Broadcast Law Blog

Broadcast Law Blog

FCC Approves Expansion of Use of FM Translators By AM Stations – But Warns Broadcasters Not to Jump the Gun and File Before New Rules Become Effective

Posted in AM Radio, FM Translators and LPFM

As we wrote last week, the FCC approved the expanded use of FM translators by AM stations – allowing their use anywhere within a 25-mile radius of their AM transmitter site, or within the 2 mv/m contour of the AM station – whichever is greater.  The current rule restricts that will be replaced limit FM translator use to the lesser of the 2 mv/m contour or the 25-mile radius for the AM station.  We summarized the draft order here, and the final order generally tracks that draft.  While the FCC has approved the change in these rules, these changes are not yet effective.  Yesterday, the FCC warned eager AM broadcasters not to file an application in reliance on the new rules just yet, or to even file an application asking for a waiver of the current rules based on the upcoming rule change, as the rules do not become effective until they are approved by the OMB under the Paperwork Reduction Act and that approval is published in the Federal Register.  To give all broadcasters an equal opportunity to take advantage of the new rules, any premature application filed in reliance on the rule change will be dismissed.

However, the FCC will entertain extensions to the construction permits for unbuilt FM translators used for AM stations where the AM licensee has decided that the new rules will afford them the opportunity to move the translator to a more advantageous location.  Translator permittees must file for these extensions and have them approved by the FCC, and the extensions will last no more than 6 months past the effective date of the new rules (see footnote 22 of last week’s decision).  The FCC also noted that, if the translator was moved using the 250-mile waiver rules (which we summarized here), any new move of the translator allowable under the new rules must stay within the 250-mile circle – the move done in reliance on the waivers afforded to stations last year, plus the moves allowed under the current rules, cannot exceed 250 miles.  There will no doubt be many broadcasters looking to take advantage of these new rules soon.

FCC Approves For the First Time 100% Foreign Ownership of US Broadcast Stations

Posted in AM Radio, FM Radio, Multiple Ownership Rules, Public Interest Obligations/Localism, Television

The FCC yesterday released its first decision approving 100% foreign ownership of a group of US broadcast stations. This comes after significant relaxation of the FCC’s interpretation of the foreign ownership limits which, less than 4 years ago, had been interpreted to effectively prohibit foreign ownership of more than 25% of a company controlling broadcast licensees (see our article here about the 2013 decision to relax the restrictive policy). In yesterday’s decision, the FCC approved the application of an LLC controlled 100% by a husband and wife, both Australian citizens, to acquire complete control over several companies that are the licensees of 7 AMs, 8 FMs, 13 FM translators, and 1 TV translator in Alaska and Texarkana, Arkansas and Texas. The FCC’s approval requires that these individuals get FCC approval if any other foreign owners are added to their company, but otherwise imposes no other significant conditions on this acquisition. Given the simple 50/50 ownership of a husband and wife in a closely held company, the ownership reporting and analysis conditions imposed on public companies who have been allowed to exceed the 25% threshold in the past (see our article here and here) were not required in this case.

What is perhaps most interesting is just how routine this process has now become. Very recently, the FCC approved investment by a Cayman Islands based fund of more than 5%, up to 49%, of the ownership in Pandora (which owns a company that holds a radio station). These approvals come on top of several other acquisitions by foreign investors of non-controlling interests in broadcast licensees. As long as these owners are approved by various US government agencies as not presenting security risks, the approvals don’t seem to be an FCC issue. The FCC noted in yesterday’s order that allowing this kind of foreign ownership brings new sources of capital into the US broadcasting industry, and may encourage other countries to relax their ownership rules to allow investment by US companies in broadcast companies serving other countries. What a difference a few years can make!

FCC Asks for Formal Comments on Next-Generation of Television, and Approves Greater Use of FM Translators By AM Stations

Posted in AM Radio, Digital Television, FM Translators and LPFM, Television

At its meeting yesterday, the FCC took two big actions affecting broadcasters. First, it approved a Notice of Proposed Rulemaking looking to adopt a transition plan for television broadcasters to move to the new ATSC 3.0 standard. The Commission apparently took the general actions previewed in its draft order released earlier this month, though additional questions were said to have been teed up for public comment in the final version of the NPRM. The final version had not been released when this article was written on Friday morning. The FCC press release on its action yesterday is here. We’ll write more about the details of the NPRM in the next few days, after it is released.

