Just a reminder that radio stations in North Carolina and South Carolina are up next in the license renewal cycle, which means that pre-filing announcements for radio stations in these states must start on June 1st.  The announcements continue on June 16, July 1, and July 16, for a total of four pre-filing announcements.  These announcements give notice to the local community that the station will be filing a license renewal application with the Commission and invite participation in the renewal process.  The precise language of the pre-filing announcements—which is dictated by the FCC’s Rules—can be found here.

The announcements should be aired in the primary language used on the station, so if the station broadcasts primarily in a foreign language, the announcements should be broadcast in that language. For commercial radio stations, at least two of the required pre-filing announcements must air on the station between 7 a.m. and 9 a.m., or 4 p.m. and 6 p.m. local time. If the station does not operate between 7 a.m. and 9 a.m. or between 4 p.m. and 6 p.m., then at least two of the required announcements must be made during the first two hours of broadcast operations. For noncommercial educational stations, the timing of the announcements is the same as for commercial stations, except that such stations need not broadcast the announcements during any month during which the station does not operate.

For more details about the pre-filing announcements and the license renewal process for radio stations, please see our recent advisory which will help radio stations prepare for the process.  A copy of the advisory is available here.  And next up in the queue will be radio stations in Florida, Puerto Rico, and the Virgin Islands, who will start their pre-filing announcements on August 1st in advance of filing their renewal applications on October 1st. 

The FCC has issued a flurry of fines against broadcast stations in the past week or two.  While a number of these fines were for the operation of unlicensed pirate radio stations, several of the fines were for public inspection file violations, stations broadcasting with excessive power or failing to reduce power at nighttime, or for other technical violations.  Agents from the Commission’s field offices have been busy visiting stations, and licensees are urged to heed these recent forfeiture actions and review their own operations to ensure compliance with the Commission’s rules, starting with the main studio rules and public inspection file requirements, about which we’ve written often in the past.  (See here, here, and here, for example.)

While the main studio and public inspection file requirements seem basic, the failure to properly follow these rules can be quite costly.  Today’s FCC releases carries news of two such fines, one for $24,000 and one for $25,000.  In the first case involving two AM stations, the Commission fined the licensee $12,000 per station for failing to maintain a local public inspection file.  A copy of the decision is available here.  The FCC increased the forfeiture from the base fine of $10,000 based on its finding of violations at other stations operated by the licensee, which in the FCC’s view may indicate a "systemic compliance issue".  In the second case, available here, the Commission fined two other AM stations operated by the same licensee a total of $25,000 for public inspection file violations, failure to operate consistent with the terms of the station’s license, and failure to make required annual measurements. 

Of particular note, one of the AM stations had failed to conduct the required annual equipment performance measurements, and had failed to switch from its authorized Daytime pattern to its authorized Nighttime directional pattern during the month of April.  Section 73.1590(a)(6) of the Commission’s rules requires that AM stations make annual equipment performance measurements, and that the details of those measurements be kept on file at the transmitter or remote control point for two years and be made available to the FCC upon request.  These measurements ensure that the station and transmitter are operating properly and are not causing any spurious or harmonic emissions, and must be conducted every year with no more than 14 months between measurements. In the case issued today, the station had no record of the measurements and had apparently not conducted the annual equipment performance measurements. 

These fines should be a clear warning to broadcast stations — particularly AM stations — to review their operations and ensure that they are in compliance with the Commission’s rules and their authorized parameters.  And AM stations should make sure to make their annual equipment performance measurements and retain the proper documentation in their files. 

With the kick-off of the FCC’s broadcast license renewal cycle comes some additional obligations for licensees, this time in the form of an FCC Form 396 Broadcast EEO Report.  The Form 396 is filed only at renewal time and serves to: 1.) confirm the licensee’s commitment to EEO, 2.) provide a narrative statement about how the station has achieved wide outreach in the preceding two years, and 3.) provide copies of the station’s two most recent Annual EEO Public File Reports (assuming that it is not exempt from the Commission’s EEO rules).  By June 1st, radio stations in the first batch of license renewals — those located in Maryland, Virginia, Washington, DC, and West Virginia — must file an FCC Form 396 EEO Report electronically with the Commission.  A Form 396 must be filed by every station, even if the station has fewer than five full time employees and is thus, generally exempt from the FCC’s EEO Rules.  In that case, if the station has fewer than five employees, it will basically just check the box to indicate that and will not need to provide anything further.  Larger stations will need to complete the entire Form. 

