The FCC has released its order setting this year’s Regulatory Fees to be paid by broadcast stations.  While has not yet set the deadline for paying those fees, that deadline should fall sometime in August or September.  In setting this year’s fees, the Commission made some decisions about fees for broadcasters that may not make sense to some – but it promised to review the decisions in the future when determining the amounts of fees in future years.  Perhaps the most controversial issue will be the fees that it set for television stations – which retain the distinction between UHF and VHF stations, and retain the requirement that VHF stations pay significantly higher fees – even though such stations are often disadvantaged (and certainly not advantaged) in the digital world.  Fees for television stations range from $81,550 for VHF stations in the Top 10 markets (versus $32,275 in those markets for UHF stations), to $6125 for VHF stations in the smallest markets versus $3050 for UHF stations.  The many stations now operating digitally on UHF channels that had previously operated on VHF channels in analog will receive some big savings, while some stations forced to operate on VHF channels for the first time may well be in for a surprise as to the reg fees that they will be paying.

The Commission also rejected requests to decrease the amount paid by AM stations in comparison to FMs, though it promised to revisit that issue in the future.  Other proposals to base payment directly on population served by a station were also rejected.  For TV translators and LPTV stations, if an entity is operating both an analog and digital station while in the process of its digital conversion, fees will have to be paid on both stations.  Full-power television stations will have to pay on their digital operations, even if they were operating with STA facilities on October 1, 2009, the beginning of the fiscal year for which these fees are paid.  All fees are based on the facilities of a station as of that date.  Specific fees for broadcasters are set out below.

Continue Reading FCC Sets Regulatory Fees – Payment Date Not Yet Set

Three months ago, we wrote about a case where the FCC held that it would grant only one application from each MX Group in the recent NCE FM window for new noncommercial FM radio stations.  MX Groups arise when multiple applicants file applications that cannot all be granted without prohibited interference.  In some cases, an MX Group can span several states, where not all applications are mutually exclusive with each other, but all are tied together in a chain, with each link being mutually exclusive with the next link.  The FCC has just released another decision, slightly refining the decision from March.  In the new case, the FCC dismissed one applicant on essentially the same grounds as in the case from March – the only reason that the dismissed application could stand on its own was because other applications with which it was mutually exclusive were themselves dismissed because of the application that was to be granted as a result of the FCC decision selecting the preferred application in the MX Group.  However, in the new case, the FCC did allow for the grant of a second application in the same MX Group, where that application was no longer mutually exclusive with the winner or with other dismissed applications because its mutually exclusivity with the chain of application was broken by the voluntary dismissal of another applicant and the settlement with yet a third.  Because of these two actions, the FCC said that this application was not in the same circumstances as was the application whose dismissal was upheld.

What this case seems to say is that, even after a 307B) grant order is released by the FCC, another application in an MX Group can possibly be granted if it is made grantable before the official dismissal is released, not by the dismissal of applications that are only dismissed because they lost the FCC comparative analysis, but if the actions eliminating the mutual exclusivity were caused by other voluntary actions.  A slim exception – but one that NCE applicants in MX Groups where they are not technically precluded by the grant of the winning application may want to explore if they do not prevail in an FCC 307(b) analysis. 

As I was preparing for a session updating and refreshing broadcasters about their obligations under the FCC’s EEO rules at the Iowa Broadcasters Association annual convention in Des Moines on June 30, I learned of what seemed to be a startling development – the Minority Media and Telecommunications Council, one of the most effective advocates in Washington for minority hiring and ownership, had urged the FCC to suspend its enforcement of the EEO rules. What was this all about? I went on with my presentation (the PowerPoint slides for which are available here, and the slides for the presentation that I did at another session providing an update on Washington issues for radio broadcasters are available here), quickly adding a summary of the MMTC request. While some broadcasters might have hoped that the request recognized that the EEO rules were no longer necessary as broadcasters were, on their own, making great strides in diversifying their workforce, in fact what the MMTC was seeking was tighter EEO enforcement, contending that the current rules are so ineffective as to not be worth the time spent on their implementation and enforcement.

