disaster Information Reporting System ("DIRS") to notify the FCC about service outages that may be caused by the storm

The information about making emergency information accessible is one that is commonly issued by the FCC (see our stories here and here about past warnings).  The FCC reminds  video providers that emergency information must be made available to those with hearing or visual impairments.  For those who are hearing impaired, information must either be provided by closed caption, or by some other means that does not block the closed caption information.  Even where a station is exempt from captioning a story - as many are in the case of breaking news - a visual element must still be provided for all audio information given on the air about "critical details regarding the emergency and how to respond to the emergency."  So stations should do open captions or have their on-air announcers use whiteboards or other means to visually convey the emergency information that they are providing in their commentary.  In the past, big fines have followed from stations that have not provided such information visually (see our post here), and the FCC has made the complaint process easier in recent years, as highlighted by today's Public Notice.

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 The Online Public File for television stations is now a reality. While appeals of the imposition of the rules remain pending, both the FCC and the US Court of Appeals denied stays of the August 2 effective date for the new requirements, so full-power and Class A television stations should now be complying with the new obligations to maintain their public files online. The Online Public File is hosted by the FCC, and uses the FCC’s newly created system for uploading, storing and accessing the documents. So far, the system seems to be functioning with a minimum of problems, though one or two glitches have been reported here and there.

Documents that stations file with the FCC are supposed to be uploaded to the Online Public File automatically by the FCC, so individual stations do not need to worry about importing them into the new system. We have heard that this may not have occurred in every instance, so stations should check their files to be sure that the proper uploading has in fact occurred. Other documents will need to be uploaded by the stations themselves, and stations will also be responsible for maintaining and monitoring the file, and deleting documents when their retention is no longer required.

Just what are the requirements for the new online public file? The FCC has put out its own Frequently Asked Questions, available here. There are many other questions that will no doubt arise over time.  We have tried to do our own summary of the obligations as we know them in the answers to common questions that we are getting about the obligations under the new rules.  Those questions and answers are set out below.

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The over-the-air reception of television stations has taken on heightened awareness in recent years.  In the regulatory world, this prominence comes from the FCC's consideration of taking back some of the broadcast spectrum for use by wireless broadband based at least partially on the Commission's belief that broadcasters are not using that spectrum efficiently as many viewers,over the last few decades, receive their TV programming from satellite and cable providers.  At the same time, there have been more articles in the press and anecdotal stories about the new importance of over-the-air reception as people "cut the cord', getting their video programming from some combination of over-the-air TV and the Internet.  Regardless of the truth of either perception, since the conversion to digital, issues about TV antennas have become more important as, in many places, an outdoor television antenna is necessary (or preferable) for decent over-the-air DTV reception.  One issue that many television broadcasters have overlooked is that of OTARD - the FCC rules on over-the-air reception devices.  As we wrote here, these rules have been interpreted to significantly limit the ability of landlords and local governments to adopt zoning rules or restrictive land-use policies forbidding outdoor TV antennas or small satellite dishes for the reception of video programming. This week, the FCC asked  if the restrictions on local authorities should also apply to common areas of housing complexes. 

The rules have traditionally been applied to restrict limitations on antennas and small dishes on property owned by the party wanting to make the installation, or property leased by that party and  even to common areas under the exclusive control of the lessee (like the portion of a driveway or parking area reserved for use by the tenant).  The FCC has allowed landlords and tenants associations to restrict the placement of OTARD devices in common areas not subject to tenant control.  But the FCC has not addressed whether local government authorities can restrict the location of antennas and dishes in these common areas.  The Satellite Broadcasting and Communications Association and DISH and DirecTV have asked the FCC to rule that, under OTARD rules, local authorities can't pass laws restricting the location of TV antennas and small dishes in these common areas, reasoning that if the owners of the land don't care, government should not be able to restrict the use of reception devices there, just as the government can't restrict the installation of these reception devices on property under the control of a tenant or home owner.  This week, the FCC asked for comments whether the OTARD rules should apply to government restrictions over TV reception devices in these common areas.  Comment are due on June 7.  Reply Comments are due on June 22.

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The FCC has released the text of its Report and Order adopted last week, authorizing full power and Class A TV stations to share spectrum as part of the band clearing process for future wireless broadband spectrum auctions.  This action was authorized by Congress in the Spectrum Act, which became law in February as part of the Middle Class Tax Relief and Job Creation Act of 2012.  We summarized the Spectrum Act in a previous blog available here.

The Report and Order allows full power and Class A TV stations to enter into agreements whereby two stations will share one six MHz channel, thereby allowing one station to return its existing channel to the FCC for cancellation and availability in the upcoming spectrum auctions.  Presumably, one six MHz channel is sufficient bandwidth to support two HD channels.  In the Notice of Proposed Rulemaking for this proceeding, the FCC said it would let the sharing stations decide how much bandwidth each station would get.

The station giving up its channel would be entitled to compensation in the so-called "reverse auction" to be held by the FCC, subject to receipt of compensation deemed acceptable by the licensee.  Presumably, that compensation would be shared with the station giving up part of its 6 MHz band to allow the two stations to share that bandwidth.  The amount of compensation each station would get would likely be determined in their sharing agreement.

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At its meeting today, the FCC voted to require that television stations maintain most of their public inspection files online, in a database to be created by the FCC (see the FCC's Public Notice here).  While the details about this obligation have not yet been released, from the comments at the FCC meeting, much is already evident.   All TV stations will have to post their files to an online server to be maintained by the FCC.  Proposals for new obligations to post information about sponsorship identification and shared services agreements have been dropped, at least for now.  Most documents not already online at the FCC will need to be uploaded within 6 months of the rule becoming effective.  And, in the most controversial action, broadcaster's political files will need to be posted to the new online database, though in a process that is to be phased in over time.

The political file obligation will apply at first only to affiliates of the Top 4 TV networks in the Top 50 markets.  And only new information for the political file will need to be posted.  Information in the file before the effective date of the order apparently will not need to be posted online, at least not initially.  The requirement for posting the political file online will be reviewed in a proceeding to begin one year after the effective date of the new rules.  As stations outside the Top 50 markets, and other stations in those large markets, will not need to comply with the political file obligations until July 2014, the FCC will be able to reexamine the impact of the disclosure obligations before the compliance obligation for the political file expands to all stations. 

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Three broadcast items are tentatively scheduled for the next FCC meeting, to be held on April 27, according to the tentative agenda released today.  In one expected action, though perhaps moving more quickly than many thought possible, the FCC has indicated that it will adopt an Order in its proceeding requiring TV broadcasters to place and maintain their public files on the Internet.  A second broadcast item will adopt rules for channel sharing by TV broadcasters as part of the plan for incentive auctions to entice TV broadcasters to give up some of their spectrum for wireless broadband use.  Finally, the FCC proposes to adopt a NPRM on whether to amend current policies so as to permit noncommercial broadcasters from interrupting their regular programming to raise funds for organizations other than the station itself.

The first item is to determine whether to require that the broadcasters maintain an Online Public Inspection File, is a controversial issue about which we wrote last week. The proposal for the online file grew out of the FCC's Future of Media Report (renamed the Report on the Information Needs of Communities when it was released last year, see our summary here).  In that same report, it was suggested that the FCC relax rules applicable to noncommercial broadcasters that limit their on-air fundraising for third-parties, if that fundraising interrupts the normal course of programming.  The Future of Media Report suggests that this restriction be relaxed so that noncommercial broadcasters be able to do block programming from time to time to raise funds for other noncommercial entities

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As technology changes, the definitions in the FCC rules don't always keep up.  In a public notice released last Friday, the FCC asked for public comment on what its definition of an "MVPD" - Multichannel Video Programming Distributor - means for purposes of its program access rules. These rules limit exclusive contracts for certain programming that one would normally think of as network cable programming, in order to make that programming available to competing distribution technologies (see this discussion of the application of these rules).  Traditionally, these rules (set out in Section 76.1000-76.1004 of the FCC's Rules) have been thought to require access to this programming by cable, satellite and other companies with their own distribution facilities (i.e. their own wires or spectrum licenses).  Now, with so much video being delivered over the Internet, companies have begun to offer cable-like services by IP-based delivery mechanisms, and they want access to that programming.  Because of these demands for program access, the FCC has asked for these comments.

The proceeding is summarized more thoroughly in our firms Advisory, available here.  As set out in the advisory, the issues on which the FCC is asking for comment could have broader implications should these IP-based systems be deemed to be MVPDs.  For television broadcasters, such a definitional change could signal the need to reexamine the rules regarding the carriage of local television stations, including whether the must-carry and retransmission consent scheme would have to be grafted onto these Internet-delivered services, a requirement that has thus far been rejected by courts and the FCC.  A reexamination of these definitions, should it occur, could have broad implications.  Comments are due on this matter on April 30, with replies due on May 30. 

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While the FCC has not yet started a proceeding to set rules for the auction of television spectrum for broadband purposes, the Commission is taking steps to clear the spectrum in other ways.  Two weeks ago, we wrote about the FCC's actions proposing to remove the Class A designation from certain LPTV stations that had not met their children's television obligations.  Since then, the FCC has gone further - proposing to take away Class A status for stations that had been off the air for significant periods of time - even with FCC permission as, according to the FCC, they could not have met the requirement for Class A TV stations that they must provide significant local programming each week (see FCC releases here, here and here, all proposing the termination of Class A status for stations that had been off the air for much of the last two years).  Given that Class A stations are as protected in the same way as a full-power TV station from being permanently displaced by the FCC in any spectrum clearing for broadband, the loss of Class A status may well deny these stations a place on the dial after any repacking of the TV band to accommodate a spectrum auction, or they may not be able to receive any share of the proceeds from any incentive auction that would be available to a Class A station that decided to turn in its license in exchange for compensation from auction proceeds.

In another decision released this week, the FCC denied the request of a television station to move from Hagerstown Maryland to a close-in Washington DC suburb.  While part of the basis for the denial was perceived procedural issues, the FCC also specifically stated that "the Commission's priorities no longer support such a move" of a station into a Top 10 market while it was considering the consolidation of the TV band to clear parts of it to be auctioned for broadband.  So it appears that, for the foreseeable future, there will be no move-ins of rural TV stations toward any major market.  

And don't expect to get any slack for rule violations by a Class A TV station, as it seems clear that the FCC is looking to clear the TV band, to the extent possible, to make its job in the incentive auction easier (see this $13,000 fine for a Class A TV station that did not have all required children's television reports in its public file).  With license renewal coming up for TV stations starting in June, TV stations, especially Class A stations, need to make sure that there houses are in order, as the FCC certainly will be looking carefully.

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While rumors are flying that the FCC is rushing to adopt its proposals to require that TV stations put their public inspection files online (see our summary of the proposals here), both the FCC and public interest groups are targeting the public files of television stations - looking to copy some or all of those files.  Rumors are that the FCC inspected the public files of all television stations in at least one city - and asked for copies of the complete files to be produced at the FCC within a day or two, in some cases requiring the copying of several file cabinets worth of material very quickly.  Whether this inspection is a one-shot deal or the start of a program to audit the files of TV stations across the country is unclear.  At the same time, public interest groups have been urging their members to inspect TV station public files across the nation, to copy parts of those files, and to post the information that they collect online.  TV stations across the country need to be prepared for these inspections.

Why these actions now?  Some may think that the FCC is just conducting a random audit, while others may suggest that the demand for complete public files is just a fact-finding mission as part of its rulemaking process.  The more suspicious of broadcasters may think that this represents the FCC sending a message that the online public file is coming, and stations may find it easier to accept the online file rather than facing these demands for the instant reproduction of their entire files to be inspected at leisure in Washington. 

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We recently wrote about the FCC's new rules requiring the captioning of television video retransmitted on the Internet.  Those rules have now been published in the Federal Register, which sets the effective dates for the implementation of those rules.  The rules become effective on April 30, which means that any video that is broadcast on TV on or after that date, that has captions when broadcast, must also have such captions when transmitted online at any time after September 30 (giving parties some time to work out technical issues with online captioning).  Further details about this deadline, and the deadlines for captioning other video that is distributed online, is available in our Advisory on the Online Captioning Compliance Deadlines, here. 

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Congress finally has given to the FCC authority to conduct spectrum auctions to reclaim parts of the TV spectrum for wireless users, and most DC-based industry associations, including the NAB, have reacted favorably. For a process that was so controversial, this seems like a very favorable result. Television stations, in particular, will have much relief from concerns about the forced-reallocation of their operations to less favorable spectrum. While most trade press reports have reported on these statements and the very general outlines of the legislation, few have looked closely at the provisions that apply to the broadcaster auctions. Just what do they provide?

The auction provisions were adopted as part of the legislation that just extended the Social Security payroll tax deduction rollbacks, extended unemployment benefits, and fixed certain limitations that had arisen on Medicare reimbursements to doctors. All these benefits needed offsetting revenues to avoid unduly increasing the Federal deficit, and the one seemingly easy place to “find” money, was through spectrum auctions. So Congress ordered the President to identify certain Federal spectrum that could be made available for wireless users, and also authorized the FCC to conduct auctions of broadcast spectrum, but under the very specific guidelines set out below.

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In the wake of Commission's rejection of hundreds of closed captioning waivers last year, many small television producers are now seeking new waivers for relief from the Commission's television closed captioning rules.  Last October, the Commission overturned nearly 300 "economically burdensome" captioning waivers on the grounds that the FCC had failed to apply the correct standard of review and had failed to follow the proper procedure for considering the requests on a case-by-case basis after public comment.  (See our earlier posting here for further details about the Commission's October decision.)  Since that decision, over 150 new waiver requests have been filed with the FCC, with most of them coming in the past month or so.  The vast majority of these waiver requests have been filed by very small program producers who assert that requiring closed captions for the television program they produce would be economically burdensome.  These waiver requests often involve religious programs, local real estate shows, and local sports or entertainment programs. Consistent with FCC's October clarification, the Commission's Consumer and Governmental Affairs Bureau is releasing Public Notices soliciting comment and input on each waiver request.  So far, the Commission has issued 14 such public notices in the past few days.  An example of one such notice is available here.  Once the particular request is put out for public notice, interested parties will have 30 days to file comments or oppositions with the FCC.  The recent public notices are careful to instruct parties to file comments or oppositions with the Commission in paper.  Any comments or oppositions sent via email will not be considered part of the official record. 

The Commission's October decision clarified the proper standard to be applied when considering a request for waiver of the television closed captioning rules on the basis that compliance would be economically burdensome.  Although that decision confirmed that the bar for obtaining a captioning waiver is rather high and requires a thorough and well-supported showing, most of the recent waiver requests that have been filed in the past month or two are very short and lack supporting documentation. Given the large number of such small television program producers, it is likely that many similar waiver requests will continue to be filed in coming weeks.  But as many of the recent waiver requests appear to lack the proper supporting documentation and detailed showing that the Commission expects, it seems that many of these requests for waiver of the captioning rules are destined to fail.  In fact, many of the requests appear to consist of little more than a letter to the FCC stating that compliance would be impossible and asking that the Commission waive the captioning requirement.  As the Commission is just starting to solicit comments on these waivers and to consider the requests, decisions are at least a month or two away.  If small program producers do not have the ability to caption their shows on their own and cannot obtain a waiver of the Commission's rules, then they will either need to find additional sponsorship to defray the costs, convince a television station or cable operator to assist with the costs, or else cease producing the program.  We will continue to track the FCC's consideration of these waiver requests and will provide future updates. 

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This afternoon, the FCC released its long-anticipated Report and Order (R&O) setting forth the Commission’s new closed captioning rules for IP-delivered video programming, pursuant to the 21st Century Communications and Video Accessibility Act (CVAA). 

As we explained when the rules were first proposed in September, the CVAA directed the FCC to establish how and when certain IP-delivered video programming must be captioned, as well as the closed captioning capabilities for devices used to view video programming. The R&O adopts closed captioning requirements for owners, providers, and distributors of IP-delivered video programming; a safe harbor technical standard and delivery format for IP video captions; a staggered compliance schedule; complaint rules; and requirements for manufacturers of devices used to view the video programming at issue.

We are currently reviewing this comprehensive rulemaking, and will post our in-depth review next week, both here and on our DWT Advisories page.

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The FCC has extended the comment deadline in two proceedings looking at imposing new public interest obligations on TV broadcasters (and potentially, at some point in the future, on radio stations as well).  Both proceedings are an outgrowth of the FCC's Future of Media Report, that suggested that broadcasters be made to be more responsive to their communities through better documentation of how they are meeting their public interest obligations.  We mentioned in our post on January FCC deadlines last week, that the reply comment deadline on the Notice of Proposed Rulemaking on the online public inspection file, which was originally scheduled for last week, has been extended until January 17.  In addition, the initial comments on the Notice of Inquiry on the development of a form on which broadcasters would report on their public interest programming (to replace the Form 355 that was adopted but never implemented) were due on January 17, but the due date for those comment has been extended until January 27, with replies now due on February 9.  We summarized the issues raised by the online public file notice of proposed rulemaking here, and those set out in the Notice of Inquiry on the new form to document the public interest service of TV broadcasters here.  File comments as to how these proposals would affect your operations, and watch to see what action the FCC takes later this year in these very important proceedings. 

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In addition to the normal FCC deadlines for routine filings, January brings the deadline for comments in a number of FCC proceedings, and a filing window for new FM applications.  For TV stations, the Commission recently extended to January 17 the Reply Comment deadline on its proposals (summarized here) for an online public inspection file.  Many public interest groups have supported the FCC's proposals to put the public file online, including the political file and new information concerning sponsorship identification information, while broadcasters have expressed concerns about the burden and practicality of an online file with all the information that the FCC is considering.  Comments are also due on January 17 on the related Notice of Inquiry looking into the adoption of a new form to document the public interest programming of TV broadcasters to replace the never-effective Form 355.  Comments deadlines on Petitions for Reconsideration of two other rulemaking decisions - on the adoption of rules allowing AM stations to use FM translators, and the Rural Radio proceeding - are due on January 4 with replies on January 17.  That the FCC only now sought comments on the 3 year old Reconsideration petitions in the AM translator proceeding is unusual, as the issue raised by the reconsideration petitions has also been incorporated in the recent FCC proceeding looking at the relationship between FM translators and LPFM opportunities.

We just reminded broadcasters of the new FM window, where applications for 119 new FM channels can now be filed between now and the January 12 deadline.  Broadcasters also need to remember to complete their Quarterly Issues Programs lists, and place them in their public file, by January 10.  As we've written, there are big fines for stations who forget to complete these reports and have to report their absence at license renewal time.  See our advisory on the Quarterly Issues Programs Lists, here, and also our advisory on Children's Television obligations, including Form 398, that needs to be filed at the FCC by January 10, along with a public file report documenting compliance with the limitations on commercial advertising in children's programming . 

For more information on many of the routine regulatory deadlines for broadcasters, see our Broadcasters Calendar for 2012 here.

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The FCC approved the first database manager for TV white spaces devices - those wireless communications devices that will operate in the spectrum currently used by broadcast television, operating on channels not in use in a given area and supposedly avoiding interference to the reception of over-the-air television stations.  Spectrum Bridge is the first company to be approved to act as a database manager, though there are several other companies who have applied and whose systems are in various stages of development and testing.  The database manager is to keep a list of all of the services that a white spaces device needs to protect from interference, and be able to transmit that information to devices to tell them what channels they can use in a given geographical area.  Protection must be accorded not only to TV stations and TV translators and LPTV stations, but also to the receive sites of Multichannel Video Programing Distributors (cable and satellite TV), certain broadcast auxiliary operations, off-shore telephone services and radio astronomy users, some land mobile operators, and certain wireless microphone users.  Today's Public Notice specifically addresses how wireless microphone users need to register with the FCC to be protected from interference.

The Spectrum Bridge database was tested a few months ago, and the FCC's letter outlines a number of concerns expressed about its operations.  These include several problems encountered by the NAB in registering sites that were supposed to be protected by white spaces devices.  While licensed facilities of TV stations and land mobile users are available from the FCC's own database, receive sites for MVPDs and translators need to be registered, as do the location of certain mobile broadcast auxiliary stations.  The FCC ordered Spectrum Bridge to re-open its database for the registration of additional sites to be protected, and said that this would provide registrants the ability to test the modifications to the system in the coming weeks before the system becomes operational. 

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The FCC this week adopted its rules implementing the CALM Act to address the public perception that commercials are too loud – louder than the programming which they accompany. Congress passed a law last year requiring that the FCC address the issue, and this week’s order adopts these implementing rules which will go into effect on December 13, 2012 (see our articles on the passage of the Act here, and on the Notice of Proposed Rulemaking in this proceeding here). The rules adopted by the FCC allow television stations and MVPDs (multichannel video programming distributors – cable and satellite TV companies) to meet the requirements of the Act by relying on the A/85 Recommended Practice, a standard adopted by the ATSC (the Advanced Television Standards Committee) setting out a process by which these TV providers can assure that commercials that they insert into program streams are not louder than the programs that they accompany. The rules also allow a safe harbor by which stations and MVPDs can comply with the Act in connection with “embedded commercials”, i.e. commercials that are sent to the station or system by a network or other program supplier.

