May is one of those months where there are neither deadlines for EEO Public File Reports nor for any of the quarterly filings of issues/programs lists and children’s television reports. But the lack of these routine filing deadlines does not mean that there are no dates of interest in the coming month to broadcasters and other media companies. As seemingly is the case every month, there are never times when Washington is ignoring legal issues potentially affecting the industry.

May 10 brings an FCC meeting where two items of interest to broadcasters will be considered. One is a proposal to abolish the requirement for posting licenses and other operating authorizations at a broadcaster’s control point and to eliminate the requirement that FM translators post information about the station’s licensee and a contact phone number at their transmitter sites (see our post here for more details). The second is a proposal to modify the processing of complaints about new or modified FM translators causing interference to existing stations. See our summary of that proposal here. If adopted at the May 10 meeting, these proposals will be available for public comment after they are published in the Federal Register. Continue Reading May Regulatory Dates for Broadcasters – FCC Meeting, FM Translator and LPTV Filing Windows, Political Windows and More Consideration of Music Reforms

This week, the US House of Representatives passed the Music Modernization Act. While widely supported among many digital media companies providing on-demand subscription music services as well as by many in the music industry, the bill seemingly has not received the publicity that has been afforded to past music royalty legislation. That may be, in part, because there were few who adamantly opposed the provisions of the bill, as evidenced by a unanimous House vote – something that never would have happened had any significant portion of the music industry opposed the bill. But this moment of togetherness may be, in part, due to the somewhat limited (though nevertheless very important) issues that it addresses.

The Modernization of Music Act began as a legislative effort primarily to address the issues raised under Section 115 of the Copyright Act – the section dealing with what are often called “mechanical royalties” – the royalties paid to publishing companies for the copyright in the “musical work,” i.e. the musical composition. In other words, these royalties are paid to the copyright holder of the words and music to a song (sometimes the composer but more often a publishing company) – not to the artist who actually records that song. The provisions of Section 115 were first adopted to allow artists to record songs once a song has been recorded and publically released in the United States – to record a “cover” of the original recordings – provided that compensation set by agreement between the user and the copyright holder is paid or, absent a voluntary agreement, that a royalty set by the Copyright Royalty Board is paid to the copyright holder (see our post here on the last CRB decision on those rates). That mechanical royalty was later expanded to cover “digital phonorecord deliveries” (“DPDs”) – the making of digital copies of the musical composition made in the context of a distribution and delivery of the song to individual consumers. Through caselaw and industry practice, DPDs were interpreted to include the need for royalties not just when a digital download is made, but also when an on-demand or interactive stream of a song is delivered to a consumer. Continue Reading House of Representatives Passes Music Modernization Act – Looking for Clarity on Mechanical Royalties, Pre-1972 Sound Recordings and Other Music Rights Issues

The FCC yesterday issued an order granting 39 radio stations (almost all stations with very small staffs or those affected by recent hurricanes or otherwise non-operational) 60 days to comply with the requirement that all full-power radio stations complete the transition to the online public file by this past March 1. We wrote about this obligation for the March 1 transition to the online public file here and here. This decision highlights the requirement for stations to have complied with the requirement to transition to the online file by March 1.

We are still hearing reports that there are stations not on this waiver list that have not activated the public file. In a footnote in yesterday decision, the FCC notes that it orally denied an extension request filed a year ago, and that its staff had discussed concerns that other stations about meeting the deadline, noting that the FCC has “encouraged all of these stations to continue to work to complete the transition to the online file as expeditiously as possible.” Whether that suggests that the Commission might not strictly enforce the March 1 deadline is open to interpretation, but it is clear that, even if it has not reached that point already, at some point (likely soon) any station not in compliance with the requirements is looking at potential FCC penalties. Note that the license renewal cycle for radio stations begins next year. That 3-year cycle in which all radio licensees will file their renewal applications will present the FCC with the opportunity to monitor compliance with the public file rules, and to impose penalties on those who have not complied. So don’t get caught being noncompliant!

We wrote last week about one broadcast issue to be considered at the FCC’s May 10 meeting, amending the procedures for resolving complaints about interference by new FM translators to other existing FM stations. At that same meeting, the FCC is planning to adopt another item in its Modernization of Media Regulation Initiative – a Notice of Proposed Rulemaking (see a draft of that item here) to eliminate the FCC rules that require broadcast stations to post physical copies of their license (and other instruments of authorization such as STAs or renewals), or to keep physical copies of these documents in a binder, at their control point.

The FCC also asks whether translator operators should continue to have to post information at their transmitter sites as to the name, address and telephone number of the licensee and where station records are maintained. Given that all of this information is in the FCC’s database and accessible to anyone with Internet access (and as the licenses posted at the control point are not even accessible to the public), the draft NPRM, if adopted at the May 10 meeting, would propose to eliminate these rules. Watch for the adoption of this proposal at the May 10 meeting, and the comments dates on the proposal that will be set after the meeting.

