No Cost of Living Change in Webcasting Royalties for 2019 – Rate Proceeding for 2021-2026 about to Begin

Last week, the Copyright Royalty Board announced its calculations for whether there would be a cost of living increase in the 2019 rates that Internet radio stations pay to SoundExchange for the public performance of sound recordings. In its initial release on the subject, the CRB’s announcement indicated that commercial webcasters would continue to pay at the rate of $.0018 per performance (set after a cost of living increase last year – see our post here). But that same notice indicated that the per performance rate would be $.0019 for noncommercial webcasters with substantial listening (i.e., those that stream more than the 159,140 aggregate monthly tuning hours that noncommercial webcasters receive for a $500 yearly payment), causing some concern among noncommercial webcasters as their per performance rates were supposed to be based on what commercial webcasters paid. That notice was revealed to be a typo according to a Federal Register correction published today – keeping the noncommercial rates at $.0018 once the noncommercial webcaster exceeds the initial complement of streaming hours it gets for the $500 yearly minimum payment (see our initial article on that decision here, and one that provided more details here).

While the rates stay the same for 2019, and will stay substantially the same for 2020 (subject only to a cost of living increase, if any), 2019 will begin the CRB proceeding for the setting of webcaster’s SoundExchange royalty rates for 2021-2026. The CRB sets rates in 5 year increments. But the proceedings to set those rates normally take two years to complete, so the proceeding to set the rates to be effective in 2021 will begin with interested parties filing petitions to participate in the proceeding following a CRB invitation to file, likely to be released at the beginning of 2019. Once parties have filed to participate, the CRB will announce a mandatory 90 day period in which the parties are to try to settle the case. If there is no settlement, the litigation will run through the remainder of 2019 and 2020, with a decision to be issued by the end of 2020. Continue Reading

FCC Starts Warning Stations of Noncompliance with Online Public Inspection File Rules

By David Oxenford on December 6, 2018 Posted in FCC Fines, License Renewal, Programming Regulations, Public Interest Obligations/Localism

This morning, the FCC has started to email out notices to numerous radio stations throughout the country, notifying them that there are issues with their online public inspection files. The email notices do not reveal what the specific problem is – but instead simply say that there are issues and ask for notice of corrective actions to the FCC. We have been warning of the FCC’s concern about incomplete or inactive online public files for some time, and the potential impact that noncompliance could have on license renewal, which starts for radio stations in the Washington DC area in June 2019, and then moves across the country in this three-year renewal cycle (see, for instance, our articles here and here). Clearly, this is a warning to stations that the FCC is watching their public files, and that compliance problems will bring issues, and possibly fines, if the files are not complete by license renewal time (or even earlier if documents were not timely created).

As we have written before (here and here), the biggest issues will likely be with stations not uploading Quarterly Issues Programs Lists and, for stations that are part of clusters with 5 or more full-time employees, Annual EEO Public Inspection file reports. Look at your file now and make sure that you are in compliance with these and all other public file obligations to insure that you do not have issues that can come back to haunt you at renewal time – or at any other time that the FCC decides to use its enforcement authority to start issuing fines.

Podcaster Sued for Copyright Infringement for Using Music without Permission – Remember ASCAP, BMI and SESAC Licenses Don’t Cover All the Rights Needed for Podcasting

By David Oxenford on November 29, 2018 Posted in Intellectual Property, Music Rights, On Line Media, Podcasting

It was news earlier this week when a company that promotes poker was sued by one of the major record labels and publishing companies for the use of music in podcasts without permission. As we have written before (see, for instance, our articles here and here), the use of music in podcasts requires a license from the copyright holder of both the musical composition and the recorded performance of the music (usually, for popular music, a publishing company and a record label). In this case, one of the first we’ve seen against a podcaster for infringement of a copyright holder’s music rights (though we have heard of other situations where cease and desist letters were sent to podcasters, or where demand letters from copyright holders resulted in negotiated settlements), Universal Music alleges that the podcast company used its music and refused to negotiate a license despite repeated attempts by the music company to get the podcaster to do so. Thus, the lawsuit was filed.

