Discussion of FCC, copyright, advertising and other legal issues of importance to radio and television broadcasters and other media companies
Principal Editor: David O’Connor
On October 13, 2008, David Oxenford conducted a session at the Kansas Association of Broadcasters Annual Convention, held in Wichita. The session, called "What Else Can Washington Do For You?" focused on regulatory and legislative developments that affect broadcasters.
A copy of the PowerPoint presentation used at this session will be available here soon.
On October 3, 2008, David Oxenford moderated a panel at the Digital Music Forum West in Los Angeles. The panel, titled Digital Rights and Clearances, discussed what rights were necessary for the use of music by online digital services, in movie and video production, and for other purposes. Panelist included, Kevin Arnold, CEO, IODA; Richard Conlon, VP, New Media & Strategic Development, BMI; Maurice Russell, VP, Bus. & Licensing, Harry Fox Agency; Patrick Sullivan, President & CEO, RightsFlow LLC; Les Watkins, SVP, Business Affairs, Music Reports; Bob Kohn, Co-Founder, Chairman & CEO, RoyaltyShare, Inc.
A video of this panel can be viewed here.
Last week, the FCC granted a brief extension of time in which to file comments on the proposed increase in power for the HD Radio operations of FM stations. We wrote about the request for comments here and here. Comments will address the requests of those who want higher power for their digital operations in order to increase building penetration of the HD radio signals (which have proven difficult to receive in some brick and steel buildings) and otherwise fill in coverage areas, and will also include submissions of those who are concerned about the potential interference to adjacent channel stations. The later includes NPR Labs, which produced a set of maps, available here, computing the potential interference that higher power HD operations could cause to a number of stations. Especially for stations which rely on coverage beyond their protected service areas, and which operate close to adjacent channel stations that run HD operations, the proposed increase could have a substantial impact. With the proposal for shared time operations that has now been highlighted by the Ion Media applications about which we wrote here, the diversity that comes from such fringe stations will have to be balanced against the diversity that can come from multicast digital channels. Comments are now due on December 5, with reply comments due January 12.
This week, an interesting concept has been advanced in a series of applications filed with the FCC. Ion Media Networks, the successor to Paxson Television, has proposed to transfer some of its broadcast stations to a new company, Urban Television LLP, to be owned 51% by Robert Johnson, the former owner of BET, and 49% by Ion itself. But, when we say that they are transferring "some" of its stations, we don’t mean that any of its stations are being transferred, but instead only that a piece of its stations are proposed to be transferred. Ion proposes to continue to own and operate stations in every market where it currently operates, but proposes to sell digital multicast channels to Johnson. Unlike any LMA or other programming agreement, the proposal is to actually take one 6 MHz television channel and break it up so that Ion continues to program one channel with its programming and the Urban Television will program the other channel with its programming, and become the actual license of that portion of the spectrum. The FCC has accepted the applications and issued a Public Notice, giving parties 30 days to file comments on the proposal.
It is not unheard of for two licensees to share the same channel – though where it is currently occurs most frequently is in connection with noncommercial broadcasters who share a single radio or TV channel, they divide it by time, so that one licensee operates, say midnight to noon and the other operates from noon to midnight. Obviously, in these shared-time arrangements, both broadcasters are not operating on the same channel at the same time. This new proposal, though, does not come out of the blue. The idea of allowing a broadcaster to sell a digital channel to a different company, has been proposed before, for both Digital Television and Digital HD Radio channels when the original station is multicasting, as a way to increase diversity of ownership.
There’s a new top-level domain name ("TLD") on the block, and broadcasters and other media companies will want to protect URLs that include their call signs, unique slogans and positioning statements or other registered marks or names. The new TLD will be ".tel." Unlike .com, .net, .org, and other current TLDs that link to websites, the new .tel TLD is designed specifically for access by mobile devices such as the Blackberry and iPhone and will access to the contact information of the holder of the .tel URL without the need for a standard website. The theory behind the .tel TLD is to allow instant access to contact information without having to access a registrant’s website. When contact information is accessed via mobile devices, the telephone numbers will appear as "hot links" that will dial those numbers upon touch or selection. Of course, links to websites may also be provided, but the primary purpose of the TLD is to provide a global contact directory without the need for the user to have Outlook or other address books or for the registrant to have a website.
