We recently wrote about the Notice of Apparent Liability for violation of the FCC’s indecency rules that was issued last week by the Federal Communications Commission, proposing to fine 52 ABC network affiliates $27,500 each. This $1.4 million fine was suggested by the FCC for alleged violations which occurred almost 5 years ago in a broadcast of the
Does the FCC’s Approval of the Clear Channel Transfer of Control Provide a Window Into the Future?
Last week, the FCC approved the long-pending application for the transfer of control of Clear Channel Broadcasting from its public shareholder to several private equity funds. Even though the application had been pending at the FCC for over a year, the Commission’s decision was notable for the paucity of issues that were discussed. The decision approves the transfer, conditioned on certain divestitures by the Company and by the equity funds that will control the new company, including divestitures previously ordered by the Commission in connection with the investment of one of these funds in Univision Broadcasting but not yet completed, and rejects three petitions that, from the Commission’s description, did not involve fundamental issues about the nature of the overall transaction, but were instead devoted to certain limited issues, in two cases involving actions in a single market. The divestiture conditions were approved seemingly as a matter of course, and do not provide any new insights into the law concerning the FCC’s attribution rules (unlike the recent decision approving the transfer of control of Ion Television, about which we wrote here, which contained an extensive detailed discussion of what it takes to make an ownership interest “nonattributable” for purposes of the FCC multiple ownership rules). Given the lack of controversy in the Commission’s order, what is perhaps most noteworthy about the decision are the concurring statements of the two Democratic Commissioners, which may provide some indication of the concerns of the Commission should we have a Democratic-controlled Commission following this year’s Presidential election.
Of course, as we’ve described in our posts about the FCC’s Localism Notice of Proposed Rulemaking (here), and the new rules regarding Enhanced Disclosure requirements for television broadcasters (here), the Commission has already begun to act in a far more regulatory manner than any other Commission in the past 20 years. Yet the issues raised by the Democrats in this decision are in areas not yet considered by the Commission. Commissioner Copps expresses his concern about the role of private equity in broadcast ownership, and whether such ownership is in the public interest. In numerous proceedings and in response to the presentation made at the FCC’s January meeting by the Media Bureau, Copps has suggested that private equity should be investigated, both to determine whether the Commission is fully aware of all ownership ties of the companies involved, and also (as emphasized in this case) for the potential economic impact on the operations of the broadcast stations caused by the new debt involved in the acquisition. Here, Commissioner Copps questions whether the announcement of a potential downgrade of the bonds of the Company if these deals occur should have been of more concern to the Commission. Private equity should be aware that, in a future FCC, an investigation of the economics of their operations should be expected.Continue Reading Does the FCC’s Approval of the Clear Channel Transfer of Control Provide a Window Into the Future?
FCC Releases Rules for Enhanced TV Disclosure Requirements
The FCC has released the full text of its Order adopting enhanced disclosure requirements for broadcast television stations – requiring that they post their public files on their websites and that they quarterly file a new form, FCC Form 355, detailing their programming in minute detail, breaking it down by specific program categories, and certifying that the station has complied with a number of FCC programming rules. The Commission also released the new form itself and, as detailed below, the form will require a significant effort for broadcasters to document their programming efforts – probably requiring dedicated employees just to gather the necessary information. The degree of detail required is more substantial than that ever required of broadcasters – far more detailed than the information broadcasters were required to gather prior to the deregulation of the 1980s – though, for the time being, much (though not all) of the information is not tied to any specific programming obligations set by the FCC.
Before getting to the specifics of the new requirements, the thoughts of the Commission in adopting this order should be considered. The Commission’s decision focuses on its desire to increase the amount of citizen participation in the operation of television stations and the decisions that they make on programming matters. While many broadcasters protested that the public rarely cared about the details of their operations, as evidenced by the fact that their public files were rarely if ever inspected, the Commission suggested that this was perhaps due to the difficulty the public had in seeing those files (the public actually had to go to the station to look at the file) and the lack of knowledge of the existence of the files (though broadcasters routinely broadcast notice of the public file’s existence during the processing of their license renewal applications, rarely producing any viewers visiting the station to view the file). With respect to the new Form 355 detailing the station’s programming, the Commission rejected arguments that reporting of specific types of programming in excruciating detail imposes any First Amendment burden on stations, as the Commission claims that it has imposed no new substantive requirements. Yet the Commission cites its desires that the public become more involved in the scrutinizing of the programming of television stations, which it states will be aided by the new form, and also emphasizes the importance that the Commission places on local service (an item detailed in Form 355). At the same time, in its proposals detailed in its Localism proceeding (summarized here), the Commission is proposing rules requiring specific amounts of the very programming that is reported on Form 355, the very numbers that, in this proceeding, it claims have no significance. Moreover, citizens will be encouraged by the Commission’s actions to scrutinize the new reports, and file complaints based on the perceived shortcomings of the broadcaster’s programming. Broadcasters in turn will feel pressured to air programming that will head off these complaints. So, implicitly, the Commission has created the First Amendment chilling effect that it claims to have avoided.Continue Reading FCC Releases Rules for Enhanced TV Disclosure Requirements
FCC Releases Specifics of Localism Rulemaking – Proposing Lots of New Rules For Broadcasters
At its December meeting, the FCC adopted a Notice of Proposed Rulemaking on Localism. At that meeting, while the Commissioners discussed the generalities of the proposals being made, the specifics of the proposals were unknown. The full text of the NPRM has now been released, and it sets out the areas in which the Commission proposes to re-regulate broadcast stations. The order also hints at a number of other proceedings that the Commission intends to launch in the near future, and reminds broadcasters of a number of other existing proceedings that will potentially bring about greater regulation. From the discussion in the NPRM, new rules will apply to all broadcasters – large and small – and potentially place significant burdens on all stations which, as always, are hardest for small stations to deal with. Given the number of new regulatory initiatives discussed by the Commission, the NPRM is a must-read for all broadcasters, and this proceeding is one in which all broadcasters should participate.
