Posted on November 4, 2008 by David Oxenford

The Promise of an Obama Administration for Broadcast and Communications Regulation

With Barack Obama's historic victory just sinking in, all over Washington (and no doubt elsewhere in the country), the speculation begins as to what the new administration will mean to various sectors of the economy (though, in truth, that speculation has been going on for months).  What will his administration mean for broadcasters?  Will the Obama administration mean more regulation?  Will the fairness doctrine make a return?  What other issues will highlight his agenda?  Or will the administration be a transformational one - looking at issues far beyond traditional regulatory matters to a broader communications policy that will look to make the communications sector one that will help to drive the economy?  Some guesses, and some hopes, follow.

First, it should be emphasized that, in most administrations, the President has very little to do with the shaping of FCC policy beyond his appointment of the Commissioners who run the agency.  As we have seen with the current FCC, the appointment of the FCC Chairman can be the defining moment in establishing a President's communications policy.  The appointment of Kevin Martin has certainly shaped FCC policy toward broadcasters in a way that would never have been expected in a Republican administration, with regulatory requirements and proposals that one could not have imagined 4 years ago from the Bush White House.  To see issues like localism, program content requirements and LPFM become such a large part of the FCC agenda can be directly attributed to the personality and agenda of the Chairman, rather than to the President.  But, perhaps, an Obama administration will be different.

One of the specific proposals of the Obama campaign is the promise to appoint a Chief Technology Officer as a cabinet-level position to help coordinate policy across the many government agencies that deal with technology and communications.  This position would be designed to develop policies that will enhance the competitive position of the United States in the world-wide technology revolution.  Clearly, such a position will create a new executive-level focus on communications policy that will affect the workings of the FCC.  How will this focus impact broadcasters?  With the unanimous bipartisan decision of the FCC on Election Day approving the use of unlicensed devices in the television band, the so-called "white spaces" decision, one might have a glimpse of the kinds of regulatory actions that could be expected from an Obama FCC (though hopefully not an example of the procedures for making that decision).  No longer will the traditional media or established communications companies be favored if there is the potential for some sort of transformative technology that can increase US technological competitiveness.

But the hope for an Obama administration is that the rhetoric of a transformative candidacy, one geared toward uniting the various divides of the country, will seep into the broader workings of the administrative agencies in Washington - that the pitched battles of one industry versus another, or one partisan viewpoint over another, will be replaced by a more cooperative spirit that will move the country, and specific industries forward.  One would hope that this spirit would encourage compromise, and would bring a new openness to government that will allow real discussion to take place on issues, rather than decisions being made based on agendas that are set in stone before the evidence is in and the arguments made.   One would hope that some of the unyielding positions that some regulators have taken on communications policy issues would be more open to persuasion and discussion.

To be more specific, one would hope that an Obama administration would, in the broadcast regulatory arena, be open to recognizing that we have a pretty incredible broadcast service in this country - one that can rapidly adapt to disasters, and can bend and shape itself to the needs and desires of the audience.  While there have been excesses in broadcasting here and there, these tend to be self-correcting, as witnessed by the recent divestitures of many radio and television stations by big groups - helping to bring back some of the localism lost by the industry's rapid consolidation in the early part of this decade. 

Some have feared that the return of a Democratic FCC will result in the return of the kinds of nitty-gritty broadcast regulation that has seemingly been advocated by some quarters of the Democratic party - a return of the Fairness Doctrine, the kinds of detailed programming disclosure requirements that have been adopted but not yet implemented for television broadcasters that impose great costs without any discernible regulatory benefit (see our post here), or the adoption of other specific regulations that increase government mandates without corresponding benefits.

But I am hopeful that an Obama administration would not be one to adopt unproductive regulation.  Clearly, the Obama administration will be one that will want to stress inclusiveness and opportunity for all in the media, and will look for ways to encourage minorities and other new entrants into broadcast ownership.  But if we look at the recent localism proceedings, for instance, we see that many members of the minority community have actually opposed the kinds of specific regulatory obligations that some have attributed to the Democratic Commissioners, as minority broadcasters and other new entrants realize that they need to make a living operating a station - that broadcasting is a business that must generate a profit.  And that specific and detailed regulation take flexibility and innovation away from broadcasters, and usually impact small broadcasters more than large conglomerates.  So an administration that wants to encourage new owners can't engage in a wholesale re-regulation of the broadcast industry.