As we have pointed out before, a broadcaster or other media company that has performance licenses from ASCAP, BMI, SESAC and even GMR does not get the right to podcast music – nor do the SoundExchange royalty payments cover podcasts. These organizations all collect for the public performance of music. While podcasts may require a performance license (see our article here about how Alexa and other smart speakers are making the need for such licenses more apparent as more and more podcast listening is occurring through streaming rather than downloads), they also require rights to reproduction and distribution of the copyrighted songs and the right to make derivative works – all rights given to copyright owners under the Copyright Act. These rights are not covered by the public performance licenses which only give the rights to make performances to the public. What is the difference between these rights? Continue Reading

The Importance of Assessing the Safety and Security of Broadcast Stations and Their Personnel

By David Oxenford on November 27, 2018 Posted in Appearances, Public Interest Obligations/Localism, Security

A topic not much discussed among broadcasters, but one that should be paramount in the future planning of all broadcast companies, is insuring the security of their stations and the safety of their employees. This is an issue on which all broadcasters should be focusing. Last month, the Wisconsin Broadcasters Association for the second time featured a panel at one of its conventions dealing with this topic. While many might think that security issues won’t arise at their stations, in fact it can be an issue at any station in any market. Listening to the stories told by the participants on these panels, and in later discussions with audience members at the two WBA conferences where the panel has now been featured, and judging from news reports, the topic is clearly one that all broadcasters should be considering. Video of the panel held last month is available here.

While the panel was premised on protecting journalists who often are the highest profile “faces” of a TV station, from the discussion it was clear that the need for security planning is one that applies not just to TV stations with news operations, but even to radio stations and other media outlets that can, for one reason or another, be targeted by someone with a grudge against the outlet or one of its personalities. We have seen high profile incidents like the shooting of the Roanoke TV journalists or the employees of an Annapolis newspaper, and we have seen just in the last few weeks pipe bombs sent to news organizations and threats against cable TV hosts. But, as discussed at the WBA panel, there have been many less publicized incidents. Two of the panelists discussed their experiences, one a shooting at a small community-run radio station and the second an intruder making threats and smashing station property in broad daylight at a small market TV station. These incidents, beyond simply raising questions of employee safety, raise both practical and legal issues for all broadcasters. Continue Reading

Just Seven Months to the Beginning of the License Renewal Cycle – Is Your Station Ready?

By David Oxenford on November 26, 2018 Posted in License Renewal, Programming Regulations, Public Interest Obligations/Localism

As we have written before, the next license renewal cycle begins on June 1, 2019, with radio stations in Maryland, Virginia, West Virginia and the District of Columbia submitting their applications. Radio renewals proceed in with applications every other month from a state or group of states (the schedule is available on the FCC website here). TV renewals begin a year later – in the same state-by-state order. Earlier this month, I conducted a webinar for several state broadcast associations to help stations in those states start to look at their operations to avoid issues that might otherwise come up in with their license renewals. Slides from that presentation are available here.

With license renewals coming up, stations should be insuring that they are ready. As we recently wrote, that includes making sure that the station’s online public file is active and has all of the required information. Particularly important are the collection of Quarterly Issues Programs reports that date back to the grant of your last renewal, as these lists demonstrate how your station has served the public interest, addressing the needs and issues facing its community (see our article here). Annual EEO Public Inspection file reports should also be in the file for stations that are part of employment units with 5 or more full-time employees, dating back to the last renewal. Stations should also be reviewing all of their other operations in preparation for renewal, to make sure that they are ready for the upcoming filing window for their stations. Assuring yourself that the station has all the licenses it needs for its technical operations, and that there are no problems with matters such as RF radiation at their tower site, are issues that should not be left for the last minute. So check out the slides from the presentation, talk to your own consultants and attorneys about other issues that may come up in the renewal process, and look for more guidance from the FCC which will undoubtedly be coming soon as the first filing date approaches.

December Regulatory Dates for Broadcasters – EEO Reports, December FCC Meeting and Getting Ready for New Years’ Obligations

By David Oxenford on November 25, 2018 Posted in Children's Programming and Advertising, Digital Television, EEO Compliance/Diversity, General FCC, Multiple Ownership Rules, Public Interest Obligations/Localism, Television

While the holidays may be upon us, there is no rest in the broadcast regulatory world. December 1 brings routine EEO public file report obligations for radio and television station employment units with 5 or more full-time employees for stations located in Alabama, Colorado, Connecticut, Georgia, Maine, Massachusetts, Minnesota, Montana, New Hampshire, North Dakota, Rhode Island, South Dakota, and Vermont. Stations in those states need to upload their EEO Public Inspection file report to their online public file by December 1, reporting on their outreach efforts for employment openings at their stations in the prior year, as well as their non-vacancy specific outreach initiative (i.e. the FCC’s EEO “menu options” where broadcasters report on efforts they have taken to educate the public about broadcast employment opportunities and to train their employees to assume more important employment roles at their stations). See our post here for more on the EEO obligations.