The FCC also formally adopted the other order it had released in draft form back in early February.  This order expands the area in which FM translators can be operated to rebroadcast an AM station. We wrote about the draft order here. The FCC Press Release about yesterday’s action is here, but again the final text has not been released, so we can’t confirm that there were no changes from the original order. Watch for more information, including details of the effective date in these new translator rules, shortly.

Flo and Eddie NY Suit on Pre-1972 Sound Recordings Ordered Dismissed By Court of Appeals – No Issues with Copies Made in the Transmission Process

Posted in Intellectual Property, Internet Radio, Music Rights, On Line Media

This week, the US Court of Appeals essentially ended Flo and Eddie’s New York case against Sirius XM where it tried to establish a public performance royalty in pre-1972 sound recordings. The Court of Appeals sent the case back to the US District Court with instructions that it be dismissed, finding that a December decision by New York’s state Court of Appeals resolved all issues in the case. As we wrote just before Christmas, the New York Court of Appeals determined that there was no public performance right in pre-1972 sound recordings under New York state law. That decision resulted from a certified question from the US Court of Appeals which was reviewing the decision of a federal District Court which had found that such a right exists. An issue in a Federal case is certified or referred to a state court when there are issues of state law that control the determination of the Federal case. As pre-1972 sound recordings are not covered under Federal law, state law controls the rights accorded to such recordings, thus the certified question was necessary in this case to determine the state of the law on this issue in New York state (see our article about the referral of the public performance issue in this case to the NY Court of Appeals, here, an article that also discusses more broadly the status of pre-1972 sound recording litigation and related issues).

This week’s federal Court of Appeals order was very direct, relying on the state court decision that there was no public performance right to end the case. It did briefly address the remaining arguments of Flo and Eddie by finding that no issues still remained as to liability for copies of the sound recordings made during the digital transmission process (server, buffer and cache copies) or on any claim of unfair competition. Basically, the Court found that any copies made in the transmission process were fair use necessary to engage in the legal performance, and there was no unfair competition issue as the performance was legal, hence not unfair in the eyes of the law. Continue Reading

What’s Up for Broadcasters in Washington Under the New Administration – A Look Ahead at TV and Radio FCC Issues for the Rest of 2017

Posted in AM Radio, EEO Compliance/Diversity, FCC Fines, FM Radio, FM Translators and LPFM, General FCC, Incentive Auctions/Broadband Report, Indecency, Multiple Ownership Rules, Noncommercial Broadcasting, Political Broadcasting, Programming Regulations, Television

A new President and a new Chair of the FCC have already demonstrated that change is in the air in Washington. Already we’ve seen Chairman Pai lead the FCC to abolish the requirement that broadcasters maintain letters from the public about station operations in their public file (which will take effect once the Paperwork Reduction Act analysis is finalized), revoke the Media Bureau guidance that had limited Shared Services Agreements in connection with the sales of television stations, and rescind for further consideration FCC decisions about the reporting of those with attributable interests in noncommercial broadcast stations and the admonitions given to TV stations for violations of the obligation for reporting the issues discussed in, and sponsors of, political ads (see our article here). Also on the table for consideration next week are orders that have already been released for public review on expanding the use of FM translators for AM stations and proposing rules for the roll-out of the new ATSC 3.0 standard for television. Plus, the television incentive auction moves toward its conclusion in the repacking of the television spectrum to clear space for new wireless users. Plenty of action in just over 3 weeks.

But there are many other broadcast issues that are unresolved to one degree or another – and potentially new issues ready to be discussed by the FCC this year. We usually dust off the crystal ball and make predictions about the legal issues that will impact the business of broadcasters earlier in the year, but we have waited this year to get a taste for the changes in store from the new administration. So we’ll try to look at the issues that are on the table in Washington that could affect broadcasters, and make some general assessments on the likelihood that they will be addressed this year. While we try to look ahead to identify the issues that are on the agenda of the FCC, there are always surprises as the regulators come up with issues that we did not anticipate. With this being the first year of a new administration that promises a different approach to regulation generally, what lies ahead is particularly hard to predict. Continue Reading

FCC Releases First EEO Audit for 2017 – Over 200 Radio and Almost 80 TV Stations Named in the Audit Notice

Posted in AM Radio, EEO Compliance/Diversity, FCC Fines, FM Radio, Television

In the swirl of news about the deregulatory efforts of the new FCC, one could almost forget that there are still many regulations in place that require significant amounts of paperwork retention by broadcasters. That point was hammered home yesterday, when the FCC released its first EEO audit letter of 2017 for radio and TV broadcasters. The FCC’s public notice announcing the commencement of the audit includes the audit letter that was sent to all of the targeted stations.  The list of over 200 radio stations subject to the audit is here. The list of almost 80 TV stations is here. Responses are due March 28, 2017. As employment information for all stations within a named station’s “employment unit” must be provided in response to the audit, the reach of this notice goes far beyond the 300 stations targeted in the audit notices. While the FCC is considering a proposal to allow online recruiting sources to suffice to meet a broadcaster’s wide dissemination requirements (as we wrote here), that proposal is still at an early stage and, as this audit notice evidences, the underlying rules remain in place.