The specific requirements for compliance with the new rules depend on whether the advertisements that are being broadcast are originated by the station or system, or whether they come embedded from some third-party program provider. For commercial insertions by the station or MVPD, compliance is assumed if they install the equipment required by A/85, use it in connection with their insertions, and maintain and repair it as necessary to keep it in good working order. For embedded commercials, stations can run all the programming through some sort of real time processing to ensure that the audio loudness is uniform. However the Commission was concerned would audio processing would degrade the audio quality of the programming provided by third parties. Thus, the Commission offered an alternative safe harbor with respect to embedded advertising. To comply with the safe harbor, stations and systems would either:

• Rely on widely available certifications from networks and other program suppliers that they have complied with the standards necessary to assure that the commercials are no louder than the programming in which they are embedded, or
• The stations and systems will need to perform “spot checks” on programming for which they have obtained no certification. Spot checks are done as follows:
  • Large stations (with over $14 million in annual 2011 revenue based on BIA Media Access Pro information) and very large MVPDs ( those with over 10 million subscribers) needs to annually spot check 100% of their non-certified programming. Large MVPDs (those with between 500,000 and 10 million subscribers) need to spot check 50% of their programming. Small stations and systems are exempt from regular spot check obligations
  • The spot check is a once-a-year obligation, requiring the station or system to do 24 hours of monitoring within a 7 day period, including at least one complete program from each non-certified program supplier, to ensure that the programs comply with the A/85 standards
  • Spot checks will phase out over 2 years as more and more programming is brought into compliance
  • If a spot check reveals an issue, the station or system needs to notify the program provider and the FCC, and do another spot check of the non-compliant programming within 30 days . If the programming continues to be noncompliant, then the programming is outside the safe harbor (meaning that, if a station or system continues to run it, they can be subject to fines)

The Order also set out additional details about what kinds of programming are subject to the rules, the complaint process for those who believe that stations or systems are not complying with their obligations, and waivers for small stations and systems.  These matters are discussed below.

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While the FCC is entertaining comments on its proposal to move the public inspection file for broadcast television stations online (see our article here), the existing physical public files of several New York area broadcasters came under examination by the New York Times, according to an article in Sunday’s paper. The article seemed to both make fun of the contents of the required public file, while at the same time noting that the people at several stations contacted by the reporter seemed to be unaware of the Commission’s requirements that the file be made available immediately to anyone who visits a station and asks to see it, and that requiring appointments is not an option. We've written in the past about stations that received substantial fines for requiring a visitor to make an appointment to see a station’s files (see, one case where a commercial TV station was fined $10,000, and another where a noncommercial FM was fined $8000 for a similar violation).  If the NY Times article is accurate, stations need to reexamine their policies and be sure that those dealing with the public know of the location of the file and the fact that it must be made available upon request – no questions asked. For more information about the public file requirements, see our Guide to the Basics of the Public Inspection File for Commercial Stations, here.

The second aspect of the report, poking some fun at some of the weird comments from the public found in the file, reinforces some of what I have been told by broadcasters. At a broadcaster meeting last week, I was told stories of station public files that have expanded exponentially since the FCC added a requirement that the file contain emails from the public, as well as letters. Broadcasters report that the letters from the public can now often take up several drawers of a file cabinet, while the remainder of the file fits in a single drawer. While the Commission has tentatively concluded that these letters would not be required to be included in the electronic online file, the recent rulemaking proposal did suggest that the letters be retained at the station, and that perhaps summaries of the written comments be made part of the online file. In addition, comments were requested as to whether social media posts about station operations be kept in some fashion – even though sites like Facebook and Twitter, by their very nature, keep most of what it posted on their sites for the public to view (see our summary of the proposals here). Broadcasters at my meeting last week were very concerned about the volume of paper that would generate, and the need for manpower to review Twitter feeds and Facebook posts almost around the clock to see if any needed to be placed into the file as they related to the station operations.

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In an eagerly anticipated case involving TV stations in the Honolulu market, the FCC's Media Bureau determined that a programming swap that permitted one company to hold the licenses of both the NBC and CBS affiliates in a single market, and to also provide technical and office services and news programming to a third station in the market, was permissible under current rules.  However, the Commission warned that it would consider in its upcoming Notice of Proposed Rulemaking in its Quadrennial Review of the multiple ownership rules whether similar situations should be permitted in the future, and seemingly implied that even this combination could be subject to further review in future licensing proceedings.  The permissibility of shared services agreements has been a question raised by public interest groups for quite some time (see our post here), and has also been raised by certain cable and satellite television operators as such combinations can result in one broadcaster negotiating carriage agreements for multiple stations in a market.  Based on this case, and the issues raised in connection with previous decisions, this will no doubt be a very controversial topic when the Commission considers the upcoming multiple ownership proceeding.

The Honolulu case began with one owner - Raycom - holding two licenses in the market - one an NBC affiliate, and the other an affiliate of the MyTV Network.  As there are 8 independently owned television stations serving Honolulu, the combination of these two stations, only one of which is a Top 4 station in the market, was permissible.  Raycom then entered into a deal with the owner of the local CBS affiliate, where the parties swapped call letters and network affiliations.  Raycom also purchased many of the non-license assets of the station, and received an option to purchase the station, and agreed to pay the licensee, over time, $22 million.  Raycom also entered into a shared services agreement with the owner of the station that had become the MyTV affiliate where Raycom would provide back office services, sales personnel, and a physical location for the station's studio and transmitting antenna, in exchange for 30% of the stations revenues, and a flat monthly payment.  As detailed below, the Commission determined that the swap of call letters and network affiliations was not subject to review at this time as there was no licensing transaction before the FCC, and the shared services agreement did not violate current FCC policies.

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The FCC has set the date for comments on the proposal for television stations to maintain an online public inspection file, including an online political file (see Federal Register notice here).  Comments are due on December 22.  Replies are due on January 6.  Happy Holidays from the FCC!  We summarized the FCC's proposals here and here.  While the proposed new rules will relieve stations from the burden of hosting the files themselves (as the FCC is proposing to host all of the files on its own servers), it still requires that stations upload their information - including all information that is put in their political file, into a new electronic reporting system to be devised by the FCC.  As we described in detail in our summary of the proposal for the online public file, the FCC is asking whether certain new public file obligations should be added to those currently in place.  These include possible posting of comments on programming that come from the station's social media efforts in addition to the letters and emails currently required; a proposed requirement to place in the public file information about sponsorship identification of all "pay for play" material that is broadcast on a station (currently only broadcast, not kept in any paper form); a requirement to provide information about shared services agreements and the programming that they provide to a station; and a requirement that all information about fines and other enforcement actions taken against a station be posted to the online file.  So how much does the FCC think that this will cost stations?

As we wrote yesterday, in adopting rules, the FCC is currently bound by the Paperwork Reduction and the Regulatory Flexibility Acts, both of which require some assessment of the impact of new regulations, particularly on small businesses.  In the Federal Register publication, the FCC's assessment of the regulatory burden of these proposed new obligations is broken down into several pieces.  The burden for the new online public file requirement, including the posting of the political file, is set forth as follows:

Respondents/Affected Parties: Business or other for-profit entities; Not for-profit institutions; Individuals or households

Number of Respondents and Responses: 25,422 respondents; 59,833 responses

Estimated Time per Response: 1 to 104 hours.

Frequency of Response: On occasion reporting requirement; Recordkeeping requirement; Third party disclosure requirement

 Obligation To Respond: Required to obtain or retain benefits. The statutory authority for this collection of information is contained in 47 U.S.C 151, 152, 154(i), 303, 307 and 308

Total Annual Burden: 2,158,909 hours

 Total Annual Costs: $801,150.00

Stations should look at and evaluate these numbers as part of their response, as the FCC has invited a cost-benefit analysis of the proposed new rules.  How is it that the FCC assumes that the regulatory burden would be over 2 million hours, but that the costs would be less than a million dollars?  How will this work be done and paid for?  It is also interested in that the number of respondents is listed as 25,422.  As there are only 1,782 full-power television stations and about 450 Class A stations according to the last FCC Report on station totals, who else is expected to report on this form?  The FCC, in its Notice of Proposed Rulemaking, specifically exempted radio from the obligations for an online public file - at least for the time being.

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When the FCC last month started a new proceeding to mandate an online public file for television stations, the Commission promised to soon initiate another proceeding to look into the need for a new form to document the public interest programming that TV stations provide.  The FCC today fulfilled that promise, and issued a Notice of Inquiry ("NOI") to start the process of adopting a new form for TV stations to complete to report on various categories of "public interest programming," however that might be defined.  In 2007, the FCC had adopted Form 355 to accomplish that task.  But, after an outcry from stations about the paperwork burden that the form would impose, the FCC never submitted it to the Office of Management and Budget for approval under the Paperwork Reduction Act, and thus the form never became effective.  The adoption of the Form 355 was vacated last month in the online public file proceeding.  But the Commission now proposes its return - in some fashion.  So what does the Commission now propose to require from TV stations to document their public interest programming?

First, the FCC asks a series of questions about how such a form should be structured, and how the information should be collected to be meaningful for those that want to analyze it, but not overly burdensome for the TV stations.   The Commission seems to conclude that the form is necessary - not even asking questions on that basic issue of whether to adopt a standardized form.  The NOI states:

We continue to believe that the use of a standardized disclosure form will facilitate access to information on how licensees are serving the public interest and will allow the public to play a more active role in helping a station meet its obligation to provide programming that addresses the community's needs and interests

The Commission then goes on to discuss the Quarterly Programs Issues lists  ("QPIs") that are currently required to be placed in a station's public file every three months - describing the issues that station management sees as important in the community and the programs that the station has broadcast to address those issues (see our most recent advisory on this obligation, here).  The Commission states that these quarterly reports should be replaced, as broadcasters have been uneven in their recordkeeping of such lists.  Of course, that may be because the FCC has never proscribed any specific form for these reports, nor specifically said what is acceptable and what is unacceptable in connection with such reports.  Seemingly, replacing one form with another (albeit a more complete, detailed new form) may well accomplish nothing if the new report does not have clear and unambiguous instructions - something never adopted for the Quarterly Reports.

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The full text of the FCC's Order overturning its 2007 decision on online public inspection files for TV broadcasters and the adoption of the Form 355 "enhanced disclosure form" has now been released.  This order, adopted at the FCC's open meeting this week (held on October 27, 2011, which we wrote about here), also contains a Further Notice of Proposed Rulemaking again suggesting an online public file, but this time it would be one hosted by the FCC.  In reading the full text, more details of the FCC's proposal become clear.  As set forth below, the Order suggests everything from a future application of these rules to radio once the bugs have been worked out, to an examination of whether a station needs to save Facebook posts and other social media comments in the same way that it preserves letters from the public and emails about station operations, to a proposal for stations to document in their files information about all "pay for play" sponsorships.  Comments on these proposals, and the others summarized below, which include a request for detailed information about the costs of compliance with the proposals, are due 30 days from when the order is published in the Federal Register, with Reply Comments due only 15 days thereafter.  The FCC, after sitting on these obligations for almost 5 years, now seems to be ready to move quickly. 

In reaching it's decision, the order first discusses some proposals that it was rejecting - some for the time being.  For radio broadcasters, the most important of the rejected thoughts was the extension of this rule to radio.  The Commission noted that there were proposals pending and ripe for action as part of the Localism proceeding (which we summarized here), to extend the online public file obligations to radio.  In this week's order, the FCC decided that it was not yet ready to apply these rules to radio.  The Commission noted that there might need to be differences in the rules for radio (implying that, at least partially, there might be resource issues making it difficult for radio broadcasters to comply with these rules), and also finding that it would be better to see how an online file works for TV before extending the rule to radio.  But, from the statements made in the Order, there is no question but that, at some point in the future, some form of the obligations that are proposed for TV will also be proposed for radio broadcasters. 

Also, it is important to note that the FCC's Localism proceeding is not dead yet.  While this week's Order stems from the FCC's Future of Media Report (renamed the Report on the Information Needs of Communities), and that report recommended that the Localism proceeding be terminated, this Order did not do that.  The Commission notes its plans to start a new proceeding designed to force broadcasters to complete a more comprehensive report on their public interest programming.  That proceeding may be where the looming Localism proposals are finally dealt with.  Statements at the meeting and passages in the Order make clear that the examination of the public interest obligations for broadcasters will begin with a Notice of Inquiry, which is a most preliminary stage of an FCC proceeding (which would be followed by a Notice of Proposed Rulemaking after the inquiry comments are reviewed) and then an Order.  So final resolution of these issues seem to be far down the road.  If that is the case, will the Localism proposals stay on the table until the Order in this new proceeding is adopted?  It is certainly unclear from the Commission's statements thus far.

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At its meeting today, the FCC vacated its 2007 Order mandating an online public file and the filing of the Form 355 “Enhanced Disclosure” form that detailed the public interest service of television broadcasters. But these requirements are not gone, as the Commission has adopted a Further Notice of Proposed Rulemaking asking to reinstate an obligation for an online public file, and a Notice of Inquiry is apparently circulating at the FCC that would propose a substitute for the Form 355. The proposal for the new online public file apparently also suggests including new information in the online file, including information about sponsorship identification and copies of shared service agreements. While the text of the FCC order is not yet out, from the information provided at the FCC meeting, the following matters appear to be on the table at the FCC:

• The FCC proposes that TV broadcasters will need to have an online public file, submitted to and maintained on servers at the FCC rather than on each individual station's website
  • Several Commissioners suggest that the Commission will develop a mechanism for accessible storage of online public files, which may be searchable by the public
  • The online public file form will automatically import other FCC filings that are required to be in the file
  • Until the FCC electronic database is perfected, the documents will be placed online in their current formats
• Letters from the public concerning station operations are proposed to be excluded from the online file out of privacy concerns, though broadcasters will still need to keep those letters in a public file at the station.
• The online public file is proposed to include the political file, which was exempt under the 2007 rule as it would be too burdensome to update that report rapidly during an election season
• The online file is proposed to include additional material not now required to be in the public file, including:
  • Copies of shared services agreements
  • Sponsorship identification information that is now only broadcast on air in connection with the program in which sponsored material is included
• The FCC is currently considering a Notice of Inquiry, a draft of which is apparently circulating among the Commissioners now, that proposes some form of enhanced disclosure form that will replace the Form 355 (and the current Quarterly Programs Issues list) to document the public service provided by TV broadcasters

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Yesterday, the FCC released an Order that reversed a five-year-old decision by its Consumer and Governmental Affairs Bureau (“CGB” or “Bureau”) that had granted certain video programmers “undue burden” exemptions from the FCC’s closed captioning rules. The reversed Bureau decision had changed the criteria for undue burden exemptions and permanently exempted two video programmers from compliance with the closed captioning rules on the basis of the new criteria. Finding that the Bureau’s new criteria deviated from both the statute and FCC precedent, the Commission overturned the decision, reversed 296 subsequent exemptions that had been granted by the Bureau in reliance thereon, and reinstated the original criteria for captioning exemptions. DWT has just released an advisory that provides more detail about the Commission’s decision, which can be found here. In addition, a copy of the Commission’s Order can be found here.

In overturning the undue burden exemptions CGB approved in 2006, the Commission found numerous faults with both the Bureau’s initial decision and its handling of hundreds of subsequent petitions seeking similar exemptions. Although undue burden exemptions were to be reviewed by the Commission on a case-by-case basis after opportunity for public comment and were to consider four factors: (1) the nature and cost of the closed captions for the programming; (2) the impact on the operation of the provider or program owner; (3) the financial resources of the provider or program owner; and (4) the type of operations of the provider or program owner, the Bureau deviated from previous Commission decisions by expanding the scope of the factors considered.  In particular, its decision relied primarily on the non-profit status of programming providers and that the programming was not produced for primarily commercial purposes.  Further, the Bureau found captioning programs would constitute a “significant hardship” and that there was a significant risk that mandating captioning would cause the video programming provider to cancel the programming.
 

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The battle over the reclamation of television spectrum for wireless broadband rages on, and some in the television industry fear that the future of over-the-air television may be sacrificed to Congressional attempts to reduce the Federal deficit. The current Congressional “Super Committee” that is attempting to find billions of dollars in spending reductions to lower the Federal deficit is reportedly considering “finding” potentially 20 billion dollars or more from the proceeds of an auction of spectrum reclaimed from television broadcasters. Various Congressional proposals have been submitted for the committee’s consideration, essentially to authorize the FCC to conduct “incentive auctions” to reclaim some TV spectrum. But, the National Association of Broadcasters and others have claimed that broadcast television service to a number of markets, particularly those in areas near the Canadian border and in urban, densely populated northeast corridor between Boston and Washington, will be particularly hard hit – imperiling the continued existence of free over-the-air service to some markets, including Detroit. In other markets, broadcasters fear there will be a lessening of the protections from interference that stations currently enjoy, or a repacking of the spectrum that will put stations on new and potentially inferior channels, without reimbursement of the costs of relocation.

The proposal for the reclamation of television spectrum was first advanced in the Commission’s Broadband Report, where the FCC committee that drafted the report suggested that as much as 120 MHz of television spectrum  be reclaimed for use for wireless broadband – 20 television channels from 32 to 51 on the TV dial.  With tablets and smartphone usage growing quickly, and the ever-increasing demands for wireless spectrum to deliver video, audio and other rich internet content, the Commission fears a spectrum shortage – especially in certain urban markets. As over-the-air viewing rates have been falling over the last two decades as more people sign up with multichannel carriers, the Report suggested that the TV band could be shrunk, with some of the spectrum being redistributed to wireless. TV stations could be incentivized to surrender their spectrum for wireless use or to share channels, an option that the proponents of reclamation claim is very feasible, as digital technologies now allow one television channel to rebroadcast multiple streams of programming.

Television broadcasters have fought back, claiming that, while the digital transition does allow for more channels in the same spectrum, they are just now rolling out new uses of that spectrum – including new programming streams and, soon, mobile video targeted to smartphones and other digital devices. An article in one newspaper  last week reviews some of the new ways for over-the-air TV viewers to get access to additional video programming to augment over-the-air programs, allowing some consumers to “cut the cord” – eliminating their multichannel video subscriptions. Some studies have suggested that such cord-cutting opportunities, combined with the recent economic turmoil, has actually increased the amount of over-the-air television viewing in the last few years, reversing or slowing the trend of decreasing broadcast TV viewership.

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The end of September marks the close of the Third Quarter of 2011, which brings two quarterly filing obligations for broadcast stations.  The first obligation is that by October 10 all radio and television stations, both commercial and noncommercial, must prepare and place in their public inspection file Quarterly Issues Programs Lists reporting on the important issues facing the stations' communities, and the programs aired in the months of July, August, and September that dealt with those issues. The failure to have a complete set of Quarterly Issues Programs lists, which were timely prepared and placed in a station’s public file, can lead to significant fines at license renewal time so all stations are urged to prepare their Quarterly Issues Programs lists in a timely fashion. See our full advisory for further details.  With the renewal cycle now in full-swing for radio stations and looming on the horizon for television stations, licensees are reminded to make sure their stations are meeting this obligation on a quarterly basis. 

Secondly, full power and Class A low power television stations are reminded that Children's Television Programming Reports on FCC Form 398 must be prepared and filed electronically with the FCC by October 10, 2011.  While technically, the deadline for filing the Form 398 with the FCC will roll to Tuesday, October 11th (because Monday is a Federal holiday, Columbus Day), given that the Reports must also be placed in the station's public inspection file within ten days after the end of the quarter, it would be best for stations to simply prepare and file their programming reports by October 10th to ensure they are timely. Our recent advisory is available here with all the details on the Children's Television Programming Reports.  By Oct. 10th, commercial stations should also prepare and place in their public inspection file the necessary quarterly certifications regarding compliance with the commercial limitations in Children's Programming. 

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The dates for comments on the FCC proposed rules for the captioning of Internet Video have been set.  Comments are due on October 18 with replies due on October 28.  An associated Federal Register publication also notes that comments can be filed with the Office of Management and Budget about the compliance of the information collection requirements contained in the proposed rules with the Paperwork Reduction Act. OMB comments can be submitted through November 28.  As we wrote last week, this proceeding is of importance to television stations and cable operators, as the rules will initially apply to video that has already been captioned to meet some other FCC rule, and is later repurposed for the Internet.  It is also important to all operators of websites that distribute such video programming.  A more detailed summary of the proposals in this proceeding is available in our Davis Wright Tremaine advisory on the NPRM.  The full text of the FCC proposals is available here.

