Last week, it was announced that Google through its DoubleClick platform, would be offering programmatic buying opportunities for advertisers looking to place audio ads into online streams. While that system is initially being rolled out among the big digital audio services, if it or other similar platforms are expanded more broadly, it could bring more advertising into internet radio, podcasting and other digital audio program channels. But, being the spoilsports that we tend to be as lawyers, we wanted to pass on some issues to consider in accepting programmatic buys – whether in online streams or in over-the-air broadcasts. The immediacy of the audience’s perception of an audio insertion into a program stream can bring unintended results – some of which may have legal consequences.

We have already written about the issues for some of the programmatic buying platforms that are inserting ads into broadcast radio and television programming. As we wrote here and here, these ads can potentially impact a broadcaster’s legal compliance – particularly in the area of political broadcasting, where these ads could affect a station’s lowest unit rate, as well as reasonable access, equal opportunities and even political file disclosure obligations. While none of these FCC issues apply directly to online ads, as we wrote here, there are potential rules on political advertising that may soon be applied to online ads, either through actions by the Federal government or by the enactment of rules to implement a recently passed New York State law that compels disclosures for online political ads similar to those required by the FCC for broadcast ads. There are other considerations as well. Continue Reading Google Announces Programmatic Buys of Audio Ads – Looking at Legal Issues with Programmatic Sales

Geoffrey Starks, currently an Assistant Chief in the FCC’s Enforcement Bureau, will, according to multiple reports released last week, be nominated to fill the FCC Commissioner’s seat currently held by Mignon Clyburn. Commissioner Clyburn, as we wrote here, has announced that she will be stepping down. She has already ceased participating in FCC meetings and on most other Commission decisions. If nominated as expected and confirmed by the Senate, Mr. Starks will be the second Democratic Commissioner, joining Jessica Rosenworcel. His term will run until 2022. Senate consideration of his nomination is likely to be paired with an extension of the term of Commissioner Carr, the most recent Republican to join the FCC, coming on board last year (see our article here). If both are approved, the FCC will continue with a 3-2 Republican majority as is usual during the administration of a Republican president.

Mr. Starks does not have a public history of direct involvement with broadcast issues, though presumably his position in the Enforcement Bureau gives him some exposure to those issues. Prior to his service at the FCC, he worked with the Department of Justice, as an attorney in a big DC law firm and clerked for a US Court of Appeals judge. With the Commission likely to be dealing with numerous important broadcast issues in the coming year, we will be watching to see how his positions on these issues develop.

In 10 days, we’ll mark the 12th anniversary of my first post welcoming readers to this Blog.  I’d like to thank all of you who read the blog, and the many of you who have had nice words to say about its contents over the years.  In the dozen years that the blog has been active, our audience has grown dramatically.  In fact, I’m amazed by all the different groups of readers – broadcasters and employees of digital media companies, attorneys and members of the financial community, journalists, regulators and many students and educators. Because of all the encouragement that I have received from readers, I keep going, hopefully providing you all with some valuable information along the way.

I want to thank those who have supported me in being able to bring this blog to you.  My old firm, Davis Wright Tremaine LLP helped me get this started (and graciously allowed me to take the blog with me when I moved to my current firm six years ago).  My current firm, Wilkinson Barker Knauer LLP, has also been very supportive, and I particularly want to thank several attorneys at the firm (especially David O’Connor and Kelly Donohue) who help catch, on short notice, my typos and slips in analysis for articles that I usually get around to finishing shortly before my publication deadline.  Also, a number of other attorneys at the firm including Mitch Stabbe, Aaron Burstein, Bob Kirk and Josh Bercu have contributed articles, and I hope that they will continue with their valuable contributions in the future.  Thanks, also, to my friendly competitors at the other law firms that have taken up publishing blogs on communications and media legal issues since I launched mine – you all do a great job with your own take on the issues, and you inspire me to try to keep up with you all.  Continue Reading 12 Years of the Broadcast Law Blog – Where We Have Been and What We Are Looking at Next

With election season upon us again, I’ve had one question that has come up repeatedly in the last few weeks about local candidates – usually running for state or municipal offices – who appear in advertisements for local businesses that they own or manage. Often times, these individuals will routinely appear in a business’ ads outside of election season, and the candidate simply wants to continue to appear on their businesses’ ads during the election as well. We wrote about this question in an article published two years ago, and since the question has been coming up again, it is worth revisiting the subject. What is a station to do when a local advertiser decides to run for office?