The FCC yesterday released a draft Notice of Proposed Rulemaking, to be considered at its open meeting on May 10, seeking to add more specificity to its rules for the resolution of interference by new FM translators. The FCC attempts to set out new procedures that it would use to decide if applications for new translators can be granted, and if new translators already granted and constructed can continue to operate, when there are complaints that the new translator will cause interference to existing FM stations and to pre-existing translators and LPFMs. Under current rules, the FCC will deny the application of a new translator if there are regular listeners of another station within the 1 mv/m of the proposed new translator, and a newly constructed translator will be required to cease operations if it cannot resolve complaints of interference to the regularly used signal of any other operating station – even outside of that station’s protected contour. Even a single listener complaint of interference that cannot be resolved from a listener who is not affiliated with the station can cause the FCC to order that a new translator be shut down.

In response to petitions filed by the NAB and a Philadelphia-area translator operator (see our summary of those filings here), the FCC has drafted this NPRM that, if adopted at its May 10 meeting, will put forward for public comment a series of proposals to make the interference complaint resolution process quicker and more objective. There is a general perception, both among full-power broadcasters who have complaints about translator interference, and among translator operators whose operations may be in limbo if subjected to interference complaints, that the current FCC process simply takes too long and is subject to manipulation and unforeseeable outcomes. With over 1500 new translators for AM stations likely to start operations shortly, with many potentially subject to interference complaints, many broadcasters have suggested that the FCC needs to act quickly to make the current system more objective – and to allow it to resolve complaints more quickly. Continue Reading FCC To Consider Proposal for New Rules on FM Translator Interference at Its May Meeting

The FCC yesterday released a Public Notice announcing an extension in the application filing deadline in the window for LPTV stations and TV translators that are displaced by the TV repacking following the incentive auction. In this window, displaced stations can file applications for new channels or new facilities that remove their conflicts with repacked stations or which move the LPTV or TV translator into the spectrum that will continue to be devoted to TV broadcasting after TV channels above 37 are repurposed for wireless uses. The new deadline for displacement applications for these LPTV and TV translator stations is now June 1.

We wrote about the opening of the window, here, and about the FCC’s rules for this window here. As the window is already open, the two-week extension gives potential applicants more time to avoid conflicts with other applicants in the window. Applications that are filed in the FCC’s LMS database will be available for viewing by other potential applicants shortly after they are filed. As applications can be amended through the end of the window, applicants can avoid specifying channels already proposed by other LPTV stations or TV translators in their markets, or otherwise deal with conflicts that might otherwise exist. So take note of that new closing date of the displacement window and the opportunities that it affords – opportunities not available once the window closes.

 

At the end of yesterday’s FCC meeting, Commissioner Clyburn announced that it would be her last.  Her term had already expired but, under the rules of the FCC, she could continue to serve until the end of the year.  She apparently has decided to leave the FCC within the next few weeks. Commissioner Clyburn served as Acting Chairman of the FCC in 2013, the first woman to chair the FCC.  For broadcasters, she is best known for starting the AM revitalization proceeding, including the proposal for FM translator filing windows reserved for AM stations (see our article here).  While Congressional Democrats have advanced a candidate to replace the Commissioner, no nomination has been made by the President given that, until now, there was not a vacancy to fill.  Watch for more news on filling that vacancy in the coming months.

 

We just wrote about the FCC talk at the NAB Convention about translator interference and pirate radio. On the TV side, there was of course mention of the remaining TV post-incentive auction transition issues with the repacking of displaced full-power stations and the open window for displaced TV translators and LPTV stations to find new homes in the remaining TV spectrum. But the other issue that came up in several regulatory conversations was reform of the Children’s Television or “KidVid” rules. As we wrote here, Commissioner O’Rielly has been put in charge of that rewrite after expressing concern that these rules did not reflect modern competitive realities (see our summary of the Commissioner’s blog post where he raised issues that he saw with the current rules). Under current rules, stations have to find three hours of educational and informational programs for their primary program channel as well as each of their digital subchannels. Particularly as the number of those subchannels could expand with ATSC 3.0, these stations will likely have difficulty finding audiences for all of that programming when the children’s audience is served by so many other outlets, including dedicated children’s channels on cable and satellite platform, and by all sorts of on-demand content.

In his speech at the Convention, Chairman Pai mentioned the efforts of Commissioner O’Rielly to review these rules. Commissioner O’Rielly, in remarks that he made at a convention breakfast, notes that he has been told that young children’s viewing of over-the-air television has precipitously dropped in recent years. At the same time, as attention spans have decreased, the FCC remains wedded to a 3 hour per week requirement for educational and informational on each programming channel offered by a TV broadcaster, and it must be provided in blocks of at least one-half hour to meet the standard review thresholds. Commissioner O’Rielly is looking for new ways for the FCC to address children’s programming requirements, and expects the FCC to start a formal proceeding to address changes in the rules by this summer. So look for more developments on this front quite soon.

