Posted on July 29, 2009 by David Oxenford

A Full Five Person FCC - What's Next For Broadcasters?

For the first time since the term of FCC Commissioner Tate expired and Chairman Martin resigned, the FCC will be back to full strength with the Senate's approval of new FCC Commissioners Mignon Clyburn and Meredith Attwell Baker.  What issues of importance to broadcasters will the Commission, now headed by Chairman Julius Genachowski, take up in coming months?   The new Chairman, who gave a number of interviews last week with the trade and popular press, emphasized the importance of the broadband rollout.  Beyond that, his priorities for the broadcast media were not detailed.  He did, however, emphasize, that any broadcast regulation (specifically referencing the mandatory review of the broadcast ownership rules that must begin next year), would have to take into account the realities of the marketplace - including the current economic conditions.

Beyond that, there were few clues as to the new FCC's priorities in the broadcast world.  But, even though there are no indications of the FCC's priorities, there are many open broadcast issues that the Commission will, sooner or later, need to resolve.  Some involve fundamental questions of priorities - trying to decide which user of the spectrum should be preferred over others.  Other issues deal with questions of what kind of public service obligations broadcasters will face.  And yet another set of issues deal with just the nitty gritty technical issues with which the FCC is often faced.  Let's look at some of these open issues that may affect the broadcast industry. 

In the first category - the issues of priorities of one type of service over another, issues include the following:

  • The priorities between LPFM stations and FM translators and full power stations (see our posts here and here on that issue)
  • Final resolution of the White Spaces issues - implementing the FCC's decision to make TV spectrum available for use by wireless devices, or reconsidering that decision based on the pending appeals by the television industry
  • Deciding whether to take TV channels 5 and 6 and change them into radio channels (see our post here), when a limited number of full power TV stations, as well as a number of LPTV stations are currently using the channels
  • Making a decision about increased HD radio power, which some other FM stations that rely on service at the fringes of their protected contours or or beyond worry would interfere by such power increases

In the second category of issues - the question of what public interest regulations the Commission should impose on broadcasters, issues include:

  • Dealing with the Petitions for Reconsideration of the FCC's decisions to require TV stations to put their public files on line and to complete the Form 355 detailing all of their public service programming in minute detail - rules adopted in late 2006 but never implemented or even sent to the Office and Management and Budget for review of their compliance with the Paperwork Reduction Act
  • Resolution of the FCC's localism proceeding proposing regulations including:
    • A return to mandatory main studios in the station's city of license
    • Manned main studios during all hours of station operations
    • Mandatory public service obligations for broadcasters
    • Consideration of the process for the selection of music on broadcast stations and whether more local music should be required
    •   Potential extension of the TV public file and Form 355 obligations set out above to radio
  • Issues about the Arbitron PPM and whether it discriminates against minority owned stations
  • Resolution of the rural radio proceeding which includes questions about what kind of service stations need to provide to their city of license
  • Decisions on the proposals to mandate stricter sponsorship identification rules allegedly to protect the consumer from being influenced by undisclosed sponsors

Other more technical or procedural issues are also pending before the Commission, including:

And, of course, there are those issues that never go away.  Indecency cases are still pending before the Courts, so the Commission may once again have to face that issue.  And there is that little question of the Fairness Doctrine that just refuses to go away.  I'm sure that there are other issues that have escaped my mind while I'm writing this - but even if there were not, it is clear that the new Commission has plenty to keep it busy without even needing to bring up any new issues for the broadcaster.  And Congress can always give the FCC new things to do, like reregulating children's television programming or restricting prescription drug advertising.  Let's hope that these keep the Commission plenty busy for now, and that they don't have time to start anything new. 
Tags: , , , , , , , , , , , , , , , ,
Posted on May 14, 2009 by David Oxenford

Even Though Old Media May Be Dying - Let's Regulate Them While We Can - Broadcast License Renewals Every Three Years?

In a speech to the Free Press Summit, Acting FCC Chairman Michael Copps suggested that broadcast license renewals should no longer be a "postcard", but instead should be a real test of the broadcaster's service to the public interest - and should happen every three years, rather than on the eight year renewal cycle that is currently provided for by the law.  While the Chairman acknowledged that many suggest that the old media are in troubled times and may well be supplanted by new forms of communications, "If old media is going to be with us a while still...we still need to get serious about defining broadcasters’ public interest obligations and reinvigorating our license renewal process."  In other words, while broadcasters may be dying, we should regulate them while we can.