The FCC reminds stations that were targeted by the audit to put a copy of the audit letter in their public file. The response, too, must go into the file. For all the TV stations hit by the audit letter, and those radio stations that have already converted to the online public file, that will mean that the audit letter and response go into that FCC-hosted online public file.

The Commission has pledged to randomly audit 5% of all broadcast stations and cable systems each year to assure their compliance with the Commission’s EEO rules – including the requirements for wide dissemination of information about job openings and non-vacancy specific supplemental efforts to educate a station’s community about job opportunities in the media industry.  We recently summarized FCC EEO issues here, reminding broadcasters of the possibility of being audited.  The FCC also has the opportunity to audit larger broadcasters’ EEO performance when they file their FCC EEO Mid-Term Report. We also wrote about the start of the obligations for the filing of FCC Form 397 EEO Mid-Term Reports – which started the year before last for radio groups with more than 11 full-time employees and last year for TV licensees with 5 or more full-time employees in a few months, and are filed on the 4th anniversary of the filing deadline for the station’s license renewal – which will give the FCC another chance to review station EEO performance.   Continue Reading

Undoing the Past – New FCC Rescinds Rulings on Noncommercial Ownership Reports, Political Broadcasting Sponsorship Disclosure and Shared Services Agreements

Posted in Multiple Ownership Rules, Noncommercial Broadcasting, Payola and Sponsorship Identification, Political Broadcasting, Television

With the change in administration at the FCC, there are opportunities for certain actions to be taken very quickly, without going through the full process of a rulemaking requiring public notice of the proposed rule change and time for public comment.  At the end of this last week, we saw the FCC’s Media Bureau take actions in three different proceedings directly applicable to broadcasters to undo what had been done during the prior administration – rescinding actions with respect to noncommercial ownership reports, the disclosure of information about the sponsor of political advertisements, and on the treatment of TV assignment and transfer applications for television stations where shared service agreements are involved.  Below, we’ll give a few details about each of those actions.

Two of the rescinded actions were January rulings by the Media Bureau which, at the time they were issued, drew statements of concern from then-Commissioners Pai and O’Rielly.  The Republican Commissioners argued that the actions should have been taken by the full Commission, not the Media Bureau.  As these decisions were not final (appeals can be taken or reconsideration requests can be filed within 30 days of an action, and the full Commission, on its own, can set aside a staff action within 40 days), the Media Bureau, presumably at the urging of the new Chairman, set these actions aside for further consideration by the full Commission.

Continue Reading

FCC Chairman Pai Promotes Transparency – Releases Draft Orders on Next-Generation TV and FM Translators for AM Stations – What Will Be Considered for Radio at February FCC Meeting?

Posted in AM Radio, Digital Television, FM Translators and LPFM, General FCC, Television

FCC Chairman Ajit Pai announced yesterday that he plans to test a new FCC procedure – releasing drafts of FCC orders to be considered at future FCC meetings at the same time as the proposed agenda for the meeting is released, weeks in advance of the meeting. On the draft agenda for the February 23rd meeting are two items of interest for broadcasters, and draft orders for both of these items were released yesterday – one for radio and one for TV. By releasing these drafts early, all parties affected by the orders can review them and spot issues which can be brought to the Commissioners’ attention before the orders are adopted. We write about the radio item below, and will cover the draft Notice of Proposed Rulemaking for next-generation TV using the ATSC 3.0 standard in a separate article.