While we have many times written about what happens when a broadcast station’s on-air employee runs for office (see, for instance, our articles here, here and here), we have addressed the question less often about the advertiser who is also a candidate. If a candidate’s recognizable voice or, for TV, image appears on a broadcast station in a way that is not negative (e.g. it is not in an ad attacking that candidate), outside of an exempt program (in other words, outside of a news or news interview program which, as we wrote here, is a very broad category of programming exempt from the equal time rules) that appearance is a “use” by the political candidate. “Uses” can arise well outside the political sphere, so Arnold Schwarzenegger movies were pulled from TV when he was running for office, as were any re-runs of The Apprentice and The Celebrity Apprentice featuring Donald Trump. An appearance by a candidate in a commercial for his or her local business is a “use” which needs to be included in a station’s political file (providing all the information about the sponsor, schedule and price of the ad that you would for any pure political buy). But that does not necessarily mean that a station needs to pull the ad from the air. Continue Reading Dealing with a Local Political Candidate Who Appears in a Spot Advertisement for a Commercial Business

For radio and television stations with 5 or more full-time employees located in Arizona, Idaho, Maryland, Michigan, Nevada, New Mexico, Ohio, Utah, Virginia, West Virginia, Wyoming, and the District of Columbia, June 1 brings the requirement that you upload to your online inspection file your Annual EEO Public Inspection File Report detailing your employment outreach efforts for job openings filled in the last year, as well as the supplemental efforts you have made to educate the community about broadcast employment or the training efforts undertaken to advance your employees skills. For TV stations that are part of Employment Units with five or more full-time employees and located in Arizona, Idaho, Nevada, New Mexico, Utah, and Wyoming, you also need to submit your EEO Form 397 Mid-Term Report. See our article here on the Mid-Term Report, and another here on an FCC proposal that could lead to the elimination of the filing of the form.

June 1 should also serve as a reminder to radio stations in Maryland, Virginia, West Virginia and the District of Columbia that your license renewal will be filed a year from now, on or before June 1, 2019. So, if you have not done so already, you should be reviewing your online public inspection file to make sure that it is complete, and otherwise review your station operations in anticipation of that filing. We wrote about some of the issues of concern for the upcoming license renewal cycle in our article here. TV stations in those same states will start the TV renewal cycle two years from now. Continue Reading June Regulatory Dates for Broadcasters – EEO, Translators, Political Rules and Earth Stations

In an Order released Friday, The FCC gave TV broadcasters five more years to convert non-textual emergency information delivered to audiences outside of news programs into speech that is broadcast on station’s Secondary Audio Programming (“SAP”) channels, usually used for Spanish and other non-English translations of television programs. Broadcasters, as we have written before (see our articles here, here and here) are already required to take textual information (like textual crawls) containing emergency information that is broadcast outside of news programming and to provide those messages in audio on SAP channels so that visually impaired viewers can get the emergency information. The blind and others with visual impairments are notified of the emergency information that is contained in a crawl by the audible tones that stations air when they are providing such information.

While the textual information can be converted to speech to be broadcast on the SAP channels though automated means, the NAB, the American Council of the Blind, and the American Foundation for the Blind submitted a request for a further waiver of the rules that would otherwise require that non-textual information like weather maps be converted into speech, noting that none of these organizations could find any source for an accurate means to make that conversion automatically. See our article here on the waiver request. The costs and potential inaccuracies of station employees trying to provide such descriptions live at a station precluded live description from being a viable solution. Thus, the FCC gave the parties five years to develop an automated system to provide such descriptions.

The NAB will need to report to the FCC on its progress at the midway point of this 5 year waiver period. The FCC also urged stations to do their best to insure that the information shown on maps and other non-textual emergency information be conveyed in textual alerts, so that the public can receive information about emergency situations. In the same order, the FCC granted a permanent waiver of this requirement to analog-only cable systems that lack the equipment to pass through the audio from such alerts.

Earlier this week, the full FCC issued a decision denying a Petition for Reconsideration of the FCC’s 2017 decision to relax the rules on the permissible locations of FM translators for AM stations, allowing them to locate anywhere within the greater of the AM station’s 2 mv/m contour or a circle with a 25 mile radius from the AM station’s transmitter site. The rule had previously required that translators be located within the lesser of those two limiting factors. See our summaries of that decision here and here. As we wrote here and here, Prometheus Radio Project, an LPFM advocacy group, had petitioned for reconsideration of that rule change and asked for a stay of its effect, arguing that the change would impact the area in which LPFM stations could locate their stations if a need to change transmitter sites arose. Prometheus also raised procedural objections about the way in which the order was adopted. In this week’s decision, the FCC rejected the Petition for Reconsideration, finding that it was properly adopted, and that Prometheus had not demonstrated that the change in the area in which translators could be located would have a significant impact on LPFM site availability. The Commission came to the same conclusion that we did in our articles on the Prometheus petition, that the change in the area to locate did not necessarily have an impact on LPFM site availability – as translators could just as well move further from LPFM sites as they could move closer.

This decision was one that addressed pleadings filed back in 2017. Several broadcast trade press articles suggested that this decision was one resolving an Informal Objection filed last week by Prometheus and other LPFM advocacy groups against almost a thousand pending translator applications – both applications filed in the latest FM translator window for AM stations and other minor change applications filed by existing translator operators. While that Informal Objection raised many of the same arguments that had been raised in the 2017 Petition for Reconsideration (and in fact cited to the pendency of that Petition as one of the reasons to deny the pending translator applications), it is a different pleading that has not yet been resolved by the FCC. As the issues are similar, one would expect a similar result – but broadcasters who received the Informal Objection should not start celebrating yet. This week’s decision was certainly good news – but it has not resolved all the issues raised by the LPFM advocates.