TV stations with 5 or more employees located in any of the New England states have the additional obligation to file their FCC Mid-Term EEO Report – due on December 3 as the 1^st is a Saturday. This report, filed on FCC Form 397, provides the FCC with the last two years’ Public File Reports, and a contact person at your stations to be contacted with EEO questions. While the FCC is considering elimination of these reports as most of the required information is already in a station’s online public file (where you should have all EEO public inspection file reports back to the date of the station’s last license renewal filing), the form is still required. Continue Reading

Agenda for FCC’s December Meeting – Start of Next Quadrennial Review of the Ownership Rules and Elimination of License Posting Requirement

By David Oxenford on November 21, 2018 Posted in General FCC, Multiple Ownership Rules

The agenda for the FCC’s December 12 open meeting is to be released today. As has become customary, the Chairman yesterday blogged about the issues to be considered at the meeting. For broadcasters, there are two matters of interest. The first will be the initiation of the next Quadrennial Review of the FCC’s ownership rules. This will begin with a notice of proposed rulemaking teeing up the areas that the FCC will be considering in this review – including radio ownership issues and likely further clarification of the FCC’s standards for waivers allowing the combination of two of the Top 4 TV stations in any market. The draft order should be released later today, just in time for Thanksgiving reading. We will post a link here when it is available (Update, 2:30 PM EDT, the draft NPRM is available here) – and will summarize some of the highlights next week.

Also on the agenda is the Order resolving the FCC’s proposal to eliminate the requirement that broadcasters post their station authorizations at the control points of their stations. We wrote about that proposal here. When the FCC posts the draft order later today, we will provide a link (Update, the link to the draft order is here). Watch for consideration of these issues at the December meeting.

Comment Dates Set on FCC Proposals to Change Clear Channel AM Interference Protection Standards

By David Oxenford on November 20, 2018 Posted in AM Radio

The FCC last month released a Notice of Proposed Rulemaking suggesting a lessening of the interference protections afforded to Class A AM stations – what are commonly known as the “clear channel” stations. That NPRM was published in the Federal Register today setting a deadline for filing comments on the FCC’s proposals of January 22 and a deadline for reply comments of February 19. We summarized the FCC’s proposals here.

As we wrote in our initial summary of the proposal, this proceeding is likely to be controversial, as licensees of Class A stations fear that the reduction in interference could lessen these stations’ appeal to advertisers, potentially adversely impacting some of the few remaining successful AM stations. The importance of these stations to rural residents and the transmission of EAS alerts are other public interest factors cited by these licensees. On the other side are the many local AM operators who might be able to increase power, especially at night, to provide better service to their communities. No matter which side of the debate you may fall on, make your thoughts known in the upcoming comment period.

FCC Fine for Premature Construction of Radio Station – Don’t Construct New Facilities Without FCC Permission

By David Oxenford on November 19, 2018 Posted in FCC Fines

The FCC has for decades prohibited the “premature construction” of broadcast stations – constructing new stations or new facilities for existing stations prior to the issuance of an FCC construction permit. In recent years, fines for such activities have been rare. But, last week, the FCC issued a Notice of Apparent Liability proposing to fine an LPFM station licensee $5000 for making changes in its station without prior FCC approval of its pending construction permit application. This decision highlights that broadcasters should not jump the gun in constructing a station or a modified facility until they have a construction permit in hand, even if they do not start broadcasting from the new facilities, as they could face FCC penalties for having done so.

This policy stems from a fear by the FCC that if broadcasters construct facilities before they are granted construction permits, the broadcasters can try to use that construction as evidence of a hardship that they would face should the FCC deny the construction permit application, making their expenditures worthless. Rather than simply rejecting such arguments, the FCC imposes a fine on broadcasters who take a risk in constructing their facilities before the FCC issues a construction permit. The Commission noted in last week’s decision that certain pre-construction activities are permitted before the grant of a construction permit (e.g. clearing and grading a transmitter site, pouring tower footings, installing electricity to a site, or even buying, but not installing, broadcast equipment). But constructing a tower or installing an antenna before a construction permit has been issued, can lead to an FCC fine or other enforcement action. In last week’s decision, the fine is proposed even though the operator de-constructed the new facilities after a complaint alleging premature construction was filed. While it may seem harsh that the FCC does not allow broadcasters to take the risk of constructing new facilities before a construction permit is granted, this decision makes clear that the premature construction doctrine is still being enforced, so broadcasters need to beware. With winter approaching in much of the country, some broadcasters may want to get a jump on the weather and construct new facilities before the FCC grants pending permits – but beware of the consequences that can follow.