First, it should be pointed out that the broadcast license renewal is no longer a postcard, and really hasn't been for almost 20 years.  The current renewal forms require certifications on many matters demonstrating a broadcaster's service to the public and its compliance with the rules, and additional documentation on EEO performance and other matters.  TV broadcasters also have substantial renewal submissions on their compliance with their obligations under the Children's television rules.  Issues of noncompliance with the rules resulted in many fines in the last renewal cycle, demonstrating that this is not a process where the FCC is without teeth.  Yet most of these fines were for paperwork violations (e.g. not keeping detailed records of EEO outreach or quarterly issues programs lists demonstrating the public interest programming broadcast by a station), not for any substantive claims that station licensees were fundamentally unqualified and should forfeit their licenses.  In fact, the Acting Chairman's speech recognizes that most broadcasters do a fine job serving their communities, yet he believes that more regulation is necessary to police those that don't.  But is this the time to be imposing additional regulatory burdens on all of the industry, for the actions of a few.  Will the overall public interest be served by such actions?  .

As we wrote years ago when this proposal was proposal was previously floated by Commissioner Copps, the license renewal process was lengthened based on findings that the old process was cumbersome and unnecessary - often provoking litigation and delay, but only rarely uncovering any real evidence of serious problems with a licensee warranting Commission action.  There simply were no benefits to the substantially increased costs of the 3 year license term.  Moreover, the processing of the applications imposed a substantial burden on an already overworked FCC staff that took their attention off of the processing of the many other matters already before them. 

The period was gradually extended - going to 5 years for TV and 7 years for radio, and reaching its current 8 year term as part of the Telecommunications Act of 1996.  The Act specifies that the license renewal term shall be for "not more than 8 years," theoretically leaving the FCC with the flexibility to decide on some term less than 8 years.  However, when the Commission decided in 1997 to extend the renewal term to the full 8 years, it did so relying on statements of Congressional intent that Congress had expected to lighten the regulatory burden on broadcasters by extending the term for the full period.  Thus, were the FCC to try to shorten this period, it would have to explain why these findings were no longer relevant.

According to Broadcasting and Cable, Commissioner Copps later stated that he did not expect to rule on localism issues, or presumably raise this license renewal extension, during his interim chairmanship.  And the NAB immediately objected to the proposal.  Yet, as this issue has been raised by the Acting Chairman before, and as he will remain on the Commission even when the permanent Chair is seated, we can no doubt expect to hear this proposal raised yet again, perhaps in a formal setting, in the near future.  Broadcasters should be prepared to address any such formal proposal. 
Tags: , , , , , , , , ,
Posted on October 3, 2008 by David Oxenford

FCC Seeks Solution on Localism - What's Being Requested?

We’ve written much about the FCC Localism proceeding and the potential for some resolution of that proceeding in the near term. At the NAB Radio Show, held the week before last, FCC Chairman Kevin Martin suggested that broadcasters should voluntarily agree on a localism plan before there is any change in the administration at the FCC, suggesting that a future FCC may be less willing to compromise than the current one. Of course, a voluntary plan does not mean a code of conduct that broadcasters could unilaterally adopt and voluntarily agree to abide by, but instead it appears to be a request for standards that are voluntarily agreed to by broadcasters and then turned into some version of mandatory rules by the FCC. In a recent article in TV Newsday, some details of what the Chairman would like to see, and what he has apparently suggested to several state broadcast associations, are set out.

According to the article, a significant piece of the Commissioner’s suggested plan would include a requirement (or an option) for broadcasters to meet a mandatory localism obligation by funding investigative journalism conducted by journalism schools at various universities throughout the country. Apparently, stations that funded such journalism, or which aired the stories produced, would get some sort of localism credit. But what would this mean, and how would it impact broadcasters?

The first question is whether this proposal would, in and of itself, be sufficient to meet all of broadcaster’s obligations. There has been some talk of a menu plan, similar to what the FCC uses to assess EEO compliance, by which a broadcaster’s localism and public service performance could be measured. Would the funding of journalism programs be but one of many menu options that a broadcaster could choose from in deciding how to serve his or her community, or would it be the only required obligation? If it is the only obligation, it would seem to raise many issues – including practical ones (how many stations could rely on the same story, how much programming can these schools really produce and how much money do they need) and some that are more of an issue of legal theory – to what extent can the FCC compel a station to fund journalism that they may not agree with, or to air the product of that journalism - as the sole way of meeting its public service obligations.  Would it violate the First Amendment rights of broadcasters?  Even if this is just viewed as a safe harbor (i.e. do it and the FCC can't come after you), if it is the only safe harbor proposal that is set out, such a plan would essentially make compliance mandatory as no broadcaster would want to risk having their other efforts fall short of meeting FCC requirements under a case-by-case analysis.

