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

The MusicFirst claim is that this case is different in that broadcasters have a self-interest in the topic.  Yet, seemingly, that argument goes too far, as a restriction on broadcasters editorializing on topics in which they have some interest could very well eviscerate the First Amendment rights that they have now had for so many years.  For instance, editorials on tax policy, health insurance, utility rate hikes, and even local bond issues may well have a direct impact on the broadcaster, but no one suggests that these topics are off limits.  Even an editorial supporting or opposing a political candidate, the heart of the editorial right for newspaper publishers and now enjoyed by broadcasters, could be seen as potentially having a financial impact on the broadcaster.  The MusicFirst petition does not address why these issues are somehow different from the performance rights issue, or why artists are entitled to more rights than supporters of positions that may be contrary to the broadcaster's position on other issues.

Moreover, it was clear even before the abolition of the Fairness Doctrine that broadcasters are not "common carriers," meaning that they do not have to accept every ad or message that anyone wants to put on their airwaves (Common carriers, like telephone companies, have to transmit every message that is given to them).  The broadcaster can serve as an editor or journalist, picking and choosing the message that it wants to convey to its listeners.  The only exception is for Federal political candidates, who have legislated a right of "reasonable access" - legislation that has not been challenged in the Courts in recent memory.  But regardless of the rights of political candidates, this exception is in no way relevant to the MusicFirst Coalition.

The MusicFirst petition also suggests that broadcasters may be improperly characterizing spots that they run against a performance royalty as Public Service Announcements ("PSAs").  Yet that also is not a relevant criticism, as the FCC did away with all of its mandatory program logging requirements back in the 1980s.  Thus, whether broadcasters characterize the announcements are PSAs, or Entertainment or News or anything else has no current significance for regulatory purposes.  Note that the localism rules adopted but not yet effective for TV, and those proposed for radio, would bring back the mandatory classification of broadcast programs and give the PSA classification regulatory significance if and when these proposed rules become effective.  But it is certainly not an objection at this point.

The PSA suggestion is tied into another claim that the radio broadcasters running these announcements may not be meeting their public file issues under the Bipartisan Campaign Reform Act ("BCRA") which requires that a broadcaster who runs advertising discussing "Federal issues" put information into their public files similar to that which is maintained for political candidates (see our post, here, for details on that requirement).  While we have advised our clients to comply with these rules, especially if anything of value has been provided to the station in connection with the ads (including scripts or pre-produced spots), where the station airs its own editorial message on the issue, the spots do not seem to fall into the BCRA requirements as they are not sponsored programming, which is essentially what those requirements address.

Ignoring other procedural and substantive issues in the petition (including its failure to name names - in most cases omitting information about the stations which supposedly engaged in the complained of conduct and of the artists who were discriminated against), the issue seems to boil down to a First Amendment issue.  No one would suggest that performers be required to allow broadcasters to attend their concerts to speak against the royalty, so why should broadcasters be compelled to give voice to a position to which they are fundamentally opposed?  We will see what the FCC does with the MusicFirst petition in coming months.  Given the recent statements of the proposed new Chair of the FCC at his confirmation hearing that he has no intention of reviving the Fairness Doctrine, the prospects are that this petition will be simply one more publicity volley in a protracted war over the broadcast performance royalty.

In the order, the FCC also minimizes the costs of complying with its new requirements.  The Commission suggests that the costs of digitizing a public inspection file would "involve a one-time cost of $15,000," and then could be maintained on a server for less than $20 a month.  Even if this cost is accurate (and as set forth below, there are reasons to doubt this), for a small market television station even that cost can be quite significant.  While the Commission suggests that small stations with minimal website operations can request a waiver of these requirements, it sets no standards by which such a waiver will be judged.  Similarly, the costs for the constant review of a station's programming necessary to complete the Form 355 will be substantial, as every day's programming will need to be timed, classified, and recorded so that the weekly averages that are reported on the Form can be computed, and as the report requires a complete catalog of all public interest programming.  Someone will have to make those computations, and prepare the required descriptions of the public interest programming, again not an insubstantial cost, especially for a small market station (and even for some larger market stations).  And for what purpose?  The Commission implies that it is for the greater good that will come from the information reported in the form - information which, as stated above, in the Commission's own eyes is currently of no regulatory significance.

