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The FCC announced yesterday 2015 regulatory fees are due by 11:59 pm (Eastern Daylight Time) on September 24, 2015.  The FCC also announced that the FCC’s automated filing and payment system (Fee Filer) for FY 2015 regulatory fees was open yesterday and will reopen on Tuesday, September 8 (it is closed today through the holiday weekend as the entire FCC electronic filing system is being shut down for maintenance).  All commercial radio and television stations (and those who hold construction permits for unbuilt commercial stations) must pay these fees.  The fees for radio are the same as were proposed in our article on the FCC’s proposal for the fees, here.  The fees for TV changed slightly from those proposed in May, and are set out at the bottom of this article.  The FCC also issued a Notice of Proposed Rulemaking, asking a number of questions about potential changes in the computation of broadcast fees in the future.

The FCC reminded all parties who pay fees that checks will not be accepted for regulatory fees.  Instead, all fees must be paid electronically by online “ACH” payment (an electronic payment system that many use for transferring money from one party’s accounts to another’s account), by credit card (though credit card payments will only be accepted when a company’s total fees due are less than $25,000), or wire transfer, all with an accompanying FCC 159-E form which must first be electronically filed through the FCC’s Fee Filer system. 
Continue Reading FCC Regulatory Fees Due September 24 – Plus FCC Proposes Changes in Future Broadcaster Fee Computations

In an article posted on the FCC’s blog yesterday, FCC Chairman Tom Wheeler listed four actions that would soon be coming out of the FCC to address broadcast issues. For TV, these include looking at what constitutes “good faith negotiations” in the retransmission consent context, and whether to do away with the FCC’s network nonduplication protection rule. For radio, the long-delayed AM revitalization docket will apparently soon be considered by the FCC. And, finally, the FCC may modernize the contest rules for all broadcasters by allowing more online disclosure of contest rules. What are these proceedings all about?

The retransmission consent proceeding grows out of Congress’ adoption of STELAR, which authorized the continued retransmission of broadcast signals by satellite television operators. As part of that legislation, which we summarized here, the FCC was directed to start a proceeding to determine whether it should adopt new rules to define what constitutes “good faith negotiation” of retransmission consent agreements. There has already been significant lobbying on this issue by both sides. Right now, good faith negotiation really has not been an area where the FCC has intervened beyond using its bully pulpit to urge parties to retransmission consent disputes to reach a deal. It is commonly recognized that failing to deal with a MVPD at all would be a violation of the good faith standard, but many MVPDs now want the FCC to become more involved, putting limits on TV channel blackouts, especially just before big televised events (like the Super Bowl or the Oscars), limiting the blackout of web-based programming to subscribers of an MVPD that is involved in a dispute, limiting the bundling of Big 4 network programs with programming from other channels provided by the TV broadcaster, and similar limits. The Chairman’s blog is short on specifics, but does suggest that, while some specific prohibitions may be suggested, the FCC would also be able to look at the totality of the circumstances to determine if a broadcaster and an MVPD were negotiating in good faith (note that these rules apply to broadcast retransmission consent negotiation, not those between MVPDs and cable channels not shown on broadcast TV).
Continue Reading FCC Chairman Details Issues Coming Soon for Broadcasters – Review of Retransmission Consent, Network Nonduplication, AM Improvements, and Contest Rules

The FCC today released an Order setting December 2 as the date for the filing of FCC Form 323 Ownership Reports by commercial broadcast stations. All commercial broadcasters must submit this report. While the report is technically supposed to be filed by November 1 every other year, that date has routinely been extended as the FCC form is far more complicated to complete for many licensees than are the normal ownership reports that are filed after station purchases and sales (see for instance, this article two years ago).

