The FCC has just issued a Public Notice announcing that all Regulatory Fees will be due on or before September 20. The FCC Website on the fees, where broadcasters can look up the fees owned for each of their stations, is now live.  That page gives the September 20 deadline.  The main fee webpage can be found here:  http://www.fccfees.com/index.html.  Broadcasters can look up the fees for their specific stations on a webpage that is linked to from the main fee page.  To go there directly, go to this page: http://www.fccfees.com/request_all.htm

Remember, broadcasters must also pay fees for all auxiliary licenses that they hold (e.g. STLs, RPUs, etc.).  If a broadcaster is the licensee of some sort of private radio, or has satellite uplink facilities, separate fees will be due for those stations too, also by the September 20 deadline.  We previously posted an article on how the FCC arrived at the new fees, and the amount of the broadcast-specific fees for each category of station in our article here.  Remember to pay these fees on time, or face a 25% late fee penalty.  In addition, it is likely that all of your pending applications will be held up while the fee is unpaid.  So pay attention to the September 20 deadline!

 

Note – 8/23/2013, 4:40 PM EDT – We are hearing from a number of users that the FCC’s electronic system does not automatically populate a station’s fee reports with its broadcast auxiliary licenses, and that it sometimes includes old licenses, or fails to include new ones. TV satellite stations also need to make sure that the proper fee is reflected, as the system will sometimes consider them as full-power stations, and assess a higher fee.   So licensees need to be very careful in reviewing the reports generated by the FCC’s system to make sure that all of their licenses (and their fee obligations) are included, and are assessed the proper fee.

No one ever claimed that music royalties are easy to understand, especially in the digital age when nice, neat definitions that had grown up over many years in the physical world no longer necessarily make sense. The complexity of the world of digital music licensing is clear from many sources, but the Commerce Department’s “Green Paper” on Copyright Policy, Creativity, and Innovation in the Digital Economy does a good job discussing many of the music royalty issues that have arisen in the last 20 years that make copyright so confusing for professionals, and pretty much incomprehensible for those not immersed in the intricacies of copyright law on a regular basis. The Green Paper discusses some of the issues in music policy that make this area so confusing, and highlights where interested parties and lawmakers should focus their efforts to reform current rules to make them workable in the digital age. The Paper also discusses other areas of copyright policy that we will try to address in other articles.  You can find the Green Paper here (though note that it is about 120 pages and will take some time to download).

One of the most controversial issues that it addresses is the concept of a general performance right for sound recordings. As did Register of Copyrights Maria Pallante in the speech we summarized here, the Commerce Department puts the current administration on record as supporting the creation of such a right – a right that has not existed in the United States, except for a limited sound recording performance royalty for performances by digital audio companies like webcasters (see our summary of the royalty rates paid by different types of Internet Radio services here) and satellite radio (see our summary of the royalties to be paid by Sirius XM under the most recent Copyright Royalty Board decision). While the most controversial aspect of the creation of a broad sound recording performance royalty has been in connection with the extension of that royalty to broadcasters, the adoption of a general royalty, as advocated by the Green Paper would extend payment obligations to others who publicly perform sound recordings – including bars, restaurants, stadiums and other retail establishments.

Continue Reading Making Music Rights Manageable in a Digital World – Issues Identified In Commerce Department “Green Paper” on Copyright Policy

The rules for determining when construction of a new tower may cause a distortion of the pattern of a nearby AM station, and when the party building the new tower has a financial obligation to remedy any interference caused, were clarified by the Commission in an order released late last week. The order makes clear that all towers used by FCC licensees must abide by these rules, putting into formal rules the existing general obligation that all “newcomers” that create interference to an existing licensee must be responsible for rectifying that interference. There was apparently some question about the duty of newcomers to rectify issues that they cause to AM stations, as the rules for all non-broadcast services did not explicitly include language embodying that concept.

The Commission also made clear that the distortion of an AM stations pattern would be measured by the “moment method,” a computer program that will determine if there is a disruption to the pattern, rather than by actual field strength measurements. Doing a “proof of performance” of an AM station can be a long and costly process. Thus the FCC several years ago authorized the moment method of modeling AM patterns (see our article here). In this order, the Commission extends the reliance on this method to the resolution of complaints about new tower construction interfering with existing AM patterns. Other specifics of the order are set forth below.