Do I expect some more regulation?  Of course - but that seems to be a reaction to the current climate for all industries in Washington where there seems to be building a general consensus that that the philosophy of deregulation may have gone too far (see our post here).  But I would look for regulation around the edges, regulation that imposes some public interest obligations on broadcasters but ones that can be lived with - not ones that are imposed simply for the sake of regulation and which can impose a crushing burden on small business. 

From the rumors swirling around DC of the names of potential Chairs of the FCC in the new administration, many have worked at past Democratic Commissions, but many of these have spent time in the business community since leaving the FCC, and are thus familiar with meeting a payroll and the costs of regulation.   I believe that right now, we should keep hope alive and look at the Obama administration as one that may bring a new emphasis to the communications world while not unduly burdening those that are already operating in that world.  It is a new day - let's hope that it is indeed a brighter one for broadcasters.
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Posted on August 1, 2008 by David Oxenford

FCC Finds Comcast Internet Management Technique Violates Net Neutrality Policy

The Federal Communications Commission voted 3-2 on to issue an order imposing regulatory controls on the Internet. The ruling concerns a network management technique used by Comcast for its high-speed Internet service that had the effect of giving slightly lower priority to some peer-to-peer (P2P) upload sessions so that the latency-sensitive applications of the vast majority of its Internet customers would remain uninterrupted. The Commission ruled that the practice—which Comcast previously announced would be phased out this year—violated the Commission’s “network neutrality” policy guidelines and amounted to discriminatory “blocking” and “monitoring” of Internet content, as well as “interference” with consumers’ “right to access” lawful Internet content. While not fining Comcast, the Commission instead orders Comcast to report on the technique, submit a compliance plan for terminating it by year-end, and describe to the FCC and the public the specifics of what new management techniques will be implemented. Noncompliance, warns the Commission, will be subject to future injunctive relief and additional enforcement actions.   Additional details of the FCC's announcement, and specific concerns about this ruling, can be found in our firm's advisory bulletin about this decision.  The Press Release on the FCC action can be found here.

While the full text of this decision is not yet available, the New York Times ran a story summarizing its effects.  The statements of the Commissioners on this decision are also available.  The dissents approach the issues from somewhat different perspectives.  Both express the hope that these kinds of objections could have been resolved by industry organizations - Commissioner McDowell's statement going into great detail about the lack of notice and precedent for the decision, and the potential impact that the decision will have on network management practices and voluntary decisions of Internet management organizations.  Commissioner Tate raises questions of what the decision will do to attempts to design technological systems that can sniff out adult content for purposes of protecting children from such content.  It's interesting that the FCC's own proposed rules for portions of the 700 mhz band include such requirements for the monitoring of adult content.

Slowly, inextricably, the FCC seems to be being dragged into Internet regulation.  We've written about the recent proposals in Congress to extend FCC closed captioning rules to the Internet.  We've also written about the proposals to involve the FCC in Internet radio rate setting.  As Internet delivery of content becomes more and more prevalent, will the Internet become, like the rest of the Communications world, subject to a pervasive scheme of regulation?  With each passing decision, that seems to become more likely.
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Posted on June 23, 2008 by David Oxenford

George Carlin - Writing the Indeceny Rules the FCC Never Did

Today's morning newscasts were filled with the stories of the passing of George Carlin - a comedian and satirist who effectively wrote the indecency regulations that most broadcasters abide by - without the FCC ever having had to adopt the regulations that he attributed to them.  In the broadcast world, Mr. Carlin was probably best known for his routine about the Seven Words that You Can Never Say on TV.  When that routine was aired by a New York radio station, and heard by a parent who claimed that he had a child in his car when the routine came over his radio in the middle of the day, the resulting FCC action against the station resulted in appeals that ended in the Supreme Court which, in its Pacifica case, upheld the right of the FCC to adopt indecency rules for the broadcast media to channel speech that is indecent, though not legally obscene, into hours when children are not likely to be listening.  But what this case and the FCC ruling did not hold are perhaps more misunderstood than what the case did hold.