This proceeding is on an extremely fast track, as Congress has charged the FCC with adopting rules by January to implement the statutory obligations set out in the Twenty-First Century Communications and Video Accessibility Act of 2010.  Already, groups representing the hearing impaired as well as certain Internet video aggregators have visited the Commission to lobby for their particular positions on the proposals.  Those representing the hearing impaired community have been very active in this proceeding, as well as in connection with the filing of objections to television stations who do not meet their obligations to provide video accessibility through captions or other written information during over-the-air programming providing emergency information (see our note here on an FCC reminder on that subject).  TV stations and other video providers need to be similarly active in explaining to the FCC what can and cannot be done technologically in a cost-effective manner to meet the needs of these citizens.  The just announced comment deadline provides video producers with that opportunity. 

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Just a reminder that by October 1, Television stations must once again make their triennial carriage elections.  By that date, TV stations must notify the local cable systems and satellite carriers in their market in writing as to whether the station intends to be carried pursuant to must-carry or a retransmission consent agreement for the next three-year term, which runs from Jan. 1, 2012 through Dec. 31, 2014.  Accordingly, before Oct.1, stations must send a written election notice to the cable systems and satellite providers in their market via certified mail, return receipt requested.  The election letter should indicate the station's call letters, channel, community of license, DMA assignment, and contact information, in addition to answering the basic question of whether the station would like to elect carriage pursuant to must-carry or else negotiate a retransmission consent agreement.  In addition, those stations electing carriage pursuant to must-carry should also indicate the channel on which they wish to be carried (i.e., the over the air channel, the cable channel on which it has been carried historically, or some other mutually agreeable channel).  And be sure to keep copies of the election letters sent out.  Copies of all the election letters must be maintained in the station’s public inspection files. 

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The FCC today announced the public testing of a new TV White Spaces database system.  Starting on September 19, 2011, the FCC's Office of Engineering and Technology will open a 45-day window to allow the public to try out the TV Band Database developed by one of the potential TV White Spaces database managers.  If approved, the Database will be used by white space devices to find available frequencies and avoid interfering with authorized services and registered facilities.  As we have written about previously (here) the Commission has adopted new rules to allow unlicensed devices to operate in the television spectrum, but such operations must protect incumbent users.  Accordingly, as part of those rules, the Commission has required the development and use of a database, which TV band devices will be required to access periodically in order to determine available frequencies and adjust their operation.  As we discussed here, the Commission has tentatively selected a number of parties to serve as database managers to develop and maintain such TV white spaces databases.  With this upcoming public trial, interested parties will now have a chance to test the database system developed by one such potential database manager.  As part of its authorization process, each interested database manager will be subject to a similar trial period of no less than 45 days.

During this trial period, interested parties are encouraged to test the database, including the basic functionality, including the following elements:  The channel availability calculator; cable headend and broadcast auxiliary receive site registration; and wireless microphone registration.  Starting on Sept. 19th, the TV band database can be accessed here.  The test site will provide a description of the trial, details on use of the system, and a link for feedback.  Following the conclusion of the test, the potential database manager will submit a report to the Commission, which will also be available for public review and comment.  At the end of the process, the FCC will determine whether this particular system complies with the rules and requirements and whether this database manager will be authorized to operate one of the official databases.  In addition to giving feedback to the database manager through the test site, parties can also submit comments directly to the FCC in the open docketed proceeding ET Docket No. 04-186 regarding the TV bands database systems through the FCC's Electronic Comment Filing System.  A full copy of today's Public Notice can be found here. 

In addition, perhaps coincidentally, today it was announced in the Federal Register that the rules involving the collection of information for these white spaces database have received OMB approval and those data collection rules are now in effect.  So once the first database managers gain FCC approval and bring their databases online, the government has the green light to instruct parties to populate the databases by registering their services and facilities for protection.  

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The FCC just issued a Report to Congress concerning the access of television viewers to in-state television stations.  This report was requested by Congress as part of STELA (the Satellite Television Extension and Localism Act), which extended the compulsory license for direct to home satellite television operators (DISH and DirecTV) - a license which gives them copyright clearances to retransmit all the programming transmitted by the broadcast television stations that they make available as part of their service packages.  Congress also requested a Report from the Copyright Office on the need for the compulsory license - a report also issued this week, which we will write about in another article.  The issue of access to in-state television stations has been a controversial issue, as several Congressmen have sought (and in a few cases actually received) legislative authority for cable providers to carry out-of-market television stations on cable systems serving areas in one state that are part of television markets where the television stations come from a different state.  The report refers to these areas as "orphan counties."  Once legislative authority was granted in one state, many other bills popped up in Congress trying for the same relief in their state - causing concern that the existing television markets (or Designated Market Areas or "DMAs", designated by the Nielsen Company) might be undermined.  To see what impact such changes would have, Congress requested this report from the FCC.

The report for the most part does not make recommendations, but instead simply provides information about the service provided to US television viewers, the potential options for bringing an in-state service to all viewers, and the issues that such proposals would raise. Perhaps the most interesting fact revealed by the report is that 99.98% of all US television households already have access to an in-state television station, either over-the-air or through a Multichannel Video Programming Distributor (e.g. cable or satellite TV system), so this is a very isolated issue.  However,when the FCC sought comments on the issues discussed in the report, a number of individuals in particular DMAs responded about situations where they could not get access to in-state television stations and asked that something be done.  The report assesses the implications of any action that could be taken.

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The debate over repurposing some of the television spectrum for wireless broadband have been raging over the normally quiet Washington summer, as issues as diverse as the budget negotiations, the tenth anniversary of 9-11 and international treaties all play their part in the discussions.  Whatever changes are made could have a profound impact on TV broadcasters nationwide, not just those in the congested metropolitan markets where everyone acknowledges that any spectrum crunch that may exist would be most acute.  This week, Congressman John Dingell, long one of the most influential Congressmen on telecommunications issues, complained that the FCC was deliberately withholding details of its plans for spectrum allocation - plans that the National Association of Broadcasters have challenged as unworkable as they would doom over-the-air television in many markets, especially those near the Canadian border.  With all the issues swirling around the spectrum reallocation debate, the realistic timing of any reallocation of the spectrum and the real impact on the free over-the-air television broadcast industry are becoming major issues being considered in Washington.

The FCC has been pursuing the idea of repurposing some of the television spectrum for wireless broadband use since well before the Broadband Report was issued last year.  As we summarized in our review of the Broadband Report, the FCC suggested that as much as 120 MHz of television spectrum could be reallocated from TV to wireless broadband uses.  The FCC and the consumer electronics and wireless industries have contended that there is a looming spectrum crunch, particularly in major markets, as smart phones, tablets and other connected devices become a bigger part of the lives of many consumers in serving not only their entertainment needs, but also providing information and business services.  The FCC's Broadband Report thought that as much as 500 MHz of spectrum would eventually be needed, and that 120 MHz could come from the television spectrum, which proponents feel has been underutilized by broadcasters since the digital television transition in 2009.  Proponents of the reallocation contend most consumers get their TV service not over the air, but from cable or satellite providers, so the need for spectrum dedicated to broadcast television is far less than it was 70 years ago when the television service was first popularized.  Broadcasters, of course disagree with that assessment, contending that the digital transition is still very new, and that uses of the digital spectrum - including a mobile DTV service and multicast channels - are just developing.  Moreover, TV broadcasters have argued that their digital offerings, when combined with Internet service, are providing an option to many to "cut the cord" from pay TV options, leading to more over-the-air viewing.  In recent weeks, as detailed below, the National Association of Broadcasters has also been contending that the proposed reallocation would irreparably damage the over-the-air television industry, especially in markets in the Northeast and near the Canadian border where, in some markets, the reallocation would be impossible without ending most or all over-the-air television service.  The radically different pictures painted by the participants in this debate have led to some of the recent charges that the FCC is being less than forthcoming about the manner in which this transition would occur and the impact that it would have on broadcast TV. 

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The FCC has granted a short extension for Reply Comments on the implementation of the CALM Act.  The new deadline for Reply Comments is August 1, 2011.  We wrote about the issues in this porceeding here,  The CALM Act ("Commercial Announcement Loudness Mitigation" Act), which must be implemented by the end of this year, is meant to require broadcasters, cable companies and other MVPDs to eliminate loud commercials - commercials that are substantially louder than the associated programming.  As we set out in our previous article, the Commission looks to establish compliance based on a series of recommended best practices developed by the Advanced Television Systems Committee.  As the ATSC is about to release an updated version of this protocal (to be released on its website on July 26), a short extension was deemed to be appropriate so that interested parties could review the updated standards.  If you are concerned about compliance with the proposed new rules, take this extended opportunity to review the new ATSC recommended practices, and file your comments on or before August 1.

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Dates for comments and replies on the FCC's Notice of Proposed Rulemaking to implement the CALM Act, regulating the volume levels of commercials, have now been set.  We provided a detailed summary of that NPRM here.  As set out in that summary, the NPRM asks many questions of broadcasters, cable companies, and other Multichannel Video Programming Distributors about implementation of the CALM Act, including who must comply, how compliance can be achieved, and the impact of reliance on program suppliers (networks, broadcast programming carried on cable, etc.) on compliance.  Comments are due on July 5, with replies due on July 18.  The FCC Public Notice setting out those dates also provides links to additional specifics about filing comments in the proceeding.  To avoid ruining your holiday weekend, get started on comments early!

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In December, the Commercial Advertisement Loudness Mitigation (“CALM”) Act was adopted by Congress and signed by the President, addressing consumer complaints about television commercials that seem louder than the program content that they accompanied. As we wrote in our summary of the Act when it was adopted, Congress has long received many complaints about loud commercials and decided to act, even though many industry groups were concerned about the ability to design an effective system to deal with the contrasts that sometimes exist between the quiet dialogue that might precede a commercial break and the commercial advertisement itself. Nevertheless, Congress adopted the CALM Act, and instructed the FCC to adopt implementing rules within a year. This past week, the FCC released its Notice of Proposed Rulemaking, looking to adopt rules to implement the statute for over-the-air television broadcast stations, cable systems, satellite, and other multichannel video programming providers. In its NPRM, the FCC asks many questions trying to clarify the details of CALM Act implementation.

The NPRM raises a broad array of implementation issues, ranging from deciding exactly which broadcast stations and which MVPDs are subject to its terms, to the establishment of safe harbors for technical compliance. As discussed in more detail below, the Commission also asks whether stations and systems can shift the burden for compliance with these rules to program suppliers, such as broadcast and cable networks, and whether contractual means of guaranteeing compliance (such as indemnification provisions in contracts between networks and affiliates) are sufficient to ensure compliance by these program providers. Questions about how MVPDs deal with retransmission of broadcast programs, and who is responsible for noncompliant broadcast programming, are also asked. Finally, the FCC suggests processes for consumer complaints and the grant of waivers to stations and systems that cannot quickly comply with the new rules.

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The FCC is taking a close look at the video programming marketplace and gathering data that will undoubtedly shape its rules and policies in the coming years.  Its review comes in the form of a periodic assessment of the multichannel video programming industry required by the Communications Act.  By its Further Notice of Inquiry issued Thursday, the FCC expanded the scope of its periodic review of the market for the delivery of video programming and renewed its previous call for data.  Although the proceeding is technically an annual occurrence (and indeed is entitled the "Annual Assessment of the Status of Competition in the Market for the Deliver of Video Programming"), it has been over two years since the FCC last released a report on the video programming marketplace.  Moreover, that report, issued in January 2009 under then-Chairman Martin, actually reported on the state of the marketplace circa 2006 as the data was a few years old by the time the report was issued. 

So the FCC's current proceeding actually seeks data for the years 2007 through 2010.  More importantly, the Notice of Inquiry marks a significant departure from previous reviews both in terms of the proposed structure of Commission's analysis and the scope of the review, as this proceeding will, for the first time, include information about the online distribution of video programming to consumers.  The Commission seeks to analyze three categories of entities that deliver video programming:  1.) multichannel video programming distributors ("MVPDs", i.e. cable systems, satellite providers, and teleco providers), 2.) broadcast television stations, and 3.) online video distributors.  For each of these types of providers, the Commission proposes to examine industry structure (number and size of providers; horizontal and vertical integration; conditions affecting competition), conduct (business models; advertising and marketing), and performance (quantity and quality of program offerings; price of service; investment and innovation).

The Commission's NOI invites comments from all interested parties, and requests data, information, and comment from entities that provide delivered video programming directly to consumers, as well as consumers and consumer groups, content creators, content aggregators, and manufacturers of consumer premises equipment.  Clearly, the Commission is casting its net widely in hopes of a thorough record for its report. Given the increasingly contentious debate over the reclamation of TV spectrum, ongoing issues regarding retransmission consent agreements, and the rise of online video programming providers, the Commission's proceeding takes on great importance, as the ultimate findings and conclusions drawn by this report will likely be used as the basis for future actions affecting video programming providers and consumers.  Comments in the proceeding are due by June 8th, with Reply Comments due by July 8th.  Interested parties may file comments and data with the Commission either in paper or via the Commission's Electronic Comment Filing System. 

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The FCC has granted a one week extension for reply comments in the proceeding looking to take many of the preliminary steps toward incentive auctions by which the FCC would reclaim parts of television spectrum for use by wireless broadband companies.  Comments are now due on April 25.  We wrote about the many issues in this proceeding, here.  Issues include the sharing of channels by independent television stations, whether stations that share spectrum are entitled to must carry rights under governing law, and how the FCC can change the digital television operational rules to make the use of VHF frequencies, where stations operating on those channels have experienced severe technical issues after the digital transition, more friendly for digital operations if the television spectrum needs to be repacked so that contiguous portions of the UHF band can be auctioned to wireless companies.

The extension was requested by a number of broadcast groups, partially based on the fact that the NAB Convention in Las Vegas has just concluded, and that there was much discussion at the Convention on the topic - including much discussion from FCC officials.  The broadcast community wanted the opportunity to respond to digest and respond to these discussions, thus the need for the brief extension.  This remains a very hot issue, with the FCC officials who attended the NAB Conference clearly pushing the agenda advanced in the Broadband Plan to reclaim some of the television spectrum for wireless uses.  Thus, these replay comments are very important, as they may set the stage for the incentive auctions and possible repacking of the television spectrum that may follow. 

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The FCC has granted an extension of time to submit comments in its proceeding to re-institute video description rules for television programming.  Comments are now due April 28th, and Reply Comments are due by May 27th.  A copy of the FCC's recent Order extending the deadline is available here.  As we wrote about earlier (here), this rule making proceeding seeks to reinstate the Commission's prior video description rules with certain modifications, as required by the Twenty-First Century Communications and Video Accessibility Act of 2010 (the CVAA). The proposed rules would require large market broadcast affiliates of the top four national networks and most cable operators and DBS providers to provide programming with audio narrated descriptions of a television program’s key visual elements beginning as soon as first quarter 2012.  Davis Wright Tremaine previously summarized the Act in our earlier advisory available here.

In addition, the FCC also just granted an extension of time to file comments in a related proceeding that seeks to implement other aspects of the CVAA.  That proceeding, addressing accessibility of equipment and Advanced Communications Services, was also initiated in early March and shares a similar timetable for promulgating rules as the video description proceeding.  Accordingly, the FCC did not grant the full 30-day extension sought by the parties, but rather has granted a two week extension of time for comments.  Comments are now due on April 25, and replies on May 23 in that proceeding.  Groups including the National Federation for the Blind and the Consumer Electronic Association requested a month-long extension in the comment date but, as Congress has required that these rules go into effect at the beginning of 2012, the Commission felt that it could only justify a two week extension and still be able to meet the statutory deadline.  So have those comments ready by April 25. 

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The Commission's recent Notice of Proposed Rule Making exploring possible changes to the television retransmission consent rules has now been published in the Federal Register setting the date for Comments as May 27th, with Reply Comments due by June 27.  As we wrote about recently (here), the FCC has commenced a rule making to consider revising its rules governing the interaction and negotiations between cable operators and broadcasters regarding carriage of local broadcast television stations.  Among other things, the NPRM seeks input on strengthening the good faith negotiation rules, changes to the notice requirements to require advance notice to consumers of carriage changes, and input on the potential benefits and harms of eliminating the Commission's network non-duplication and syndicated exclusivity rules.  Again, interested parties have until May 27th to file comments with the Commission either in paper or through the FCC's Electronic Comment Filing System.  Reply Comments will be due by June 27th. 

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UPDATE:  On March 23rd, the FCC granted a ten-day extension of the filing deadline.  Comments are now due April 28th, and Reply Comments are due by May 27th.

The FCC's recent item proposing the adoption of video description rules was published in the Federal Register today setting the deadline for Comments in the proceeding. The FCC subsequently extended the deadline, and Comments are now due by April 28th, with Reply Comments due by May 27th.  As we wrote about recently (here), the FCC has initiated a rule making proceeding to reinstate its prior video description rules with certain modifications, as required by the Twenty-First Century Communications and Video Accessibility Act of 2010 (Act). The proposed rules would require large market broadcast affiliates of the top four national networks and most cable operators and DBS providers to provide programming with audio narrated descriptions of a television program’s key visual elements beginning as soon as first quarter 2012.  Davis Wright Tremaine previously summarized the Act in our earlier advisory available here.

Now, with today's publication of the Notice of Proposed Rule Making in the Federal Register, the date for comments has been set, and the FCC is moving quickly to implement the rules.  In addition to proposing to reinstate the rules previously adopted by the FCC, the item asks many practical implementation questions about refreshing market rankings, applicability of the rules to low power television, and what constitutes the “technical capability” to pass through video descriptions. In particular, the FCC seeks to refresh the list of the top 25 DMAs, as well as update the top five national nonbroadcast networks subject to the rule.  Interested parties may file comments with the FCC either in paper or electronically through the FCC’s Electronic Comment Filing System on or before April 28, 2011.  

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The FCC recently revised its TV “white spaces” rules to facilitate the use of unlicensed communications devices on spectrum originally allocated exclusively for broadcast television.  Although there is still a long way to go before new unlicensed devices are deployed in this spectrum, the recent revision of the rules has triggered an important deadline.  As detailed in our client advisory issued today and available here, cable headends, TV translators, low power television stations, and other Multichannel Video Programming Distributor (MVPD) receive sites that are located outside a broadcast station’s standard protection zone have until April 5, 2011, to file a waiver request seeking interference protection.

Practically speaking, the vast majority of cable headends, TV translators, and MVPD receive sites that rely on the reception of an over-the-air broadcast signal are located well within the broadcast station’s standard protection zone. Thus, the April 5th deadline applies only to those unique cases in which an existing over-the-air receive site is located more than 80 kilometers (49.7 kilometers) beyond the edge of the broadcast station’s protected contour.

As the filing deadline is less than a month away, we encourage potentially affected parties to promptly review their operations. Television broadcasters, who may not themselves operate a facility eligible for a waiver, should consider if there are cable headends, TV translators, or other MVPD receive sites far beyond their contour that might benefit from a waiver request.  In such cases, the broadcaster should coordinate with the operators of those facilities to ensure a timely submission. 

See today's advisory for further details on this upcoming deadline, as well as our earlier postings here and here for more information about the white spaces rules and the forthcoming white spaces database. 

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Among the many items adopted by the Commission at last week's open meeting was a Notice of Proposed Rule Making (NPRM) regarding retransmission consent agreements and the carriage of broadcast television stations by cable and satellite providers.  Retransmission consent has been a hot topic of late both in Washington and in the national press.  During the past year, a few carriage negotiations between broadcast television stations and cable or satellite operators have resulted in interruptions - or threats of interruptions - in the carriage of local stations.  As a result, both Congress and the public have paid increasing attention to retransmission consent negotiations, and the Commission's NPRM is a effort to review some aspects of its rules governing the relationship between local broadcast stations and the cable and satellite providers that retransmit their signals.  A copy of the NPRM is available here. 

The NPRM is the outgrowth of a petition for rule making filed in March 2010 by cable and satellite providers, along with several public interest groups.  These groups jointly petitioned the FCC seeking significant changes to the current retransmission consent process.  Perhaps the most notably aspect of last week's NPRM is not the changes the FCC proposes, but rather the changes it refrains from pursuing.  The Commission states in the NPRM that it does not believe that it has the authority to adopt either interim carriage mechanisms - to require the continued carriage of a station without a station owner's consent while negotiations continue - or mandatory binding dispute resolution procedures for retransmission consent negotiations, both of which were proposed by the cable and satellite providers in their petition for rule making.  In both cases, the Commission found that it lacked the statutory authority to pursue the rule changes proposed by the petitioners. 

