On Line Media

Subscribe to On Line Media via RSS

Last week, the Copyright Royalty Board asked for comments on a proposed settlement agreement between Sirius XM and SoundExchange, and some articles about that announcement have not been entirely clear about what the deal covers.  It has nothing to do with webcasting royalties for 2016-2020, which are still being litigated (see our article here about the proposals of the parties in that case).  Nor does it have to do with the royalties payable for Sirius’ primary satellite radio service, which were just upheld by the Court of Appeals (see our article here).  Instead, these royalties have to do with a very narrow part of Sirius’ business – providing music channels packaged and sold to consumers along with video services like cable and satellite TV.

Some who closely follow these issues (and the coverage of CRB issues on this blog) may think that the rates for these services were set at the same time as the Sirius rates for their satellite music service, as the CRB at that time set the rates that were applicable to Music Choice, which also offers a music service bundled with cable or satellite video programming (see our articles on the recent decision on the appeal of the rates, and the article on the CRB decision itself here).  Even though Music Choice offers pretty much the same service, their rates are different – as Music Choice was classified as a “preexisting subscription service” in the Digital Millennium Copyright Act, while the service that Sirius provides is classified as a “new subscription service” paying at a different royalty rate set by the CRB using a different royalty standard.  How did this happen?
Continue Reading Copyright Royalty Board Announces Settlement between Sirius and SoundExchange for New Subscription Services Packaged with Cable and Satellite Video – How Different Royalty Standards Result in Different Royalty Rates

Who says that the Internet is not regulated?  Whether to treat Internet video providers by the same rules that apply to cable and direct broadcast satellite systems is the subject of a Notice of Proposed Rulemaking released by the FCC just before Christmas, notice of which was published in the Federal Register today, setting the comment dates on the proposal.  Comments are due by February 17, and replies by March 2.  This proceeding could have a substantial impact on Internet video providers – potentially extending FCC jurisdiction to a whole host of services not currently subject to its rules, and potentially subjecting Internet video services to all sorts of rules that apply to traditional MVPDs (multichannel video programming distributors), including the FCC’s EEO rules, captioning rules and CALM Act compliance.  Even the political broadcasting rules, which the FCC notes in the NPRM only specifically apply to cable and direct broadcast satellite rather than to MVPDs generally, could potentially be looked at in the future for these services should they come under FCC jurisdiction.  At the same time, the rules could also have an impact on program suppliers and broadcast networks, as various rules dealing with access to cable and broadcast programming could extend to Internet video providers, potentially conflicting with existing contractual obligations and even the Copyright Act.  What are some of the specific issues being considered?

The issues raised in the Notice are many – including the very fundamental one as to whether the FCC even has the authority to include Internet delivered video (what the FCC refers to as Over the Top or OTT providers) under the rules for MVPDs.  While the general definition of MVPD would seem to cover Internet video (as it covers anyone who makes multiple channels of video programming available for purchase by subscribers), it is not that simple.  As with any Federal law, one can’t just stop the analysis with a quick read of the statute.  The statute, in at least one place, defines a “channel” as a portion of the electromagnetic spectrum capable of delivering a TV channel.  And the FCC has defined a TV channel as one comparable to what is delivered by broadcast TV.  It’s that reference to “electromagnetic spectrum” that has tripped up previous services seeking an expansion of the MVPD definition.  In the case of Internet-delivered service called Sky Angel, the FCC staff 5 years ago determined that, as it was not a facilities based system – it did not control that electromagnetic spectrum on which its programming was delivered – it could not be an MVPD.  The full Commission sought comments on the staff decision then (see our article on that request for comments on Sky Angel here and here,) and, with the recent Aereo decision (see our articles here and here) and its aftermath, and the seemingly daily announcement of new online video service offerings from everyone from CBS to HBO to Dish and Disney, the FCC seems now ready to move with this expansion of its authority to cover video on the Internet.  Because of the potential for very similar video services to have very different regulatory burdens (cable and satellite could be subject to all the FCC MVPD rules, while the same programming, delivered by an Internet service, might have none of those obligations under the current regulatory interpretations), the majority of the FCC want to move forward with this proposal.  But it asks for comments on whether it really has the authority to do so. 
Continue Reading FCC Regulation of Internet Video? – Dates Set for Comments on Treating Over-the-Top Video Providers like Cable and Satellite TV