Continue Reading FCC Sets New Rules for Determining When New Tower Construction Triggers Financial Responsibility for Disrupting AM Station Antenna Patterns

The FCC has finalized its regulatory fees for this year, though they have not announced the actual filing date, other than to say that the fees will be paid during a window to be announced sometime in September. In the Order announcing the new fees, in addition to setting the fees (which represent an increase for broadcasters of approximately 3.5% over past years), the FCC addressed several issues that it had raised in its Notice of Proposed Rulemaking on the fees, about which we wrote here.  The issues for broadcasters were few, and some of the most significant changes will not take place until the future.

One of the simple issues that was addressed was the difference between the fees for UHF and VHF television stations. Regulatory fees have always reflected the analog preference of VHF stations over UHF, as those stations had larger coverage and were, generally, more profitable. In the digital world, it is exactly the reverse, as UHF stations are far better at transmitting a digital signal.  Yet the fees still reflect the old reality – and VHF stations, as set forth below, pay twice as much as UHF stations. The FCC finally recognized that this was not right, and has decided to set regulatory fees at the same level for both VHF and UHF stations. But, because of certain procedural requirements, the new fees will not take effect until next year. So, this year, VHF stations will again continue to pay a disproportionately high fee.

The Commission also promised to review other fees in the future. Part of the way that fees are set is based on the percentage of the FCC’s resources that are devoted to the regulatory activities associated with a particular communications industry service, as reflected by the employees in the FCC Bureau most directly in charge of regulating the service . One of the reasons for the increase in the fees for broadcasters is because the FCC decided that the fees previously associated with the International Bureau, whose services working on International treaties and clearances, benefit all different kinds of communications entities regulated by other FCC Bureaus, should be largely reallocated to those other Bureaus for purposes of counting the fees paid by the communications services regulated by those other Bureaus.  At least part of the International Bureau fees were allocated to the Media Bureau which regulates broadcasters. In fact, this reallocation will increase fees to an even greater extent over time, but the FCC capped the rate of increase for fees for this year, to avoid “sticker shock” to the various services whose fees will increase.

Continue Reading FCC Announces Regulatory Fees to be Paid in September – Specific Filing Dates to Be Announced Soon

The FCC has just announced that the Form 323 Biennial Ownership Reports for commercial broadcasters, due to be filed on or before November 1 of this year, will now be due instead by December 2. This is the third straight time that the obligation to file these reports has been extended, due to the complexity and confusion that surrounds the completion of the information that is required on the form. All commercial broadcasters, including LPTV licensees, need to file this form by the new deadline. As set forth in more detail below, at this point, this obligation does not extend to noncommercial educational licensees.

In 2009, the FCC adopted a requirement for modified Biennial Ownership Reports for all commercial stations, requiring that such reports be filed by all commercial broadcasters – including LPTV licensees, sole proprietors, general partnerships and other licensees who had previously been exempt from such obligations. The reports were to be filed on an expanded form that gathers information not just about who the owners of broadcast stations are, but also the race or ethnicity and gender of such owners. This information was to be gathered so that the FCC could better assess the minority ownership of broadcast stations.  This was to be used for purposes such as developing new ownership rules for the broadcast industry.  In fact, the information gathered from the first set of these forms was recently the subject of comment in the ongoing multiple ownership proceeding at the FCC (see our article here).

The forms were also supposed to be searchable by individual, so that the FCC or interested parties could easily cross-reference the broadcast interests of various individuals. To do so, however, required the gathering of new information, and required that every individual obtain an FCC Registration Number (an FRN), which required that they provide a Social Security or Taxpayer ID Number (for corporate owners of licensees) to the FCC. This obligation stirred much controversy. In addition, the format of the reporting of the other broadcast interests of individuals required much more time than had previous reports.  That complexity has not disappeared over time. 

Continue Reading Filing Deadline for FCC Form 323 Biennial Ownership Reports Extended Until December 2 – Why the Delay?

In a lawsuit filed last week (see the complaint here), Flo and Eddie, the artists who were behind the 1960’s band The Turtles, claim that Sirius XM has infringed on the copyrights in their songs by allowing copies of these recordings to be made by the satellite radio service and in certain Internet offerings that Sirius XM makes available. The article in THR.esq (the Hollywood Reporter’s legal blog) that first announced the lawsuit talks much about the ambiguous status of pre-1972 sound recordings under Section 114 of the copyright act (the section providing for royalties for the public performance of sound recordings by digital services), and seems to view the suit as a reaction to the decision in the satellite radio proceeding before the Copyright Royalty Board finding that Sirius XM owed no performance royalty to SoundExchange for its playing of pre-1972 sound recordings (see our article about that decision). As pre-1972 sound recordings are not entitled to Federal copyright protection, the Board decided that there could be no payment due to SoundExchange (which collects royalties for payments made under Section 114) as there was no Federal right. While that point seems to be well-established, a close reading of the complaint makes it appear that it is not the public performance that is the principal basis of the lawsuit, but instead the copies that are made in the digital transmission process and by certain features of Sirius’s Internet streaming services that allow the download or on-demand playing of their digital streams.