 

These and many other issues will no doubt have to be resolved before any progress can be made on this issue. And with the election only a month away, and a new administration taking the reins of government in less than four months, is there still time for this FCC to act on this proposal? It remains to be seen.
Tags: , , , , ,
Posted on January 24, 2008 by David Oxenford

FCC Releases Specifics of Localism Rulemaking - Proposing Lots of New Rules For Broadcasters

At its December meeting, the FCC adopted a Notice of Proposed Rulemaking on Localism.  At that meeting, while the Commissioners discussed the generalities of the proposals being made, the specifics of the proposals were unknown.  The full text of the NPRM has now been released, and it sets out the areas in which the Commission proposes to re-regulate broadcast stations.  The order also hints at a number of other proceedings that the Commission intends to launch in the near future, and reminds broadcasters of a number of other existing proceedings that will potentially bring about greater regulation.  From the discussion in the NPRM, new rules will apply to all broadcasters - large and small - and potentially place significant burdens on all stations which, as always, are hardest for small stations to deal with.  Given the number of new regulatory initiatives discussed by the Commission, the NPRM is a must-read for all broadcasters, and this proceeding is one in which all broadcasters should participate.

Among the specific proposals on which the Commission asks for comments include the following:

Community Advisory Boards:  The Commission tentatively concludes that all stations will be required to establish a community advisory board to advise the station on the issues of importance to the community that can be addressed in the station's programming.  The Commission indicated that it did not want to bring back the burden of the ascertainment process that was abolished in the 1980s, but asks how the Board should be established so as to represent the entire community, suggesting that the categories of community leaders that were used in the ascertainment process could be used as a standard to guide the licensee in determining the make-up of the board.  Other questions include how often the board should meet, and how the board members should be selected (or elected - though by whom, the Commission does not suggest).

Other Community Outreach Efforts.  The Commission also suggests that other community outreach efforts should be considered as possible mandates for broadcasters.  These would include the following:

  • Listener surveys by telephone or other electronic means (general public surveys were also part of the ascertainment process abolished in the 1980s, so if this were adopted together with the Community Advisory Board, ascertainment would effectively be back)
  • Focus sessions or town hall meetings
  • Participation of management personnel on community boards, committees, councils and commissions (mandatory civic participation?)
  • Specific phone numbers or email addresses, publicized during programming, for the public to register their comments on station operations.

Remote Station Operations.  Comments are sought as to whether television stations should be forbidden to operate without being manned during all hours of operation.  Radio operations will be addressed in the proceeding to consider the public interest issues posed in the Digital Radio Proceeding (see our summary here).

Quantitative Programming Guidelines.  The Commission proposes to adopt quantitative standards for programming that a station would have to meet to avoid extra processing and scrutiny at license renewal time.  Questions include what categories of standards should be established (just local programs - or more specific requirements to set required amounts of news, public affairs and other categories - and how to define what programming would qualify in each category), should requirements be established as specific numbers of minutes or hours per day or per week or by a percentage of programming or through some other metric, should other specific requirements or measurements be established?

Main Studios.  The commission suggests reverting to the pre-1987 requirement that each station maintain a main studio in its community of license

Network Programming Review.  The Commission asks whether rules should be adopted to require that local network affiliates have some ability to review all network programming before it is aired.  If so, what programs would be exempt from the requirement (e.g. live programs), how much prior review is necessary, would such a right disrupt network operations?

Voice Tracking.  The Commission asks if "voice-tracking," (i.e. a radio announcer who provides announcing on a radio station from outside a local market, sometimes including local inserts to make it sound as if the announcer is local) should be limited or prohibited, or if disclosure should be required.

Local Music.  While the Commission indicates that it did not think that a ban on national playlists was required, it did ask whether broadcasters should be required to report the songs that they play, and how they choose their music.  With that information, the Commission asks if it should consider the amount of local music played when assessing whether a station has served the needs of its community at license renewal time.

Class A TV.  The Commission asks whether it should adopt rules that permit more LPTV stations to achieve Class A status, meaning that they would no longer be secondary stations subject to being forced off the air by interfering uses of the TV spectrum by full-power TV stations.