While it proposes to refrain from action on those two elements of the petition for rule making, the Commission does propose to review several aspects of its rules in an effort to, in its words, "protect the public from, and decrease the frequency of, retransmission consent negotiation impasses within our existing statutory authority."   To that end, the NPRM seeks input on strengthening the good faith negotiation rules, including whether it would be  per se violation of the good faith negotiation rules for a station to give a network with which it is affiliated the right to negotiate for carriage, or for a station to grant another station or station group the right to negotiate for carriage, such as when a station is party to a local marketing agreement (LMA) or joint sales agreement (JSA).  In addition, the NPRM proposes changes to the notice requirements of its carriage rules to require advance notice to consumers if there is the possibility that a station will be dropped from a providers' programming line up.  This advance notice would allow consumers to make alternative plans if negotiations ultimately fail and a station's signal is deleted from the lineup.

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Yesterday, the FCC initiated a rule making proceeding to reinstate its prior video description rules with certain modifications, as required by the Twenty-First Century Communications and Video Accessibility Act of 2010 (Act). The proposed rules would require large market broadcast affiliates of the top four national networks and most cable operators and DBS providers to provide programming with audio narrated descriptions of a television program’s key visual elements beginning as soon as first quarter 2012.  Davis Wright Tremaine previously summarized the Act in our earlier advisory available here.

The Notice of Proposed Rule Making (NPRM) takes the first step toward restoring the video description regulations that the FCC previously adopted in 2000, but which were subsequently vacated by the U.S.  Court of Appeals for the D.C. Circuit. Now with explicit Congressional authorization, the FCC seeks to restore the video description rules by Oct. 8, 2011, as required by the Act. The FCC proposes a quick implementation, with the video description and pass-through rules beginning Jan. 1, 2012. The most significant elements of the reinstated video description rules are: 

• Broadcast affiliates of the top four national networks—ABC, CBS, Fox, and NBC—located in the top 25 television markets must provide 50 hours per calendar quarter of prime time and/or children’s programming with video descriptions.
• The top five national nonbroadcast networks must provide 50 hours per calendar quarter of prime time and/or children’s programming with video descriptions. The proposed rule would be applied to multichannel video programming distributors (MVPDs), including cable operators and DBS providers with 50,000 or more subscribers, and presumably then be applied to the top five networks through affiliation agreements.
• “Live” and “near live” programming is exempt from the rules.
• In order to count toward the requirement, the programming must not have been aired previously with video descriptions, on that particular broadcast station or MVPD channel, more than once.
• All broadcast stations, regardless of market size or affiliation, and all MVPDs, regardless of the number of subscribers they serve, must “pass through” video description when such descriptions are provided and when the station or program distributor has the technical capability to do so.

In addition to proposing to reinstate the rules previously adopted by the FCC, the item asks many practical implementation questions about refreshing market rankings, applicability of the rules to low power television, and what constitutes the “technical capability” to pass through video descriptions. In particular, the FCC seeks to refresh the list of the top 25 DMAs, as well as update the top five national nonbroadcast networks subject to the rule. In determining the top five nonbroadcast networks, the FCC proposes to exclude from the top five any nonbroadcast network that does not provide, on average, at least 50 hours per quarter of prime time non-exempt programming, i.e., programming that is not live or near-live. The NPRM specifically seeks comment from any network that believes it should be excluded from the top five covered networks because it does not offer enough pre-recorded prime time or children’s programming.

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As our colleague Brian Hurh wrote recently on our sister blog, the www.broadbandlawadvisor.com, a federal district court last week granted a preliminary injunction prohibiting the mere retransmission of broadcast television programs over the Internet, without more.  The order is not only important for its confirmation of a 2008 Copyright Office decision rejecting Internet retransmission of video programming under Section 111 of the Copyright Act, it also reaffirms the “quid pro quo” of compulsory licensing – that one cannot merely retransmit programs over the Internet (or any other medium, for that matter) without acquiescing to federal regulation.  See WPIX, Inc. et al v. ivi, Inc., Case No. 1:10-cv-07415-NRB (S.D.N.Y., Feb. 22, 2011).

The order stems from a preliminary injunction sought by national broadcasting networks and local stations, Major League Baseball and several motion picture studios against a single defendant, ivi, Inc.  ivi’s business consisted of capturing over-the-air broadcast programming in several major markets and retransmitting it over the Internet to ivi subscribers across the country.  

The central issue was whether ivi could lawfully retransmit such programming over the Internet pursuant to a “compulsory license” under Section 111 of the of the Copyright Act (17 U.S.C. § 111).  In a brief but informative history of Section 111, the Court explained that the compulsory license was created to allow the then-nascent cable industry to retransmit over-the-air programming to subscribers in exchange for a statutory license fee paid to the Copyright Office.  That bargain, however, also required cable operators to willingly submit to the FCC’s jurisdiction.  According to the record, ivi refused to adhere to this bargain, instead arguing that its Internet video service was outside the purview of the FCC because it was transmitted over the Internet.  The Court flatly rejected this argument, holding that ivi not only was not a cable system eligible for a license, it could not both benefit from a compulsory license while at the same time avoid obligations under federal law.

In essence, the Court’s decision reinforces the notion that there is, and has always been, a balance between the development of new video technologies and respecting the copyrights of content owners.  Cable operators accomplished this through the Section 111 compulsory license; the Internet has yet to discover a balance of its own. 

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Last week the FCC rejected a request by a low power television broadcaster seeking an experimental license to test a technology that would allow broadcast television stations to provide broadband access.  The brief decision, available here, was issued by the FCC's Media Bureau and rejected the request primarily on the grounds that the technology the LPTV broadcaster sought to test is inconsistent with the existing ATSC standard for transmission of digital television signals in the U.S.  This decision brought about a rebuke by a Wall Street Journal columnist, suggesting that the FCC was not fully exploring one way to rapidly deploy broadband through existing TV licensees, in fears of foregoing the revenues that would come from an auction of reclaimed television spectrum.   This issue arises while the FCC considers the digital conversion of LPTV, and the future of the television spectrum generally.

As has been well known and discussed for at least the last decade, the ATSC standard chosen for digital television broadcast service in the United States is not ideal for mobile service and is not well suited for two-way broadband service.  The current ATSC standard was designed to provide a signal to fixed locations for traditional in-home television watching.   As we have written before, in 2000, in the early days of the digital television conversion, some broadcasters suggested that the system be changed to accommodate a more robust signal allowing better mobile reception and other services that maximize the capacity of the digital channel. That proposal was rejected for fears of slowing the digital conversion, but is seemingly being revisited now. 

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The FCC's auction of new VHF TV channels in New Jersey and Delaware (about which we have written many times including here) has resulted in only three qualified bidders.  Despite this lack of interest in these VHF channels, the FCC seems to be looking at VHF as a way to facilitate its announced plans for the clearing of significant portions of the television spectrum for wireless broadband use.  The Commission this week set the comment date - March 18, 2011 - on ways to overcome the issues that have been posed to TV stations that have remained in VHF channels after the digital transition.  In the same proceeding, the FCC also seeks comments on allowing TV stations to share the same 6 MHz channel, with both stations retaining their cable and satellite must-carry rights.  That same proceeding implies that we may well have seen the last new over-the-air television stations.  This crucial proceeding on the future of the television band requires careful attention by all parties who may be affected by the many proposals contained in this relatively compact Notice of Proposed Rulemaking. 

The first part of the FCC's proposal (about which we previously wrote here), is to look at ways to get some of the television stations to give up their current channel to allow the FCC to use it for broadband, and having that station share another station's channel to continue to provide its program service on what is the equivalent of a digital subchannel.  The proposal to encourage multiple TV stations to share the same 6 MHz channel raises many issues.  First, the FCC recognizes that the proposal may result in some television stations giving up their ability to broadcast in High Definition (one of the principal reasons for the initial transition to digital), but suggests that stations sharing the same channel could work out "dynamic arrangements" to allow sharing the spectrum flexibly, increasing the portion digital bandwidth allocated to one station when it has programming that would benefit from higher definition, while switching some of the bandwidth allocation to the other station at other times. 

While the Commission assumes that each station will continue to exist as an independent station even when sharing a channel with another station, many of its questions in this proceeding seem to signal uncertainty about this conclusion.  Issues on which the Commission seeks comment include:

• What effect will channel sharing have on the deployment of HD programming and mobile television?  The Commission does not ask about 3-D television, which some broadcasters have begun to experiment with, and might be worth a comment if there are those who expect that to be part of the television future that could be affected by channel sharing arrangements.
• In channel sharing, would each station be able to maintain a Standard Definition signal at all times?
• The Commission assumes that each station sharing a single channel (and thus a single transmission facility) would retain a separate license, and be individually responsible for FCC-rule compliance (e.g. EAS, indecency, children's television, political broadcasting, etc).  How would responsibility over the technical compliance be apportioned?
• Should commercial and non-commercial stations be allowed to share the same channel?  Could commercial stations share channels that have, to this point, been reserved for noncommercial educational uses?
• Will there be a loss in service to the public from such combinations?  Will there be television "white" and "gray" areas created, i.e. areas where there will be no over-the-air television service or only a single service?
• Should cable and satellite service be included when evaluating questions of loss of service?
• What impact should channel sharing have on other FCC rules, like the media ownership rules?

Perhaps the biggest issue with channel sharing is the cable and satellite carriage issue, which raised a number of issues for the Commission.  The issues, summarized below, also demonstrate the Commission's tentativeness in its conclusion that two stations sharing the same channel are really independent stations.

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The Commission today released an Order conditionally designating 9 companies to be database administrators for white spaces devices.  As we wrote in our article describing the FCC's recent decision on reconsideration of its White Spaces order, these administrators will be responsible for maintaining a database of all users of the TV spectrum who must be protected from interference from white spaces devices.  Protected entities include TV stations, LPTV stations and TV translators, cable and satellite receive locations, certain wireless microphone users, and the paths between TV stations and translators.  Each database must maintain all of this information, so that white spaces devices can determine what channels must be protected in areas in which they are operating. 

The conditional nature of the designation reflects the fact that these administrators had requested designation in late 2009, before the recent Order on Reconsideration which adopted the new requirements that all white spaces devices must communicate with these administrators instead of relying on any sort of spectrum sensing.  Thus, the FCC is requiring the proposed administrators to update their filings to reflect that they can meet the new requirements for the maintaining the database.  One of these new requirements is one of security - so that it can be ensured that the users will have an accurate data base from which to operate, without fear of tampering or other abuses.  The FCC will also require that each administrator attend an education session conducted by the FCC, and to go through a rigorous testing period - with tests conducted by the FCC to make sure that the administrator's service will actually provide the necessary information to protect incumbent TV spectrum users from interference from white spaces devices.

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Many broadcasters, both television and radio, have been running the NAB spots on the Future of Television.  Those spots contain a description of the service available from local television stations and the new technologies that over-the-air television are in the process of deploying, and end with the suggestion that the Future of Broadcast Television lies in "technology not regulation from Washington DC."  Obviously, these ads are geared to address some of the many legislative and administrative issues facing TV broadcasters - including the proposals to take back some of the TV spectrum for wireless broadband uses.  Given that these spots could be arguably be seen as addressing Federal issues, to be safe, they should be identified as issue ads in stations' public inspection files, and appropriate information about those spots should be placed in the files.

The NAB, in announcing the availability of these spots, suggested this same precaution.  We've written before about issue ads, and the need to place notations in the public file about these ads. For instance, when stations ran ads on the broadcast performance royalty, we suggested that same treatment (and proponents of the royalty complained that broadcasters might not be making such notations).  What needs to go in the public file?  As the issues are Federal ones (as opposed to state and local issues that have lesser disclosure obligations), the requirements are similar to those that apply to political candidates. 

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Yesterday, the House of Representatives passed the CALM Act, directing the Federal Communications Commission to adopt regulations controlling the volume of commercials on television broadcast stations, cable systems, satellite, and other multichannel video programming providers. This bill was passed by the Senate in September.  Once signed by the President, the Federal Communications Commission will be required to adopt a rule to implement the legislation within one year, and the rule is to become effective within one year after its adoption. The FCC rule is to adopt parts of the ATSC A/85 standard, which seeks to target the volume of commercials in digital programming to the volume of dialogue (or other “anchor element”) in the accompanying program. An interesting description of the issues that must be addressed in determining just what is "loud," and for controlling that volume, can be found in a recent Wall Street Journal article (here, subscription may be required). 

Congressional estimates are that the costs of necessary equipment range from a few thousand dollars to $20,000 per device, for an aggregate industry cost of tens of millions of dollars. Congress anticipated that the costs may be burdensome for small cable operators and smaller market television broadcasters, and provided that waivers may be granted for financial hardship for one year renewable terms  The Commission may also grant waivers or exemptions from the rule that it adopts for classes of broadcasters and multichannel video programming distributors under the FCC’s general waiver authority.

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The FCC today started an examination of the future of the spectrum currently used by broadcast television, beginning the formal process of implementing the ideas raised in its Broadband Plan of repurposing some of that spectrum for use by wireless broadband technologies. Specifically, the FCC adopted a Notice of Proposed Rulemaking, seeking comment on a number of issues. While the full text of the FCC’s order has not been released, many of the issues for consideration can be gleaned from the comments made at the FCC meeting. In the initial presentation made about the NPRM, it was stated that the principal issues to be addressed in the NPRM were:

• Allowing new primary allocations in the television spectrum for fixed and mobile wireless users.
• Providing a framework that would allow two or more broadcast television stations to share a single 6 MHz channel, retaining full must-carry rights for each station, while allowing for the return of spectrum to the FCC to be auctioned for wireless uses
• Looking at ways to increase the value of VHF television channels (channels 2 through 13) for DTV use, including proposals to allow stations operating on such channels to operate at higher power and to increase performance standards for indoor antennas

Co-primary uses could be important for many TV users, as currently LPTV and TV translator stations are secondary services, implying that such services might be preempted by new primary wireless users.  The enhancement of the VHF spectrum would be important to any attempt to dedicate significant spectrum to wireless broadband without substantial disruption to over-the-air television, as without the use of those channels (which are underutilized, particularly in urban markets, as they have proved to be very susceptible to interference and do not provide as broad coverage as VHF analog service did), the ability to repack the TV spectrum to clear portions of the spectrum for wireless would be very restricted in the major metropolitan areas where any spectrum crunch is likely to be most acute. 

As FCC Chairman Julius Genachowski stated, this was an efficient presentation on an important issue. The explanation of the proposals took far less time than each of the Commissioner’s individual statements, all of which raised important issues that will be addressed in this proceeding.   The FCC public notice about this proceeding is available by clicking here.  But an examination of each of the Commissioner's statements (which are available through the links on their names, below) is important to understand the scope of the issues to be addressed by the FCC. 

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After Thanksgiving - everyone's thoughts turn to technology policy.  Well, maybe not everyone, but reading Thursday's New York Times, David Pogue wrote his column celebrating his 10th anniversary in the paper with observations about truths that he has discovered about the technology world.  Many of those same truths apply to broadcast policy, and are particularly relevant with a week coming up in which the FCC may take its first steps toward dramatically reshaping the media landscape as it considers the future of the television spectrum, and potentially repurposing some of that spectrum for wireless broadband.  Pogue's first observation was that new technology does not replace old technology - instead it merely provides more choice to the consumer.  He points out that TV did not replace radio, and that satellite radio didn't replace radio either.  Instead, these services became complements, perhaps eroding the audience of the established technology in some ways, and perhaps making the older technology redefine its mission, but the older technology survived, and remained relevant.  We've written similar observations about the future of radio - it's a technology that reaches masses with no incremental costs for adding new listeners - and is now and, for the foreseeable future will be, the most efficient way to reach large audiences with popular formats.

It is a similar story with other communications media.  And we sometimes over-react to short term trends believing that some audience erosion for a particular technology will result in its doom, when in fact it may just result in some form of re-invention.  In the last two years, we've seen print media go from being left for dead, to being part of one of the most talked about media deals of the last month - the merger between the Daily Beast and Newsweek to bring a print component to a new media darling.  Television, too, is not dead yet - it still the most watched source of video programming, whether distributed over the air or through some multichannel video transmission source, with over-the-air programming about to get a new take as mobile DTV begins its roll-out in the coming months. Recently, there has even been the occasional article about consumers "cutting the cord" - relying on over-the-air TV, supplemented by web video content, to drop their cable or satellite connection.  As Pogue suggests, all these media will continue to survive and offer choices to consumers.  But Pogue does not take into account the potential impact of a fundamental change in regulatory policy that intervenes to disrupt the natural progression of the marketplace.

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Last week, we wrote that the FCC is going ahead with a rulemaking looking at how broadband needs may require some reallocation of the TV spectrum to wireless uses.  The initiation of a rulemaking on that issue is planned for the next FCC meeting in late November.  With that proceeding about to begin, the FCC today froze all applications for new Low Power Television (LPTV) stations and for TV Translators, and for major changes in existing LPTV and TV translator stations.  Over a year ago, after not having accepted applications for a decade during the DTV transition, the FCC allowed the filing of applications for new LPTV stations and TV translators in rural areas.  Finding that much of the demand for new translators has been met in these rural areas in the intervening period, the FCC has now determined that, until the spectrum needs for television and broadband are more certain, it would not accept any more applications for these stations. It appears that the long-planned window for LPTV stations in major markets will not happen in the foreseeable future.

The freeze does allow for the filing of minor changes to LPTV and TV translator stations, for applications to flash cut to digital, and for displacement applications if a full-power station precludes the continued operation of such a station on its current channel.  LPTV and translator stations still operating on channels 52 through 69, which have already been reallotted for wireless uses, can also file displacement applications during the freeze.

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As summarized by Brian Hurh on our sister site broadbandlawadvisor.com, yesterday the FCC's Consumer and Government Affairs Bureau released a Public Notice seeking comments to refresh the record on closed captioning that was last addressed in the Commission's 2005 and 2008 Closed Captioning NPRMs. As recognized by the Commission, much has happened since those proceedings, both technologically and regulatory. As directed by the recently enacted 21st Century Communications and Video Accessibility Act (which we blogged about earlier here, and discussed in DWT's Advisory here), the FCC's rules must be revised to extend closed captioning to the Internet within 6 months of the Advisory Committee's report on closed captioning, which must be released by October 2011. As we noted earlier, the Advisory Committee must be formed by December 8, and hold its first meeting by April 2011.

The revised closed captioning rules will necessarily require a new closed captioning rule making proceeding, and presumably, the Commission is gathering information now to determine what the forthcoming rule making proceeding will look like. Some of the issues that the Commission seeks to refresh include:

• Whether to establish quality standards for non-technical aspects of closed captioning, including whether different quality standards should apply to live and pre-recorded programming;
• The need for mechanisms and procedures over and above the "pass through" rule, and whether there should be a per violation forfeiture amount for non-compliance;
• Whether the FCC should revise its rules to disallow the use of electronic newsroom technique for certain DMAs;
• How the section 79.1(d)(12) exemption for channels producing revenues of less than $3 million should apply to digital mulitcast, specifically, the ramifications of treating each multicast stream as a separate channel for purposes of the exemption.

Comments are due November 24.  Reply comments are due December 9.  Comments can be submitted to the FCC in paper, or electronically via the FCC's Electronic Comment Filing System. 

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FCC Chairman Julius Genachowski announced today that the FCC is ready to move forward with preparations for incentive auctions in anticipation of receiving Congressional authority for such auctions at some point in the future.  In a speech at the Spectrum Summit held today at the FCC in Washington, DC, Genachowski invoked President Eisenhower, FDR, and the transcontinental railroad, among other historical figures and events, to emphasize his belief that America is at a critical time in its history and that ensuring a steady flow of spectrum for wireless use in the next five to twenty years will be crucial to the growth and prosperity of the United States of America.  This is potentially welcome news for wireless carriers eager for new spectrum, but also a clear warning to television broadcasters that as far as the FCC is concerned it is not a matter of if, but rather when, the FCC will have the authority to conduct incentive auctions to facilitate the recapture of television spectrum and the repacking of the television channels. 

Since the release of the National Broadband Plan in March, which advocated the reclamation and re-purposing of 120 MHz of spectrum currently allocated for free over-the-air broadcast television, the FCC has quietly proceeded to meet with broadcasters and prepare for the possibility of incentive auctions.  Now, following on the heels of the recent TV White Spaces order, which we wrote about recently here and here, Genachowski has announced that the Commission will consider a Notice of Proposed Rule Making at its November 30th open meeting "that would lay essential groundwork for implementing incentive auctions quickly should Congress act."  According to the Chairman's speech, the forthcoming item will explore a licensing framework that would allow stations to "voluntarily" share channels and examine new ways to improve the digital television reception of VHF channels in hopes of making that spectrum more attractive as a home for relocated television stations. This last issue is particularly interesting, given that the Engineering Forum held by the Commission in June explicitly explored the issue of improving VHF reception and found that there was little or no way to improve the reception of digital stations operating on VHF channels.  But the Commission will have to find someplace to move broadcast stations, and it will undoubtedly explore all options in the effort to meet the challenge of freeing up spectrum. 