As we have written before, pre-1972 sound recordings were left out of Federal statutes as, until 1972, sound recordings (a specific recording of a song by a particular artist) had no protection at all under Federal copyright law. As these sound recordings had no Federal protections, state laws were adopted – principally to prevent bootlegging or other unauthorized copies of such sound recordings from being made and distributed. As there was not, and still is not, a general public performance right in sound recordings, there has been little in the way of court cases suggesting that pre-1972 sound recordings have rights that other sound recordings do not have, e.g. a general public performance right. If the Flo and Eddie suit were really alleging that there is a public performance right in pre-1972 sound recordings, then seemingly every restaurant, bar, or stadium that plays the original hit versions of Good Vibrations, Rock Around the Clock, Johnny Be Goode, the Twist or the Turtles’ Happy Together could find themselves looking at potential liability for public performance of these sound recordings. Certainly, these state statutes, many of which have been around for decades, did not contemplate the exclusively digital public performance right that exists for post-1972 sound recordings, which was not adopted until the late 1990s. So, if the plaintiffs are asserting that there is a public performance right inherent in these statutes, it would seem that it would have to be a general public performance right. But it sure seems difficult to believe that courts would find ambiguous state statutes adopted to prevent illegal copying created a public performance right where none has ever before existed in the common law of the United States.

Continue Reading Flo and Eddie Use State Laws on Pre-1972 Sound Recordings to Target Certain Sirius XM Services

Another month is upon us, along with all of the FCC regulatory obligations that accompany it. August brings a host of license renewal obligations, along with EEO public file obligations in a number of states, as well as noncommercial Biennial Ownership Report filings in several states. We also expect that the FCC will notify stations of the date for the payment of their regulatory fees (which will either be due late this month or early next). As we reported yesterday, the filing of long-form translator applications for over 1000 applicants from the 2003 FM translator window also comes at the end of the month. There are comments due in a number of FCC proceedings. We’ll talk about some of those issues below. For TV broadcasters, we also suggest that you review our article that recently ran in TV NewsCheck, updating TV broadcasters on issues of relevance to them not only this month, but providing a description of the full gamut of issues facing TV broadcasters. We prepare this update for TV NewsCheck quarterly.

Today brings the deadline for the filing of license renewal applications for radio stations in California and for TV stations in Illinois and Wisconsin. Stations in these states, and in North and South Carolina also have EEO public inspection file reports that should be placed in their public inspection files no later than today. Noncommercial TV stations in Illinois and Wisconsin also need to file Biennial Ownership Reports today, and noncommercial radio stations in California, North Carolina, and South Carolina should also file their Biennial Ownership Reports by today.

Continue Reading August FCC Regulatory Deadlines for Broadcasters – Including Renewals; EEO; Comments on Indecency, the Online Public File and Cross-Ownership

The processing of the FM translator applications left over from the 2003 translator window marches on. The FCC today announced the window for long form applications for all the translator applications that are no longer mutually exclusive with other applicants. The FCC has asked for long-form applications for these 1239 applications (filed on Form 349 and providing more detailed legal and technical information about the applicant and its proposed operation) to be filed by August 30. The FCC Public Notice about this filing deadline is here. The list of applications that are identified as singletons are here.

Many of these applications are those that filed technical amendments in the recent settlement window eliminating mutual exclusivity with other applications. There are 1239 such applications that could be granted as a result of this action, on top of the applications already identified as "singletons" before the settlement window (see our article here), and perhaps others still subject to FCC processing. The remaining applications, who were not able to resolve mutual exclusivity with other applicants, will end up in an auction at some point in the future. 

In the long-forms, the applicant may make minor changes to its technical facilities that were specified in the tech box on the original application. However, these changes, if made in a market that the FCC deemed spectrum-limited for purposes of LPFM availability, must contain a "preclusion study" showing that they will not impact LPFM opportunities in their markets. Any changes are also secondary to any application filed in the upcoming LPFM window.