Among the specific proposals on which the Commission asks for comments include the following:
Community Advisory Boards: The Commission tentatively concludes that all stations will be required to establish a community advisory board to advise the station on the issues of importance to the community that can be addressed in the station’s programming. The Commission indicated that it did not want to bring back the burden of the ascertainment process that was abolished in the 1980s, but asks how the Board should be established so as to represent the entire community, suggesting that the categories of community leaders that were used in the ascertainment process could be used as a standard to guide the licensee in determining the make-up of the board. Other questions include how often the board should meet, and how the board members should be selected (or elected – though by whom, the Commission does not suggest).
Other Community Outreach Efforts. The Commission also suggests that other community outreach efforts should be considered as possible mandates for broadcasters. These would include the following:
- Listener surveys by telephone or other electronic means (general public surveys were also part of the ascertainment process abolished in the 1980s, so if this were adopted together with the Community Advisory Board, ascertainment would effectively be back)
- Focus sessions or town hall meetings
Remote Station Operations. Comments are sought as to whether television stations should be forbidden to operate without being manned during all hours of operation. Radio operations will be addressed in the proceeding to consider the public interest issues posed in the Digital Radio Proceeding (see our summary here).
Quantitative Programming Guidelines. The Commission proposes to adopt quantitative standards for programming that a station would have to meet to avoid extra processing and scrutiny at license renewal time. Questions include what categories of standards should be established (just local programs – or more specific requirements to set required amounts of news, public affairs and other categories – and how to define what programming would qualify in each category), should requirements be established as specific numbers of minutes or hours per day or per week or by a percentage of programming or through some other metric, should other specific requirements or measurements be established?
Main Studios. The commission suggests reverting to the pre-1987 requirement that each station maintain a main studio in its community of license
Network Programming Review. The Commission asks whether rules should be adopted to require that local network affiliates have some ability to review all network programming before it is aired. If so, what programs would be exempt from the requirement (e.g. live programs), how much prior review is necessary, would such a right disrupt network operations?
Voice Tracking. The Commission asks if "voice-tracking," (i.e. a radio announcer who provides announcing on a radio station from outside a local market, sometimes including local inserts to make it sound as if the announcer is local) should be limited or prohibited, or if disclosure should be required.
Local Music. While the Commission indicates that it did not think that a ban on national playlists was required, it did ask whether broadcasters should be required to report the songs that they play, and how they choose their music. With that information, the Commission asks if it should consider the amount of local music played when assessing whether a station has served the needs of its community at license renewal time.
Class A TV. The Commission asks whether it should adopt rules that permit more LPTV stations to achieve Class A status, meaning that they would no longer be secondary stations subject to being forced off the air by interfering uses of the TV spectrum by full-power TV stations.
Correction – Comment Date Not Set on LPFM/Broadcaster Relationship
Last week, we published a note that the FCC had published the new rules on Low Power FM (LPFM) stations in the Federal Register, starting the comment period on the issues raised in the Further Notice of Proposed Rulemaking in that proceeding – principally addressing the relationship between LPFM stations and FM translators and improvements
FCC Rules Against Kucinich Request for Inclusion in CNN Presidential Debate
The FCC has now joined the Nevada Courts (see our post here) in denying Dennis Kucinich entry into the Presidential debates. In a decision released this week, the FCC found that they could not force CNN to include Kucinich in its Democratic Presidential Debate, as such an action would violate the First Amendment. The FCC only has the jurisdiction to determine if Kucinich was entitled to equal opportunities for not being included, and the Commission rejected that claim as well, finding that the carriage of the debate was on-the-spot coverage of a news event, exempt from equal opportunities.