For radio, the draft order would permit an expansion of the area in which an FM translator rebroadcasting an AM station can be located. Under current rules, the 1 mv/m contour of translator must be entirely contained within the lesser of the daytime 2 mv/m contour of the AM station or within a circle with a 25 mile radius from the AM transmitter site. With severely directional AM stations, sometimes the ones most in need of help from FM translators, translators can be restricted to service areas only a few miles from the primary AM station in some directions – leaving the AM stations unable to serve their entire market and fill in the holes in their coverage area. This issue was raised as one of many issues for consideration in the FCC’s AM revitalization proceeding, about which we wrote here. Under the draft order released yesterday, translators will now be able to be located in a much greater area – as long as the 1 mv/m contour stays within a 25 mile radius measured from the AM site or within the 2 mv/m contour of the AM station – whichever is greater. This promises to give all AM stations the opportunity to serve their markets with FM translators and, for larger AM stations, gives them the ability to fill in their service areas with FM translators (perhaps multiple translators) over a much larger area. Continue Reading

FCC Votes to Abolish Requirement for Retaining Letters From the Public on Station Operations – First Step in Broadcast Deregulation?

Posted in AM Radio, EEO Compliance/Diversity, FM Radio, General FCC, License Renewal, Programming Regulations, Public Interest Obligations/Localism

The FCC on Tuesday voted to abolish the 44 year old requirement that commercial broadcast stations retain, in their public file, letters (and emails) from the public dealing with station operations (see the full Order here). As noted by the Commissioners in their comments at the FCC meeting (and as we suggested here and here when this proposal was first introduced), these documents were rarely if ever accessed by the public. Mirroring our comments from last year, the Commission noted that, in today’s world, where social media is where so many people take to comment on each broadcaster’s every action, and where the comments are open to all and preserved for posterity, the requirement for the retention of letters in a paper public file was felt to be no longer necessary. Plus, with the rest of the public file either already online or soon to go online when the last radio stations convert to the FCC-mandated online public file next year (see our articles here and here), the elimination of this requirement allows stations to have more security at the main studios as people can’t just show up unannounced to view the file, as required under the current rules.  Note that this will change the rules only for commercial stations – noncommercial stations have never had the obligation to include letters from the public in their public inspection files.

Much of this was expected in light of the new deregulatory bent of the Commission. About the only issue that had not previously been highlighted was the associated elimination of the requirement for TV stations that they report letters from the public about violent programming in their license renewal applications. The statute requiring the disclosure of these letters applied only to letters which the FCC rules required to be retained by the station. As the FCC will no longer require those letters be retained, the FCC found that the need to report letters about violent programming was now moot – and instructed the Media Bureau to delete the requirement from the license renewal forms. Because the reporting requirement lacked any real purpose, since the FCC has never sanctioned a broadcaster for violent programming and likely has no jurisdiction to restrict such programming, the abolition seems to be nothing more than the elimination of an unnecessary paperwork burden on broadcasters. Continue Reading

February Regulatory Dates for Broadcasters – EEO Reports and Comments on Ownership, EEO and Copyright Issues

Posted in EEO Compliance/Diversity, FM Radio, General FCC, Incentive Auctions/Broadband Report, Intellectual Property, Internet Radio, Multiple Ownership Rules, Music Rights, Television

While there is a new administration in charge at the FCC, there are still those regular regulatory dates that broadcasters must face, as well as dates unique to pending proceedings that arise from time to time. Before we get to the February dates, we should remind broadcasters of those January 31 dates that they should be considering, including the deadline for signing up for the Interim License Agreement for those radio stations playing music represented by the new performing rights organization GMR (see our articles here and here). January 31 is also the deadline for payment of SoundExchange yearly minimum fees by webcasters (including broadcasters who stream their music on the Internet), as well as the date for comments to the House Judiciary Committee on the structure of the Copyright Office (see our article here) and with the Copyright Office on the qualifications for a new Register of Copyrights (see our article here).

With the start of February, there are routine regulatory dates for broadcasters dealing with EEO requirements. Commercial and Noncommercial Full-Power and Class A Television Stations and AM and FM Radio Stations in Arkansas, Kansas, Louisiana, Mississippi, Nebraska, New Jersey, New York, and Oklahoma that are part of an Employment Unit with 5 or more full-time employees, must place in their public file (or upload to their online file for TV and radio stations that have already converted) their EEO Public File Reports. Stations also need to put a link to the EEO Public File reports on the home page of their websites, if their station has a website (meaning they have to have a webpage for their most recent report if they have not converted to the online public file). For Radio Station Employment Units with 11 or more full-time employees in Kansas, Nebraska, and Oklahoma and Television Employment Units with five or more full-time employees in Arkansas, Louisiana, and Mississippi, FCC Mid-Term Reports on Form 397 must be submitted to the FCC by February 1. We wrote about FCC Mid-Term Reports here. Continue Reading