While we are in the Holiday season, the regulatory obligations faced by broadcasters don’t stop.  December brings a continuation of the TV renewal cycle, though we are nearing the end of that cycle.  Renewal applications for all TV, Class A and LPTV stations in the following states are due on December 1: Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont.  These stations need to file their first two post-filing license renewal announcements on the first and 16th of the month.  Stations that filed their license renewal applications in October also will be broadcasting their post-filing announcements on those same days (their last two announcements).  Those would be stations in the following states and territories: Alaska, Hawaii, Oregon, Washington, American Samoa, Guam, the Mariana Islands, and Saipan.  TV stations in the states that file license renewals on February 1 (those in New York and New Jersey) have to start running their pre-filing announcements on the December 1 (and run a second on December 16).

There are other routine filings due in December.  On December 1, Commercial and Noncommercial Full-Power and Class A Television Stations and AM and FM Radio Stations with employment units with 5 or more full-time employees in Alabama, Colorado, Connecticut, Georgia, Maine, Massachusetts, Minnesota, Montana, New Hampshire, North Dakota, Rhode Island, South Dakota, and Vermont all need to complete their EEO Public File Report and place that report in their public file (and on their websites, if they have one).  Noncommercial stations still have obligations to file Biennial Ownership Reports on every other anniversary of the filing of their license renewal applications.  That means that these reports are due on December 1 for Noncommercial Television Stations in Alabama, Connecticut, Georgia, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont; and on the same day for Noncommercial AM and FM Radio Stations in Colorado, Minnesota, Montana, North Dakota, and South Dakota.
Continue Reading December Regulatory Dates for Broadcasters – Renewals, EEO Reports and Noncommercial Biennial Ownership Reports in Some States; TV Ancillary and Supplementary Revenue Reports; As Well as LPTV Rulemaking Comments and Many Other Expected Actions

On Friday, the US District Court in the Southern District of NY found that there is a public performance right in pre-1972 sound recordings in that state, following two decisions from California finding a similar right under California law (though on different grounds).  Like the first decision in California (about which we wrote here), this decision was the result of a law suit by Flo and Eddie of the Turtles against Sirius XM, arguing that Sirius XM was infringing on their rights by playing old Turtles songs without paying the duo (who now own the Turtles’ copyrights) any compensation.  Unlike the California decision which looked to specific language in the California statute about ownership of pre-1972 sound recordings, the NY Court reaches a decision in some ways broader than the California decision, but potentially also in some ways narrower.  What does it mean for the many businesses that play such recordings?

There is no public performance right in sound recordings generally in the United States, with the limited exception of the public performance of such recordings in a digital medium.  Sound recordings had not been covered by Federal copyright law at all until 1972, when they were covered for purposes of protecting reproductions and distributions and other general rights, but Federal law specifically did not include this public performance right in sound recordings until the 1990s.  When sound recordings were added to Federal law in 1972, the regulation of pre-1972 sound recordings was specifically left to state regulation (where it had been prior to Federalization).  The limited digital performance right was adopted in a series of laws enacted in the late 1990s, as fears of digital piracy based on Internet and other digital transmissions grew.  So webcasters, satellite radio, digital cable radio and other digital users of sound recordings have paid a royalty for the performance of such recordings.  That royalty is set by the Copyright Royalty Board (see our article here about the most recent CRB proceeding to set rates), paid by noninteractive services to SoundExchange, and distributed by SoundExchange to copyright holders and artists. For interactive services (like Spotify or iTunes or Rhapsody), the performance rights have to be directly negotiated with the copyright holder, leading to disputes like the recent decision of Taylor Swift to pull her new album from Spotify (see our article here about the difference between interactive and noninteractive services).  As the 1990s adoption of the limited public performance right in sound recordings was a Federal act, most observers believed that there was no public performance right in sound recordings for pre-1972 recordings, as there never had been one prior to Federalization (despite many attempts by artists and labels to have one included in the law)(see our article here when the Flo and Eddie suit was first filed). 
Continue Reading New York Court Finds Public Performance Right in Pre-1972 Sound Recordings – How Will This Affect Businesses that Use Music?