At this week’s NAB Convention, issues about FM translators and pirate radio dominated the radio news from the sessions that featured FCC speakers. On the translator front, FCC Chairman Pai, in his speech to the convention, announced that there is a Notice of Proposed Rulemaking that has been drafted and is being considered by the FCC Commissioners, looking to make changes in how complaints about interference to full-power stations from translators would be handled. Currently, a single complaint from a regular listener to a full-power FM station, even if that listener listens outside of the full-power station’s protected contour, is enough to shut down the new translator if the translator licensee cannot resolve that complaint. This policy has prompted a number of battles between translators and full-power stations over whether complaints have come from bona fide listeners (as opposed to employees or others with close connection to the complaining station) who are receiving real interference, and whether or not that interference truly exists (e.g., whether it has been caused by the new translator) and whether or not such interference has been remediated by actions taken by the translator licensee. Last year, the NAB proposed a number of fixes to the policy – suggesting that more than one complaint should be required to prove true interference and that, if interference is found, that the translator be allowed to relocate to any available channel on the FM band to remediate that interference, not just to adjacent channels as a “minor change” as currently required (see our summary of the NAB proposal here). It is anticipated that the FCC’s proposed rulemaking will contain some of the NAB’s suggestions.

Pirate radio was also on the Chairman’s agenda, and was discussed in a panel of other FCC officials at the convention. The Chairman highlighted the recent seizure of a pirate radio operator’s equipment in the Boston area, mentioning that two other such actions had also been taken. The discussion in other panels highlighted the FCC’s willingness to pursue not only pirate operators themselves, but also their landlords where the landlord appeared to be actively involved with the pirate’s operation (see our article here). The FCC is also looking for legislative assistance to broaden that authority to undertake enforcement actions against those who make possible pirate radio operations through providing space, services, or other assistance (see our article here). Watch for further actions on both issues in the near future.

With the NAB Convention upon us, and much of the talk being centered on television issues including the repacking of the TV band after the incentive auction, the conversion to the next-generation of TV transmission as allowed by the new ATSC 3.0 transmission standard, and the effects of the FCC’s changes in the local television ownership rules and the reinstatement of the UHF discount in connection with the national ownership cap, it almost seems like radio is an afterthought. The FCC is considering some matters of interest to radio, including how to revitalize the AM band, and it has taken steps to revitalize individual AM stations through the use of FM translators. And the FCC is apparently considering changes in FM through the creation of a new class of C4 stations (see our post here). Yet, in recent ownership orders from the FCC, while TV ownership rules have been dramatically relaxed in the face of new video competition so that local TV owners can more robustly address their challengers, there were no corresponding changes in the radio rules. In the last ownership proceeding (which we summarized here), other than making changes to the embedded market rules (potentially affecting only radio stations in the suburbs of New York and Washington), and allowing ownership joint ownership of radio with TV and newspapers through the abolition of the cross-ownership rules that had limited or prohibited those combinations, radio ownership rules themselves have not been subject to any real changes in ownership limits since those limits were set in the wake of the 1996 Telecommunications Act. The FCC did make some changes early in this century when it adopted Arbitron (now Nielsen Audio) markets as the way in which competition in rated markets is defined, but the numbers of stations that one party can own has not changed since those numbers were established in the 1996 Act – even though Congress gave the FCC the authority to review and revise the rules to insure that they remained in the public interest.

While there have been no changes in the ownership rules for radio, think about the changes that have taken place in the competitive environment since 1996. At that point, streaming was something only a few technologically-forward people even knew existed. Pandora did not launch its streaming service for another decade, and Spotify was even further behind – not launching in the US until 2011. Even those few people who knew that audio streaming existed in 1996 would never have thought that they could listen to a streaming service in their cars. Apple was not offering a streaming music service – in fact it had not even introduced the iPod (introduced in 2001) or the iTunes store (2003) – both now about to become technological relics themselves because of technological changes. Given that there was no iPod, there were obviously no podcasts to bring audio storytelling to the millions who now listen to their favorite programming through the multitude of services that provide podcasts on almost any subject. There was no Alexa to bring Amazon and other music services into the home – in fact Amazon itself had only begun selling books online in 1995. Even Sirius XM (then Sirius and XM as two competing companies) had not initiated their services at the time of the 1996 Act – as XM did not start providing service to consumers for another 5 years (with Sirius launching a year later). And the pace of change for audio technology is not slowing. Continue Reading What’s Next for the FCC’s Radio Ownership Rules? – Do Changes in the Audio Marketplace Justify Changes in Ownership Limits?