These issues may well be played out in appeals or requests for reconsideration of the new rules.  But, unless and until the rules are changed, broadcasters will need to comply with the new requirements.  First, the provisions governing the on-line maintenance of the public file include the following (with our observations in parentheses):

• The Rules will become effective 60 days after the notice of their approval by the Office of Management and Budget (as required by the Paperwork Reduction Act - this is paperwork reduction?) is published in the Federal Register.
• Stations can either post the public file contents on their own website, or on the website of their State Broadcast Association (why would the Association volunteer to do that?).  Even if the State Association agrees to host the website, the station must have a link on its website to the report. 
• If a station has no website, it does not need to create one to comply with these rules (and it has no obligation to place the file on the State Association site).  But if it later develops a website, it must have the public file contents posted within 30 days.
• The contents of the political file do not need to be posted on the website
• Letters from the public do not need to be posted on the site - though emails from the public should be posted
• Documents that are posted on other sites, including the FCC site, need not also be stored on the station site, if a link to the documents is placed on the station's site
• The file must be accessible to the disabled, complying with Conformance Level A of the World Wide Web consortium's Web Content Accessibility (W3C/WAI) guidelines.  (Information may be found here).  This may preclude some files being stored solely in a PDF format (and will no doubt cause some consternation among those at stations, who we would expect to be most people, not familiar with these standards). 
• Twice each day, the station must publicize on the air, with its station identification, the availability of the file on the website.  At least one of those mentions must be between the hours of 6 PM and midnight.

The FCC Form 355 requires information including the following:

• A list of the station's programming streams (i.e. the analog channel and any digital multicast program streams) and "their main programming focus"
• A list of the parent company and affiliates of the company which owns the station (isn't this what Ownership Reports are for?)
• For each programming stream, the average number of weekly programming hours devoted to the following:
  • High Definition programming
  • National news
  • Local news produced by the station
  • Local news produced by some other entity (who must be identified)
  • Programming devoted to "local civic affairs," defined as programming designed to provide the public with information about local issues, including statements or interviews with local officials, discussions of local issues, and coverage of local legislative meetings.  This programming must be subtracted from the "news" programming reported above.
  • Coverage of local electoral affairs - basically coverage of local elections - which must also be subtracted from the news coverage numbers reported above
  • Independently produced programming, i.e programming not produced by a national network (presumably each local station will have to determine if a network has as little as a one-third interest in all programming that is being aired)
  • "Other" local programming - which is not defined but presumably would include sports, religious, and entertainment programming produced within the station's service area
  • Public service announcements
  • Paid public service announcements (a PSA-type announcement for which the station or any group that the station is affiliated with - presumably including state broadcast associations - receives something of value)
  • Closed captioned programming
• A list of each national news story that includes significant treatment of community issues, listing for each such program:
  • title, length and date and time of airing
  • whether it was aired on the primary channel of the station
  • whether it was locally produced
  • whether it previously aired on this station or any other station (how is a station supposed to figure out what other stations a national news program aired on?)
  • if it was part of a regularly scheduled news program
  • whether any consideration was received for the broadcast of the segment
• A list of all local news program segments dealing with community issues, providing the same information for each such segment as listed above for national news segments
• A list of all local civic affairs program segments that provides significant treatment of a community issue, with all the same details as listed above for news segments
• A list of all electoral affairs programs that includes significant treatment of community issues, with the same details as provided for news segments
• The title, length and date and time of the airing of all independently produced programming
• A list of all local programming not otherwise listed above, with title, length,and date and time of airing, and whether the station received consideration for airing the program
• For each PSA, the name of the sponsoring organization, the number of times the PSA ran, the length, and the percentage of times that were during prime time hours
• For each paid PSA, the same information as for unpaid PSAs
• Details of programming directed to "undeserved communities," defined as demographic segments of the community to which little or no programming is directed (query - if no programming is directed to a particular demographic segment, how can a station have anything to report in this category?)
• Details of religious services or other local religious broadcasts aired at no change
• A description of how the station determined that its programming met community needs
• Details on the amount of closed captioned programming broadcast by the station, and a list of exempt programs that were aired, with details as to the exemptions
• Whether the station voluntarily provided video description of any of its programs and, if so, how much
• Information about broadcasts about community emergencies, including a statement as to whether or not the station complied with the rules that require such programs to be accessible to the disabled
• Whether or not more than 3 hours per day of programming is provided pursuant to an LMA or JSA.

