Here are some of the regulatory developments of significance to broadcasters from the past two weeks, with links to where you can go to find more information as to how these actions may affect your operations.
- The FCC’s Public Safety and Homeland Security Bureau partially granted NAB and REC Networks’ waiver request (discussed in our last update here) of the December 12, 2023 deadline for compliance with the FCC’s new Emergency Alert Service (EAS) rules – which require that, when a station receives an over-the-air EAS alert, it must wait at least 10 seconds to determine if a CAP alert has been sent through the IPAWS system and, if it has, the station should rebroadcast that internet-delivered CAP alert rather than the one received over the air. We wrote more about that requirement on our Broadcast Law Blog, here. The Bureau extended the compliance deadline until March 11, 2024 for EAS Participants using Sage EAS equipment, as Sage is only now delivering an update to its equipment to allow for this default-to-CAP requirement to be implemented. The Bureau, however, declined to extend the compliance deadline for all EAS Participants. Thus, EAS Participants that do not use Sage EAS equipment must still comply with the December 12, 2023 deadline.
- The FCC’s Media Bureau reminded TV broadcasters that the FCC’s audio description rules will apply to DMAs 91 through 100 as of January 1, 2024. As we previously discussed here, the FCC expanded the FCC’s audio description requirements to commercial broadcast television stations affiliated with one of the top four television broadcast networks (i.e., ABC, CBS, Fox, and NBC) in Designated Market Areas 101-210. Currently, the FCC’s audio description requirements apply only to the top 90 DMAs. As a result of the FCC’s Order, the audio description requirements will now expand to 10 additional DMAs each year – with the expansion to DMA 91-100 effective as of January 1, 2024, and then DMAs 101-110 on January 1, 2025, and ending with DMAs 201-210 on January 1, 2035. Audio description provides narrated descriptions of a television program’s key visual elements during natural pauses in the program’s dialogue, for the benefit of individuals who are blind or visually impaired.
- The Copyright Royalty Board published in the Federal Register two notices of cost-of-living increases in the fees paid by broadcasters for the use of music in their operations. The first notice announces that, for webcasters, including broadcasters who stream their programming on the Internet or deliver it through mobile apps, the SoundExchange royalty fees will increase to $.0025 per performance (up from $.0024 in 2023) for performances delivered on or after January 1, 2024. The second notice announces that noncommercial radio stations affiliated with high schools or colleges but not affiliated with NPR or CPB will pay yearly royalties of $194 to both SESAC and GMR (up from the $188 paid in 2023) for licenses to perform musical compositions licensed by these organizations on these school’s over-the-air stations. We wrote more about these royalty increases on our blog, here.
- Also in the music royalty world, just before Thanksgiving, BMI announced that the company was being sold to an investment fund. BMI was founded by broadcasters over 80 years ago to moderate music licensing fees by providing a competitor to ASCAP. Until 2023, it operated as a non-profit entity. BMI collects royalties for songwriters and their publishing companies when their music is performed in public (including by broadcasters, online companies, retailers, bars and restaurants, and other venues that play music outside the home or other circles of close family and friends). BMI is currently engaged in litigation with the Radio Music License Committee over how much commercial radio stations should pay for the use of BMI-licensed music. How private ownership by an investment fund will affect this litigation and future royalties, and whether changes to the antitrust consent decree under which BMI operates will be sought (see our blog article on recent consideration given to changes in the consent decree), are all unknowns raised by this sale.
- The FCC circulated drafts of two items of interest to broadcasters that it will consider at its next open meeting on December 13:
- A Notice of Proposed Rulemaking, which proposes to eliminate video service “junk fee practices” by cable and direct broadcast satellite (DBS) service providers. As we wrote here, the FCC previously proposed “all-in-pricing” for cable and satellite services. The FCC now proposes additional customer service protections that prohibit cable operators and DBS service providers from imposing a fee for the early termination of a cable or DBS video service contract; and requiring cable and DBS service providers to provide subscribers with a prorated credit or rebate for the remaining days in a billing cycle after service cancellation.
- A Report and Order which, if adopted, will create rules implementing the January 2023 Low Power Protection Act (LPPA) – which provides LPTV stations in very small television markets with a limited window of opportunity to apply for status as Class A television stations. Class A status gives a station protection from being bumped off its frequency by new full-power TV facilities. The status also protects a station in the event of a future contraction of the TV band as recently occurred with the repacking that followed the 2017 TV “incentive auction.” As we noted here, in March 2023, the FCC released a Notice of Proposed Rulemaking to implement the LPPA. The FCC’s Order largely adopts the proposals in the NPRM – except that stations converting to Class A status will not lose their status if the Designated Market Area where they operate subsequently grows beyond the limit of 95,000 households that applies to stations eligible to apply for this upgraded status.
