In the FCC’s recent Report and Order on Diversity, released earlier this year, the Commission announced new requirements for all broadcast station’s advertising sales contracts. The new FCC rule requires that all advertising contracts contain clauses ensuring that there is no discrimination based on race or gender in the sale of advertising time. This new requirement, which took effect in July, not only requires broadcasters to have these non-discrimination clauses in their advertising sales contracts, but will also require that broadcasters certify as to the existence of such clauses in their next license renewal application. Thus, to be sure that you can make such certifications, you must revise your advertising contracts to include a nondiscrimination provision, such as the one set out below, if you have not done so already. 

These new measures are intended to increase participation in the broadcast industry by businesses owned by women and minorities. The Commission was concerned that some advertising contracts include either explicit or implicit “no urban/no Spanish” dictates. Such contractual limitations, the Commission explained, may violate U.S. anti-discrimination laws by either presuming that certain minority groups cannot be persuaded to buy the advertiser’s product or service, or worse, intentionally minimizing the number African Americans or Hispanics patronizing advertisers’ businesses. 

Continue Reading FCC Rules Require Non-Discrimination Clauses in All Advertising Sales Contracts – Act Now to Avoid Trouble Later

As broadcasters are aware, earlier this year, the FCC imposed DTV Consumer Education requirements mandating that television stations and other video providers educate viewers about the upcoming transition from analog to digital television (DTV).  Thus far, the education efforts have consisted primarily of Public Service Announcements (PSAs), crawls, and longer format programs designed to educate the public about the February 17, 2009 switch to DTV.  Now that stations are approaching the home stretch, however, the FCC’s rules require additional efforts.

Specifically, for those stations that elected to follow “Option Two” of the DTV Consumer Education requirements — which seems to be the vast majority of television stations — beginning on November 10, 2008, television stations must begin a "100-Day Countdown" to the transition consisting of enhanced efforts leading up to February 17, 2009.  During this period, each station following Option Two must air at least one of the following per day:

Graphic display:  A graphic super-imposed during programming content that reminds viewers graphically there are “[X] number of days” left until the transition, and that visually instructs viewers to call a toll-free number or to visit a web site for further details.  The graphic’s duration may vary from 5 to 15 seconds, at the discretion of the station.

Animated graphic: A moving or animated graphic that concludes with a countdown reminder, which will remind viewers that there are “[X] number of days” until the transition. Viewers are to be visually instructed to call a toll-free number or to visit a website for details.  The graphic’s duration may vary from 5 to 15 seconds, at the discretion of the station.

Graphic and audio display: Either a graphic display or animated graphic along with an added audio component.  The duration may vary from 5 to 15 seconds, at the discretion of the station.

Longer form reminders: Stations may choose from a variety of longer form options in order to communicate the countdown message.  Examples might include an “Ask the Expert” segment in which viewers can call in to a phone bank and ask knowledgeable people questions about the transition.  The length of these segments can vary from 2 to 5 minutes, at the discretion of the station.  (Some stations may also choose to include during newscasts DTV “experts” who may be asked questions by the anchor or reporter about the impending Feb. 17, 2009, deadline).

With this 100-Day Countdown, the Commission hopes to push strong to the finish line and build viewer and consumer momentum for the final switch to digital on February 17th.  The FCC has been paying close attention to station compliance with the DTV Consumer Education requirements and stations are advised to start planning now for their 100-Day Countdown efforts.  One additional note, stations that have elected to follow Option Two should also be sure to air at least one longer form program (at least 30 minutes in length) if they have not done so already.   At least one such program must be run between the hours of 8:00 AM and 11:35 PM prior to February 17, 2009.  

The FCC has released a Public Notice reminding TV stations to update their FCC Form 387 DTV Transition Status Reports by October 20, 2008.  If you will recall, these Reports were filed by stations earlier this year (and updated in July) outlining the steps remaining for the stations to complete the transition to DTV.

As we’re now coming down the home stretch, stations that have not already completed the transition to digital must once again update their status reports.  Specifically, stations that by October 20th have not filed a covering license application and notified the FCC that they are operating with full and final DTV facilities must update their Form 387 DTV Status Report by October 20.

A copy of the Public Notice is available here.  Stations should make sure that the Form 387 provides:  (1) the station’s detailed plan for the remaining steps in the transition, (2) dates for completion of construction and commencement of full, final DTV operations, and (3) plans for terminating existing service (e.g., reduction or termination of analog or pre-transition digital service).  All stations that have not completed their full and final DTV facilities by October 20th need to review the status of their DTV transition and update the Form 387 accordingly.

In addition, stations are reminded that the Commission’s DTV Orders contain specific rules regarding the early termination or reduction of analog service.  In particular, stations that intend to permanently reduce or cease analog operations prior to November 19, 2008, must have obtained authority from the FCC to do so and must have aired the appropriate viewer notifications.  For stations intending to permanently reduce or cease analog operations after November 19th, but before the February 17, 2009 switchover do not require prior FCC approval, however, the station must give the FCC 30-days advance notice, and must also air 30 days of viewer notifications letting the audience know that the analog will be terminated early.  Stations should also include this information in their Form 387 reports so that the FCC knows when the station intends to permanently terminate their analog service.

