The FCC today issued a Public Notice extending the deadline for the filing of the initial forms for broadcasters to participate in the incentive auction. We wrote about the form here, and the initial deadline here. The deadline is extended from December 18 to January 12. This also has the affect
Incentive Auctions/Broadband Report
Closing In on the Incentive Auction – Broadcast Application and Reimbursement Forms Available for Review, Reverse Auction Workshop and TV Interference Calculations
The last week has been a busy one for the FCC in preparing for the December applications by broadcasters for participation in the TV incentive auction. The incentive auction will, of course, offer TV broadcasters money (in some cases, lots of it, at least initially) to vacate their spectrum so that the television band can be “repacked” – consolidated into fewer channels – with the reclaimed spectrum being divided into different size blocks and resold to wireless companies for wireless broadband uses. In the last week, the FCC has made public two forms that will be important to that effort – the Form 177 which (as we wrote here) will be filed in December by broadcasters initially interested in participating in the auction, and the Form 2100 Schedule 399, which will be used to claim reimbursement by TV stations that do not surrender their licenses but which are forced to change channels as part of the repacking. The Form 177, the form that broadcasters must submit if they want to take part in the reverse auction, is not easy to find, but is available here, on the website of the Office of Management and Budget, where it has been submitted for review under the Paperwork Reduction Act before it can be released to broadcasters for submission by the December 18 filing deadline.
Similarly, and a bit more publicly, the FCC has released the form, Form 2100 Schedule 399, which broadcasters who do not sell out in the incentive auction, but instead are repacked and forced to move to another channel, will use to claim reimbursement for such moves. The form reveals the categories of expenses for which reimbursement would be made. This form is also being submitted to OMB for approval under the Paperwork Reduction Act, according to the FCC Public Notice which provided notice of the form.
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The Incentive Auction Moves Forward – FCC Decisions Further Defining Channel Sharing, and Order Setting When Wireless Users “Commence Operations” Ending LPTV Operations
The FCC seems to almost daily be issuing orders in the incentive auction proceeding, looking to the filing of applications in December by TV stations ready to give up their spectrum to the FCC so that it can be repackaged and resold to wireless users. In the last two days, the Commission has issued orders further clarifying the channel sharing rules and defining when a wireless user of the newly repackaged spectrum “commences operations” requiring that LPTV stations and TV translators operating on frequencies that would cause interference to the wireless operators to cease operations.
On channel sharing, the FCC ruled on a few issues not addressed in earlier channel sharing orders, clarifying issues raised by these prior orders (see our articles on channel sharing agreements here and here) some of which will affect very few TV stations. For instance, it decided that TV stations which entered into channel sharing agreements in which both parties offer their spectrum for surrender can designate alternative channel sharing partners in the event that both stations to the initial sharing agreement are “frozen” in the incentive auction at the same time – meaning that both will be bought out by the FCC if the auction is a success in the round in which they are frozen. While it is commendable that the FCC is providing stations with this flexibility to designate a backup sharing partner in case their initial partner’s station is also bought out in the auction, it would seem that it is unlikely that many stations will put themselves in a position to take advantage of this provision, as most channel sharing agreements will require one station to retain a channel on which the partners in the agreement can operate post-auction. It would seem as if it will be the rare case where all parties to a channel sharing agreement will be subject to being bought out by the FCC at the same time. Probably much more important is the decision of the FCC to extend the dates by which stations that agree to channel sharing agreements must actually implement those agreements after the auction has concluded.
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Broadcast Incentive Auction Moves Forward – Specific Auction Procedures and Opening Bids Released, Applications to Participate Due By December 18
By David Oxenford on
At the end of last week, the FCC took the expected steps of releasing its public notice setting out the specific procedures for broadcasters interested in participating in the incentive auction by selling their spectrum back to the FCC to be repurposed for wireless broadband, and a notice setting out the specific opening prices that each full-power and Class A TV station will be offered in the auction. These notices also set December 18 as the deadline for stations to submit a new Form 177, declaring if they are interested in participating in the auction. While the dollar numbers to buy out stations perhaps got the most attention, stations need to remember that they are only opening prices – prices which will fall in the reverse auction process until the FCC has only enough interest in stations selling their spectrum to meet its spectrum clearing target. But the release of the numbers and the deadline for participation highlights for many stations the need to focus on the realities of the auction and make their plans for participation (or non-participation) accordingly.