At a recent seminar held by the Federal Communications Bar Association, an economist from the FCC described how the process would work.  Essentially, broadcasters would make a bid for what they would accept to do one or more of the following (i.e. "how much would it take before you'd..."):  1.) share a channel with another broadcast station, 2.) move to a VHF channel, or 3.) cease broadcasting altogether.  Then, new entrants would make offers as to what they would bid for new spectrum.  The Commission would compare and reconcile the two elements, consummate the transactions, and then repack the television spectrum to accommodate the amount and location of the new spectrum sold.  This is a grossly simplified version of what the FCC, auction experts, and economists anticipate the incentive auctions will look like, but it was clear that the FCC has given incentive auctions a lot of thought and is eager for the opportunity to put the theory into practice.  It will be interesting to finally have the FCC put this theory on paper and present it for public comment in the forthcoming NPRM.  It will also be interesting to see how the FCC will conduct a rule making in the abstract, as it is almost guaranteed to not have any statutory authority for the type of auctions it will be seeking to draft regulations to govern. 

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The FCC's long-awaited White Spaces decision, revisiting its authorization of the operation of unlicensed wireless devices in the television spectrum (see our summaries of the intial order here and here), has finally been released.  The FCC decision and associated comments of the Commissioners promise Super Wi-Fi, or Wi-Fi on Steroids, and a host of other wireless digital marvels, without significantly interfering with the incumbent users of the spectrum (principally TV stations and wireless microphone users).  In this order on reconsideration, the FCC addresses many issues raised by many parties to the proceeding - some suggesting that the FCC has not sufficiently protected the incumbent users, while others arguing that the limitations on wireless users are too onerous.  For broadcasters, some of the highlights of the decision include:

• No change in the interference protections given to TV broadcasters.  Some had suggested the use of various alternative propagation methods to be used instead of the standard FCC method of predicting the protected contours of television stations.  The FCC rejected these proposals, finding that alternatives would not be more accurate in predicting potential interference.  One minor correction including in the database that will be used by wireless devices to protect stations from interference will be included - information on a television station's antenna beam tilt.
• No change in the protection of LPTV station protected contours.  LPTV advocates had suggested that greater protection was required for LPTV stations that were still operating in an analog mode.  This was rejected by the Commission, given the impending digital transition for LPTV (see our summary of the LPTV digital transition, here)
• Greater protection was afforded to cable headends, TV translator receive sites, and the receive locations for Satellite television providers (like DISH and DIRECTV) and other Multichannel Video Providers (MVPDs), so that existing television reception, no matter how it is received will be protected.  The current rules provide that such sites within 80 km from the edge of a television station's protected contour can register in the database to be used by white spaces devices to determine where they can operate.  The Commission recognized that sites beyond that 80 km distance may also need protection.  Such sites can petition the FCC for waiver of the 80 km distance within 90 days of the effective date of this order, and the FCC will seek comment on whether or not to accord the site protection.  New sites need to register within 90 days of being put into service. 

Some of the other issues addressed by the Commission, including a big change in how these devices will operate to prevent interference, are summarized below.

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As the media has reported extensively this week (for example here and here) the FCC is poised to tap into the television spectrum to allow the use of that spectrum on an unlicensed basis, potentially leading to a wave of innovative unlicensed devices, including potentially turbo-charged Wi-Fi.  On the tentative agenda released recently for the next open Commission meeting, to be held next Thursday, September 23rd, the Commission has included an item entitled:  "TV White Spaces Second MO&O:  A Second Memorandum Opinion and Order that will create opportunities for investment and innovation in advanced Wi-Fi technologies and a variety of broadband services by finalizing provisions for unlicensed wireless devices to operate in unused parts of TV spectrum." 

As watchers of the TV white spaces issue will recall, the Commission adopted an Order in late 2008 to permit the operation of unlicensed devices in the so-called "TV white spaces", which is the spectrum in the TV band that is not actively occupied by a television station in a particular geographic area.  (An earlier advisory by Davis Wright Tremaine summarizing the Commission's 2008 Order can be found here.)  Following the adoption of that Order, over a dozen parties sought reconsideration of the Commission's decision; those petitions remain pending.  It is not clear whether the proposed Order would be an Order on Reconsideration, but presumably it will address the issues raised by these petitioners.  In addition, the NAB (National Association of Broadcasters) and others filed an appeal in the Court of Appeals for the D.C. Circuit seeking to challenge the FCC's white spaces Order.  That appeal is on hold pending the Commission's resolution of the Petitions for Reconsideration.  Despite the unresolved objections, in late 2009, the FCC moved forward with putting a spectrum management structure in place that would establish a privately maintained database that would permit coordination in order to locate unused spectrum in the TV band in a particular area.  We summarized this step in an earlier blog entry here.  In early 2010, nine parties submitted proposals to be designated TV Band Device Database Managers, but to date the matter remains pending. 

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Interested in a brand new full power digital television station in Atlantic City, New Jersey, or Seaford, Delaware?  Then the FCC has just what you're looking for, provided that you're ready, willing, and able to build the station from the ground up and don't mind a low VHF channel.   The Commission today issued the first auction notice regarding Auction No. 90 for the auction of two new full power commercial television stations.  Having amended the DTV Table of Allotments earlier this year to drop in DTV Channel 4 at Atlantic City, New Jersey, and DTV Channel 5 at Seaford, Delaware, the Commission has moved quickly to the competitive bidding stage and starting the process to offer these new channels to interested parties.  Today's Public Notice is the first step in the auction process and seeks comment on the rules and procedures for the auction, including the proposed minimum opening bid amounts that it has set for each station, namely, $200,000.  The auction rules proposed by the Public Notice are consistent with those used in other recent broadcast auctions and don't really offer any surprises. The Commission does not propose a date for the proposed auction and that will be set by a future auction Notice.  Comments on the Commission's proposed auction procedures and minimum bid amounts are due by September 30th, with replies due by October 15th. 

By allocating and offering these new VHF channels for commercial television operations, the Commission is satisfying Section 331 of the Communications Act of 1934, as amended, which directs the Commission to allot at least one VHF TV channel to each state to the extent technically feasible.  Given the recent and ongoing debate over the possible reclamation of television spectrum or changes to the television interference protections,  it seems a bit counter-intuitive that the Commission is moving quickly to offer these two new full power TV stations, particularly in the (generally speaking) congested Mid-Atlantic Region.  Further, given the issues encountered by other DTV stations in operating on low VHF channels, Channels 4 and 5 may not be seen as prime spectrum, again particularly in the congested Northeast.  Both of those things said, however, a full power TV station is still a full power TV station.  And cable and satellite must-carry rights are hard to come by, not to mention the fact that the stations are located in Atlantic City, NJ and central Delaware, respectively.  So unless something radical happens in the next 12 months -- say like all consumers migrating to the consumption of television via the Internet instead of broadcast, cable, or satellite television -- it's likely that there will be a fair bit of interest in the auction of these two new stations.  

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Continuing its implementation of STELA (a.k.a. the Satellite Television Extension and Localism Act of 2010), the Commission last week released an Order granting the application of satellite television provider DISH Network, LLC, and allowing DISH to once again import distant, out-of-market broadcast television signals.  In its Order approving DISH's application, the Commission agreed that the DBS provider:  1.) had initiated local-into-local carriage in all 210 markets, including 29 markets in which it had not previously offered local signals; 2.) is predicted to provide a good quality satellite signal to 90% or more of the households in each of the 29 previously unserved markets; and 3.) that there are no technical failures that would preclude DISH's continued compliance with these first two elements.  Having met these requirements, DISH has satisfied the statutory requirements established by STELA and may now once again avail itself of the compulsory copyright license in order to offer distant television broadcast signals to qualified subscribers.  With the Commission's Order, the previous court ruling from 2006 that had barred DISH (then Echostar Communications) from offering distant signals is effectively moot and DISH is back in the business of importing distant signals.  This is a big step for DISH and one that it pushed hard to include in STELA.  And of course the upside is that now DISH subscribers in all 210 television markets have access to local television stations via DBS -- provided that DISH and the local stations have reached agreements for carriage, which was not yet the case according to the one party who commented in the FCC's proceeding. 

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The FCC has issued another in a series of Notice of Proposed Rule Makings aimed at implementing changes to the satellite television rules brought about by the recently enacted Satellite Television Extension and Localism Act of 2010 or "STELA".  In particular, by its NPRM issued last week, the Commission proposes a predictive model to provide presumptive determinations as to whether a household is considered unserved by a local network-affiliated digital station.  The model proposed is a point-to-point predictive model that will allow parties to determine whether a particular location has the ability to receive an over-the-air digital television broadcast signal at the intensity level necessary for service.  The predictive model proposed by the Commission is based on the current model used for predicting reception of analog signals, which uses Longley-Rice to predict signal propagation. 

In proposing this predictive model, the Commission tentatively concludes that the current standard for an outdoor antenna should continue be used in predicting digital television signal strengths at individual locations.  Although STELA revised the definition of an "unserved" household by changing the previous statutory reference to a "conventional, stationary outdoor rooftop antenna" to refer simply to the use of an "antenna" (as we mentioned in our earlier blog), the Commission's recent NPRM finds that the Act's specification of the DTV standard incorporated in the FCC's rules implies the use of an outdoor antenna to receive service.  Therefore, the predictive model the Commission proposes in its NPRM for determining reception of over-the-air digital television signals will continue to include the outdoor antenna standard (with some adjustments for height).  That said, and as the Commission itself notes, given that both of the satellite television providers are moving towards providing local-into-local service in most markets, the need for making determinations as to which households are "unserved" (and hence eligible to receive distant signals), is diminishing, although there are still a number of markets where such local-into-local service has yet to be implemented. 

Although STELA also narrowed the unserved standard to focus just on the reception of signals from an in-market affiliate (rather than simply any affiliate) and to address the notion of multicast digital streams, these changes do not impact the Commission's adoption of a predictive model, and thus were not explicitly addressed by the NPRM.  However, the Commission does include a Further Notice of Proposed Rule Making to address issues regarding on-site measurements in the event that a subscriber requests an on-site signal strength test following application of the predictive model.  Here again, the Commission proposes to limit measurements to outdoor antennas.  Comments on the Commission's proposed rule changes will be due 20 days after publication of the NPRM in the Federal Register, which, as of this writing, has not yet occurred. 

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Last week, the FCC's Media Bureau granted waivers of the requirement that television tuners be capable of receiving both analog and digital television transmissions, but only with respect to tuners meant for mobile use.  The FCC justified the waivers of the All Channel Receiver Act given the technological constraints that an analog reception chip would put on mobile receivers meant for the reception of the Mobile/Handheld Digital Television Standard (A/153) signals.  This signal is being tested now to allow television broadcasters to provide mobile programming in addition to their current over-the-air broadcast signals - a service planned for commercial roll out at the end of the year.  These waivers, granted in response to requests by Dell and LG Electronics, not only signal the seriousness with which this new service is being regarded, but also provide evidence of the coming end of analog television, now used solely by LPTV stations.   

In considering the waiver, the Commission recognized that the only television stations that would be affected by the lack of an analog tuner were LPTV stations, and no such stations opposed the waiver request.  As one of the waiver proponents noted, analog television signals were not meant for mobile reception, and thus the lack of such a receiver in a mobile device was no big loss.  Moreover, the FCC noted that the digital conversion of LPTV stations has already begun, in that it no longer accepts applications for new analog LPTV stations.  The Commission reiterated that it will soon set a date for the final conversion of the last analog LPTV stations to digital.  Thus, the failure to receive analog would be, at most, a temporary issue.

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The FCC has wasted no time on the television reallocation proposal outlined in its National Broadband Plan, scheduling the first of four working sessions on the issue for two weeks from now.  The first session will be held at the FCC on Friday, June 25, 2010 from 3:00 to 6:00 PM.  These working sessions are intended to address the technical challenges of the reallocation proposal.  According to today's Advisory released by the FCC, the Commission has invited "a number of broadcast industry engineers and technical experts in related fields" to participate in the sessions.  On the agenda for the June 25th meeting are such topics as:  The Cellularization of Broadcast Architecture, Methodologies for Repacking the TV Band, Advancements in Compression Technology, and Improvements in VHF Reception.  It's not clear who has been invited to attend or what the goal of the meeting is with just 30 minutes allocated to each of these four huge topics, but it is clear that the FCC is full speed ahead on its proposed reallocation of spectrum from the TV bands.  See our earlier posting here discussing the spectrum reallocation plan and the potential impact on broadcasters.  The meeting is open to the public and available online at http://reboot.fcc.gov/live/ for those interested in following the proceedings, which should be just about everyone in the television broadcast industry. 

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In recent years, as competition in the video marketplace has become more intense, in a number of broadcast television markets, competing stations have teamed up to combine certain of their operations to achieve economies while still allowing for some degree of independence of programming.  Under these "shared services agreements", one station will provide back-office support and often advertising sales for another station in the market.  Where the station providing the support programs less than 15% of the programming hours of the station being supported, the contractual arrangement is not "attributable under the FCC's multiple ownership rules.  Thus, these services can be provided in circumstances where the supported station could not be owned by the station that is providing the services.  Nevertheless, a number of these arrangements have been under attack from public interest groups, and recent Commission actions indicate that the FCC may well be reviewing its position on these sorts of agreements.

A few weeks ago, in approving an application which provided for a shared service agreement between two television stations in the same market (over the objection of a competitor), the FCC noted that it was approving the deal as consistent with its rules as they are currently enforced, but warned that the arrangements would be reviewed as part of the FCC's review of its multiple ownership rules - a review which is to take place this year.  This week, the FCC agreed to treat a case in Hawaii, which has generated much controversy and press coverage, as a "permit but disclose" proceeding, meaning that parties are not confined to the usual process of arguing their cases through written submissions served on all parties (or meetings at which all parties are present).  Instead, interested parties can now meet with FCC decision-making staff (including FCC commissioners) on their own, as long as they file an "ex parte" notice in the record summarizing the presentations that they made.  This process is usually used only for high-profile decisions with potential far-reaching impact or where new policy is potentially to be made. 

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The FCC today issued a further Public Notice reminding all Video Programming Distributors (VPDs)-- including those who might otherwise be exempt from some elements of the closed captioning rules -- to register their contact information with the FCC.  All VPDs, including television stations, should have already identified appropriate contact people within their organizations and filed their contact information with the FCC.  Although that info was due to the FCC by March 22, 2010, today's Public Notice, available here, indicates that many folks still have not yet complied with the new rules.  Accordingly, the FCC is seeking to increase compliance by reminding VPDs of this obligation and encouraging distributors to register their contact belatedly.  All television stations and other VPDs should ensure that they have taken the necessary steps and registered their contact information with the FCC.  While the FCC has exercised its discretion thus far and issued a reminder instead of simply cracking down and commencing enforcement proceedings, video programming distributors are now on notice.  And the next actions by the Commission with regard to this new rule will undoubtedly be more aggressive and could possibly involve enforcement actions.

As we've discussed previously, a new FCC closed captioning rule recently went into effect that requires video programming distributors to establish:  1.)  a contact person for handling immediate closed captioning concerns, and 2.)  a contact person for receiving written captioning complaints of a general or non-time sensitive nature.  In order to assist viewers and potentially facilitate the resolution of such captioning complaints, the rule requires that video programming distributors publicize the appropriate contact information and also provide the contact information to the Commission, which will maintain a database open to consumers.  Thus, by March 22, 2010, all television stations and other distributors were to have designated a contact person, posted the necessary contact information on their web site (and in any phone directories the distributor may advertise in), and submitted the information to the FCC.

If stations failed to file that info by March 22nd, they should do so immediately.  The best way for stations to file this information with the FCC is to visit the FCC's website and submit the information online. The Commission’s website contains a detailed web form with step-by-step instructions to walk applicants through the process.  Alternatively, the contact information can be e-mailed directly to the FCC’s Disability Rights Office at: CLOSEDCAPTIONING_POC@fcc.gov . 

Video programming distributors must keep their contact information current and update both their websites and the Commission’s database within 10 business days of any changes to the information. Further details about the contact information requirement and the revised FCC closed captioning complaint rules can be found in our earlier posting here.

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The FCC today issued a Public Notice  instructing applicants for new analog low power TV (LPTV) stations to amend their pending short-form applications by May 24th in order to specify digital operations. If the short-form application is not amended by May 24th it will be dismissed.  As some of you may recall, way back in 2000 the FCC opened a window for the filing of new LPTV stations. Rather than full applications, at the time applicants were simply required to file a "short form" tech-box application specifying the basic parameters of the proposal.  And of course, at the time the proposals were all for new analog LPTV facilities. Over the years, many of these proposals were found to be non-mutually exclusive, and the applicant applied for and received construction permits for new LPTV stations.  Other proposals were conflicted and were included in an FCC Auction to resolve the conflict, which also resulted in the grant of new construction permits. Many others, however, remained mutually exclusive and deadlocked. The FCC has now decided that, as it will no longer grant any new analog LPTV stations, any remaining proposals that are still pending must be amended to specify digital operations. 

Today's action is consistent with the Commission's pronouncement made last Summer when it announced the opportunity to commence filings for new LPTV stations in rural areas (which we wrote about here).  At that time, the FCC stated that going forward it would grant only digital LPTV stations and not any new analog LPTVs.  It's unclear why today's Public Notice was not released last year once that decision was made, but in any event today's action would appear to be one more step towards the ultimate transition of all LPTV stations to digital operations, which was mentioned as part of last week's National Broadband Plan (which we discussed here).  While the Commission has not yet set a date for the transition of existing analog LPTV stations to digital, the Broadband Plan suggested accelerating that process to migrate all broadcast television to digital operations.  However, the Plan also suggested potentially repacking the television spectrum, encouraging the consolidation of television operations, and changing interference protections for teleivsion stations, so whether the Commission would move forward with requiring analog LPTV stations to convert to DTV without clarifying some of these new proposals and their impact on low power television stations is unclear.  One other observation:  with the potential conversion to digital operations looming, the days of analog LPTV stations operating on TV Channel 6 and broadcasting audio intended to be received by FM radios would appear to be numbered. 

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Just a reminder that all Video Programming Distributors -- which includes broadcast television stations --  must identify a contact person for closed captioning issues, both immediate issues and general complaints, and file that contact information with the FCC by March 22, 2010.  As we've discussed previously, new FCC closed captioning rules recently went into effect that require video programming distributors to establish a contact for handling immediate closed captioning concerns, as well a contact for receiving written captioning complaints of a general or non-time sensitive nature.  In order to assist viewers and potentially facilitate the resolution of such captioning complaints, the rules require that video programming distributors publicize the appropriate contact information and also provide the information to the Commission, which will maintain a database open to consumers.  

Accordingly, by March 22, 2010, television stations must designate a contact person, post the necessary contact information on their web site (and in any phone directories the station may advertise in), and submit the information to the FCC.  The best way for stations to file this information with the FCC is to visit the FCC's Web site and submit the information online. The Commission’s Web site contains a detailed form with step-by-step instructions that will walk applicants through the process.  Alternatively, the contact information can be e-mailed directly to the FCC’s Disability Rights Office at: CLOSEDCAPTIONING_POC@fcc.gov.

Video programming distributors must keep their contact information current and update both their Web sites and the Commission’s database within 10 business days of any changes to the information.  Further details about the contact information requirement and the revised FCC closed captioning complaint rules can be found in our earlier posting here. 

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On Friday, Feb. 19, 2010, two important new closed captioning rules were published in the Federal Register and went into effect. The new rules require immediate attention by video programming distributors -- including broadcast television stations -- to ensure that they respond promptly to viewer complaints regarding closed captioning issues, and to ensure that they timely file contact information with the FCC by March 22, 2010. 

As detailed in Davis Wright Tremaine’s November 2008 advisory and subsequent January 2009 advisory update, the Federal Communications Commission (FCC) adopted a Declaratory Ruling and Order in late 2008 that, among other things, imposed new requirements on video programming distributors with respect to fielding inquiries and complaints about closed captioning.  While the implementation of some aspects of those rules was delayed initially, with Friday's publication in the Federal Register, two of those are now in effect.  The new rules, and the obligations they impose on video programming distributors, are discussed below. 

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A reminder that by February 1 noncommercial radio stations in Arkansas, Louisiana, Mississippi, New Jersey, and New York, and noncommercial television stations in Kansas, Nebraska, and Oklahoma must prepare and file electronically a biennial Ownership Report with the Federal Communications Commission (FCC) using the current noncommercial FCC Form 323-E.

Please note, this filing date applies only to noncommercial radio and TV stations in the states listed above. The FCC has revised its rules regarding the reporting of ownership interests for commercial broadcast stations, and has revised the commercial Ownership Report – Form 323. Although commercial broadcast stations will file on a unified reporting deadline, by Order released late December 2009, the FCC has suspended indefinitely the filing of biennial Ownership Reports for commercial broadcast stations as we've posted previously. The Commission is taking additional time to address certain issues raised by petitioners and to revise the new form further.  Once the FCC re-releases the form, stations will have 90 days to file the report, so stations should watch this space or the FCC's releases for future news about the return of the Ownership Report for commercial stations. 