While MMTC acknowledged that there have been a number of recent cases fining stations for noncompliance with the EEO rules, it contends that often the stations that are hit by such fines have very diverse workforces, and thus should not have to worry about EEO outreach. We have written about some of these fines.  These cases demonstrate that the current rules are not targeted at minority and gender-based affirmative action, as FCC rules requiring any evaluation of minority and gender-based hiring were twice declared by the US Court of Appeals to be instances of unconstitutional reverse discrimination. Instead, the current rules are focused instead on bringing new people into the broadcast employment workforce – people recruited from a wide variety of community groups, and not exclusively by word of mouth or through other hiring avenues that simply take people from traditional broadcast hiring sources. But, as MMTC points out, these rules are not based on necessarily seeking to include members of minority groups or women in station workforces.  Thus, as their focus is simply on wide dissemination of information about job openings, even stations that have high percentages of minorities and women on their staffs can still run afoul of the rules by not publicizing job openings.

Continue Reading David Oxenford Reviews EEO Rules with the Iowa Broadcasters, While MMTC Asks the FCC to Suspend EEO Enforcement

As we anticipated, the FCC has suspended indefinitely the opportunity to apply for new, digital low power television (LPTV) stations in non-rural areas, which had been slated to begin on July 26, 2010.  Given the FCC’s new focus on repacking and reallocating the television spectrum for use by broadband competitors, the Commission’s postponement of the filing opportunity is not unexpected.  In fact, based on the fact that the filing opportunity had been extended once already — from January of this year to July — it was a fairly safe bet that the window would be closed before it even opened once the National Broadband Plan was released in March.  It would seem to be counter-intuitive to put more stations into the spectrum that you are working to (potentially) reclaim or repack.  And that’s just what the FCC thought as well, as they have now postponed "until further notice" filings for new digital LPTV stations in non-rural areas. 

Although it will not accept any applications for brand new digital LPTV stations in non-rural areas on July 26th, the Commission will permit existing LPTV, TV translator, and Class A television stations to file applications seeking digital companion channels in communities nationwide beginning on July 26, 2010.  In addition, parties may continue to file for new digital LPTV stations in rural areas, as well as file applications to flash-cut to digital on their current channels.  A copy of the FCC’s Public Notice is available here. 

The long-delayed revised Biennial ownership reports (about which we last wrote here) for commercial broadcast stations, on the new Form 323, are due on July 8, and the FCC is in the process of clarifying what it needs.  The Commission just released a Public Notice reminding broadcasters that the report is supposed to be detailing station ownership as of November 1, 2009 (when the reports were originally supposed to be filed).  Yet, in the 8 months since that date, many stations have changed ownership.  Is a new owner supposed to get the old owner to complete the form?  What if the old owner is off somewhere on a cruise, or simply wants nothing more to do with the station?  The FCC’s Public Notice clarifies (to some extent) what to do in that case – indicating that stations in that situation can file a waiver request, detailing why they can’t provide the ownership information for the owners who held the station license on November 1, 2009, and asking that the FCC waive its rules and excuse the filing of a report for this particular station.  This obligation to file the waiver request is on the current owner.  Note that the FCC does not say that it will grant all such waiver requests, and it specifically excludes from these waiver situations "pro forma" assignments or transfers, i.e. ones where the actual control has not changed but the legal entity holding that control has changed such as in a corporate reorganization where a station license is moved from a parent company to a subsidiary, or from a corporation to an LLC which is controlled by the same individual. 

Another looming issue may also create issues for the July 8 filings.  A group of state broadcast associations and broadcast owners has asked the US Court of Appeals to once again put the filing obligation on hold until the FCC justifies the information that is being collected.  Last week, the Court asked the Commission to justify its requirement that each person with an attributable interest in a station (i.e. anyone who would have to be reported on the Form 323) obtain an FRN (a unique identifier) which can only be obtained by furnishing  a Social Security Number.  While this may indicate that the Court is concerned about forcing every investor and officer and director of a broadcast company to provide this information, even if the Court forbids the collection of that information, it is possible that the FCC would move forward anyway with the Form 323 filing obligation – just removing the FRN from the required filing.  So don’t count on the July 8 deadline being pushed back – start preparing now to be on file by the deadline.