Beginning December 3, 2008, anyone with a registered trademark or service mark can register a .tel domain name using that mark for a cost estimated to be in the $500 range. This so-called "sunrise" period will last for two months. Beginning February 3, 2009, there will be a so-called "landrush" period allowing anyone to register any unregistered .tel domain names, including generic or descriptive marks or names, such as radio.tel or cable.tel, on a first-come, first-served basis. (Bad faith use of a third party’s trademark will be subject to cancellation under existing domain name dispute procedures.) The "landrush" period will last until March 23, 2009, after which the .tel TLD will be generally available to anyone at a much reduced fee, currently estimated to be as low as $1.25 per month.
Continue Reading “.tel” Domain Name To Become Available Soon
The FCC this week released the details of its "White Spaces" decision, authorizing the use of both fixed and mobile unlicensed devices within the television spectrum. In theory, these devices are supposed to be able to sense the existence of television signals so that they can operate on other frequencies and avoid creating interference. However, as an extra safety measure, the FCC has also required that these devices connect at least once a day with a database of all other protected users of the television spectrum and, by used of geo-location technology, determine what other users are in the area where the "TVBD" (television band device) is being used and operate on frequencies which protect those other users. Our firm has prepared a memo outlining the full decision. The Davis Wright Tremaine memo can be found here. When one reviews the full text of the FCC decision, it becomes pretty clear that we should not look for such devices anytime soon.
While the Commission’s order actually discussed in some detail the question of whether these devices should be permitted to operate before the end of the digital television conversion in February 2009, given the issues that still need to be resolved, this discussion really appears to be an academic one. First, devices that meet all of the FCC requirements have to be designed and built, and type-accepted by the FCC labs. In a recent article by Shelly Palmer in his well regarded blog on television issues, he suggests that many engineers are convinced that these devices simply will not work. When one reviews the FCC requirements, one can see why that might be the case.
The Stephen Colbert Christmas Special begins with Colbert sitting at the piano, writing new Christmas songs. Why? He explains that, while he likes all of the old Christmas songs well enough, he’d only get royalties if he wrote the songs, so he’s writing his own. In a few sentences, Colbert explains the system of broadcast royalties in the United States, and the source of the dispute over the broadcast performance royalty that took up much committee time in the last Congress, and is bound to return in the next Congress in 2009. As Colbert explains, in the US, the composers get paid when their music is played on a broadcast station. These payments come from the the royalties that broadcast stations pay to ASCAP, BMI and SESAC, the performing rights organizations or "PROs" that represent the composers or the music publishing companies that hold the copyrights to those songs. But, as Colbert points out, the performers do not get paid when they sing the song on the air.
We’ve written about the controversy about whether or not performers should get a royalty when a song that they perform but did not write, is played on the air. But Colbert seems to have solved the problem about the performer not getting royalties when their songs are played on the air – simply by writing his own songs. And maybe we’ll be singing these songs at future Christmas parties, paying Colbert royalties, and at the same time explaining broadcast performance royalties to future generations.
Continue Reading Stephen Colbert’s Christmas Special Explains Broadcast Performance Royalties
An FCC decision in a case involving two applicants for a construction permit to construct a new noncommercial television station in Tulsa illustrated an interesting dilemma that can arise from the application of the "point" system that is used to decide comparative cases for new noncommercial stations. We wrote about the point system, here. In this case, neither of the applicants enjoyed a Section 307(b) preference for superior technical coverage. And neither had any preferences for being part of a statewide network. Instead, the only differences between the applicants was that one was a local, established non-profit organization (Oral Roberts University), while the other was not a local group, thus giving ORU 3 points under the comparative system. The non-local applicant received 2 points as it had no other station in the market. Thus, Oral Roberts received the grant – despite the fact that it already had another television station in the same city.