- The FCC has until December 27th to comply with a court order requiring the agency to conclude its still-pending 2018 quadrennial review of its local broadcast ownership rules (see our blog article for more on the Court order and on the issues under consideration in that proceeding, including a review of the local radio ownership limits, the restrictions on combinations of two of the Top 4 TV stations in any market, and the dual network rule forbidding common ownership of two of the Top 4 TV networks). With that deadline in sight, lobbying at the FCC on how the FCC should conclude the proceeding has continued during the past two weeks. A small broadcaster suggested that the FCC should keep the overall radio ownership caps in place, but eliminate limits on the number of AM vs. number of FM radio stations a single owner could hold in a market. Another group of broadcasters urged the FCC to eliminate the local radio ownership rules given the dramatic change in marketplace competition since the ownership rules were adopted, noting that local stations need greater scale to compete with digital media for advertisers and listeners. Those comments suggested that radio’s share of local advertising and audience has been cut in half in the last 12 years, while the shares of digital media companies, unconstrained by local ownership restrictions and offering no local service, have exploded. A group of TV broadcasters noted their concerns (here and here) with pay TV advocates seeking to treat LPTV stations and multicast streams as full power stations for purposes of the TV Duopoly rule (which restricts the ownership of two TV stations in the same market), noting that many small markets cannot support four full-power television stations and therefore continuing to permit dual or multiple affiliation agreements by a single broadcaster is the only way that such markets will receive a full complement of television network programming. Finally, the NCTA urged the FCC to retain the prohibition on combinations of Top 4 TV stations arguing that these rules prevent broadcasters from exercising undue leverage during retransmission consent negotiations.
- The FCC’s Enforcement Bureau issued nine Notices of Illegal Pirate Radio Broadcasting to landowners in the Boston area for apparently allowing illegal broadcasting from their properties. The Bureau warned the landowner that the FCC may issue fines of up to $2,316,034 under the PIRATE Radio Act if the FCC determines that the landowner continues to permit any individual or entity to engage in pirate radio broadcasting from their property. The nine notices can be found here, here, here, here, here, here, here, here, and here.
- The FTC took action to expand its authority to investigate the use of artificial intelligence to engage in fraud, deception, infringements on privacy, and other unfair practices by streamlining its staff’s ability to issue civil investigative demands (CIDs) – an investigative tool much like a subpoena – in investigations relating to AI. The FTC issues CIDs to obtain documents, information, and testimony that advance FTC consumer protection and competition investigations.
- The FTC also announced that it issued warning letters to two trade associations and 12 social media influencers alleging that the influencers were receiving payments or other consideration for Instagram and TikTok posts promoting sugar and other sweeteners without providing adequate notice of the payments and the sponsors in those posts. The letters ask that the recipients contact the FTC to explain how the FTC’s concerns would be addressed and warned of $50,120 fines that could be imposed for each violation. These actions reflect the FTC’s policy requiring disclosure to the public when endorsements and testimonials for products and services, even those on social media, are sponsored. See our articles here and here on these policies.
- The FCC’s Media Bureau and Managing Director revoked a Texas AM station’s license for failure to pay delinquent FCC regulatory fees. The station failed to timely pay all of its regulatory fees for FYs 2012, 2015, 2016, 2017, 2018, 2019, 2020, and 2021; and it did not respond to an Order to Pay or Show Cause (which we wrote about here) providing either evidence that the fees were fully paid or an explanation why the fees should be waived or deferred. The station still must pay the delinquent regulatory fees even though the station’s license was revoked. While this is an extreme case, it is a reminder that the FCC takes unpaid regulatory fees seriously, and that licensees must ensure that such fees are timely paid.
- The FCC’s Media Bureau denied an informal objection filed against a new noncommercial FM station application. The objection claimed that the application should be denied because it did not comply with the FCC’s technical rules governing such applications – even after the application was refiled at FCC staff’s direction with amended technical parameters following its dismissal for being technically defective. The Bureau instead granted the application – finding that the applicant was permitted to amend its amended application to resolve minor deficiencies in that amended application.
- The FCC’s Media Bureau released a Notice of Proposed Rulemaking asking for comments on a TV station’s petition for rulemaking that proposes the substitution of Channel 29 for Channel 2 at Greenville, South Carolina. The petitioner is proposing the channel substitution due to the station’s poor reception on VHF Channel 2 by viewers, another reflection of the superiority of UHF channels for the transmission of digital television signals.
- Based on complaints, the FCC’s Enforcement Bureau issued Notices of Violation against two Texas FM translator stations for operating with antennas and at heights not approved by the FCC. The stations have 20 days to respond to the notices detailing how the violations occurred and how they will remedy these violations. Copies of the notices are available here and here.
On our Broadcast Law Blog, we wrote an article setting out many of the most significant regulatory dates for broadcasters in the month of December – see that summary here.