The FCC announced two significant policy initiatives by Blog post in the last week – perhaps recognizing that the Internet provides a better way of packaging a message about policy directions than an unpredictable news conference.  The two decisions announced this week by Blog post were (1) the Chairman announcing that he has directed that a Notice of Proposed Rulemaking be circulated among the other Commissioners to treat Over-the-Top TV providers (“OTT” providers, usually those that provide service over the Internet) of linear programming as MVPDs – meaning that they would be treated, for regulatory purposes, in much the same way as cable and satellite TV services, and (2) an announcement by the head of the incentive auction task force that the auction by which some of the broadcast TV spectrum will be purchased from TV users and resold to wireless carriers for broadband wireless uses will be postponed from its expected date in the summer of 2015 until early 2016.  We will write about the postponement of the auction later.  But what does the MVPD proposal mean?

The MVPD issue is one that we last wrote about here.  At the urging of some OTT providers, apparently including Aereo, the FCC has been urged to treat these providers, when they provide “linear” programming (programming that is provided at set times on a set schedule, in the manner of broadcast TV or cable programming, as opposed to the on-demand programming of a Netflix or Hulu), in the same fashion as cable and satellite.  The Chairman, in his blog post, announces his support for an FCC proceeding to review that proposal, apparently looking to use linear Internet programmers as a new competitive force against cable and satellite TV.  By treating these services as MVPDs, they could get access to over-the-air TV programming (if they can negotiate retransmission consent agreements with the TV stations) and equal access to programming provided by vertically integrated cable programmers (those programmers that have attributable ownership from cable system operators).  But, obviously, there are some big “ifs” here.
Continue Reading FCC Policy by Blog Post – Over-the-Top Internet-Delivered Television Programming Providers May be Treated as MVPDs, a Reaction to Aereo?

An Alabama radio station recently received a notice about the new royalty rates that are payable to ReSound, the Canadian equivalent of SoundExchange, a collective set up to receive from webcasters royalties for the public performance of sound recordings and to distribute those royalties to the copyright holders (usually the labels) and the artists who recorded the songs, according to a story in today’s issue of Tom Taylor Now (a radio industry newsletter).  Tom asked me why would a radio station in Alabama get this notice – shouldn’t their payments to SoundExchange take care of the royalties that they owe for their streaming?  In fact, webcasters receiving these notices do need to consider their practices.

The general principle in the Internet world is that a webcaster is liable for paying music royalties for listeners where the listener is located – not where the transmitting entity may be located.  The same principle applies to rights to video and other content made available through the Internet – which is why your US HBO Go or Netflix subscription may not work the next time you visit London or Tokyo and try to watch a movie on your computer in your hotel room.  Rights are usually granted country by country (or sometimes by region), but in many cases rights granted in one country don’t give the Internet service acquiring those rights permission to circulate the content worldwide.  Thus, many large webcasters block their streams outside the US – notably webcasters like Pandora, who pulled their non-US streams back in 2007 (see our article here that we wrote when they took that action, which reminds me how long I have been writing this blog!). 
Continue Reading Why is a US Radio Station Getting a Notice about Webcasting Royalties in Canada? – Why Webcasters Geo-Block Their Streams to Avoid International Music Royalties

Could a change in the FCC treatment of Internet delivered video services be in the works – and how would that affect services like Aereo?  There were a number of published articles last week that suggested that the FCC was considering extending the definition of a Multichannel video programming distributor (MVPD) to over-the-top video providers or, as they are apparently being referred to, as Online Video Distributors (OVD) who provide linear programming like a cable or satellite company (as opposed to an on-demand provider like NetFlix).  While Chairman Wheeler at a press conference following last week’s open FCC meeting reportedly stated that the issue was “kicking around” implying that no decisions had been made, the FCC did announce that it was making a long-outstanding proceeding to look at this issue into a “permit but disclose” proceeding, meaning that parties can lobby the FCC on the issue as long as they file statements for the record disclosing the substance of their conversations with decision-makers.  What does all this mean?

If the Commission were to consider OVDs to be MVPDs, they would presumably be covered by all of the rules that apply to cable and satellite – including provisions that allow equal access to cable network programming in which the cable companies have a financial interest, and would also be subject to the must carry-retransmission consent regime that is applicable to other MVPDs, requiring MVPDs to negotiate with (and in many cases pay) TV stations to carry their programming.  The open proceeding to consider OVDs as MVPDs was started by a company called Sky Angel that focused on family-friendly programming.  The service initially delivered its programming by satellite, but migrated it to the Internet, at which time they wanted access to cable programming including Animal Planet.  When access to that programming was denied, they complained to the FCC.  The FCC staff initially denied the complaint, determining that MVPDs had to be “facility based,” meaning that they had to own the actual facilities that delivered the programming to the consumer.  The full Commission over two  years ago asked for public comment on whether this decision was correct – we wrote about that request for comment here and here – and the proceeding has essentially sat at the FCC ever since, until it began to get some renewed interest in connection with the Aereo case.
Continue Reading Will FCC Extend MVPD Rules to Online Video Providers – Including Retransmission Consent Fees and Program Access Rules?