First, the case was about "indecency" not "obscenity."  Many of this morning's newscasts referred to the Pacifica decision as being an Obscenity decision.  Obscenity is speech that can be banned no matter what the time and place, as it is speech that is deemed to have no socially redeeming value.  Indecency, on the other hand, is a far more limited concept.  Indecent speech is speech that is constitutionally protected - it has some social significance such as the social commentary clearly conveyed by the Carlin routine.  It cannot be constitutionally banned.  But the Supreme Court upheld the FCC's decision in the Pacifica case that, because of the intrusive nature of the broadcast media, it can be limited to hours where children are not likely to be in the audience.  Hence, the FCC has a "safe harbor" that allows indecent programming between the hours of 10 PM and 6 AM, when "obscene" programming is never allowed on the air.

But perhaps the greatest misimpression of the Carlin routine is the widely held belief that there are in fact Seven Dirty Words that you can never say on the air.  In fact, that is not and has never been the FCC's holding.  In fact, until recently, there were no words that were specifically banned on the air - all had to be evaluated by context.  Even though recent FCC decisions have tried to make the "F-word" and the "S-word" into those words that you can never say on TV (or radio) outside the safe harbor, even those bans are not absolute as the FCC's approval of the airing of Saving Private Ryan during prime time hours has shown.  (and, as we have written before, these new rules have not fared well so far in the Courts and may be headed back to the Supreme Court for further review).  The other words in the Carlin routine have never been specifically prohibited in all contexts - some in fact have been deemed not by themselves indecent in subsequent FCC cases.  Instead, under the rules that the FCC has tried to enforce, a contextual review of the program must be done to determine if, in context, the words were used to shock or titillate, and whether they were used to describe sexual or excretory functions.  That is obviously a difficult issue to decide, and one that has taken up much legal time and argument since the Pacifica decision.  (See our memo, here, discussing some of the lines drawn by the FCC).

Yet, despite the fact that the FCC never adopted a list of Seven Words that You Can Never Say On TV, many broadcasters believe that they have, and we probably have Mr. Carlin to thank for that belief.  Perhaps there will be Carlin retrospectives on broadcast stations in coming days - but they are unlikely to run during the middle of the day.
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Posted on April 24, 2008 by David Oxenford

FCC Releases New Version of the Public and Broadcasting and Sets Up Help Desk for Broadcast Complaints

The Public and Broadcasting is a document first written by the FCC in the 1970s to tell the public about how the FCC regulates broadcast stations, and to tell the public how they can get involved in the regulatory process.  Broadcasters must maintain a copy of the manual in their public file, and make it available to members of the public who request it.  For years, the manual was grossly out of date, finally being updated a few years ago.  Today, the FCC issued a Public Notice announcing that they have once again updated The Public and Broadcasting, and that all stations need to place the new version in their public file.  The new version, with a new subtitle "How to Get the Most Service from Your Local Station" can be found here.  Stations should print that document, and place it in their public file.

The manual is updated, and sets out most of the programming and other operational rules that would be of interest to the public.  The manual seems to be objective - pointing out that most programming decisions are left to the broadcast licensee to avoid violating the Freedom of Speech rights of the broadcaster. 

 

The Commission, at the same time, announced that it was setting up contact representatives within the FCC to deal with questions from the public about how to deal with their local broadcasters - and how to get involved in the FCC's processes of regulating broadcasters.  Toll free numbers and email addresses of one contact representative to deal with radio matters, and another for TV, have been established.  Setting up these contacts seem to be part of the FCC's suspicion, reflected in their localism proceeding and in connection with many other recent FCC actions, that broadcasters are not adequately serving the public and that there is significant interest on the public's part to become active in the activities of broadcasters and their regulation by the Commission.  This suspicion also seems to be underlying the proposals for community advisory boards and manned main studios in a station's city of license, as reflected in the issues raised in the localism proceeding, where comments are due on Monday, April 28.

As the Commission is urging that the public monitor broadcasters and their adherence to the FCC's rules, broadcasters should start their compliance programs by updating the version of The Public and Broadcasting that is in their public file.
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