These reports require information as to each owner of a broadcast company as of October 1, 2015.  A unique identifier for each individual named in a report is also required as the FCC is looking to make all ownership information searchable by individual, so that interested persons can determine the interlocking broadcast interests of owners of broadcast stations. As we wrote here, the FCC has recently proposed a way to identify individuals who don’t want their social security numbers to be used to obtain the necessary FCC identification number – though that procedure has not yet been adopted but could quite well be acted on before the filing date. In addition, the form requires that the race, ethnicity and gender of individual owners be reported, so that minority ownership can be assessed and tracked by the FCC. To make all individuals and their interests searchable, the forms require separate fields for different blocks of information including other broadcasts interests of individual owners – making the form complex to complete for companies with multiple owners who have multiple broadcast interests. These reports need to be filed electronically, and can take time to complete, so don’t wait to start work on the biennial report.
Continue Reading FCC Sets December 2 Deadline for Filing 2015 Biennial Ownership Reports for Commercial Broadcast Stations

With tomorrow’s FCC meeting to detail dates and procedures for the TV incentive auction dominating the headlines, there are other August regulatory dates that should not be overlooked. While we never can get to all of the relevant dates in our monthly highlight article, here are a few items worth your consideration. For one, we will soon be seeing details for submitting the regulatory fees that are due from all commercial broadcasters (and most other commercial entities regulated by the FCC) before the end of September. Last year, that notice came out right at the end of the month – immediately before the Labor Day weekend, somewhat later than in past years (see our article here). So be on the alert for that notice, to allow you to be ready to pay those mandatory fees before the applicable deadline.

Already, by the first of the month, commercial and noncommercial full-power and Class A television stations and all radio stations in California, Illinois, North Carolina, South Carolina, and Wisconsin that are part of an employment units with 5 or more full-time employees should have put into their public inspection files their annual EEO Public Inspection File Report, and posted those reports online so that they are accessible to visitors to their station websites. As part of the Mid-Term EEO reporting process we wrote about here, radio stations in the Carolina’s that are part of employment groups with 11 or more full-time employees should have also filed their Form 397 EEO Reports with the FCC by August 3. Noncommercial television stations in Illinois and Wisconsin should also have submitted their Biennial Ownership Reports by August 3, as should have noncommercial radio operators in both North and South Carolina and California. Details on all of these standard regulatory deadlines are available in our Broadcaster’s Regulatory Calendar, here.
Continue Reading August Regulatory Dates for Broadcasters – While Incentive Auction Dominates the News, Other Dates to Watch

Yesterday, it was announced that the Radio Music License Committee (RMLC) settled its lawsuit with SESAC (see the press release here, and the full agreement here), where the RMLC had charged that SESAC’s practices in collecting its music royalties from the radio industry violated the antitrust laws (we wrote about the filing of the lawsuit here). While there was no admission of guilt by SESAC, it did agree that, between now and 2037, it will negotiate royalties with RMLC on an industry wide basis (up to now, SESAC could negotiate on a station-by-station basis). If RMLC and SESAC can’t agree to a royalty, the royalty rate will be set by an arbitrator – and past SESAC royalties would not have any precedential value in such proceedings (broadcasters have contended that past SESAC rates are far more, in comparison to those charged by ASCAP and BMI, then would be warranted based on the percentage of music from SESAC writers that is played on most radio stations). In subjecting SESAC to industry-wide negotiations and potential arbitration, the settlement is very similar to the deal reached in antitrust litigation between SESAC and the TV Music License Committee (about which we wrote here).

The settlement also tracks the structure of RMLC agreements with ASCAP and BMI (see our articles here and here) in that future SESAC licenses will cover broadcasters not only for their over-the-air programming, but also for their Internet streams and their HD channels (which were charged separately by SESAC for many stations). However, the agreement provides that the unitary license should not diminish the total royalties that would have been paid by the industry to SESAC if these rates were negotiated separately.   In other words, the effect of the unitary license is simply administrative convenience – everything is covered by a single license, so each station does not need multiple licenses from SESAC for its normal broadcast activities. However, unlike the ASCAP and BMI agreements, this agreement puts limits on this unified coverage for a broadcaster’s business that is outside the retransmission of the broadcaster’s over-the-air signals, excluding on-demand subscription services (presumably ruling out Rdio, in which Cumulus has an interest, from being covered by the radio license), and also excluding music-intensive custom radio, specifically ruling out Pandora and iHeartRadio from relying on this license for their online services. The agreement also says that other music users that are not primarily radio operators cannot get coverage for these other non-broadcast businesses simply by buying a radio station. What else does the agreement provide?
Continue Reading Radio Music License Committee Settles Antitrust Suit Against SESAC – What Does it Mean for the Radio Industry?