With regulatory fees behind us, October brings a number of the routine quarterly regulatory filing dates.  October 10 for all broadcast stations, commercial and noncommercial, is the date by which your Quarterly Issues Programs lists, setting out the most important issues that faced your community in the last quarter and the programs that you broadcast to address those issues, need to be placed in the physical public inspection file of radio stations, and the online public file of TV broadcasters.  As missing and incomplete Quarterly lists have led to more fines in the recent license renewal violation than any other matter, and as the FCC staffers have been reviewing some of the TV station lists that are now posted in the online public inspection files of station, completing these forms on a timely basis remains very important. 

Full power TV and Class A TV stations by October 10 also need to have filed with the FCC their FCC Form 398 Children’s Television Reports, addressing the educational and informational programming directed to children that they broadcast.  Also, by that same date, they need to upload to their online public files records showing compliance with the limits on commercials during programming directed to children.  Children’s television reports have trailed right behind the Quarterly Issues Programs lists as the source of fines at license renewal time – so be sure that these are completed and filed on a timely basis as well. 
Continue Reading October Regulatory Dates for Broadcasters – Quarterly Issues Programs Lists and Children’s Television Reports, New Form for TV CP Applications, Comments on Captioning of Video Clips and Incentive Auction Reimbursement Form and More!

As the summer of copyright comes to an end, the music licensing issues which arose causing me to repeatedly write about this extremely contentious season in copyright law are by no means finished (see the most recent of our Summer of Copyright articles here).  In fact, on the first full day of autumn, we received a very interesting decision out of a US District Court in California on the lawsuit brought by Flo and Eddie against Sirius XM, finding that the music service improperly failed to pay royalties for the public performance of pre-1972 sound recordings from the duo’s former band, the Turtles (a copy of the decision can be found in this Billboard article).  As we have written before, Flo and Eddie brought suit against Sirius XM, arguing that the service needs to get permission to make public performances of these recordings and, by not doing so, it violated their California state law copyrights. 

Pre-1972 sound recordings first registered in the US are not covered by Federal law, so the current mechanism for Sirius XM to pay for the digital public performance of sound recordings (paying a royalty, set by the Copyright Royalty Board, to SoundExchange) does not exist.  To the surprise of many (including this author) the Court concluded that there is in fact a public performance right in pre-1972 sound recordings under California state law, and went on to conclude that Sirius XM violated its obligations under the law to pay for the use of music.  This decision, on a summary decision motion, may quite well be appealed.  The issue is also before many other courts, both in California and elsewhere.  But this decision is certainly worth review, as it could have an impact not only on digital services, but also on any other company that publicly performs such recordings – including other digital music services, bars and restaurants, stadiums, and potentially even broadcasters.
Continue Reading Court Rules in Favor of Flo & Eddie in California Suit Against Sirius XM for Public Performance of Pre-1972 Sound Recordings – What Does This Decision Mean for Broadcasters, Digital Media Companies and Other Music Users?

The Commission has set the date for comments on it Further Notice of Proposed Rulemaking on certain aspects of the captioning of Online Video clips.  We recently summarized the FCC action setting up compliance deadlines for the captioning of video clips taken from programs that are shown on TV with captions, and then repurposed for online use.  While the Commission has already established the obligations for TV broadcasters to take these clips and caption them when shown online on the broadcaster’s own website or through its own app, there are still certain areas to which the rules have not yet been extended on which comments are sought. The Comment deadline is October 6, with replies due November 3 (see the full text of the FCC decision here, and the Federal Register publication of the comment dates here).  What is being considered?

Basically, questions are asked about three areas. The first is whether to require that clips be captioned when they are shown on third-party websites.  The current rules require that full programs shown on TV and repurposed to the Internet be captioned when shown on third-party sites, but the new rules for clips were not immediately extended that far, as the Commission seeks comments on the costs and difficulties that might exist in such an extension.
Continue Reading Comment Dates Set for Rulemaking on the Required Captioning of Online Video Clips – What is Being Considered?