 As I was preparing this litany of information that the Form 355 will contain, I was trying to imagine how stations will comply with this requirement. As set out above, the form calls for an inventory of all program segments that deal with issues of public concern.  To fully comply with the rules, it would appear that a station will have to have staff members dedicated to monitoring all programming broadcast on the station - including on multicast streams and including all network and syndicated programming - to determine if the programming contains a significant discussion of important issues of public concern. Then, if any segment of any program does contain such a discussion, the station will have to write up the description of that program for inclusion on the Form 355, providing the duration, topic and time of broadcast of each such program. The Form 355 will not be a form that a station can simply fill out in the last few days of the quarter, but instead will require a minute-by-minute review of station operations, and a daily updating up information to be ready to upload it on the quarterly due date.

This would seem to be an incredibly burdensome requirement for any station. But, as with any new regulatory mandate, the burden falls hardest on small market stations. The costs and time to monitor station programming is essentially the same whether a station is in Glendive, Montana or New York City, as the amount of programming that a station broadcasts in either a big or a small market is essentially the same. Yet a New York City station has far greater resources from which to pay the costs of compliance with these rules. The small market station, in many cases already reeling under the costs of the digital transition, will be crushed by the new burden that these new rules entail. If ever the Paperwork Reduction Act should be brought to bear to reject a program for the regulatory burden it imposes, this should be the case. Lets hope that the Office of Management and Budget is more attuned to the burden that these rules create than was the FCC.

While these new reports do not impose any new standards on a broadcaster requiring a specific amount of any type of programming, at least Commissioner Copps expressed his hope that this was but a first step in developing mandatory requirements for specific amounts of public service and public affairs programming for TV broadcasters.  Commissioner McDowell, on the other hand, recognized the implicit threat that these forms imposed - by requiring the detailed reporting of the types of programming that a station airs, the FCC is implicitly urging stations to air that kind of programming.  He feared that this was moving the FCC in the wrong direction toward more regulation and treading on First Amendment concerns.

Commissioner McDowell also expressed concerns about how stations - especially smaller ones - would meet the requirement that they have their public files online in 60 days.  While there was some discussion about the potential for waivers by smaller stations which maintain a bare-bones website or are otherwise financially distressed, one wonders if the Commission fully understands what needs to be in a public file, and the potential issues that can arise from putting it all on-line.  Not only will there be these new quarterly filings that will need to be put online (or linked to, as apparently the Commission will allow a station to link to documents that are already online), but there will also need to be links to children's programming reports, EEO annual reports, and Ownership filings on FCC Form 323.  Stations will also need to put on their websites Network Affiliation Agreements, LMAs or JSAs, documents relating to their ownership (including options, pledges and other financial documents that set limitations on the operation of the station) and various other sometimes voluminous documents.  From what was said at the meeting, about the only documents that will not need to be put on the website will be political file contents and letters from the public that are sent by "snail mail" (though email letters from the public will need to be maintained online).  I would fear that these obligations will be the kind of "gotcha" rules that will lead to fines at license renewal time, just as the failure to keep a complete public file, to complete Quarterly Issues Programs lists, or to observe all the obligations of the children's television rules led to so many fines during the recent renewal cycle. 

This summary is based on the Commission's brief Public Notice about the actions, and the statements made at the FCC meeting.  When the full text of the Commission's order is released, we will know more about the details of these requirements.  Stay tuned, and start thinking about increasing the electronic storage capacity of your station website.