Noncommercial stations, on the other hand, continue to follow the previous rules filing biennial Ownership Reports on FCC Form 323-E, which has not been revised. The FCC is conducting a rule making proceeding to change, potentially, some of the ownership reporting rules for noncommercial licensees, but meanwhile, noncommercial broadcast stations continue to follow the existing rules.  Accordingly, as Feb. 1, 2010, marks the two-year anniversary of the filing of a biennial Ownership Report for noncommercial stations in the above-referenced services and states, those stations must now file a biennial Ownership Report to update their ownership information or affirm the information currently on file.  More information about this filing deadline can be found in our recent client advisory, available here.  

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Another year is upon us, and it’s time for predictions as to what Washington may have in store for broadcasters in 2010.  Each year, when we look at what might be coming, we are amazed at the number of issues that could affect the industry – often issues that are the same year to year as final decisions are often hard to come by in Washington with the interplay between the FCC and other government agencies, the courts and Congress. This year, as usual, we see a whole list of issues, many of which remain from prior years. But this year is different, as we have had a list topped by issues such as the suggestion that television spectrum be reallotted for wireless uses and the radio performance royalty, that could fundamentally affect the broadcast business.  The new administration at the FCC is only beginning to get down to business, having filling most of the decision-making positions at the Commission.  Thus far, its attention has been focused on broadband, working diligently to complete a report to Congress on plans for implementation of a national broadband plan, a report that is required to be issued in February.  But, from what little we have seen from the new Commission and its employees, there seems to be a willingness to reexamine many of the fundamental tenants of broadcasting.  And Congress is not shy about offering its own opinions on how to make broadcasting "better."  This willingness to reexamine some of the most fundamental tenets of broadcasting should make this a most interesting, and potentially frightening, year. Some of the issues to likely be facing television, radio and the broadcasting industry generally are set out below.

Television Issues.

In the television world, at this time last year, we were discussing the end of the digital television transition, and expressing the concern of broadcasters about the FCC’s White Spaces decision allowing unlicensed wireless devices into the television spectrum. While the White Spaces process still has not been finalized, that concern over the encroachment on the TV spectrum has taken a back seat to a far more fundamental issue of whether to repurpose large chunks of the television spectrum (if not the entire spectrum) for wireless users, while compressing television into an even smaller part of what’s left of the television band – if not migrating it altogether to multichannel providers like cable or satellite, with subscription fees for the poorest citizens being paid for from spectrum auction receipts. This proposal, while floated for years in academic circles, has in the last three months become one that is being legitimately debated in Washington, and one that television broadcasters have to take seriously, no matter how absurd it may seem at first glance. Who would have thought that just six month after the completion of the digital transition, when so much time and effort was expended to make sure that homes that receive free over-the-air television would not be adversely impacted by the digital transition, we could now be talking about abolishing free over-the-air television entirely? This cannot happen overnight, and it is a process sure to be resisted as broadcasters seek to protect their ability to roll out new digital multicast channels and their mobile platforms. But it is a real proposal which, if implemented, could fundamentally change the face of the television industry.  Watch for this debate to continue this year.

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This afternoon the FCC announced that it would postpone the opportunity to apply for new digital low power television stations until July 26, 2010. The Commission had begun accepting applications for new digital LPTV stations in so-called rural areas beginning in late August, and had previously announced that it intended to expand the first-come, first-served filing opportunity to the rest of the country starting January 25, 2010.  The Commission has now pushed that date back by six months, allegedly to allow it more time to process the applications that it has already received thus far, and also to allow the “Commission staff to dedicate additional time and resources for consideration of the Broadband Plan.”  It is not clear whether this statement literally means that engineers from the Low Power branch of the Video Division of the Media Bureau have been assigned to assist with the Broadband Plan, or if the FCC is simply hesitant to issue permits for more new LPTV stations until it figures out the future of broadcast television.  Either way, the Commission has decided to step back from accepting applications for new digital LPTV stations, at least for now.  A copy today's public notice can be found here. 

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Only a day after asking over-the-air television broadcasters to justify their existence and why some or all of their spectrum should not be reclaimed by the FCC to be used for wireless broadband (and giving interested parties only until December 21 to not only justify their existence, but also to come up with technical means by which the spectrum could be more efficiently used, business plans for their future use of the spectrum, and a survey of the competing needs for that spectrum - see more detail below), the FCC issued another request for comments, asking how current video devices could be made more accommodating to Internet video.  These comments, also due on December 21, seemingly bring consumer electronics manufacturers and multi-channel video providers into the FCC's rapidly-expanding evaluation of the video industry and its future.  As the comments filed in connection with these two requests will no doubt lead to proposals to be included in the FCC's February report to Congress on strategies for broadband deployment, these quickly prepared filings could help determine the future of the video industry for the foreseeable future.

The new proceeding, looking for a "plug and play" model of consumer video devices that can access conventional television delivery systems and the Internet, starts with the statement that Internet video is "tremendously popular" and a prediction that, as it expands, new applications for such video will be found.  The Commission says that it sees Internet video as one way of spurring broadband adoption.  How to best promote the plug and play model for consumer video devices that can access the Internet is the crux of the comments that the FCC seeks.  The Commission first asks whether there are currently video devices that allow televisions to view not only the programming provided by multichannel video providers (e.g. cable and satellite), but also Internet video that may be available through an Internet service provided by that same MVPD, stating that it was not aware of such devices.  Next, the Commission asks what would be necessary to develop such devices, and what rules the Commission could adopt to possibly require capabilities in set top boxes and other devices to provide this universal access to video programming of all sorts.  The third area of inquiry from the Commission asks about standards that could be adopted to make Internet video and video from other sources interact with all other home audio and video equipment, including DVRs, to bring about the "digital living room."  And finally the Commission asks what stands in the way of plug and play devices that will work with all networks by which video is delivered.

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The FCC has wasted no time in pressing ahead with the discussion of whether the spectrum currently used by local broadcast television stations is being put to the greatest use and whether it should be "re-purposed" for the so-called broadband effort.  This afternoon, the FCC issued a Public Notice soliciting comments by December 21st regarding the demand for spectrum, the factors the FCC should review when considering the re-purposing of TV spectrum, and potential approaches to increasing spectrum availability and efficiency.  Although the Public Notice asks broad, far-ranging policy questions, the comment date for the "specific data" that the Commission seeks to obtain from interested parties is less than three weeks away, which hardly seems adequate for a proper, informed discussion on an issue of this magnitude.  The specific topics of discussion identified by the Commission and details about how to submit comments can be found in the Commission's Notice. 

Among the issues broadcasters will undoubtedly address (and indeed have already begun to address in other forums) is the fact that the forthcoming spectrum crisis -- which seems to have become a given in certain circles -- has not been well substantiated.  Related to that is the notion that broadcasters already have the ability to lease any "excess" digital television spectrum and use the capacity to provide broadband access, mobile services, or virtually anything else under the sun.  Stations will likely suggest that this mechanism will allow the wireless broadband market to tap this spectrum without further government intervention, if and when the demands of the wireless market require it.  Other issues sure to be of discussion is the value of local broadcast stations, the usefulness of free over-the-air broadcasting, the future of broadcast journalism, and the service stations provide to the public, just to name a few.   It will be challenging, to say the least, for commenters to quantify and address any of these significant questions within just 19 days. 

Having just completed the DTV transition six months ago, it seems that broadcasters have barely been given a chance to operate on their digital spectrum and to explore the options afforded by the transition in terms of high-definition, multicasting, data casting, broadband access, and mobile TV, just to name a few, before having to rush to defend its use, or lack thereof.  The Commission's rush to solicit comments is clearly guided by its need to develop a broadband plan early next year, however, the issues raised by today's Public Notice are among the most significant it has ever attempted to address, certainly with respect to broadcasting and mass media.  It goes without saying, but there is much, much more to be said about these issues, so stay tuned.   And see our earlier blog entries (including here) for further thoughts on the matter. 

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A year after the FCC issued its order adopting the "White Spaces" proposals (about which we wrote here and here), to allow wireless devices to operate in unused portions of the television band on a non-interference basis, the FCC took its first steps toward actual implementation of that order by issuing a request for Proposals from entities wishing to be considered for the position of Database Manager.  This Database Manager will play a very important role in the implementation of the White Spaces order, as it will identify all of the current operators in the TV band that the new wireless devices will have to protect while operating in a given region.  In its White Spaces order, the FCC concluded that not all of these devices could, on their own, adequately sense where there were TV stations or other spectrum users that needed to be protected.  Thus, the White Spaces devices need to be able to communicate with the database to be maintained by the Manager, to make sure that they are operating on clear portions of the television spectrum.  White Spaces devices need to protect not only full power TV stations, but also Low Power TV stations and TV translators, as well as the path between a full-power TV station and any translator that rebroadcasts that station.  Cable system headends which pick up TV signals must also be protected, as well as land mobile users who use portions of the TV band.  Certain regular users of wireless microphones also need to be protected - so the database will need to be very detailed to give the White Spaces devices access to information about all of these existing users who must be protected.

In its Request for Proposal, the FCC has asked that proposed Database Managers provide extensive information by the January 4, 2010 filing deadline.  Information requested includes the following:

1. The entity must demonstrate that it possesses sufficient technical expertise to administer a TV band database. It must demonstrate that it has a viable business plan to operate a database for the five-year term the rules. To the extent that the proponent will rely on fees from registrations or queries, the proposal should describe the fee collection process.

2. The entity must describe in detail the scope of the database functions that it intends to perform, such as managing a data repository, performing calculations to determine available channels, and/or registering fixed unlicensed devices and licensed services not listed in the Commission’s databases, or how it will have functions performed in a secure and reliable manner by another entity. The entity must also describe how data will be synchronized between multiple databases if multiple databases are authorized and how quickly this synchronization of data will be accomplished.

3. The entity must provide diagrams showing the architecture of the database system and a detailed description of how each function operates and how each function interacts with the other functions.

4. If the entity will not be performing all database functions, it must provide information on the entities operating other functions and the business relationship between itself and these other entities. In particular, it must address how the Commission can ensure that all of the requirements for TV band database administrators in the rules are satisfied when database functions are divided among multiple entities, including a description of how data will be transferred among these various related entities and other databases if multiple databases are authorized and the expected schedule of such data transfers (e.g. real-time, once an hour, etc.)

5.  The entity must describe the methods that will be used by TV band devices to communicate with the database and the procedures, if any, that it plans to use to verify that a device can properly communicate with the database. It must include a description of the security methods that will be used to ensure that unauthorized parties can not access or alter the database or otherwise corrupt the operation of the database system in performing its intended functions. In addition, the entity should describe whether and how security methods will be used to verify that Mode I personal/portable devices that rely on another device for their geographic location information have received equipment authorization, interfaces, protocols) that will be used by TV band devices to communicate with the database and the procedures, if any, that it plans to use to verify that a device can properly communicate with the database. It must include a description of the security methods that will be used to ensure that unauthorized parties can not access or alter the database or otherwise corrupt the operation of the database system in performing its intended functions. In addition, the entity should describe whether and how security methods will be used to verify that Mode I personal/portable devices that rely on another device for their geographic location information have received equipment authorization.

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DWT attorneys David Oxenford and Ronnie London both spoke at the Future of Television - East Conference held in New York City on November 18-19, 2009. Dave delivered introductory remarks to the Conference, and participated with Shelly Palmer, Host of MediaBytes, in a discussion "What's the Industry Buzz.". Dave discussed the role of Washington in the Future of Television, outlining the issues facing "television" in its broadest sense - including broadband deployment, net neutrality, the battle over the spectrum, privacy, piracy and content protection, and content regulation.  The slides from his presentation are available here.

Ronnie was a panelist on a panel called The Future of Online Video, participating in a discussion with several CEOs of online video companies.  Ronnie discussed issues including FTC disclosure obligations, sponsorship identification requirements, and privacy concerns for companies offering on-line video.

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By December 1, 2009, all commercial and noncommercial digital television (DTV) stations must electronically file a FCC Form 317 with the Commission reporting on whether the station has provided any ancillary and supplementary services over their digital spectrum during the twelve-month period ending on September 30, 2009.

Under the Commission's Rules, in addition to providing free over-the-air broadcast television, DTV stations are permitted to offer services of any nature, consistent with the public interest, convenience, and necessity, on an ancillary or supplementary basis.  Some examples of the kinds of services that may be provided include computer software distribution, data transmissions, teletext, interactive materials, aural messages, paging services, audio signals, and subscription video.

All DTV stations -- regardless of whether the station holds a DTV license or is operating pursuant to Special Temporary Authority (STA), program test authority (PTA), or some other authority -- must file a Form 317 reporting whether or not it provided such services and whether it generated any income from such services. If the station did provide such ancillary services, then the FCC wants to know about it. More importantly, if the station generated revenue from the provision of those services, then the FCC wants its 5% cut of the gross revenues derived from such service.  The Form 317 is very brief, soliciting information about the license and the types of services provided, if any, and must be filed electronically through the CDBS filing system.

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On Friday, the Commission formally began a rule making proceeding regarding children and electronic media.  Aware of the vast opportunities, but also the potential risks inherent in today's (and tomorrow's) electronic media, the Commission is seeking to gather information about the extent to which children are using media today, the benefits and risks of the various technologies, and the ways in which society can improve the benefits while minimizing the risks.  Formally entitled "Empowering Parents and Protecting Children in an Evolving Media Landscape", the proceeding is aimed at building a record to inform and guide the Commission's future actions in this area. 

Clearly, these are big picture questions the FCC is dealing with at this stage, but with Friday's Notice of Inquiry the Commission seeks to break the issues down into several areas of inquiry and solicit comment from interested parties.  For example, with respect to the potential benefits, the Commission has identified six principle benefits it sees from electronic media and seeks input about each, including:  (i) improved access to educational content; (ii) ability to acquire technological literacy necessary in a global economy; (iii) ability to develop new skills in the use of technology and the creation of content; and (iv) facilitating new forms of communication with family and peers.  With respect to risks, the Commission has noted a range of potential dangers ranging from the possible exposure to child predators to the impact of excessive or exploitative advertisements.  The Commission's item also asks broad societal questions, such as whether there is a minimum level of media literacy that is required to participate effectively in modern society, and if so, how do we ensure that future generations gain the necessary exposure to electronic media.  At this stage of the process, the Commission is truly asking questions rather than proposing specific rules.  And in fact, there may be potential issues related to regulation in some of these areas, including First Amendment problems in connection with restricting access to indecent material in different types of electronic media. 

Just as an aside, the Notice quietly notes that the Commission previously released Notices of Proposed Rule Makings involving interactive television and embedded advertising on television, respectively.  While the FCC does not incorporate those open matters into this new proceeding, it does invite parties wishing to update the record on issues regarding embedded advertising in broadcast and cable television or interactive television to file ex parte submissions in the earlier dockets. 

The deadline for submitting Comments in this proceeding will be 60 days after publication of the Notice of Inquiry in the Federal Register, with Reply Comments due within 90 days of publication.  Comments may be filed with the Commission on paper, or online using the FCC's newly revamped Electronic Comment Filing System. 

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An article from TV NewsCheck last week reported on an approach by an FCC representative to television operators, floating an idea that the FCC would "buy" TV spectrum from existing television station operators, and repurpose that spectrum for wireless users - presumably some sort of wireless broadband.  The funds to buy the spectrum would come from the auction of the frequencies.  Over-the-air TV viewers would perhaps be left with a limited over-the-air service.  Today, another article cites a study filed at the Commission that suggests that the auction of TV spectrum could bring in more than three times the value of what that spectrum is for broadcasting.  Could these developments grow into a ground swell that could signal the end of over-the-air television?  Nicholas Negroponte made the much quoted observation almost 15 years ago, before the Internet was the multi-media service that it is today - that communications devices that were wired will become unwired, and those that were wireless would become wired - the "Negroponte Switch" or the process of "unwiring."  But is this switch inevitable for television, and is it in the industry's best interest?

The theory of unwiring looked at the growing demands of wireless data networks for more and more bandwidth. While voice and data services were, at one time, wired services (the plain old telephone, the fax, even the telegraph), more and more of that information is now being digitally packaged and delivered wirelessly.  At the same time, video programming was delivered through wireless over-the-air television (though no one ever referred to it as "wireless"), but each year is more and more delivered by wired means (by cable companies and what used to be telephone companies).  At this point, estimates are that only a bit more than 10% of television households get their television programming exclusively from over-the-air reception.  Looking at this transition, some have theorized that the progression would continue, and the broadcast services would end up being delivered to fixed locations by wire, while the data services would be delivered wirelessly.

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The FCC recently issued two reminders about television programmer's obligations to members of their audience who are hearing impaired.  The first notice made clear that stations must caption 100% of their "new, non-exempt" Spanish language programming as of January 1, 2010.  The second notice was to remind broadcasters that, when providing emergency information, they must make that information accessible to the hearing impaired, even if the programming falls into one of the captioning exemptions.  For instance, emergency information provided in live programming on a broadcast station with less than $3 million in revenues must still be accessible to the hearing impaired, either through closed or open captions, or through white boards or chalk boards or other devices that can be read by those who cannot hear the aural announcement on the station.

These issues are addressed in more detail in our Davis Wright Tremaine Advisory, here.  The memo also summarizes the current obligations of broadcasters and other video programmers under the FCC's captioning rules, and the status of pending proceedings to potentially change the exemption for programming channels with less than $3 million in revenue so that DTV multicast streams would be included with a station's main channel in deciding if the station met the exception.  It also discusses the status of implementation of new FCC rules changing the complaint process for violations of these rules.  These are important rules that the FCC takes seriously so, for more information, check out our Advisory. 

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The Commission today released yet another forfeiture for what has become an increasingly common oversight among broadcasters -- the failure to timely file a license renewal application for a satellite earth station.  What made today's forfeiture unique, however, is the fact that the Commission proposed to double the amount of the forfeiture based on the size of the broadcast licensee and its presumed ability to pay such a fine.  After balancing all the factors, the Commission ultimately ratcheted the fine down a bit, but in the end it assessed a $25,000 fine for the failure to timely file license renewal applications for two earth stations and for the continued operation of those facilities without proper authority.  In light of today's decision, broadcasters should be sure to review and track the expiration dates for all FCC authorizations. 

The FCC's decision in this case makes clear that in imposing a large fine in this case it is attempting to send a message that the Licensee will heed.  Per the Commission's decision:  "This $16,000 forfeiture amount [the baseline forfeiture]  is subject to adjustment, however.  In this regard, we consider the size of the violator and ability to pay a forfeiture, as well as its prior violation of the same rule sections before us today.  To ensure that forfeiture liability is a deterrent, and not simply a cost of doing business, the Commission has determined that large or highly profitable companies such as [Licensee] , could expect the assessment of higher forfeitures for violations, and that prior violations of the same or other regulations would also be a factor contributing to upward adjustment of apparent liability.  Given [Licensee's] size and its ability to pay a forfeiture, coupled with its previous violation, we conclude that an upward adjustment of the base forfeiture amount to $32,000 is appropriate."  [Emphasis added.]  In reaching its decision, the Commission noted that the Licensee in this case was a large broadcaster with "net yearly sales" of over $110 million.  

This forfeiture should serve as a clear warning to broadcasters both big and small to review and track the expiration dates of any earth stations or other authorizations held by a broadcast station.  Rarely (if ever) will the license term of an earth station authorization coincide with the renewal of the parent broadcast station, which means it is easy for the earth station to slip through the cracks.  

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This week, the FCC announced that it will begin accepting applications for new digital-only LPTV and translator stations in rural areas as of August 25, 2009. Beginning on that date, the FCC will also begin to accept applications for major changes to existing analog and digital LPTV and TV translators in rural areas, and applications for digital companion channels (DCCs) for existing analog stations in rural areas. By "rural areas", the FCC means stations that specify a transmitter site that is located more than 75 miles away from the reference coordinates of the 100 U.S. cities listed in the FCC’s Public Notice. Applications for new analog facilities will not be accepted. This filing opportunity will be on a first-come, first-served processing basis, and mutually exclusive proposals will be resolved by auction.  A copy of the FCC's Public Notice is available here.

While this window is for new stations, major changes, and DCCs in rural areas, prior to that date all existing LPTV, TV translator, and Class A television stations may wish to review their present options for converting to DTV. The Commission’s Public Notice reminds existing stations that they may file an application for on-channel digital conversion (i.e. flash-cut) at any time. In order to retain processing priority, existing stations are encouraged to file flash-cut applications prior to August 25th, and certainly by January 25, 2010, at which point the FCC will open the door for new digital licensing opportunities on a nationwide first-come, first-served, as discussed below. 

