Yesterday, the FCC announced that it had seized the equipment of another pirate radio operator, this time one who was operating from a high-rise in Manhattan. The pirate was operating an unauthorized FM radio station from a New York apartment building. As we recently wrote in connection with another seizure of the equipment of a pirate operator in the Boston area, such seizures are not easy to accomplish – as it takes far more than an FCC inspector knocking on a door and walking out with the unauthorized equipment. Instead, the FCC needs to convince the local US attorney to get a warrant for the seizure, and the US Marshalls need to actually conduct the seizure. Much coordination is needed, so the FCC’s recent actions demonstrate the priority that the FCC is placing on stamping out these unauthorized operations.

What may also be of assistance to these efforts is legislative changes authorizing steeper fines for pirates and giving more direct authority to the FCC to take action against those who assist pirates in their operations.  In our article about the Boston equipment seizure, we also summarized a draft PIRATE Act that has been circulating in Congress. That bill has now been officially introduced in Congress, and referred to the house Energy and Commerce Committee for consideration. FCC Commissioner O’Rielly issued a statement applauding the action. The text of the bill as introduced is not yet available (but should be available shortly here – a discussion draft is available here but may have changed since this draft was initially circulated). We will be watching to see if this bill proceeds in the current legislative session.

With high profile primaries in numerous states and similar elections last week, and more coming over the next few months in preparation for the November election, broadcasters are dealing with the legal issues that arise with on-air advertising that either promotes or attacks candidates and which addresses other important matters that will be decided in the election – including ballot issues in a number of states. While we have addressed many of the legal questions that arise with on-air political advertising in other posts on this blog and elsewhere (see, for instance, our Political Broadcasting Guide here and these slides from my recent presentation on the FCC political advertising rules for the Washington State Association of Broadcasters), we thought that it was worth discussing some of the efforts that are underway to bring FCC-like regulation to the world of online political advertising.

Thus far, the FCC has tended to stay out of the online political broadcasting world. As we wrote a decade ago, other than having to give some consideration to the value of online advertising thrown into a package with over-the-air ads, the FCC avoids regulation of ad sales on websites and advertising delivered solely through other digital media platforms. So a broadcaster who sells stand-alone online ads to political candidates or issue advertisers need not worry about questions of lowest unit rates, reasonable access, or the political file. Continue Reading Moving Broadcast Political Advertising Rules to the Online World – NY State Adopts a New Law While Congress Considers Online Political Advertising Disclosures, and the FEC Considers Enhanced Online Sponsorship Identification

At yesterday’s FCC open meeting, the Commission commenced two proceedings of interest to broadcasters. The first deals with the processing of complaints of interference caused by new FM translators. The second proposes to eliminate the need for the posting of station licenses and other FCC authorizations at the control points of broadcast stations. Comments dates in each proceeding will be computed from the publication of these orders in the Federal Register, which will occur at some point in the future.

In each case, the FCC essentially adopted without significant revision the draft notices that were released several weeks ago. The Notice of Proposed Rulemaking (available here) on translator interference standards sets out proposals for the minimum number of listeners who would have to complain before an interference complaint would be processed, and suggests limiting complaints of interference to those that arise within the 54 dbu contour of the primary station complaining about the interference. We wrote in more detail about the FCC’s proposals in our summary of the draft notice, here. Continue Reading FCC Opens Rulemaking Proceedings on the Processing of Interference Complaints for FM Translators and Eliminating the Posting of Licenses at Broadcast Control Points

The week before last, we summarized the provisions of the Music Modernization Act as passed by the House of Representatives. The Senate is now poised to take up this legislation in a hearing scheduled by the Senate Judiciary Committee for next Tuesday, May 15. The legislation proposes, among other things, to set up a SoundExchange-like collective for the collection and payment of mechanical royalties due under Section 115 of the Copyright Act and to create a digital public performance right in pre-1972 sound recordings (ending some of the litigation that has arisen in recent years on that issue). Our summary provides more details on these issues and highlights some of the other issues addressed by this bill.