Continue Reading July 8 Filing Deadline for Commercial Broadcast Stations Form 323 Ownership Report – Clarifications Issued

The FCC issued a reminder to all video program distributors – including TV stations, cable systems and satellite television providers –  that emergency information must be made accessible to those with hearing or vision disabilities.  For those with hearing difficulty, the Commission reminded providers that they must make information available visually as well as aurally – either through closed captioning or some other method that the aurally impaired can understand the nature of the emergency. For the visually impaired, if the emergency information is provided in a crawl or through some other non-verbal manner, there need to be alert tones broadcast identifying that emergency information is being conveyed so that visually impaired viewers can make arrangements to find out what the emergency is.  With hurricane season upon us, the Commission wanted to remind video service providers of these obligations.

The Commission also reminded service providers and viewers of the new complaint process, about which we wrote here, that sets up a process for viewers who believe that there has not been proper captioning information provided.  This reminder alone should alert broadcasters and other video program providers of the seriousness with which the FCC views these rules.

Continue Reading FCC Reminder About Making Emergency Information Accessible to People With Hearing or Vision Disabilities

In an email blast that went out this morning, the musicFIRST Coalition, the group organized to pursue a performance royalty on radio broadcasters for the use of music in their over-the-air broadcasts, announced that they would be holding a rally and concert with a member of the 1960s rock band the Monkees, musically backed by three Congressmen.  Mickey Dolenz of the Monkees will be backed by a band featuring two Democratic Congressmen and a Republican in a concert to be held in the Capitol Building’s Visitor’s Center at 4:30 in the afternoon – presumably so that other Capitol Hill staffers will stop by and attend the rally.  While this is not the first concert to be held in support of the royalty, this one comes after some in the broadcast industry have suggested that the push for the royalty is dead for the year, given the fact that the NAB has well over half the members of the House of Representatives signed onto a non-binding resolution opposing the royalty.  The concert, plus the recent letter from the Copyright Office in support of the broadcast performance royalty that we recently wrote about, show that the campaign from the supporters of the royalty has not diminished, but instead continues unabated.

Some in the broadcast community have suggested that, given the major issues that are pending before Congress and the fact that the Congressional schedule will likely be tight in the fall in advance of the November elections, there was not time for this issue to come up this year.  But there are still many opportunities for the issue to be considered – either as part of some other legislation, or perhaps in the "lame duck" session of Congress after the elections but before the new Congress is convened in January.  During that lame duck session, Congressmen who are not returning to Washington, either through retirement or after an election defeat, can be unpredictable,  Thus, broadcasters need to continue to be on alert for possible action in this area, and need to continue to talk to their local representatives to combat the "star power" that the recording industry can muster to visit the halls of Congress.

In a recent speech before the Community Radio Conference, FCC Commissioner Mignon Clyburn suggested that the proposal to reallocate Channels 5 and 6 for FM radio use had merit and should be considered further.  That proposal is already before the FCC, and ripe for decision – so it could theoretically be adopted tomorrow.  However, the proposal is not backed by all.  While Commissioner Clyburn may think that the idea bears more exploration, there seems to be significantly more consideration that is necessary before a decision on the pending proposals can be made.  What are these proposals, and what is standing in the way of a reallocation? 

As we have written before, the proposals have been made to take TV Channels 5 and 6, which are immediately adjacent to the FM band, and reallocate them to radio broadcasting.  The pending proposals include suggestions that LPFM stations could be located on the new FM channels that could be created, that new space for noncommercial radio operations could be created and, if they operated digitally, there would even be room to move the entire AM band to Channel 5.  While some have suggested that any relief from such a transition would be long in coming, as radios would need to be manufactured, in fact that process might not be as prolonged as suggested, as the frequencies used by these television channels are already used for FM radio in Asia.  Radios already exist that could pick up these channels (at least for analog reception).  However, television interests have opposed this reallotment, but it may well be the broadband plan which could have the greatest impact on the consideration of this issue. 