 

In addition to these specific proposals to be considered in this proceeding, the Commission mentions a number of other proceedings that are either underway or which will be initiated to consider other issues relevant to the consideration of localism in broadcasting.  The new proceedings to begin include:

Embedded Advertising.  The Commission specifically states in the NPRM that it believes that there are a number of broadcast practices that violate the spirit of the Commission's sponsorship identification rules.  On one of these issues, the Commission plans to launch a proceeding to investigate 'embedded advertising," commercial messages that are contained in program content (e.g. when the hero of a TV program sips a recognizable can of Coke or drives a Ford or goes to see a specific new movie).  That proceeding was on the Commission's agenda in December, but was pulled at the last minute but apparently will return in the near future.

Network-Affiliate Issues.  The Commission for years has had pending before it a petition by a group of owners of network affiliated television stations arguing that network affiliation agreements gave the networks too much power, effectively precluding affiliates from making programming choices that might better serve the interests of their communities.  It appears that the Commission will be resolving those issues, perhaps in a new proceeding to specifically consider some of those issues.

In-State Television Signal Availability.  The Commission promises to initiate a proceeding to determine if cable and satellite carriers should be permitted (or required) to provide subscribers with service from an in-state television station, even if the subscriber lives in a DMA where all the television stations originate in another state. 

FM Channel Availability.  The FCC has instructed its staff to come up with a tool to make it easier for the public to determine (on their own without hiring a consulting engineer) if a new FM station can be allotted at a particular community.  Look for this tool to appear on the FCC's website in the future. 

Other issues will be decided as part of other on-going proceedings.  These include:

Enhanced Disclosure Obligations.  In a simultaneously released Order, the FCC imposes certain enhanced disclosure obligations on television broadcasters - requiring that new forms be completed quarterly by broadcasters reporting on the types of programming that they broadcast, and requiring that public file information be maintained on the station's website (if the station has a website).  The imposition of similar requirement for radio is already under consideration in the Digital Radio proceeding.

Emergency Communications.  The obligations of broadcasters to communicate with their audiences in times of emergency, including communications with the hearing impaired and with audience members who do not speak English, are to be considered in an Emergency Communications docket that the Commission states will be decided soon

LPFM Issues.  Issues about providing LPFM stations with more protections from interference from full power stations, and a potential preference against FM translator stations, will be addressed in a Further Notice of Proposed Rulemaking in which the Commission will soon be receiving comments (see our post here)

Payola, Video News Releases and Sponsorship Identification.  The Commission currently has proceedings underway to enforce its payola rules in specific cases, and to gather more information about the use of Video News Releases (VNRs) by broadcasters, as well as certain specific enforcement actions.  The Commission intends to pursue these issues

Increase Opportunity for New Entrants.  In a separate proceeding adopted at the December meeting, the Commission adopted an order containing specific rules to enhance the opportunities for new entrants into broadcast ownership, thus increasing local media diversity.  That proceeding will also raise a number of new issues.  The text of the new rules adopted in that proceeding, and its proposals for other new rules, has not yet been released, but a number of localism related issues will be discussed in that proceeding.

Comments on this extensive list of proposals for new rules are due only 30 days after a summary of this proceeding is published in the Federal Register.  The Commission has given the public only 30 days to comment on proposals to return the broadcast industry to the regulatory structure of the 1980s.  All broadcasters should be paying attention to these proposals, as they will have a direct impact on their bottom line, and will also create numerous traps into which a broadcaster can fall at renewal time.  The five and ten thousand dollar fines that we saw in the last renewal cycle for stations that did not complete all of their quarterly issues programs lists may well be nothing compared to fines for violating some or all of these new standards if adopted.  Pay attention to this proceeding!

 

 
Tags: , , , , , , , , , , , ,
Posted on November 9, 2007 by David Oxenford

FCC Sets Unusual Public Forum to Assess License Renewal of New Jersey Television Station

In a very unusual, if not unprecedented case, the FCC announced a Public Forum on the license renewal application of WWOR-TV to assess the service provided by that station to the citizens of New Jersey.  While the FCC has in the past held evidentiary hearings on license renewal applications, those hearings were trial-type, adversarial proceedings held on specific issues before administrative law judges - not amorphous public proceedings on general questions about the service provided by the station.  This proceeding seems much more akin to the "localism" hearings that the FCC has been holding around the country (including the most recent held in Washington on Halloween), only in this case it is not conducted to come up with some general policy guidelines, but instead it is to assess whether a broadcast license worth hundreds of millions of dollars should be renewed.  While the revocation of a license for failure to serve the public interest under the license renewal standards that have been in effect for the last 11 years is unprecedented, this process may be one that other stations could face were proposals of certain Congressional and FCC proponents of license renewal reform to get their way.