Twice this morning, I was faced with the question of whether a business needs a license to play a radio or TV station on their premises, once in a story in one of the broadcast trade publications (see the article here, in the You Can’t Make This Up column toward the bottom of the article) about a gas station that thought that they got around paying ASCAP, BMI and SESAC fees by using “6 or 7” consumer radios around the station. After I saw that article, I thought that it was worth writing this article, as the difference between 6 and 7 radios could make a real difference as to whether the business needs to pay music royalties.

Broadcasters need to be careful about urging their clients to play their stations at their business locations. There are very specific rules, and if the rules are not followed, liability can result. But, as detailed below, there are some exceptions to the obligation of commercial establishments to pay ASCAP, BMI and SESAC that apply specifically to establishments that play only FCC-licensed radio or TV stations. But the details of the exceptions must be observed or there can be issues. All of the performing rights organizations have contractors who travel the country, checking out retailers, bars, restaurants, and other commercial establishments to make sure that they are following the rules. There are periodically press reports about these rights organizations seeking royalties (sometimes through legal actions) from coffee shops, nightclubs, and even farmers markets that publically perform music without signing license deals. So these commercial establishments need to know the rules about music use to avoid becoming a target. As set forth below, the rules are very specific, and broadcasters can actually benefit from the exceptions as, in the limited circumstances set out in the Copyright Act, businesses can play music from FCC licensed outlets without a license, but music from other sources could present an issue. But be careful, as there are very specific rules – and the difference between 6 and 7 radios could be a real issue.
Continue Reading Does a Local Business Need Licenses from ASCAP, BMI and SESAC to Play My Radio or TV Station on Their Premises?

EEO Mid-Term Reports on FCC Form 397 must be filed at the mid-point of the renewal cycle of radio stations if they are part of a station employment unit with more than 10 full-time employees, or 5 or more full-time employees for TV. A station employment unit is one or more commonly-controlled stations serving substantially the same area, and sharing at least one employee. As it has been 4 years since the first radio renewal applications were filed in the last license renewal cycle, June 1 brings the deadline for radio groups in Maryland, DC, Virginia and West Virginia that have more than 11 or more full-time (30 hours per week) employees to file their Form 397 Reports. The FCC yesterday issued a reminder to stations about this obligation.

The reminder does not address in any detail the content of the form. Essentially, the Form 397 (which can be viewed here) is like the Form 396 filed by stations in connection with their license renewal applications. After providing identifying information, the form requires that station licensees identify a person who is responsible for EEO compliance at the station, and to attach their last two EEO Public Inspection File Reports – the most recent of which will, for stations in these states, need to be placed in the public inspection file by June 1. These Public Inspection File reports can be reviewed by the FCC to assess the hiring efforts made by the broadcaster for job openings in the last two years to insure that the station’s outreach efforts to prospective new employees were sufficiently broad to attract applicants from all significant groups within the station’s service area. We wrote about the basics of the FCC’s EEO policies for broadcasters here.
Continue Reading FCC Issues Reminder on Form 397 EEO Mid-Term Reports – Filing Obligations Begin on June 1 for Radio Stations in DC, Maryland, Virginia and West Virginia

Paying regulatory fees is a part of the yearly calendar for broadcasters and other entities that do business before the FCC. These fees are usually due in August or September, to be paid before the start of the FCC’s fiscal year on October 1. And each year, about this time, the FCC puts out a Notice of Proposed Rulemaking (NPRM), asking about its system for collecting royalties and what changes should be made before fee collection begins in a few months. That order came out yesterday. It resolves some issues left over from last year (deciding, for instance, to assess fees for Direct Broadcast Satellite television providers), and asks many questions – including some about broadcasters. For broadcasters, questions include whether the FCC should adjust the relative percentages of its collections from radio and TV (a question that could pit broadcasters against each other) and whether changes should be made in allocation of fees within a service, adjusting the rates currently paid by different classes of radio and TV stations. The FCC also asks whether it should adopt rules that allow stations in economically depressed areas to get relief from regulatory fees. The fees proposed for broadcasters for this year are set out at the end of this article. Comments on the FCC proposals are due on June 22, and replies by July 6.