We recently wrote about the controversy before the FCC about Arbitron‘s roll-out of the Portable People Meter ("PPM").  A number of broadcast groups, particularly those who target minority audiences with their programming, have requested that the FCC hold a hearing as to whether the introduction of the PPM in a number of major radio markets should be allowed, arguing that it has the potential to discriminate against minority audiences and to decrease diversity in the media.  Arbitron and other broadcast groups have opposed the initiation of that proceeding, arguing that the regulation of a ratings service exceeds the FCC’s regulatory authority.  Now, the opponents of the PPM have sough relief from a number of state and local governments, with the Attorneys General of New York and New Jersey filing suit to prevent the initiation of service by Arbitron.  The office of New York Attorney General Andrew Cuomo issued this Press Release, and that of New Jersey Attorney General Anne Milgram issued this Release, citing the reasons for the suit.  Both claim that the use of PPM technology, which they claim has methodological flaws, is a deceptive trade practice by a monopoly provider of services.  The NJ suit goes on to claim that the disparate effect of the claimed inaccurate measurements on minority and ethnic stations violated the state’s anti-discrimination laws.  Arbitron of course denies these claims.

The lawsuits have received substantial coverage in both the popular and trade press.  Today’s Washington Post has an article discussing the controversy.  Citing an interview with Alfred Liggins of Radio One, a leading radio group targeting African American listeners, the article suggests that the PPM may take a while for stations to adapt to, but once they do, even minority-targeted stations can obtain valuable programming feedback from the new methodology, as it allows feedback as the ratings information in days rather than the months that that the current diary system requires.  This rapid feedback allows broadcasters to make programming adjustments that will allow them to maintain or improve their ratings position.  Mark Ramsey’s Hear 2.0 blog looks at some anomalies in the PPM in specific demographics, but in another post concludes that despite whatever shortcomings the PPM may have, the industry needs to work with Arbitron on insuring that the PPM works – as an automated system is inherently more reliable than the diary method that relies on listeners recalling and accurately writing down their radio listening.

Continue Reading NY and NJ State Attorneys General Sue to Stop Roll Out of PPM – What’s A Station to Do?

As we enter the waning days of this election season, where some candidates get more desperate and the attack ads get sharper, broadcasters are often faced with requests that they pull an ad created by a candidate.  Claims are made that the ad contains untrue claims about an opponent or that the ad contains copyrighted material used without permission.  What is a station to do?  When the ad is an ad purchased by a candidate or their authorized committee, and contains a "use" by the purchasing candidate (a use being a spot where the purchasing candidate’s voice or likeliness appears on the spot) the broadcaster is forbidden from censoring that ad.  Essentially, that means that the candidate can say just about anything in their ad (as long as it does not violate a Federal felony statute), and the FCC’s rules prohibit the broadcaster from refusing to air the ad based on its content.  But, because the station cannot censor the ad, it has no liability for the contents of that ad.  This is in contrast to ads by third parties (e.g. advocacy groups, unions, political parties and others not specifically authorized by the candidate), where the broadcaster theoretically has liability for the content of a political ad (see our post on that subject, here).

Two recent cases illustrate the issue.  In one, according to press reports, in a race for the sole seat in the House of Representatives representing the state of North Dakota, one candidate has claimed that the ads of the other misrepresent the positions of that candidate.  The candidate being attacked has asked that the spots be pulled from the air, while the candidate running the spots has refused to pull them.  Even if requested by the candidate being attacked, and even if the ad is in fact false, broadcasters cannot pull one candidate’s ad if that candidate wants to continue to run it.

Continue Reading Broadcasters Prohibited From Censoring a Candidate’s Ad

The FCC has released another Public Notice that it is auditing the EEO performance of a number of the entities that it regulates.  However, this time, the audits are not of broadcasters, but instead of cable companies and other multichannel video programming distributors who are subject to essentially the same EEO rules as broadcasters.  The list of MVPDs that have been hit by the audit can be found appended to the Notice.  Each company that was audited has 30 days to respond to the FCC with details of its compliance with the EEO rules, including information about the wide dissemination of information about each of its job openings and other EEO outreach efforts that it has made.  The FCC’s policy is that it will audit the EEO performance of 5% of all of its broadcasters and MVPDs each year – so use this audit notice as a reminder to review your EEO program.  Details of the FCC’s requirements for a broadcaster’s EEO obligations can be found in Davis Wright Tremaine’s advisory, here.

Press Reports (such as this one) have stated that the Obama campaign has purchased half-hour blocks of time on at least NBC and CBS to broadcast a political infomercial to be aired at 8 PM Eastern time on October 29.  Some reports indicate that other broadcast and cable networks will also be broadcasting the same program.  Did the networks have to sell him the time?  In fact, they probably did.  Under FCC rules, Federal political candidates have a right of reasonable access to "all classes" of time sold by the station in all dayparts.  This includes a right to program length time, a right that was affirmed by the US Court of Appeals when the networks did not want to sell Jimmy Carter a program length commercial to announce the launch of his reelection bid.  Because of this right, the networks often had to sell Lyndon LaRouche half hour blocks of time to promote his perennial candidacy for President. 