Continue Reading Over 1000 New FM Translators Almost Ready for Grant – Long Form Applications Due August 30, Changes Secondary to LPFM Applicants

How do you advertise a business that sells tobacco products and has the word “cigarette” in its name? Apparently, you don’t, at least not on radio and TV stations – based on the teachings of the Public Notice released by the FCC this week, entering into a consent decree with a broadcaster. In exchange for dismissing its investigation of the broadcaster, the broadcaster agreed to voluntarily contribute $15,000 to the US Treasury and adopt a compliance program to monitor the sponsorship identification of commercial messages broadcast on its station. What was the problem? The station tried to avoid the name of a local business that wanted to advertise on the station – The Cigarette Outlet. The station was apparently aware of the prohibition in the FCC rules and in US criminal statutes against promoting the sale of cigarettes on the broadcast airwaves. So it did not want to say the name of the business on the air, as you can’t promote cigarettes. But, it wanted to advertise the other products sold by the business (while cigarettes and smokeless tobacco cannot be advertised on the air, subject to certain limitations, other tobacco products can be promoted). So, in the ads, the station talked about the products sold at the store, and gave its address, phone number and directions to its one and only location. The licensee argued that this should have been enough to identify the sponsor of the ads – as the whole purpose of the sponsorship identification rule (Section 73.1212) is to inform the public about who the true sponsor of an ad is. Here, argued the licensee, there could be no question who the sponsor was – but they just could not say the name on the radio because of the statutory prohibition against cigarette ads.  In the consent decree entered into by the broadcaster, the FCC’s Enforcement Bureau simply said in response to the licensee’s arguments: “The Bureau disagrees with this assertion.” 

No explanation was provided as to why the Bureau disagreed. The FCC’s sponsorship identification rule, Section 73.1212, provides that the true sponsor of an ad for which the station receives consideration must be disclosed in the ad, with certain very limited exception. The rule does provide that, where an ad is for a product or service, the trade name of the product or service can be sufficient identification, and the station need not broadcast the name of the manufacturer, vendor or service provider itself. Yet, in this case, the ad for the products sold by the Cigarette Outlet, and the description of the services that they provided (the sale of the products advertised), was apparently not enough to meet the sponsorship identification rules, at least in the eyes of the FCC’s Enforcement Bureau. So that only conclusion that seemingly can be drawn from this decision is that, if a business has the word “cigarette” in its name, a station is on very dangerous ground trying to advertise any of the products available in the store. Based on this decision, proceed with caution in airing similar ads. 

Fines of $20,000 for violations of the obligations to prepare and file Children’s Television Reports have been flowing out from the FCC as it works its way through license renewal applications filed by television stations over the last year. We wrote about a number of these fines here, when the first wave of fines was issued by the FCC, mostly dealing with Class A TV stations. In the last two weeks, the fines have continued, with a few targeting full power television stations, and many others hitting Class A stations. In several cases, the fines reached $20,000, and included fines not only for the failure to file the reports with the FCC on a timely basis, but also the late placement of the reports into the station’s public file, and the failure to report the deficiencies in compliance on the license renewal forms. There were new cases involving Class A television stations and, as with the last batch of these cases, the Commission made clear that the licensees could give up their Class A status to avoid the proposed fines – not mentioning that, if they did so, they would also be giving up their status as primary station licensees, meaning that they would be secondary to any new full power TV construction (for a new station or a modification of an existing station) and would also lose any protection that they otherwise would have in the repacking of the television band in the upcoming incentive auctions that will sell part of the current TV spectrum to wireless users for wireless broadband uses.

The cases decided in the last two weeks include a $20,000 proposed fine to a full-power station in Louisiana that did not timely file 18 Form 398 Reports during the license term ($17,000 for the late filings and $3000 for not reporting the late filings in the renewal application). In another case involving a proposed $20,000 fine, a Georgia Class A station had failed to timely file 20 Form 398 Reports, and also did not complete 15 Quarterly Issues Programs Lists and place those reports in its public file on a timely basis. With the online public file, compliance with the Quarterly Issues Programs list requirement can be monitored by the FCC, even though such reports are not filed at the FCC. A third $20,000 fine was given to a Class A station that was late with 25 children’s television reports, and failed to identify the failures on the renewal, even though the FCC had inquired about the status of 7 of those reports before the renewal was submitted, and the licensee had admitted its failures to comply with the rules. $10,000 of the fine was attributed to the late-filed public file documents, $7000 to the late-filing of the Form 398s, and $3000 to the failure to admit the violations in the license renewal. 

Continue Reading More Big FCC Fines for Children’s Television Violations