Regulatory fees (or “reg fees” to most folks in the communications world) are assessed to recapture from those being regulated the costs of that regulation. To figure out what each regulated commercial entity must pay, the FCC has to try to allocate its budget among the various services that it regulates, based on how many of its employees spend their time regulating a particular industry (based on Full Time Employees – or “FTEs” – an FTE being a person working full-time at the FCC, or, for instance, two half-time employees who together count as a single FTE). So the FCC each year has to go through a complex analysis of the work that it does, and try to allocate the time spent by each of its employees on particular regulated services. As these NPRMs on reg fees make clear, this can be a very difficult process, as there will obviously be some employees who spend time on projects that cut across service lines – e.g. those in the International Bureau who negotiate with foreign governments may benefit broadcasters in some negotiations, and wireline or wireless companies in others. Or the Enforcement Bureau, the Office of the General Counsel and the Commissioner’s staffs may handle a diversity of matters covering all sorts of services. The allocations that are arrived at can be interesting and debatable – and have little to do with the economics of the industries involved or their revenue base.
Continue Reading FCC Asks for Comments on Regulatory Fees for 2015 – Lots of Questions about Broadcast Fees

Almost two years ago, the FCC launched its AM revitalization efforts with great flourish, and promises of prompt action. We wrote about the two aspects of potential assistance for AM stations that were proposed in the FCC’s Notice of Proposed Rulemaking – technical proposals which mostly focused on ways to make the relocation of AM stations easier (see our article here) and the quick-fix proposal for new FM translators reserved for AM stations, a band-aid to keep AM stations alive while a new more permanent solution for these stations could be found (see our post here). The comments on the translator proposal, a filing window for new FM translators reserved for AM stations, were almost all positive. The vibrations from the FCC also seemed to be positive, and many AMs have been hanging on in anticipation of the coming of this filing window. This week, serious questions arose as to whether the FCC thinking on this issue has changed – and it appears that a translator window for AM stations may not in fact occur (or perhaps not in the manner that it was envisioned by most observers over the last two years).

This rethinking was first exhibited in an article on the FCC’s Blog, posted by FCC Chairman Wheeler on Monday morning, April 13, just as the National Association of Broadcasters Convention was beginning in Las Vegas. The article quickly became a prime topic of conversation among radio broadcasters at the convention. In the article, the Chairman promises to move quickly to resolve the issues posed in the AM NPRM, adopting some of the technical proposals that were set out in the NPRM, and proposing for future consideration new ideas for AM improvement. But what gathered the most attention were his comments on FM translators for AM stations. He wrote the following about that window:

I have two concerns about the record and whether opening such a window is necessary, given the current state of the marketplace. The first is whether there is an insufficient number of FM translator licenses available for AM stations….The second unanswered concern is why, if it is necessary to open the translator window, it should only be opened for one group… [I]f we are to assure that spectrum availability is an open opportunity, then the government shouldn’t favor one class of licensees with an exclusive spectrum opportunity unavailable to others just because the company owns a license in the AM band.

Conversations in Las Vegas centered around the meaning of these comments, comments that were further amplified in his speech before the NAB Convention on Wednesday.
Continue Reading The Confusing State of AM Radio Revitalization Efforts – No FM Translator Window for AM Licensees?

March is one of those rare months on the broadcast calendar when there are few routine regulatory deadlines for broadcasters. As we are winding down in the television license renewal cycle, the month’s only license renewal obligations for TV broadcasters are the pre-filing license renewal announcements on the 1st and 16th of the month for stations in Delaware and Pennsylvania, whose renewals are due on April 1, and the post-filing announcements for TV stations in New York and New Jersey. But there are still dates of interest to broadcasters in the month ahead. Here are some of those dates.

March also brings the obligation, by March 16 for TV stations to be in compliance with the Closed Captioning Quality Standards, which require that broadcasts assess and work to perfect the quality of the closed captioning carried on their stations. While the FCC is looking at bringing television program suppliers under these rules, as of now, the obligation for compliance with the rules is on the television broadcaster. We wrote about the captioning quality rules and the FCC’s recent proceeding to shift some of the burden to program suppliers here.
Continue Reading March Regulatory Dates for Broadcasters – Closed Captioning Quality Standards Effective Date, Comments on Online Public File, MVPD Status for Online Video Providers, LIFO for Political Ads, and FRNs for Biennial Ownership Reports