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In a truly eleventh-hour decision, the FCC released an Order late Friday evening suspending the filing of FCC Form 323 Ownership Reports that would otherwise be due on Monday, June 1st for certain broadcast stations.  In its recent Report and Order adopted in the proceeding devoted to Promoting Diversification of Ownership in the Broadcasting Services, the Commission revised its rules to implement a single November 1st filing deadline for all commercial broadcast stations to submit an ownership report.  The Order, however, neglected to address the fact that numerous broadcast stations faced filing deadlines under the current rules that would require an ownership report to be filed by June 1, August 1, or October 1 (depending on a station's license renewal anniversary). 

It is unclear why this issue was not addressed as part of the earlier Report and Order, which was adopted nearly two months ago on April 8th, or why today's Order was not released earlier in order to prevent stations from filing in advance of the June 1st deadline, but the clarification will be helpful for those stations that have not yet filed, or for those that would otherwise face an August 1st or October 1st ownership report deadline.  For those stations that have already filed their Ownership Reports consistent with the June 1st deadline, the Order is silent as to whether the FCC will refund the filing fees paid by those licensees, or alternatively, if those licensees will be required to pay another fee come November 1st. 

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The FCC's has published in the Federal Register certain aspects of its November decision on closed captioning - most notably the Further Notice of Proposed Rulemaking asking if a broadcaster's multicast streams should each count as a separate "channel" potentially exempt from closed captioning requirements if that channel doesn't bring in more than $3 million in annual revenue.  Seemingly, each of the multicast streams are what one would conventionally think of as a channel, yet the Commission has asked for comments on this issue - comments to be filed by February 12.  If the Commission was to determine that a multicast stream was not a separate channel, the captioning obligations would apply if the station, in all of its cumulative operations, had revenues of $3 million.   This could impose significant costs on innovative programming done on these multicast streams.  The November decision also clarified certain other rules, and adopted certain processes for dealing with complaints about captioning issues (processes yet effective as they have not been approved by the Office of Management and Budget for compliance with the Paperwork Reduction Act).  Davis Wright Tremaine has published a memo providing more information about the effect of the Federal Register publication.  Our summary of the November decision itself is available here

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In its rush to complete the "analog nightlight" program rules in time for television stations to make plans for the February 17 end date for analog television, and to comply with a statutory mandate to have the program in place by January 15, the FCC will require some people to work through their New Years Weekend to have comments to the FCC by Monday, January 5.  Federal Register publication of the Commission's Notice of Proposed Rulemaking on this proposal took place today.  We wrote about the program to allow some analog television stations to operate for 30 days after the end of the digital transition, to carry emergency information and to inform viewers who missed the message on the digital conversion about what they need to do to receive digital television, and about some of the issues posed by the FCC, here.  Reply comments on this proposal are due three days later -January 8. 

As the comment date is also when stations who were not included on the original list of those who automatically qualify for nightlight status are supposed to ask to be included and show how they will protect digital television operations, some engineers will also need to be busy this weekend.  With this short response time, station operators need to quickly get going on the comments due on Monday. 

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The FCC this week released the details of its "White Spaces" decision, authorizing the use of both fixed and mobile unlicensed devices within the television spectrum.  In theory, these devices are supposed to be able to sense the existence of television signals so that they can operate on other frequencies and avoid creating interference.  However, as an extra safety measure, the FCC has also required that these devices connect at least once a day with a database of all other protected users of the television spectrum and, by used of geo-location technology, determine what other users are in the area where the "TVBD" (television band device) is being used and operate on frequencies which protect those other users.  Our firm has prepared a memo outlining the full decision.  The Davis Wright Tremaine memo can be found here.  When one reviews the full text of the FCC decision, it becomes pretty clear that we should not look for such devices anytime soon.

While the Commission's order actually discussed in some detail the question of whether these devices should be permitted to operate before the end of the digital television conversion in February 2009, given the issues that still need to be resolved, this discussion really appears to be an academic one.  First, devices that meet all of the FCC requirements have to be designed and built, and type-accepted by the FCC labs.  In a recent article by Shelly Palmer in his well regarded blog on television issues, he suggests that many engineers are convinced that these devices simply will not work.  When one reviews the FCC requirements, one can see why that might be the case.

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The FCC has adopted new procedures for the submission of complaints about the failure to adequately provide closed captioning of video programming carried on television stations and cable systems.  In the same order, the Commission issued clarifications about the impact of the digital transition on the obligations of stations and networks to caption programming, and asked for comments on the issue of whether television stations that have multiple streams of programming can consider each stream as a separate "channel" for purposes of determining if they are exempt from captioning obligations for channels that have less than $3 million in revenue.  Our firm has published an Advisory summarizing this Order, and the complaint process that now applies both cable systems and broadcasters.  The Davis Wright Tremaine Advisory can be found here.

The outcome of the Further Notice of Proposed Rulemaking can have a real impact on the decisions made by broadcasters and their decisions to run multicast television programming.  Some stations have used an a second or third digital channel to do various forms of local programming, some along the lines of cable access programs - with local musicians, comedians or other sorts of original programs.  Others have run local news and public affairs programs.  If the Commission were to consider all programming streams to be a single "channel" (which seems to be contrary to how the Commission has treated cable programming where all channels, even if commonly owned, are considered as different "channels"), some channels will be met by new increased costs.  While hardship exemptions can be granted to particular programs, and could conceivably be applied here, stations should seemingly not have to go to the expense and trouble to make such hardship showings (as well as the uncertainty as to whether it will ultimately be granted) if these streams making less than $3 million and fit within that explicit, existing exception definition.  Watch for the dates of comments in this proceeding. 

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By December 1, 2008, all commercial and noncommercial digital television (DTV) stations must electronically file an FCC Form 317 with the Commission reporting on whether the station has provided any ancillary and supplementary services during the twelve-month period ending on September 30, 2008. 

Under the Commission's Rules, in addition to providing free over-the-air broadcast television, DTV stations are permitted to offer services of any nature, consistent with the public interest, convenience, and necessity, on an ancillary or supplementary basis.  Some examples of the kinds of services that may be provided include computer software distribution, data transmissions, teletext, interactive materials, aural messages, paging services, audio signals, and subscription video.  Unlike in years past, this year all DTV stations -- regardless of whether the station holds a DTV license or is operating pursuant to Special Temporary Authority (STA), program test authority (PTA), or some other authority -- must file a Form 317 reporting whether it provided such services and generated any income.  If the station did provide such ancillary services, then the FCC wants to know about it.  More importantly, if the station generated revenue from the provision of such services, the FCC wants its 5% cut of the gross revenues derived from such service.  The Form 317 is very brief, soliciting information about the license and the types of services provided, if any, and must be filed electronically through the CDBS filing system.  

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As broadcasters are aware, earlier this year, the FCC imposed DTV Consumer Education requirements mandating that television stations and other video providers educate viewers about the upcoming transition from analog to digital television (DTV).  Thus far, the education efforts have consisted primarily of Public Service Announcements (PSAs), crawls, and longer format programs designed to educate the public about the February 17, 2009 switch to DTV.  Now that stations are approaching the home stretch, however, the FCC's rules require additional efforts.

Specifically, for those stations that elected to follow “Option Two” of the DTV Consumer Education requirements -- which seems to be the vast majority of television stations -- beginning on November 10, 2008, television stations must begin a "100-Day Countdown" to the transition consisting of enhanced efforts leading up to February 17, 2009.  During this period, each station following Option Two must air at least one of the following per day:

Graphic display:  A graphic super-imposed during programming content that reminds viewers graphically there are “[X] number of days” left until the transition, and that visually instructs viewers to call a toll-free number or to visit a web site for further details.  The graphic's duration may vary from 5 to 15 seconds, at the discretion of the station.

Animated graphic: A moving or animated graphic that concludes with a countdown reminder, which will remind viewers that there are “[X] number of days” until the transition. Viewers are to be visually instructed to call a toll-free number or to visit a website for details.  The graphic's duration may vary from 5 to 15 seconds, at the discretion of the station.

Graphic and audio display: Either a graphic display or animated graphic along with an added audio component.  The duration may vary from 5 to 15 seconds, at the discretion of the station.

Longer form reminders: Stations may choose from a variety of longer form options in order to communicate the countdown message.  Examples might include an “Ask the Expert” segment in which viewers can call in to a phone bank and ask knowledgeable people questions about the transition.  The length of these segments can vary from 2 to 5 minutes, at the discretion of the station.  (Some stations may also choose to include during newscasts DTV “experts” who may be asked questions by the anchor or reporter about the impending Feb. 17, 2009, deadline).

With this 100-Day Countdown, the Commission hopes to push strong to the finish line and build viewer and consumer momentum for the final switch to digital on February 17th.  The FCC has been paying close attention to station compliance with the DTV Consumer Education requirements and stations are advised to start planning now for their 100-Day Countdown efforts.  One additional note, stations that have elected to follow Option Two should also be sure to air at least one longer form program (at least 30 minutes in length) if they have not done so already.   At least one such program must be run between the hours of 8:00 AM and 11:35 PM prior to February 17, 2009.  

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Broadcasting and Cable magazine today reported that the FCC is looking to back off some of the requirements for the "enhanced disclosure" of television broadcaster's public interest programming (see our summary of the new requirements of FCC Form 355, here).  B&C reports that the FCC may lessen or at least better explain some of its new reporting requirements to try to avoid having these rules being struck down by the Courts as being arbitrary and capricious, or to avoid further proceedings which might be ordered by the OMB were it to determine that the rules violated the Paperwork Reduction Act.   We have speculated as to the likelihood that these rules, requiring substantial new burdens on television broadcasters, would have difficulty surviving OMB review.  How could these burdensome rules, which the FCC has effectively stated have no regulatory purpose as the Commission has no requirements for any percentages of any particular type of programming (see our post here) possibly be justified under a Paperwork Reduction Act analysis - much more paper for no specific regulatory purpose simply does not seem to provide any justification for the new rules?  A Paperwork Reduction Act analysis focuses on the burden on small entities.  The new enhanced disclosure rules do not exempt small broadcasters.  B&C suggests that an exemption for noncommercial stations may be one of the changes to be made by the FCC - certainly a welcome change but hardly enough to help small market commercial TV operators who will be hardest hit by these rules. 

We would certainly not be surprised by the FCC lessening the burden that they have imposed on television broadcasters.  We have seen Commission staffers in public forums express surprise at the descriptions of the burdens that these rules place on television broadcasters.  And we have noted the slow pace with which these rules have been rolled out - having been adopted in December, the text of the decision coming out in January, and they still are not effective.  We will all have to watch closely to see if this press report is accurate and the FCC in fact reconsiders its Enhanced Disclosure requirements.  Stay tuned. 

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More than 8 years ago, a group of television station owners (the Network Affiliated Stations Alliance or "NASA") who operated stations affiliated with the major television networks filed a request with the FCC, petitioning the Commission to rule that certain provisions in network affiliation agreements that limited the ability of stations to preempt network programming should be prohibited.  While some of these issues were raised in the Commission's localism proceeding, the parties have now reached an agreement to resolve many of the issues.  The Commission last week released an order approving that agreement and clarifying some of the legal issues as to what provisions can be contained in network affiliation agreements.  These clarifications not only help to clarify the clauses that can be contained in affiliation agreements, but also give broadcasters insights as to what kinds of provisions can be included in any agreement by which one party provides programming to a broadcast station licensee, including agreements such as LMAs.

 The Commission's Order sets out standards governing the network-station relationship that insure that the licensee maintains control over programming and other basic operational decisions of their station.  From this basic principal, the following specifics were adopted:

• Station licensees have an unfettered right to reject network programming that they believe is contrary to the public interest, "unsatisfactory" or "unsuitable
• Stations can preempt network programming when the licensee thinks there is some other programming which is of greater national or local importance.
• If a preemption is done for one of these reasons, the affiliation agreement cannot impose monetary or non-monetary penalties or limit the amount of such preemptions
• Affiliation agreements cannot give networks the right to "option" time in the future unless they make a commitment to fill that time with programming.   This is important in a multichannel digital context, as it prevents networks from tying up time on a second or third channel that they might or might not use.

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On Monday, the President signed into law a bill adjusting the reimbursement dates of the Low Power Television grant program by which LPTV and TV translator stations can seek a $1,000 grant in order to ensure that they are able to continue to receive and rebroadcast the signals of primary full-power television stations once the full-power stations complete the transition to digital television.   In late 2007, the government announced the start of the LPTV Digital-to-Analog grant program designed to help translators and low power television stations continue their analog broadcasts after the February 17, 2009 conversion of full-power television stations to DTV.  Specifically, the LPTV Digital-to-Analog Conversion grant program will provide funds to eligible translators and LPTV stations that need to purchase a digital-to-analog converter box in order to convert the incoming signal of a full-power DTV station to analog format for retransmission on the analog LPTV station.  The program has been funded with a total of $8 million, which is available in $1,000 grants to eligible LPTV stations.  As a result of the recent change, funds granted through the LPTV Digital-to-Analog grant program will available beginning in fiscal year 2009 (Oct. 1, 2008 – Sept. 30, 2009), rather than in fiscal year 2011.  In addition, the recent bill also extends the availability of funding through fiscal year 2012.

Any low-power television broadcast station, Class A television station, television translator station, or television booster station that meets the following three criteria may apply for the grant to defray the cost of the digital-to-analog converter box:

1. It is itself broadcasting exclusively in analog format;
2. It has not purchased a digital-to-analog conversion device prior to February 8, 2006; and
3. It is (or will be) re-transmitting the off-air digital signal of a full-power DTV station.

Applications for this grant program are being accepted until February 17, 2009.  Priority compensation will be given to eligible LPTV stations licensed to 501(c) non-profit entities or LPTV stations serving a rural area of fewer than 10,000 viewers.  Thus, priority is given to stations owned by translator associations and others that might not otherwise be able to afford the costs of converting the signals that they receive from analog to digital, and which might, without the grants, go off the air.  More information on how to apply for such grants is available on the NTIA’s website here.   

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Yesterday, the FCC released its further Public Notice announcing that the freeze on filing certain Class A LPTV applications will be lifted on August 4th.  Previously, Class A stations had been frozen from expanding their authorized contours and from changing channels (displacing) while the DTV transition was underway.  Because Class A stations receive protection as primary stations, the FCC needed to lock those stations down until it had completed the DTV Table of Allotments, which it has now done.

Accordingly, as of August 4th (nearly four years to the day that the freeze was first imposed), Class A LPTV stations will once again be able to seek to modify their contours and change channels.  Applications filed prior to August 4th that requested a waiver of the freeze will be treated as having been filed on the 4th.  Thereafter, changes will be on a first come, first serve basis.  A copy of the public notice is available here. 

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The FCC has released a Public Notice reminding TV stations to update their FCC Form 387 DTV Transition Status Reports.  If you will recall, these are the Reports filed by each station in February of this year outlining the steps remaining for the station to complete the transition to DTV.  Stations are under an obligation to update that status report as circumstances warrant, and also by October 20, 2008.

Now, however, the FCC needs to prepare a status report of its own, so it has requested that all stations update their Form 387 by no later than July 18, 2008, which is next Friday.  The Public Notice states that:  “Stations should report any significant changes to the information contained in their original DTV Transition Status Reports including a change in the station’s (1) transition plans, (2) construction or operational status or (3) existing service (e.g., reduction or termination of analog or pre-transition digital service). In addition, stations should report if they have filed (1) an application for extension of time; (2) an application for digital construction permit; (3) a request to reduce or terminate analog or digital operations; and/or (4) a petition for rulemaking to change their post-transition DTV channel.”   A copy of the complete Public Notice is available here. 

Accordingly, stations will need to review the status of their DTV transition and their plans for between now and February 17, 2009, and update the Form 387 by Friday, July 17th.  At the very least, stations migrating back to their current analog channel or else flash-cutting to digital on their current analog channel will need to reflect the fact that they have now obtained a construction permit authorizing that modification of the station’s facilities .  Alternatively, for those few stations that have nothing new to report, there's no need to file anything.

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The FCC Form 355 requiring "enhanced disclosure" by television stations was a frequent topic of discussion at this week's NAB Convention in Las Vegas.  That form will require that television broadcasters report significant, detailed information about their programming, providing very detailed reports of the percentage of programming that they devote to news, public affairs, election programming, local programming, PSAs, independently produced programs and various other program categories, as well as specifics of each program that fits into these categories (see our detailed description of the requirements here).  Obviously, all broadcasters were concerned about how they would deal with the expense and time necessary to complete the forms, and the potential for complaints about the programming that such reports will generate.  At legal sessions by the American Bar Association Forum on Communications Law and the Federal Communications Bar Association, held in connection with the NAB Convention, it became very clear to me that the obligations imposed by these new rules are obligations adopted for absolutely no reason, as the Commission has not adopted any rules mandating specific amounts of the types of programming reported on the form.  In fact, one of the Commissioner's legal assistants confirmed that, unless and until the FCC adopts such specific programming requirements, the Commission's staff will not need to spend any time processing these forms.  Thus, if the form goes into effect, broadcasters will be forced to keep these records, and expend significant amounts of staff time and station resources necessary to complete the forms, for essentially no purpose.

Of course, public interest advocates will argue that the forms will allow the Commission to assess the station's operation in the public interest, and will allow the public to complain about failures of stations to serve local needs.  But, as in a recent license renewal case we wrote about here, the Commission rejected a Petition to Deny against a station based on its alleged failure to do much local public affairs programming as, without specific quantitative program requirements, the Commission cannot punish a station for not doing specific amounts of particular programming. If the Commission adheres to this precedent, it will not be able to fine stations for the information that they put on the Form 355, but only for not filing it or not completing it accurately.  Thus, unless the Commission adopts specific programming requirements, the form will be nothing more than a paperwork trap for the unwary or overburdened broadcaster.  And, as is usually the case with such obligations, the burden will fall hardest on the small broadcaster who does not the staff and resources to devote to otherwise unnecessary paperwork.

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As we posted earlier, television stations must file an FCC Form 388 with the FCC reporting on their DTV educational efforts by April 10th.  That Form is now available on the FCC's web page here.  However, stations should be aware of the unusual filing procedure required for this form.  This form will not be filed through CDBS, but rather will be filed through the FCC's Electronic Comment Filing System (ECFS), which is used for submitting comments in notice and comment rule making proceedings.  The ECFS submission page is available here.   Thus, stations will need to prepare the FCC Form 388 using the  Word document available on the FCC's web site, and then electronically submit the completed Word document into Docket Number 07-148 using ECFS.  Although the new rules were only effective for one day of the First Quarter, stations should report any voluntary DTV educational efforts undertaken during the quarter. 

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Quarterly Issues Programs Lists Due April 10th -- This is a eminder to all radio and television stations, both commercial and noncommercial, that Quarterly Issues Programs Lists reporting on the important issues facing the stations' communities, and the programs aired in the months of January, February, and March dealing with those issues must be prepared and placed in the stations' public inspection file by April 10, 2008. The failure to have a complete set of Quarterly Issues Programs lists, which were timely prepared and placed in a station’s public file, can lead to significant fines at license renewal time so all stations are urged to prepare their Quarterly Issues Programs lists in a timely fashion. See our full advisory for further details.

Please note, the New Form 355 for television stations has not yet become effective, but when it does, television stations will be required to use this new form to report on their programming content in great detail.  Stations should prepare for the implementation of this form now. 

Children's Program Reports Due April 10th --  Commercial full power and Class A low power television stations are reminded that Children's Television Programming Reports on FCC Form 398 must be prepared and filed electronically with the FCC by April 10, 2008. The Reports must also be placed in the stations' public inspection files by that date. Our recent advisory is available here with all the details, including the requirements for DTV stations airing multiple program streams and details about the new Form 398. Quarterly certifications regarding compliance with the commercial limitations in Children's Programming should also be prepared and placed in the public inspection file by April 10th.

New Form 388 Report on DTV Educational Efforts Due April 10th -- Last, and definitely not least, by April 10th full power television stations must electronically file the newly minted Form 388 reporting on their efforts to inform viewers about the DTV transition.  Although the FCC's new rules mandating educational efforts by TV stations were only effective March 31st (the last day of the quarter), the FCC nevertheless is requiring that all stations file a report detailing their DTV education efforts during the First Quarter of 2008.  Thus, stations will largely be reporting on any voluntary educational efforts undertaken in the first quarter (PSAs, news programs, etc.), as well as electing which of the three Options that they intend to employ for their DTV educational efforts going forward.  More information is available in our recent advisory. 

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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.