The incentive auction procedures public notice is one that broadcasters need to carefully review and, for those intending to offer their spectrum for sale, to have their economic advisors review as well. Not only does the notice provide information about forms to be completed and the specific steps to be taken by broadcasters to participate in the auction, but it also includes exhibits setting out the mathematical models used by the FCC to determine the descending prices to be offered to broadcasters as the auction continues and when the offers will be frozen (meaning that the FCC has accepted the station’s offer to vacate their current channel, subject to the success of the forward auction raising sufficient funds to pay out the amounts offered to the broadcasters). Exhibits setting out the formulas used to calculate interference between broadcasters remaining after the auction and wireless users are also included in exhibits to the notice. What are some of the other specific issues for broadcasters addressed in the notice?
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FCC Issues Clarification of Incentive Auction Quiet Period – How Will It Affect Television Station Sales, and What Other Restrictions are Imposed on Broadcasters’ Communications About the Auction?
The FCC this week issued a document called “Guidance Regarding Prohibition of Certain Communications During the Incentive Auction, Auction 1000.” That mouthful of a title identifies a document which clarifies the restrictions which apply during the incentive auction on communications by and between broadcasters (and wireless companies) that could influence the bidding in the auction. In other auction proceedings, these kinds of restrictions have commonly been referred to as “anti-collusion rules.” Here, the FCC talks about “prohibited communications” during the “quiet period.” The quiet period extends from the filing of applications evidencing an intent to participate in the auction (likely to happen in December of this year for TV broadcasters who are interested in offering their channel for surrender the FCC, see our article here about the auction timing and procedures, including a link to the slides from a presentation on auction issues that we conducted for several state broadcast associations), until the very end of the auction when the FCC announces the final results. Thus, this quiet period will potentially extend many months, especially if there are multiple “stages” of the auction where broadcasters offer their licenses for sale and wireless companies bid on the spectrum that has been surrendered. Many broadcasters and other industry participants – from programmers worried about being the conduit of information about broadcasters’ auction intentions, to noncommercial licensees worried about representations to their audiences that could be made during pledge drives – were concerned about the very strict rules initially adopted by the FCC, which prohibited almost any communications by broadcasters that would hint as to their intentions as to whether or not they would participate in the auction. The rules also threatened to bring station sales to a halt during this period. This week’s Guidance should alleviate at least some concerns, but significant restrictions remain, and the FCC demands that auction participants educate their employees about what can and cannot be said during the auction, as a disclosure of bidding strategy or tactics can result in severe penalties.
While the Guidance addresses both broadcasters participating in the Reverse Auction to sell their spectrum to the FCC to be repurposed for wireless uses, and the Forward Auction, where the wireless companies bid on the returned spectrum, we’ll focus on the broadcast issues. There were a number of significant clarifications that affect broadcasters. While we will briefly discuss some of the issues addressed by the Guidance, the penalties for the violation of these rules are so severe, and the rules so nuanced, that we feel the obligation to warn broadcasters not to rely on this summary or any other that you read in the trade press. This is one of those areas where getting legal advice from your own attorney about the ins and outs of these rules is crucial.