How often do networks (or stations) have to make such time available?  They only have the right to be "reasonable." While what is reasonable has not been defined, the amount of time that will be requested will probably be limited by the cost of such time.  Even were it not limited by cost, the FCC would probably not require that a broadcaster sell such a prime time block more than once or twice during the course of an election – and given the late stage that we are in the current election, it seems unlikely that more than one such request would have to be honored during these last few weeks of the campaign.  Stations do not need to give candidates the exact time that they requested – so the rumored reluctance of Fox to sell this precise time to the Obama campaign because it might conflict with the World Series would probably be reasonable – if they offered him the opportunity to buy a half hour block at some other comparable time.   

Continue Reading Obama Buys A Half Hour of Time on Broadcast Networks – What FCC Legal Issues are Involved?

According to numerous press articles, including this one in Multichannel News, the FCC has begun an investigation into several commentators on TV news programs to see if they were receiving payments or other consideration for presenting a particular viewpoint on military issues on which they were interviewed.  According to press reports, the FCC has sent letters requesting information about the arrangements to both television networks and the commentators themselves.  This investigation would appear to be a continuation of the FCC’s concern about undisclosed sponsors of programming attempting to convince the public of a particular position on any controversial issue of public importance.

This investigation seems to be very similar to a case about which we wrote last year, where the FCC issued fines to a station group that aired programming that included commentator Armstrong Williams, who had been receiving consideration to speak in support of the No Child Left Behind program.  The FCC has also been looking at similar issues in its Sponsorship Identification and Embedded Advertising Proceeding, about which we wrote here.  In both of these proceedings, the FCC has warned broadcasters that they need to assess whether anyone who is supplying programming material to the station is receiving consideration for the views expressed on that programming, particularly where that programming involves something that could be considered a controversial issue of public importance.  Thus, stations should be asking networks, program syndicators, and others appearing on a program whether they are receiving any consideration for the views that they are about to express – particularly where that is not clear from the context of the program.  While the FCC has not explicitly so stated, it would seem like an interview of an author about his new book or an actor about his new movie would clearly imply that the author or actor received consideration.  But where someone is expressing an opinion on some matter where it is unclear that there is any commercial or financial interest, and such an interest does indeed exist, the station should be aware  of that interest and disclose that connection on-air.  See our discussion here for another case where the FCC imposed fines on a cable system for not disclosing such interests.  One more thing to worry about!

In a recent decision, the FCC adopted new rules for AM station proofs of performance that make the process much simpler.  We wrote about this proposal when it was advanced, here.  The order adopted a week ago allows stations installing new series fed AM directional antennas to avoid the time-consuming and expensive process of doing a full proof of performance, by instead using a computer modeling process plus a limited number of actual measurements.  Comments filed in the proceeding convinced the FCC that this process would be as accurate as the full proofs that had previously been required for new AM stations and for many changes to existing stations.  Providing this option to AM broadcasters should greatly simplify and expedite the process of completing AM construction and the licensing of such stations.

As part of this order, the FCC also asked for further comments to discuss whether the construction of communications towers – even those that do not otherwise fall under FCC jurisdiction because, for instance, they are too short to require tower registration which is primarily triggered by FAA considerations – near to AM directional towers should also be required to use this same computer methodology to determine the effect that new construction would have on the nearby AM station.  If so, would parties proposing such new construction have to notify nearby AM stations, or just some subset of AM operators (such as those that are themselves operating under program tests).  If notification is to be required, how much advance notification should be required?  Comments on this proposal are due 30 days after this order is published in the Federal Register. 

The Barack Obama Channel – a surprising concept to find on your satellite television dial. Yet there appears to in fact be such a channel, according to a columnist at Politico, who found that the Dish Network is dedicating a whole channel to Obama commercials run back to back. Has Dish owner Echostar decided to stake out a partisan position in this hotly contested election? No, instead, it appears that the Obama campaign has decided to purchase time on that channel to run their ads. Leaving aside the question of whether this is a wise expenditure of campaign funds, the question is raised – is this legal?

The answer appears that it is legal, as long as the McCain campaign is given equal opportunities to buy their own channel at a similar price. The Direct Broadcast Satellite (“DBS”) Companies – Dish and DIRECTV – are subject to the FCC’s political broadcasting rules in the same manner as broadcasters (rules more strict than those that apply to cable companies, as reasonable access requirements are imposed on DBS requiring that they sell reasonable amounts of commercial time to Federal candidates who may request it). Thus, the equal time or equal opportunities rule would apply to DBS.  Because of the equal opportunity obligations, the mere fact that only one candidate has decided to avail themselves of the opportunity to buy the time does not make it problematic. Dish just needs to maintain enough channel capacity to create a McCain channel should that campaign decide, at some point between now and the election, to spend its resources to buy a channel of its own. The Obama Channel is another in a seemingly never-ending stream of weird political broadcasting issues that have come up in this election season. Our coverage of some of the other issues that have come up this year can be found here, and our Political Broadcasting Guide, setting out many of the rules of the road for this election season, is available here.