This decision is what we predicted in our post when the court’s denied Kucinich access to the Nevada Presidential debate. As we set out in that post, to encourage political debates, the FCC has determined that debates are on-the-spot coverage of news events as long as more than one candidate is included, and the decision as to which candidates to invite is made based on some rational criteria that is not exercised in some discriminatory, partisan fashion. In this case, the Commission found that CNN’s criteria – that a candidate had to have finished in the top 4 in a previous primary and be polling over 5% in an established national Presidential preference poll were not standards that were being applied arbitrarily for partisan reasons. The Commission concluded that the mere fact that Kucinich was receiving Federal funds and had unique positions on the issues was not enough to conclude that CNN was required to either include him in the debate or provide him equal time.Continue Reading FCC Rules Against Kucinich Request for Inclusion in CNN Presidential Debate
FCC Announces Further Testing of White Spaces Devices
The FCC has announced that on January 24 it will begin a new round of testing of wireless devices that will work in that part of the communications spectrum currently reserved for television station operation. The idea, about which we wrote here, would be that these devices could operate at low power, on channels not used by
Comment Date on the Relationship of Low Power FM Stations to FM Full Power Stations and Translators Set
[Correction 1/24/2008- we have published a correction to this entry, here, noting that the Federal Register publication described below contained only half of the FCC’s order in its LPFM proceeding, omitting the portion seeking public comment. That section of the order will apparently be published in the Federal Register at a later date – so the February 19 comment date set out below is incorrect. Everyone has more time to prepare their comments. The actual filing date will be set in the future.]
The FCC Order establishing new rules for Low Power FM (LPFM) Stations was published in the Federal Register on January 17. This sets the date of February 19 for the filing of comments on the question of the relationship between LPFM stations and both FM translators and full-power FM stations. These comments will address two issues, (1) whether LPFM stations should remain secondary stations, subject to being knocked off the air by new full-power FM stations and (2) whether LPFM stations should get some sort of priority over some or all FM translator stations.
LPFM stations have been "secondary" stations, meaning that they could be knocked off the air when a new FM station came on the air, or when improvements to the facilities of an existing FM station were constructed, if the new full-power FM facilities would be caused interference from the existing LPFM station. As we wrote here, at its November meeting, the FCC decided that it needed more information to determine whether LPFM stations should continue to be secondary to new or improved FM stations. While not reaching a final determination on that issue, the FCC adopted temporary processing policies which essentially force the full-power stations to deal with LPFM operators in cases where such interference arises – potentially blocking improvements in the facilities of a number of FM stations. Continue Reading Comment Date on the Relationship of Low Power FM Stations to FM Full Power Stations and Translators Set
Nevada Court Denies Kucinich Right to Participate in Broadcast Debate – Recognizing FCC’s Exclusive Role to Regulate Equal Opportunities in Political Debates
In a wild series of legal decisions preceding the Democratic Presidential debate in Nevada, a Nevada judge ruled that MSNBC had to include Congressman Dennis Kucinich in its debate, only to be overruled by a decision of the Nevada Supreme Court released less than a hour before the debate was to begin. Notably, the initial decision was not based on FCC rules, but instead on a breach of contract theory, as FCC precedent seems relatively clear that a Presidential debate sponsor need not include all candidates in a debate for the coverage of that debate by a broadcaster or cable operator to be exempt from the equal opportunities rules enforced by the FCC.
The FCC has long recognized that, to promote the coverage of debates on broadcast media, the sponsors need to be able to limit participation in those debates for them to have any meaning. In some races where there are minimal requirements for being placed on a ballot, there can be dozens of candidates for a particular office. If all needed to be included in a broadcast debate, the debate would never be broadcast, and the public would not receive the benefit that on-air coverage would provide. The issue first arose when the equal opportunities rule was adopted, as broadcasters feared that, unless every candidate for a particular office was included in the debate, any broadcaster or cable company carrying the debate would have to give free "equal time" to any candidate that did not participate in the debate. Continue Reading Nevada Court Denies Kucinich Right to Participate in Broadcast Debate – Recognizing FCC’s Exclusive Role to Regulate Equal Opportunities in Political Debates
Advertising Issues on Washington’s Agenda for 2008
As 2007 wound to an end, advertising issues figured prominently on the agenda of Washington agencies, including both the FCC and the FTC. While the FCC is looking at specific regulatory requirements governing broadcast advertising, the FTC is investigating the privacy issues raised by advertising conducted by on-line companies. In November, the FTC held a two day set of workshops and panels where interested parties discussed issues of behavioral advertising – advertising that can be targeted to individuals based on their history of Internet use, and whether or not regulation of these practices was necessary. The wide-ranging discussion is summarized on our firm’s Privacy and Security Blog, here. After gathering this testimony, we will see if the FTC decides to proceed to propose any regulations dealing with this sort of personalized, on-line advertising.
At the FCC, there are two separate proceedings dealing with advertising issues for broadcasters. The first came about as part of the FCC’s diversity initiatives adopted at its December meeting. There, the Commission determined that broadcasters will need to certify in their renewal applications that they have not discriminated in their advertising practices. While this proposal was adopted at the Commission’s December 18 meeting, the full text of the decision has yet to be released, so we do not know the specifics of this new requirement.Continue Reading Advertising Issues on Washington’s Agenda for 2008