Continue Reading Commissioner Clyburn Suggests TV Channels 5 and 6 Could Be Used For Radio – Will It Happen?

Davis Wright Tremaine attorneys David Oxenford and Rob Driscoll conducted a seminar –  Using Music in Digital Media: Business and Legal Issues – on June 16, 2010 in New York City.  The seminar was presented to attorneys from committees of the New York State and New York City bar associations.  In the seminar, Dave and Rob discussed the music licensing issues that can arise when music is used in digital media – touching on everything from royalties for the streaming of music by Internet radio stations, to the use of music in video productions or in advertisements that may be displayed online, to the occasional use of music by a business on its website to enhance the "stickiness" of that site.  The PowerPoint presentation from the seminar is available here.  Many of the issues that were covered in the seminar are discussed in Dave and Rob’s memo the on The Basics of Using Music in Digital Media, available by clicking on this link.

Another topic that was discussed was the use of music in user-generated content, and how website operators can avoid liability that may arise from the posting on their sites of content using music and other copyrighted materials by users over whom the site owner has no control.  The Digital Millennium Copyright Act provides protection for those who host sites where such content is posted, but certain formalities need to be observed by the site owner to insure that they receive the law’s full protection.  Site owners cannot encourage the posting of copyrighted content unless the appropriate clearances have been obtained, they cannot have actual knowledge of the infringing content, they cannot receive a direct financial benefit from the infringement, and they must act promptly to remove infringing content if notified that it is on their site.  To make this notification possible, to provide a "safe harbor" under the DMCA, a website owner needs to place a notice on its website in a "location accessible to the public," and register with the Copyright Office, the name of a person to be contacted by a copyright owner if the owner finds its content being used on the site without permission.  This notice must provide the contact person’s address, phone number and email address.  Information about registering the contact person with the Copyright Office, a list of those website operators who have registered, and a link to the form to be used to register a contact person, can be found here.

Stations that are licensed as "noncommercial educational" stations are prohibited by the FCC from running commercials – seemingly a pretty straightforward prohibition.  Yet drawing the line between a prohibited commercial and a permissible sponsorship acknowledgment is sometimes difficult in these days of "enhanced underwriting."   In a recent case, the FCC fined a noncommercial radio station $12,500 for repeatedly airing 4 announcements from sponsors that the Commission found to have crossed the line by being overly promotional.  These announcements, which appear to have been recordings of unscripted sponsor acknowledgments, demonstrate how carefully noncommercial stations must police their sponsorship announcements to avoid risking an FCC sanction.

The announcements in these cases are worth reviewing. Some have subtle promotional messages, while the areas of concern are more clear in others.  But in reaching its decision, the Commission goes through a close analysis of the wording of each announcement to see if the announcement contains "comparative or qualitative descriptions, price information, calls to action, or inducements to buy, sell, rent or lease", all prohibited language in a noncommercial sponsorship identification.  So, when one of the announcement referred to "beautiful Harley Davidson light trucks" sold by a local auto dealer who sponsored the station, the FCC found that this was a qualitative claim that went over the line.  Similarly, statements that "we have it here" or "where we are proud to be Mexicans" (these announcements having been run on a Spanish-language station in California) were found to be attempts to qualitatively distinguish this dealer from others, or to be inducements to buy – a prohibited call to action.  And a specific statement that "no downpayment" would be required on a purchase constituted the kind of price information that should not be contained in a sponsorship acknowledgment.  Another announcement for a local tire store had similar problems in the content of the ads, using phrases such as stating that the company "knows about tires" and that the company’s product "reduces [the] loss [of tire] pressure" and "has less risk of suffering damages . . . last longer and [is] not too expensive cause you to save more . . . [and] save more in gas per mileage."

Continue Reading Noncommercial FM Station Fined $12,500 for Sponsorship Acknowledgments That Were Too Commercial