The consideration of the bill by the Judiciary Committee is the next step to the bill becoming a law. The hearing will feature representatives of several groups directly affected by the legislation – including David Israelite, the CEO of the National Music Publishers Association (NMPA represents publishing companies that usually hold the copyrights to musical compositions); Chris Harrison, the CEO of the Digital Media Association (DiMA represents digital music services like Spotify, Pandora and Apple Music); and Mitch Glazier, the President of the Recording Industry Association of America (RIAA represents the major record labels who usually own the copyrights to the sound recordings – the compositions as recorded by particular performers). Members of DiMA and the RIAA pay mechanical royalties. Members of NMPA collect those royalties. Thus, these groups are directly affected by the Music Modernization Act. Songwriters and performers, including Motown legend Smokey Robinson, will also testify at the hearing. A full list of the participants can be found on the Judiciary Committee’s website, where video of the hearing will also be available next week. Continue Reading Senate to Hold Hearing on May 15 on Music Modernization Act

Starting June 1, 2019, just over a year from now, the next broadcast license renewal cycle will begin. By that date, radio stations in DC, Maryland, Virginia and West Virginia must file their renewal applications. Every other month for the next 3 years will bring the filing of radio license renewals in another set of states. And television stations will begin their renewal cycle a year later (June 1, 2020). The FCC’s schedule for radio license renewals can be found here and here. For TV stations, the schedule of renewal filings by state is in the same – just one year later than for radio. Every eight years, broadcast stations have to seek the renewal of their licenses by the FCC by demonstrating their continuing qualifications to be a licensee, including showing that they have not had a history of FCC violations and that they have otherwise served the public interest.

We have already written several times about how, with all broadcasters – both radio and TV – now required to have an online public file, it is important for stations to make sure that those files are complete and are kept up to date on a regular basis (see our articles here, here and here). Given that the contents of the online public file can be viewed by anyone, anywhere, just by launching an Internet browser, we would expect more complaints about incomplete files, and more scrutiny by the FCC of the contents of files that rarely were subject to FCC review in the past. FCC staffers can review public file compliance from their offices or homes, and do not have to rely on the rare field inspection to discover a violation. Thus, stations should be reviewing the contents of their files now to be sure that they are ready for the scrutiny that they will receive in the upcoming renewal cycle. But that is not the only issue about which stations need to be concerned, as illustrated by a decision released by the FCC yesterday, deciding to hold an evidentiary hearing as to whether the license renewal of a broadcast station that had been silent much of the last license renewal term should be granted. Continue Reading License Renewal Cycle Starts in a Year – Crackdown on Silent Stations and Online Public File Signal Warnings to Broadcasters

Last week, Aaron Burstein of our law firm and I conducted a webinar for several state broadcast associations on legal issues in digital and social media advertising. As broadcasters become more active in the digital world, whether it be through social media platforms like Facebook and Twitter, or by posting their content online through their own websites, through platforms like YouTube, or by streaming their content directly to the consumer, commercial broadcasters need a way to monetize their efforts. So advertising follows the broadcaster into these new platforms. In providing these advertising opportunities, broadcasters need to think of the ground rules that they may not have considered in depth before – including restrictions on certain types of advertising imposed by the terms of use of social media platforms like Facebook and YouTube; or oversight by government agencies like the FTC on issues including the disclosure of sponsors, the statements made by celebrity endorsers, privacy and security of data, or advertising directed to children. We covered these issues and many others in our presentation, the slides for which are available here.

This presentation forms a good companion to my broader presentation on digital and social media issues for broadcasters, a link to which can be found here. Today’s broadcaster is no longer subject to just the rules of the FCC, but must be aware of regulation from many other government agencies as the broadcaster’s content becomes available not just on the air, but on the many other platforms that virtually all broadcasters use today.

The FCC yesterday issued a Declaratory Ruling approving the acquisition by a company owned by two Mexican citizens of 100% of the ownership interest of a company that owns two radio stations in California and Arizona. Currently, the company owned by the Mexican citizens had only a 25% interest in the parent company of the licensee which, until a few years ago, would have been the limit imposed on foreign ownership of a US broadcast station. But, several years ago, as we wrote here, the FCC decided to permit, on a case by case basis, greater foreign ownership of US broadcast station owners. The FCC has also issued guidance on how public US companies can track their foreign ownership. See our articles here and here. Through yesterday’s decision approving the 100% ownership of the radio company, together with a case last year approving 100% ownership of broadcast stations in Alaska and Texas by Australian citizens (see our summary here), the Commission has demonstrated that it is serious about, in the right circumstances, approving foreign ownership of US broadcast stations.

Foreign ownership does not come without limits, however. Any foreign owner seeking to acquire a substantial stake in a US broadcast station must be reviewed by various Executive Branch agencies to insure that there are no perceived security risks raised by the proposed acquisition. The FCC has to do its own review as well. And, once approved, the foreign owner must report on any changes in its ownership so that new interest holders can go through the same approval process. Nevertheless, this series of decisions make clear that the FCC is open to non-US investors acquiring broadcast properties. It may take longer to sell a station than when a property is acquired by a US buyer, and certain foreign buyers may not be allowed if security issues come up, but otherwise the market is open to many new buyers of broadcast stations.

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!