And please note, the Form 396 Report must be filed before the Form 303-S License Renewal application can be submitted, as Question 2(a) in Section III of the Form 303-S requires that applicants cross-reference and specify the FCC filing number of the previously submitted Form 396 EEO Report.  For more information about the EEO Annual Public File Reports and the June 1st deadline please see our recent advisory. 

It’s almost summer time, and broadcast stations and other media companies are getting ready for the arrival of the summer associates.  As we’ve written in our Guide to the FCC’s EEO Rules, all FCC-licensed stations with 5 or more full-time employees must, in addition to widely disseminating information about their job openings, must complete a certain number of "supplemental efforts" from a menu list provided by the FCC – efforts intended to educate the public about broadcast employment, the training necessary for such employment and how to locate such employment. One of the menu options is an internship program – and many stations have such programs, some conducted in connection with various broadcast associations, some conducted with local educational institutions, and some just set up by the station itself.  As with anything else, stations, especially commercial stations, need to consider the legal issues that internship programs raise – especially unpaid internships.

In particular, stations need to be careful that interns don’t cross the line, doing more "real" work at a station and displacing paid employees, in a way that might create wage and hour liability to the station.  Our Davis Wright Tremaine Employment Practice Group has just published a great memo, setting out the details of an analysis that all employers should go through in setting up an internship program to make sure that the don’t run afoul of the wage and hour laws – in a simple and straightforward way .  You can find that advisory, Summertime Blues: Limits on Using Unpaid Student Interns and Volunteers, here.   Read it, and make your summer worry-free!

As part of the Local Community Radio Act which, among other things, repealed restrictions against protecting full-power FM stations from third-adjacent channel interference from LPFM stations, Congress required that the FCC conduct a study of the economic impact that such stations will have on full-power FM stations.  The FCC began the process of conducting that study, asking for public comment on a series of questions designed to look at that impact.  Comments are due on June 24, 2011, with reply comments to be filed by July 25.  The Commission asks for comments in two general areas, asking what impact LPFM will have on full-power stations’ revenues and on their audience share, but tentatively decided that it would not look at any economic impact that interference from LPFM would have on full-power stations.

What led the FCC to this tentative conclusion?  The FCC said that the Act did not specifically require any study of the economic impact of interference and, since the principal purpose of the Act was to set out how the FCC should deal with interference remediation, Congress had already addressed all that needed to be considered about any potential interference.  This view was bolstered by the inclusion in previous legislation of a specific directive to study interference, which led to the report from the MITRE  Corporation.  That report concluded that there would be no substantial interference from LPFM to full-power stations, which opened the door to the passage of the Act.  Thus, the Commission reached the tentative conclusion that no additional study of the economic impact of LPFM was necessary, but they seek comment on that tentative conclusion.  We expect that there will be such comments.

Continue Reading FCC to Study Economic Effect of LPFM on Full-Power FM – But Not the Economic Impact of Any Interference that May Be Caused

Just as webcasters thought that they had their royalty obligations figured out, there comes news that the already complicated world of digital media royalties may well become more complicated.  Last week, EMI, which in addition to being a record label is a significant music publishing company, has reportedly decided to withdraw portions of its publishing catalog from ASCAP – which had been licensing the public performance of these songs. The withdrawal from ASCAP applies only to "New Media" licensing.  What is the impact?  As of today, webcasters pay ASCAP, BMI and SESAC for the rights to play virtually the entire universe of "musical compositions" or "musical works" (the words and musics of the song).  By withdrawing from ASCAP, EMI will now license its musical compositions itself, adding one more place that webcasters will need to go to get all the rights necessary to play music on an Internet radio type of service.  In addition to royalties paid for the musical composition, webcasters also pay SoundExchange for public performance rights to the sound recordings (the song as recorded by a particular singer or band) – and by paying this one organization, they get rights to perform all sound recordings legally released in the US.   But any Internet radio operation needs both the musical composition (except for those compositions that have fallen into the public domain) and the sound recording performance rights cleared before they can legally play the music.