Commissioner Copps, while not specifically dissenting from this decision, did point out that the decision might not really be one that served the public. Is it really better, he asked, that a second television station be awarded to a local group, or would the local community be better served by a new voice – even if that voice was not from a local community organization? While Commissioner Copps did not mention it, under the comparative hearing system used to evaluate commercial applicants before the adoption of the auction system now in use, favored diversity of ownership (not having other media interests) over local ownership. Seemingly, almost any system of selection will lead to some anomalous results that may demonstrate the need to reexamine the system from time to time to determine if it really does benefit the public, or if it is simply making arbitrary distinctions between applicants. This may be one of those cases showing that it is time for a reexamination.
Last week, President-elect Barack Obama delivered his first weekly radio address since he was elected President. The broadcast made news, not only for its content, but also because it was streamed on the Internet, particularly on You Tube, but also retransmitted on many other websites. The fact that the Internet makes such transmissions not only possible, but so easy and so widely available demonstrates one of many reasons why all the worry about the return of the Fairness Doctrine is unwarranted. With access to so many diverse opinions not only on the radio but also through all of the new technologies, why should the government care that one radio station may not cover all sides of a controversial issue? If one station does not put on a strongly held viewpoint on an important issue, you can bet that someone who holds that viewpoint will find some way to transmit it to others.
The return of the Fairness Doctrine has been the great invisible monster in the room since the election – with many commentators, particularly conservative ones, worrying that the Democratic Congress will attempt to reinstate the Fairness Doctrine. Off-hand comments such as those made by Senator Schumer on Fox News, have fueled this speculation, even though the Obama campaign has specifically rejected such a return. The Fairness Doctrine is one grounded in scarcity of the electronic spectrum – from the fear that if one side of an issue was allowed to dominate one of the few means of communicating with the population of a community, it would effectively be able to stifle the ability of those with contrasting viewpoints to get their message out. But, to use a phrase that is becoming increasingly popular – that thinking is so 20th Century.
The Webcaster Settlement Act, about which we write here, has been signed into law by President Bush, giving parties to the Internet Radio royalty dispute until February 15 to enter into a settlement and have it become effective, without the need for any public comment or any further government approvals. Several recent articles have indicated that a settlement is close – for at least some of the webcasters. In several recent statements, Tim Westergrin of Pandora has indicated that the webcasters in DiMA (the Digital Media Association), in their negotiations with SoundExchange and the record labels, were getting very close to results. At a the Digital Music Conference held in Los Angeles last month, Jon Potter, the President of DiMA, seemed to echo that sentiment. However, neither could state with absolute certainty when the deal would come, or what its terms would be, though in Westergrin’s comments at that conference, available here, he stated that webcasters probably would not be happy with the likely outcome of the settlement, implying that there would be a high rate that would be agreed to by the parties, though it would be one less than what the Copyright Royalty Board ordered (and one which would allow companies like his to survive). However, he indicated that perhaps not all webcasters would be able to survive at the rate being discussed, and some might have to try to enter into their own agreements to fit other types of webcast operations. In fact, the Webcasters Settlement Act is not limited to a single settlement, so various other parties who participated in the CRB proceeding – including broadcasters who stream their signals online, small commercial webcasters, and NPR and other noncommercial groups – could negotiate settlements as well, though there have not been any recent public statements that these negotiations were close to bearing fruit.
At a panel that I moderated at the CMJ Music Marathon later in October, which included a SoundExchange representative and a member of its Board, there was a suggestion that further settlements with groups other than DiMA might follow if and when the deal with the large webcasters is concluded. This approach may make some sense as the copyright holders don’t want any deals that they cut with small webcasters or noncommercial parties that could affect their negotiations with larger webcasters, from whom the vast bulk of their revenues are derived. Copyright holders naturally want to address the interests that will be the most lucrative. However, this approach does put smaller parties, who are often most worried about potential liabilities and most sensitive to uncertainty, into a very uncomfortable position. As we’ve written before, the statutory license that is administered by SoundExchange was granted by Congress at least partially to make access to music possible, especially to smaller parties with little bargaining power and little ability to cut deals with thousands of copyright holders, which would be required without this license. Yet these are the parties most in need of relief from the rates imposed by the Copyright Royalty Board, so we hope that the talks of future settlements in fact are accurate.