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The Commission's Localism Report and related Notice of Proposed Rule Making seeking comment on a slate of proposed new rules has been published in the Federal Register.  Accordingly, Comments in this rule making proceeding must be filed with the Commission by March 14 and Reply Comments must be filed by April 14.  This is a very short period of time in which to comment on a number of significant proposals that are poised to return the broadcast industry to the regulatory structure of the 1980s.  As we reported earlier, the Commission proposes to re-regulate broadcast stations, and the NPRM suggests a number of substantive rule changes, such as effectively re-instating ascertainments, eliminating the unmanned operation of broadcast stations, imposing quantitative programming requirements, and requiring that main studios be maintained within a station's community of license.  This NPRM proposes a number of potentially burdensome requirements, many of which were eliminated by the Commission long ago, and many of which go beyond what the FCC has ever required.

Given the potential impact that the FCC's proposed rules could have on broadcast stations, broadcasters are encouraged to file comments in this important rule making proceeding. 
Comments can be filed with the Commission in paper or electronically through the FCC’s Electronic Comment Filing System.  When submitting comments, commenters should be sure to reference the docket number for this rule making, MB Docket No. 04-233.  

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The Commission's DTV Third Periodic Review adopting the rules and procedures for moving television stations through the end of the DTV transition was published in the Federal Register today, meaning that almost all of the new rules and forms adopted by the Order are now effective.   Now that the majority of the new rules are in effect, several related filing dates have been established.  As expected, this evening the FCC released its Public Notice notifying stations of several deadlines and summarizing some aspects of the Commission recent DTV Order. 

First, the FCC Form 387 DTV Status Report is now available and can be filed electronically through CDBS.  Consistent with the Third Periodic Review, all television stations, even those that have built and licensed their post-transition DTV facilities, must file a DTV Status Report on FCC Form 387 by February 19th (the FCC gave one extra day due to the federal holiday).

Second, as part of the final push to digital many television stations need to obtain a construction permit for their post-transition facilities.  In order to avail themselves of expedited processing, stations must file their Form 301 or Form 340 construction permit applications by March 17th (45 days from today).  If stations 1.) file their applications before March 17th, 2.) the application does not expand the station’s facilities beyond its final post-transition DTV Table Appendix B facilities, and 3.) the application specifies facilities that match or closely approximate the DTV Table Appendix B facilities, then the FCC has said that it will expedite processing of the application, generally acting on such applications within ten days. 

Third, the FCC has imposed deadlines by which stations that need to obtain a construction permit for their post-transition facilities must file their construction permit applications.  Stations with an August 18, 2008 construction deadline must file a CP application no later than March 17, 2008.  Stations with a February 17, 2009 deadline must file a CP application no later than June 19, 2008.

The particular steps necessary for a station to complete the DTV transition by the February 17, 2009 end of analog broadcasting will vary depending on the station, but now that the new rules and forms are in effect stations are urged to begin preparing their applications immediately.  See our earlier posting for more details about the Third Periodic Review and the specifics about how stations will complete the DTV transition. 

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The FCC has released the full text of its Order adopting enhanced disclosure requirements for broadcast television stations - requiring that they post their public files on their websites and that they quarterly file a new form, FCC Form 355, detailing their programming in minute detail, breaking it down by specific program categories, and certifying that the station has complied with a number of FCC programming rules.  The Commission also released the new form itself and, as detailed below, the form will require a significant effort for broadcasters to document their programming efforts - probably requiring dedicated employees just to gather the necessary information.  The degree of detail required is more substantial than that ever required of broadcasters - far more detailed than the information broadcasters were required to gather prior to the deregulation of the 1980s - though, for the time being, much (though not all) of the information is not tied to any specific programming obligations set by the FCC.

 Before getting to the specifics of the new requirements, the thoughts of the Commission in adopting this order should be considered.  The Commission's decision focuses on its desire to increase the amount of citizen participation in the operation of television stations and the decisions that they make on programming matters.  While many broadcasters protested that the public rarely cared about the details of their operations, as evidenced by the fact that their public files were rarely if ever inspected, the Commission suggested that this was perhaps due to the difficulty the public had in seeing those files (the public actually had to go to the station to look at the file) and the lack of knowledge of the existence of the files (though broadcasters routinely broadcast notice of the public file's existence during the processing of their license renewal applications, rarely producing any viewers visiting the station to view the file).  With respect to the new Form 355 detailing the station's programming, the Commission rejected arguments that reporting of specific types of programming in excruciating detail imposes any First Amendment burden on stations, as the Commission claims that it has imposed no new substantive requirements.  Yet the Commission cites its desires that the public become more involved in the scrutinizing of the programming of television stations, which it states will be aided by the new form, and also emphasizes the importance that the Commission places on local service (an item detailed in Form 355).  At the same time, in its proposals detailed in its Localism proceeding (summarized here), the Commission is proposing rules requiring specific amounts of the very programming that is reported on Form 355, the very numbers that, in this proceeding, it claims have no significance.  Moreover, citizens will be encouraged by the Commission's actions to scrutinize the new reports, and file complaints based on the perceived shortcomings of the broadcaster's programming.  Broadcasters in turn will feel pressured to air programming that will head off these complaints.  So, implicitly, the Commission has created the First Amendment chilling effect that it claims to have avoided.

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This evening, at about the close of business on a Friday evening, the FCC issued a decision on an number of indecency complaints involving a five-year old episode of "NYPD Blue."  The Commission fined approximately fifty or so ABC affiliates in the Central and Mountain time zones $27,500 each for airing indecent material.  Specifically, the Commission found that a scene in the episode aired on February 25, 2003 containing adult female nudity to be indecent.  The Commission rejected ABC's seemingly common sense argument that a woman's buttocks are not "sexual organs" within the definition of the indecency rules.  Instead, the FCC has now determined that showing the backside of a naked woman is a violation of the indecency rules if it airs before 10 PM, as it did in the Central and Mountain time zone.  A copy of the FCC's decision can be found here.  If there is a silver lining it is that the FCC imposed the statutory maximum that existed at the time the programming was aired -- $27,500 -- rather the new, stepped up fines.  Further, the Commission fined only those stations about which it received an actual complaint, and not simply all stations in those time zones that aired the episode. 

The stations have until February 11th to either pay the fine or appeal the forfeiture.  This is an accelerated timeframe for responding or paying the fine, as usually Commission gives stations 30 days to respond to a Notice of Apparent Liability for Forfeiture.  It is unclear what the impetus was for the FCC to finally issue a decision on the "NYPD Blue" complaints nearly five years after the episode originally aired and with several challenges on earlier Commission indecency rulings currently pending before the courts.  No word yet on whether ABC and the affected affiliates will appeal the decision, but it seems likely that this indecency decision will join the others already in the pipeline for judicial review.  And in the meantime, broadcasters have been put on notice that a woman's posterior is now officially indecent material.  No word yet on whether showing a man's rear end is equally problematic, but if there's a station willing to air it and a viewer willing to complain, the FCC will undoubtedly tackle that critical issue if and when it arises.   

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The FCC has announced that on January 24 it will begin a new round of testing of wireless devices that will work in that part of the communications spectrum currently reserved for television station operation.  The idea, about which we wrote here, would be that these devices could operate at low power, on channels not used by television stations in a particular market (the so-called "white spaces"), without creating interference to television stations.  Proponents (mostly tech and computer companies) claim that these low power devices could be used for wireless broadband and other communications devices, while opponents (principally television broadcasters, but also and wireless microphone companies which operate in the television spectrum) fear that the devices, when released into an unregulated, real-world environment, will create damaging interference to the new digital television operations that begin in February 2009.  The Commission's tests will attempt to resolve this controversy.

The Commission has already once tested some devices, and found them wanting (see our summary here).  However, those who support the devices claim that the tests were flawed and one of the devices that was tested was malfunctioning.  So the FCC has announced revisions in the testing process, and opened the testing process to public observation.  Four devices will be tested.  No matter what the results of the tests, you can be sure that the debate will continue.

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A reminder to all radio and television broadcast stations, both commercial and noncommercial, that Quarterly Issues Programs Lists reporting on the important issues facing the stations' communities, and the programs aired in the months of October, November, and December dealing with those issues must be prepared and placed in the stations' public inspection file by January 10, 2008.  The failure to have a complete set of Quarterly Issues Programs lists, which were timely prepared and placed in a station’s public file, can lead to significant fines at license renewal time so all stations are urged to prepare their Quarterly Issues Programs lists in a timely fashion.  See our full advisory for further details.

In addition, commercial full power and Class A low power television stations are reminded that Children's Television Programming Reports on FCC Form 398 must be prepared and filed electronically with the FCC by January 10, 2008.  The Reports must also be placed in the stations' public inspection files by that date.  Our recent advisory is available here with all the details, including the requirements for DTV stations airing multiple program streams and details about the new Form 398.  Quarterly certifications regarding compliance with the commercial limitations in Children's Programming should also be prepared and placed in the public inspection file by January 10th. 

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At its Oct. 31 open meeting, the Commission adopted an Order declaring exclusive access and service clauses in video contracts between cable operators and multiple-dwelling units (MDUs) -- think apartment buildings -- to be unenforceable.  According to the FCC, such exclusive contracts can be harmful, and it expects that the rule change will result in greater choice for consumers and competition among video services providers.  The Commission launched a further proceeding to determine whether it should take similar action against exclusivity clauses entered into by Direct Broadcast Satellite television providers, private cable operators, and other multichannel video programming providers.  The further proceeding will also explore whether the Commission should prohibit other types of exclusive arrangements in the provision of video services.  It is unclear when this order will become effective.  The text of the decision has not yet been released, but once the new Order become effective, the rules will apply to existing as well as future contracts as the FCC did not provide any transition or grandfathering period for existing agreements.  Given Chairman Kevin Martin’s sense of urgency for this issue, the FCC is likely to release that text as soon as possible.  Representatives of various interest groups, including cable operators, have indicated publicly their intention to challenge the order in court.  For more details about the Commission's action please see DWT's recent bulletin. 

At the same Oct. 31^st meeting, the Commission also adopted a Second Report and Order extending a number of cable franchising rules that previously applied only to new video competitors to incumbent cable operators.  Earlier this year, the Commission had adopted rules streamlining the local cable franchising process for new video entrants (i.e., telephone companies) and clarifying that certain payments often demanded by local franchise authorities would be considered franchise fees and therefore counted against the 5 percent franchise fee cap.  By its Second Report and Order adopted this week, the Commission decided to extend many of these rules to incumbent cable operators as well.  According to Chairman Martin, extending these rules to incumbent cable operators will help level the playing field between new entrants in the video delivery market and existing operators.  For more details about the Commission’s Second Report and Order, please see DWT’s recent bulletin on the issue. 

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On Friday, the FCC issued a public notice promising further testing of "white spaces" devices.   As we've written before, these devices are being promoted by many of the largest tech companies as ways to make more efficient use of the television spectrum by using low power wireless devices within that spectrum in places where those devices would not interfere with the operation of television reception.  The National Association of Broadcasters and other television groups have opposed allowing such operations for fear that they will cause interference to broadcast stations.  Especially during the digital transition, when listening habits are just being worked out and new digital televisions are just being purchase and installed by users, and because interference to a digital television station does not result in "snow" as in the analog world, but instead no picture at all, broadcasters fear that these devices could severely impact the success of the digital transition. 

In August, as we wrote here, the FCC released the first results of its interference studies, finding the potential for severe interference to television broadcasters.  While broadcast groups trumpeted these tests as proof of their fears, many of the tech companies claimed that the testing was flawed, using at least one device that was malfunctioning.  The tech companies essentially asked for a "do over," while the broadcasters argued that, even if a tested device was malfunctioning, that malfunction itself was enough to demonstrate that the devices are not reliable enough to protect television operations during this sensitive transition.

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On Monday, the FCC issued a $4,000 fine to a cable operator for the use of a so-called Video News Release, or VNR, in a news segment focusing on consumer issues.   The facts in this case are very similar to the facts in dozens of other inquiries involving broadcast television stations that remain pending before the Commission, and this decision could very well signal the beginning of a number of forfeitures aimed at cracking down on the (until recently) common practice of using video material provided for free by third-parties without providing attribution or a sponsorship identification.  The decision was issued by the Enforcement Bureau and not the full Commission, and goes to lengths to explain that the sponsorship rules apply to cablecasting material aired by cable operators, and that the use of even a free video (i.e. with no consideration promised or paid to the cable operator or broadcaster) can require a sponsorship ID, even if no political or controversial issue is involved. 

In this case, a cable network aired potions of video from a VNR produced on behalf of a product called "Nelson's Rescue Sleep."  No consideration was given or promised to the cable operator, but the VNR was provided to the cable operator for free.  The sponsorship ID rules typically come into play when money, services, or other valuable consideration is given in exchange for airing the particular material.  Normally, the phrase "services or other valuable consideration" does not typically include services or property furnished without charge or at a nominal fee, such as the VNR.  In this case, however, the FCC concluded that the video was furnished in consideration for the product being identified to a degree greater than what was reasonably related to the use of the product or service in the broadcast. The VNR was included in a news segment about non-prescription sleep aids, but the segment did not contain any other sleep-aid products.  And (because it was a VNR for the product itself) the segment dwelled on and discussed at length the underlying product "Nelson's Rescue Sleep." Citing to a 44-year old FCC Public Notice that provided guidance to broadcasters in the early 1960s about the sponsorship ID rules, the FCC found that the use of the VNR in this situation obviated the exception for free material and that a sponsorship identification should have been included.   A copy of the FCC's decision is available here. 

The FCC's forfeiture order was adopted exactly one year to the day that the material was aired by the cable operator, and thus, seems to have been issued now so as to avoid the possibility that the statute of limitations prevent the Commission from issuing a fine.  Although this is the first such VNR fine against either a cable operator or television broadcaster, it seems likely that more such decisions will be forthcoming.  Indeed, Commissioner Adelstein, who has championed this novel interpretation of the sponsorship identification rules, was quick to issue a statement applauding the Enforcement Bureau for its decision.  Given that the decision seems to cross into the territory of a cable operator's or broadcaster's editorial and journalistic discretion protected by the First Amendment, one can imagine that the cable operator (and any broadcasters fined in the future) will attack vigorously the FCC's interpretation of its sponsorship ID rules with respect to VNRs.

UPDATE:  On Thursday (September 27, 2007), the Commission issued a further decision involving the same cable operator, fining the operator an additional $16,000 for four more VNR incidents similar to the one discussed above.  In each instance, the cable operator included video that was received for free in a program aired on the system without attribution or a sponsorship identification.  The Commission concluded that the free video clips contained extensive images, discussion, and mention of the particular product, which triggered the sponsorship ID rules.  A copy of that decision is available here. 

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A reminder to all radio and television broadcast stations, both commercial and noncommercial, that Quarterly Issues Programs Lists reporting on the important issues facing the stations' communities, and the programs aired in the months of July, August, and September dealing with those issues must be prepared and placed in the stations' public inspection file by October 10, 2007.  The failure to have a complete set of Quarterly Issues Programs lists, which were timely prepared and placed in a station’s public file, can lead to significant fines at license renewal time so all stations are urged to prepare their Quarterly Issues Programs lists in a timely fashion.  See our full advisory here for further details.

In addition, commercial full power and Class A low power television stations are reminded that Children's Television Programming Reports on FCC Form 398 must be prepared and filed electronically with the FCC by October 10, 2007.  The Reports must also be placed in the stations' public inspection files by that date.  Our recent advisory is available here with all the details, including the requirements for DTV stations airing multiple program streams and details about the new Form 398.  Quarterly certifications regarding compliance with the commercial limitations in Children's Programming should also be prepared and placed in the public inspection file by October 10th.

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Late Tuesday night, in a meeting originally scheduled to start at 9:30 in the morning, the FCC adopted an order establishing the rules governing the carriage of broadcast signals by cable operators after the February 17, 2009 transition to digital television.  While the full text of the Commission’s action has not yet been released (and may not be released for quite some time), based on the FCC’s formal news release and the statements made by the commissioners at the meeting and in their accompanying press releases, we can provide the following summary of these important FCC actions.

First, for a period of at least three years after the February 17, 2009 transition from analog to digital broadcasting, cable operators will be required to make the signals of local broadcast stations available to all of their subscribers by either:  (1) carrying the television station's digital signal in an analog format, or (2) carrying the signal only in digital format, provided that all subscribers have the necessary equipment to view the broadcast content.  This rule reflects a compromise position offered by the National Cable & Telecommunications Association, and is regarded as less burdensome on cable systems then the FCC's original proposal of an indefinite analog carriage obligation. 

Second, the FCC reaffirmed its existing requirement that cable systems must carry High Definition (HD) broadcast signals in HD format, and further that it must carry signals with “no material degradation”, i.e., with picture quality as good as any other programming carried by the operator.  In affirming its "no material degradation" standard, the FCC rejected a proposal by the broadcast industry that would have required operators to pass-through all of the bits in digital television broadcast signal.

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The FCC recently issued a Public Notice reminding television broadcasters of the requirement that, after January 1, 2008, television stations (as well as cable and satellite television systems) must, in each calender quarter, close caption at least 75% of their Pre-Rule Programming.  Pre-Rule Programming is that programming first broadcast or exhibited prior to 1998 for analog programming and prior to 2001 for digital programming.  New Programming, that produced after those dates, should already be captioned by stations.  For details of this requirement (including the different rules that apply to Spanish-language programming), see our firm's memo on this subject, here.  Television station operators should review their programming schedules and contracts to be sure that they will be ready to meet these obligations.

The FCC Public Notice also reminds broadcasters that these requirements are different than the obligations of television broadcasters to provide emergency information visually - not closed captioned, but  visible to all.  We have written about how serious the FCC takes these emergency obligations in connection with fines that have been issued to broadcasters for providing on-air information orally without any visual presentation for the hearing impaired .  See, for instance, our entries, here and here.  With hurricane season still in full swing, broadcasters must keep these rules in mind, and remind their on-air staff to remember to comply with these obligations.

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Annual EEO Public File Report Deadline - October 1

Affected States:  Alaska, American Samoa, Florida, Guam, Hawaii, Iowa, Mariana Islands, Missouri, Oregon, Puerto Rico, Virgin Islands, Washington

By October 1, 2007, radio and television Station Employment Units (SEU) in the states listed above must:  (1) prepare their Annual EEO Public File Report; (2) place it in the public inspection files of all stations comprising the SEU; and (3) post the Report on the websites, if any station in the SEU has a website.  The Annual EEO Public File Report summarizes the station's or the SEU's EEO activities during the previous 12 months, and provides information about the recruitment and outreach that the station conducted in the past year.  The states with the October 1 filing deadline are:  Alaska, American Samoa, Florida, Guam, Hawaii, Iowa, Mariana Islands, Missouri, Oregon, Puerto Rico, Virgin Islands, Washington. 

In addition to preparing the Annual EEO Public File Report by October 1, larger radio stations in Florida, Puerto Rico, and the Virgin Islands must also prepare and file with the Commission an FCC Form 397 Mid-Term EEO Report.  Please note, only radio station SEUs located in these three jurisdictions with 11 or more full-time employees are required to file an FCC Form 397 by October 1, 2007.

Biennial Ownership Report Deadline - October 1

Affected States:   Radio:  Alaska, American Samoa, Florida, Guam, Hawaii, Mariana Islands, Oregon, Puerto Rico, Virgin Islands, and Washington;  Television:  Iowa and Missouri

By October 1, 2007, radio stations in Alaska, American Samoa, Florida, Guam, Hawaii, Mariana Islands, Oregon, Puerto Rico, Virgin Islands, and Washington, and television stations in Iowa and Missouri must prepare and file an FCC Form 323 Biennial Ownership Report with the FCC.  Similarly, noncommercial stations in these states must file a Biennial Ownership Report on FCC Form 323-E.  Ownership Reports are filed every other year, reporting on changes in the licensee’s ownership and updating the information requested by the form.

The timing for the filing of the Biennial Ownership Report and the preparation of the Annual EEO Public File Report is based on the anniversary of the filing of the station's license renewal.  In turn, the renewal cycles are organized by state and type of service, and are staggered based on the FCC's prearranged schedule.  Periodically, we will remind groups of stations as to their upcoming deadlines, and stations should be vigilant to make these required filings.  Copies of our complete reminder memos containing additional information on each of these requirements can be found here (Ownership) and here (EEO).

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The Commission today granted a 60-day extension of time for the relocation of broadcast auxiliaries in the 2 GHz band.  The extension of time is in response to the joint petition submitted last week by Sprint Nextel, MSTV, NAB, and Society of Broadcast Engineers requesting that the Commission waive the current BAS transition completion date for an additional twenty-nine months.  A copy of the Commission's Public Notice can be found here.  Barring this extension of time, Sprint Nextel would have been obligated to complete the relocation of all BAS facilities by September 7, 2007, which clearly would have been impossible.  The Commission’s 60-day extension of time will push the deadline back to November 6, 2007, and allow Commission time to consider the issues raised by the petitioners and whether a two and a half year extension is warranted. 

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