The news reports quote EMI as talking about the efficiencies that will be created by its licensing the musical compositions directly – in conjunction with the licensing of other rights – like the rights to make reproductions of its compositions, or the rights to publicly perform sound recordings to which its record label holds the copyright. But the whole idea of a performing rights organization with collective licensing is that it provides to digital music services the efficiencies offered by a one-stop shop for the purchase of rights to all a very large set of musical compositions.  Up to now, a digital music service knew that, by entering into licensing agreements with ASCAP, BMI and SESAC (the "performing rights organizations, or "PROs"), it had rights to virtually all the musical compositions that it would normally use (i.e. they received a "blanket license").  If these rights are balkanized, so that each significant publisher licenses their own music, the webcaster will have to make multiple stops to license all the music they need – which always leads to confusion.  The more places they have to go to license music, the more possibility that they will overlook a necessary rightsholder.  But there is even a bigger potential issue for webcasters – price.

Continue Reading Another Royalty Payment for Webcasters? EMI Withdraws From ASCAP For New Media Licensing

Three recent FCC cases demonstrate how seriously the FCC views tower site issues – imposing fines up to $14,000 for various violations of FCC rules.  One $14,000 fine was in a case where an AM station’s tower was enclosed by a fence that was falling down and did not enclose areas of high RF radiation as required by Section 73.49 of the rules.  The station also had a main studio that was unattended on two successive days, and had no one answering the phone on those days – no one to respond to the FCC’s calls.  The FCC broke the fine down as $7000 due to the lack of fencing, and $7000 to the unattended main studio.

In the second case, the FCC, the FCC fined a station $10,000 for areas of high RF radiation that were not fenced or marked by signs when the FCC conducted its inspection, and $4000 for operating overpower.  The Commission measured the overpower operation on one day, inferred that it had been in place the previous day, and thus deemed the violation repeated.  The Commission found that the station’s tower was fenced, but that there was high RF outside the fence, leading to the fine.  The third case was one where the Commission found that the top flashing beacon on a tower was out on two successive days, even though the required steady lit obstruction lights on the side of the tower were operational.  While the licensee notified the FAA of the outage three days later (with no noted prompting from the FCC), and had the situation corrected two days after notifying the FAA, the Commission also determined that the the violation was repeated and willful, leading to a $10,000 fine.

Continue Reading Tower Lights Out, High RF Radiation, Insufficient Transmitter Site Fences – FCC Fines Up to $14,000

In less than a month, a four year cycle of radio and television license renewal applications begins with the filing, on or before June 1, of license renewals by radio stations in Maryland, Virginia, West Virginia and the District of Columbia.  To help stations prepare for their upcoming renewals, I conducted a webinar, sponsored by the Michigan Association of Broadcasters and joined by broadcasters from 9 other state associations, discussing issues that broadcasters should be considering.   Slides from that presentation, setting out the renewal process, and various issues that should be considered by broadcasters, including: public file issues, technical matters, EEO and other nondiscrimination matters.  Copies of the slides used in the presentation are available here.

In addition to those slides, we have many other resources available for a broadcaster thinking about their license renewal application.  These include the following:

  • A primer on the issues to be considered in preparing for license renewal, available here.  In that memo, there are links to the texts of the required pre-filing and post-filing announcements that broadcasters must air to inform their listeners about the filing of the renewal application
  • A memo that sets out the materials that should be kept in a commercial station’s public file, and the retention period for those materials, here.
  • A memo generally describing the requirements of the FCC’s EEO rules, here, and a second memo, reminding broadcasters of their yearly EEO public file report obligations, a sample of which is here.  Remember, FCC Form 396 report must be filed with the license renewal application, and that form requires the submission of the station’s last two years public inspection file reports
  • An advisory, here, summarizing the requirements for a station’s quarterly programs issues lists.
  • Recent blog entries on the FCC’s requirement for a nondiscrimination certification in their advertising contracts, here and here.

FCC Sources of information for the renewal filing are also available.  A version of the FCC Form 303S – the license renewal form – can be viewed here.  The form contains a good set of instructions as to what information the FCC is seeking from licensees.  The FCC also has its own webpage on license renewal, here.  Dates for radio license renewals are available here, and the dates for TV renewals are here.