As we wrote here and here, some have suggested that the FCC's license renewal process should be fundamentally reformed.  There have been suggestions that license renewal, which once occurred every three years for broadcast stations but now comes up but once every eight years, should return to that shorter cycle.  And some have suggested that the license renewal process should have more "teeth" to assess a broadcaster's performance (see, for instance, the statement of Commissioner Copps at the FCC Localism hearing in Portland, Maine in June). These teeth have been suggested to include everything from specific quantitative showings of public interest programming by the broadcaster, to local public hearings to assess the level of that service for some or all broadcast stations.  How the FCC would have the resources to conduct hearings for any meaningful number of broadcast stations is unclear - but the suggestion has been made by various proponents of license renewal reform. 

The examination of WWOR-TV's service to the residents of New Jersey may reflect the station's unique history.  Once licensed to New York City and part of the RKO broadcast group which had all of its FCC licenses challenged because of issues of candor stemming from some corporate wrongdoing engaged in by its parent company. While all of the company's other licenses ended up in other hands as a result of the renewal challenges, the WWOR license was saved by an act of Congress, agreeing to renew the license of any VHF television station that would move to a state that currently had no commercial VHF television service. As New Jersey had no VHF station, WWOR's move to New Jersey saved its license.

Now, however, the station's renewal has been challenged on various grounds, and the FCC will hold this unique hearing.  Will this be but the first of such hearings?  This is an issue for broadcasters to watch as the FCC weighs various proposals for ensuring localism through license renewal reform and other means.
Tags: , , , , , ,
Posted on September 24, 2007 by David Oxenford

One Sign That Broadcasters Are About to Become Political Footballs - Obama Suggests Shorter Broadcast License Terms and Less Consolidation

At last Thursday's Public Hearing on multiple ownership in Chicago, about which we wrote here, a statement was read by a spokesman for Presidential candidate Barack Obama.  According to press reports, the statement expressed the candidate's positions favoring shorter license renewal terms for broadcasters so that they would be subject to more public scrutiny, as well as criticizing the FCC for allowing broadcast consolidation.  These thoughts essentially echo the comments of FCC Commissioner Copps, especially on the subject of license renewal terms, whose views we wrote about here.  While many press reports have asked if this statement by Senator Obama foreshadows the broadcast ownership debate becoming part of the presidential campaign issues, we worry that it may signal a far broader attack on broadcasters during the upcoming political year.  The statement by Senator Obama is but one of a host of indications that broadcasters may face a rash of legislative issues that are now on the political drawing boards.

Broadcasters make easy targets for politicians as everyone is an expert on radio and television - after all, virtually everyone watches TV or listens to the radio and thus fancies themselves knowledgeable of what is good and bad for the public.  But those in Congress (and on the FCC) have the ability to do something about it.  And, with an election year upon us, they have the added incentive to act, given that any action is bound to generate at least some publicity and, for some, this may be their last opportunity to enact legislation that they feel important.  We've already written about the renewed emphasis, just last week, on passing legislation to overturn the Second Circuit's decision throwing out the FCC's fines on "fleeting expletives" and making the unanticipated use of one of those "dirty words" subject again to FCC indecency fines.  Clearly, no Congressman wants to be seen as being in favor of indecency (look at the rise in the indecency fines to $325,000 per occurrence which was voted through Congress just before the last election), and First Amendment issues are much more nuanced and difficult to explain to the voter, so watch this legislation.

But indecency and ownership are not the only broadcast issues on the Congressional agenda.  Bills to regulate violence on television are pending (see our post here).  Proposals have been made to regulate the advertising of unhealthy food to children, which have been stayed off temporarily by a government commission to study the issue and suggest voluntary guidelines, but at least one Presidential candidate has suggested (as we wrote here) that legislation is an option if the voluntary reforms don't go far enough and move fast enough.  And LPFM, about which we wrote here, also may rise on the Congressional agenda. 

The FCC may itself feel the heat to do something (almost anything) in the election year, and in the last days of the Presidential term and perhaps the last days of the terms of some of the sitting Commissioners (as there is usually substantial FCC turnover after an election, no matter which party wins).  Many FCC issues, from rumored new rules on payola and sponsorship identification, to old issues long waiting for resolution, like the taping of broadcast programs and the extension of broadcast EEO rules to part-time employees and the return of Form 395 all await action.  So, in the crazy days before the election, watch carefully to see what surprises your government has in store.
Tags: , , , , , , , , , , , , , , , , ,