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October Regulatory Dates for Broadcasters – Many Routine Filings for All Broadcasters, Incentive Auction Actions, and More
By David Oxenford on
Posted in AM Radio, Cable Carriage, Children's Programming and Advertising, Digital Television, EEO Compliance/Diversity, FM Radio, FM Translators and LPFM, General FCC, Incentive Auctions/Broadband Report, License Renewal, Low Power Television/Class A TV, Noncommercial Broadcasting, Programming Regulations, Public Interest Obligations/Localism, Television
October is one of those months where the regulatory stars align, when not only do broadcasters in many states have EEO Public File report obligations, but also Quarterly Issues Programs Lists need to be placed in the public files of all commercial and noncommercial stations, and Quarterly Children’s Television Reports need to be filed at the FCC and placed in the public files of television stations. On top of these routine obligations, there are a number of actions likely to be taken by the FCC that may affect many segments of the broadcast industry. So let’s look at some of the specifics.
First, by October 1, EEO public file reports should be placed in the public file of stations with 5 or more full-time employees, if those stations are located in the following states and territories: Alaska, Florida, Hawaii, Iowa, Missouri, Oregon, Washington, American Samoa, Guam, the Mariana Islands, Puerto Rico, Saipan, and the Virgin Islands. In addition to those obligations, radio stations that are part of employment units with 11 or more full-time employees and are located in the states of Florida, Puerto Rico, and the Virgin Islands must prepare and file with the FCC EEO Mid-Term Reports on FCC Form 397, submitting specifics of their employment practices in the last two years (through the submission of their Public File reports) as well as some additional information. The Mid-Term report for those stations are due by October 1. More information about these EEO obligations can be found in our article here.
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TV Incentive Auction Timing and Procedures Become Clearer – A Presentation on the Process, and More on Upcoming Important Dates
By David Oxenford on
The Incentive Auction, by which the FCC is to pay TV stations to surrender their spectrum and then resell that spectrum to wireless carriers, is to begin on March 29, 2016 (see our article here which broke that news). At the end of last month, my law partner Jonathan Cohen and I presented a webinar to members of 11 state broadcast associations on the auction process, as clarified by the FCC last month in its Incentive Auction Bidding Procedures Public Notice (here). The slides from our state association presentation are available here. These slides set out the background of the proceeding, the process that broadcasters will go through to participate in the auction, an outline of the issues that come up in channel sharing agreements, the post-auction repacking of the TV spectrum into the fewer channels that will remain dedicated to TV use, and the deadlines for stations to either end their service or implement any facility changes ordered as part of the repacking.
Even more light was shed on the process yesterday, in remarks made by FCC Chair Tom Wheeler at the CTIA convention in Las Vegas. In his remarks, he reiterated the intention of the FCC to begin the auction next March. He also indicated that more specific advice about auction procedures would be coming by a subsequent FCC Applications Procedures public notice in October. Chairman Wheeler said that broadcasters will be indicating their intent to participate in the auction around Thanksgiving (by filing initial auction applications), and wireless companies will be filing their initial applications around the first of the year indicating their intent to participate in the second phase of the auction to buy up the spectrum surrendered by broadcasters. Note that these dates are all very general, so you’ll need to watch as specific guidance is provided by the FCC. Given that the FCC has said that broadcasters will be given 60 days of advance notice of the amount that they will be offered to surrender their spectrum before being required to file their initial application, if the Applications Procedures public notice is the document where the opening bids are provided, the Thanksgiving date, for instance, may well actually be sometime in December.
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August Regulatory Dates for Broadcasters – While Incentive Auction Dominates the News, Other Dates to Watch
By David Oxenford on
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.
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FCC Announces Comment Dates for Rulemaking on Post-Incentive Auction Channel Sharing and a Delay in Channel Sharing Webinar
Last week, we noted that the FCC was planning for today a webinar on channel-sharing issues in connection with its incentive auction. That same article also summarized the FCC’s decision modifying the rules for channel sharing. Yesterday, the FCC announced that the webinar has been postponed until August 13, presumably so that the…
March 29, 2016 Proposed in FCC Documents for Start of TV Incentive Auction
It looks like the dates for the FCC incentive auction (where some broadcasters will sell their spectrum to the FCC to be repackaged and resold to wireless companies for wireless broadband purposes) are becoming clear. After this week’s delay of the consideration of the incentive auction items (see our article here), the drafts of…