Continue Reading Getting Ready for License Renewal – Slides and More Information from State Broadcast Associations’ Webcast

The advertising to children of food deemed unhealthy has been the subject of government concern for many years.  We wrote about the efforts of then-Senator Brownback to limit such ads – either by voluntary industry action or by government regulation.  These concerns led to the formation of a public-private task force to come up with voluntary actions to limit advertising unhealthy foods to children.  The FTC this week released a draft of that report – proposing prohibitions on advertising most unhealthy food to children that would be in place by 2016 (with certain additional restrictions becoming effective 5 years later).  These guidelines would apply not only to broadcast advertising, but also to marketing on the Internet and in many other media.  While the report talks about voluntary industry guidelines, the NY Times quotes some as asking just how voluntary such guidelines really would be – asking if the government might not step in to mandate compliance if industry was unsuccessful (see the Times article here, subscription may be required).  Comments on the FTC proposals are due on June 13, 2011.

The guidelines published by the FTC ask many questions about how to define what foods are considered unhealthy, and also about whether the timeline of 2016 for implementing a ban on unhealthy food advertising is reasonable (the later 2021 deadline would apply to certain restrictions on salt in food).  Advertising would be restricted for those up to 17 years of age, and extends to 20 categories of advertising including radio and TV, online ads, sweepstakes, ads in video games, and other marketing in traditional and digital media directed to children.  Broadcast programming that reaches an audience that is 30% children 2 to 11 would be deemed "targeted" to them, for children 12 to 17, the programming would be deemed targeted to children if there were a 20% representation of those age groups in the audience.  Internet ads would also use the 20% standard.

Continue Reading FTC Requests Comments on Guidelines for Advertising Unhealthy Foods to Children

How do you determine who is control of a noncommercial broadcaster governed by a self-perpetuating Board of Directors?  That question was addressed in a recent FCC decision, dismissing an application for a new noncommercial FM station that had not properly disclosed its owners on its FCC Form 340 application. In that case, the applicant had reported to the FCC that it was controlled by one individual, the head of a Monastery.  No other officers or directors or members of the applicant nonprofit corporation were listed in the application.  A competing applicant searched state records, and determined that its articles of incorporation reflected that the applicant was to be governed by a Board of Directors, and required at least three directors.  Moreover, the state filings had listed 6 directors – including two individuals who were not US citizens.  When challenged, the applicant admitted that the applicant corporation was set up in the manner set out in the state filings, but contended that the directors were all members of the same religious order, and could not challenge the decisions of their superior – arguing that this gave the superior effective control over the entity.  The FCC rejected the argument – relying on state laws that said that a company is governed by its Board of Directors – and concluding that the individuals on that board therefore had control of the applicant.  Any attempt to now list the 5 other members on the FCC application would be a major change in the control of the board (and would raise alien ownership issues because of the two directors who were not US citizens), so the application was dismissed.

This case illustrates the Commission’s general rule that, when evaluating control of nonprofit entities that don’t have shareholders or other owners, as do commercial enterprises, the FCC looks to the governing body of the entity that holds the FCC license to define where control lies.  But the rules for noncommercial entities have never been completely clear – as the FCC has for over 20 years had a rulemaking to establish rules governing changes in control of noncommercial entities.  While this proceeding has been pending, the FCC looks at these issues through an interim policy based on the rules proposed in that proceeding.  Under that policy, the FCC assumes that nonprofit boards will have periodic changes in composition.  It requires that, when a majority of the governing board changes due to these normal, gradual changes, a noncommercial broadcaster file a Form 316 short-form transfer of control – an application routinely processed by the FCC in a matter of days.  But, if there is a sudden change in control of the Board where a controlling interest changes all at once (e.g. if members of a nonprofit entity vote out a majority of the Board, or if there is some sort of mass resignation), then the company should obtain FCC approval on an FCC Form 315 "long form" application, that is subject to petitions to deny.  In the context of any application for a new station, a long-form transfer will result in a dismissal of an application for which the filing window has closed, while short-form changes will be permitted. 

We wrote about these issues when the FCC commenced its still-pending proceeding to require noncommercial broadcasters to file their ownership reports on the same biennial schedule as commercial entities. With license renewal approaching, noncommercial licensees should review their ownership, and make sure that its ownership information is correct, and that any transfers that have occurred based on these policies have been properly reported and approved.