While Copyright Royalty Board decisions on royalties for webcasters, Sirius XM and mechanical royalties get most of the attention, the CRB also sets rates paid by “business establishment services” for the “ephemeral copies” made in their music businesses. Business establishment services are the companies that provide music to businesses to play in retail stores, restaurants and other commercial establishments. These services have come a long way from the elevator music that once was so derided – and now set the mood in all sorts of businesses with formats as varied as the commercial businesses themselves.  While the rates paid by these services pay for music rights is a little off-topic for this blog, these rates are a bit unusual, so they are worth mentioning.  The Copyright Royalty Board just announced a proposed settlement between the services that were participating in the CRB case and SoundExchange which will raise the rates gradually from the current 12.5% of revenue to 13.5% over the next 5 years, with a minimum annual fee of $20,000, up from $10,000. These rates, which apply to any company that does not negotiate direct royalties with the sound recording copyright holders, go into effect in 2019 and will be in place through 2023. Comments on these proposed rates are due June 18, though CRB rules limit the consideration of comments from those who were not participants in the proceeding.

We have written about the rates paid by these services before (see for instance our articles here, here and here).  What makes them unusual is that the royalties are not paid to SoundExchange for the public performance of sound recordings, as are the royalties paid by other digital music services including webcasters (here and here) or Sirius XM.  That is because, in adopting Section 114 of the Copyright Act, Congress did not want to impose on businesses a new performance right, as there is no general public performance right in sound recordings in the United States.  Businesses and other services that do not digitally transmit performances of audio recordings have no obligation to pay copyright holders in the sound recordings (usually the record companies) or artists for the public performance of music.  Users do, however, pay fees for the public performance of the underlying composition through ASCAP, BMI and SESAC and GMR.  As we wrote here, the Register of Copyrights has suggested that a general public performance right in sound recordings be paid in the United States. But that would impose new fees on all businesses that use recorded music in the US, from stadiums playing “We Will Rock You” at the appropriate point in a big game, to DJs spinning their discs in nightclubs, to the trendy tunes playing in the hip clothing retail stores, to over-the-air radio. This proposal is therefore very controversial.  So, if they are not paying public performance fees, why do background music services have to pay SoundExchange? Continue Reading Copyright Royalty Board Announces Proposed New SoundExchange Royalties for Business Establishment Services

Last week, the Radio Music License Committee (RMLC), the organization representing most commercial radio broadcasters in negotiating performance royalties for musical compositions, initiated a proceeding in US District Court in the Southern District of New York against BMI.  This action raises short-term issues as to what this particular lawsuit means for the radio industry, and it also highlights longer term issues that may arise through legislative and regulatory changes that may affect these cases like this one in the future.

As we have written many times (see e.g here and here), BMI is subject to antitrust consent decrees governing its activities – including the rates that it charges to companies wanting to use the music that it licenses.  When BMI and a user cannot agree on the terms of the license, either party can initiate a proceeding in court for the court to determine what reasonable rates are for the use proposed.  These actions are all brought in the Southern District of New York where a specific judge is assigned to hear BMI disputes.  This proceeding is referred to as a “rate court” proceeding where the parties will present evidence as to what each believes to be a reasonable rate – with the judge making the decision, subject to review by the Second Circuit Court of Appeals.  What issues brought BMI and RMLC to Court? Continue Reading RMLC Initiates Rate Court Proceeding with BMI to Set Radio Royalties – What Does It Mean?

On Monday, the US Supreme Court issued an opinion striking down a Federal law (the Professional and Amateur Sports Protection Act or “PASPA”) which prohibited state legislatures from taking any action to legalize betting on sports. PASPA also contained a restriction on advertising sports betting. The state of New Jersey challenged that law, arguing that it improperly limited the authority of state legislatures to act. The Supreme Court agreed, and invalidated the entire Act, including the restriction on advertising sports betting. Some trade press articles have suggested that this signals a boom for broadcasters and other ad-supported media companies as companies rush to start advertising legal sports betting now that the prohibition is gone. While in the long run that may be true, and there may be immediate benefits to stations in certain states, there are numerous caveats for broadcasters to consider before they recognize an advertising boom from sports betting companies.

The entire decision was not based on any analysis of whether or not betting on sports is a good thing, but instead it was a decision based exclusively on a question of state’s rights. The Supreme Court determined that Congress cannot tell state legislatures what they can and cannot do. While Congress may have the authority to ban or otherwise regulate sports betting, if they wanted to regulate it, they should have done so directly. Instead, as the law prohibited state legislatures from taking action to legalize sports betting and other actions predicated on that limitation on states rights, the Supreme Court determined that this was an exercise of authority that Congress does not have – Congress can’t tell state legislatures what to do. Based on the Court’s analysis that all parts of the act were premised on this ban on state legislative actions, the entire law was struck down. That means that there is no blanket federal ban on sports betting, and it leaves each state to regulate as it may wish. For companies ready to take bets on sporting events, and media companies who want to take advertising from sports betting companies, in most cases they need to wait for the states to make decisions on how to proceed. Continue Reading Supreme Court Strikes Down Law against Sports Betting – But Broadcasters Need to Proceed with Caution