In a letter to FCC Chairman Martin and Commissioners Copps and Tate, Congressman Edward Markey, head of the House of Representatives Subcommittee on Telecommunications and the Internet, has asked that the FCC take strong steps to restrict the advertising of unhealthy food in children’s television programs.  While applauding voluntary efforts promised by some broadcasters to include in their children’s programing more Public Service Announcements (PSAs) for healthy eating, Congressman Markey urged the FCC to do more by cutting in half to 6 minutes per hour the amount of permissible advertising in children’s programming , and by finding that a station had not met its obligations to broadcast educational and informational programming directed to children if the station aired ads for unhealthy foods during a program which would otherwise qualify as a toward meeting the station’s obligations.

The letter from Congressman Markey, while citing efforts in other countries to enforce similar regulations, does not address basic issues with each of his proposals.  First, if sponsorship of children’s programming is cut in half, won’t that also cut the incentive of broadcasters to air such programs?  Cutting sponsorship to the bone would seem to guarantee that broadcasters will do the absolute minimum amount of children’s programming required, so that they can air programs where there are no advertising restrictions.

These requirements would also seem to make broadcasters into the food police.  Broadcasters will have to educate themselves as to the nutritional qualities of various food products to make sure that nothing impermissible gets on the air.  And where will lines be drawn?  Could a station safely advertise a fast food store if the ads featured only the salads sold by the store – even where that store might also sell not so healthy alternatives?  If definitions are drawn by numerical limits on contents such as sugar, salt and fat (as suggested by the letter), will these limits necessarily lead to advertising the most healthy foods?  Will broadcasters be forced to substitute for parents in making decisions about what their children will eat?

 

Continue Reading Congress Urges New Children’s Television Regulation

This article is no longer available. For more information on this topic, see  FCC Deadlines in January – Quarterly Issues Programs Lists, Children’s Program Reports, Comments on TV Online Public File and Public Interest Obligation Proposals, FM Window and More

On the same day that many webcasters were on Capitol Hill lobbying for the Internet Radio Equality Act, the Copyright Royalty Board issued its Final Determination of Rates and Terms today, and it was published in the Federal Register.  That action starts the clock ticking on appeals which must now be filed in 30 days.  In the Final Determination, the Board included a few revisions in its initial decision, reflecting the issues that it addressed in response to the Rehearing motions – including provisions adding a transitional period of two years during which webcasters can pay using an Aggregate Tuning Hour formula instead of paying based on each performance.  Surprisingly, the Board also amended the rules that it adopted governing the timing of the first payment under the new royalty rate, making the first payment due 45 days from the end of the month during which the Final Determination was issued.  As the decision was issued today, May 1, that would delay the due date for the first payments under the new royalties until July 15.

The statute governing the Copyright Royalty Board allowed the Library of Congress to review the CRB decision to determine if the Librarian (through the Copyright Office) saw any obvious errors of law.  Apparently, the Librarian found none (though that does not mean that there are not issues that can be raised on appeal), leading to the publication of the decision in the Federal Register.  Appeals are due 30 days after that publication.  On that date, parties file a Notice of Appeal, which provides notice to the Court of Appeals that parties believe that the decision was in error.  After those notices are filed, the Court will set briefing schedules and oral arguments.  The appeal process that can take a year or more before a decision is rendered.

Our previous coverage of the CRB proceeding can be found, here.

In a ruling released last week, a US District Court Judge issued a ruling finding that a download of a recorded musical work does not give rise to a "public performance" requiring a payment to ASCAP, BMI or SESAC.  If this decision is upheld on appeal, it could mean that one less fee would have to be paid in connection with on-demand downloads – which would also affect podcasts and video downloads made available by broadcasters on their websites.  However, there are many issues that must be understood about this ruling, so broadcasters should not impetuously rush to provide downloads and podcasts without first securing the bundle of rights necessary for such performances.

First, it is important to understand the issue that was presented in this case.  The case did not involve streaming of programming – so it has no effect on Internet radio royalties.  It involves only downloads – where a copy of a specific work is downloaded to a single consumer’s computer at the request of that consumer.  This is what happens when a consumer buys a song from iTunes, or downloads a podcast made available by a broadcaster.  There is no question that, to provide such a download or podcast containing music, a service needs to get permission from the copyright holder in the "sound recording," the song as recorded by a particular artist.  This is typically received from the record company which holds the copyright.  In addition, there is a requirement that the rights to the composition must be obtained for purposes of the making of the making of a "reproduction" and a "distribution" of the underlying composition.  This is typically obtained from the publishing company or a clearinghouse such as the Harry Fox agency.  A service that provides downlaods of music can alternatively pay a statutory royalty for the composition, though that requires following a somewhat cumbersome process of filings set out by the Copyright Office and requiring specific notice to the copyright holder in the publication.

Continue Reading District Court Finds No Public Performance In Download – Could Affect Fees on Podcasts and Video Downloads

At it’s meeting on Thursday, the FCC announced that it is commencing a proceeding that would require cable systems to adopt measures to insure that over-the-air television stations would continue to be available even to analog cable subscribers after the end of the digital television subscribers.  This might include some sort of dual carriage requirement that a cable system carry both an analog and a digital feed of a television station’s signal (which the FCC had rejected for pre-transition cable carriage), or that the system provide a converter box to the analog subscriber.  While the FCC has not released the full text of its Notice of Proposed Rulemaking setting out the details of the issues that it raises, a Public Notice about the proposal can be found here.  A summary of the issues is also available in our firm’s bulletin, here.

Watch for more on this proceeding once the full text of the Notice of Proposed Rulemaking is released.

On Thursday, the FCC issued its Report on violent programming on television, finding that such programming has a negative impact on the well being of children, and suggesting that Congressional action to restrict and regulate such programming would be appropriate.  A summary of the findings of the Commission can be found in our firm’s bulletin on the Report, here.  As we point out in our bulletin, the Commission did not adopt this report with a united voice, as both Commissioner Adelstein and McDowell expressed concerns about the thoroughness of the report, the practicality and constitutionality of drawing lines between permitted and prohibited violence in programming, and even whether the government is the proper forum for restricting access to such programming or whether this isn’t fundamentally an issue of family and parental control. 

The Report suggests that legislative action to restrict violent programming  or to channel it to certain time periods might be appropriate as parents are often not home when children watch television, and technological controls, like the V-Chip, are ineffective as parents don’t know that they exist or, if they are aware of the existence of the controls, they don’t know how to activate them.  The Commission also suggests that the ratings given to programs are not always accurate.  An interesting alternate take can be found in an article in Slate, here, citing a study not mentioned by the FCC finding that parents, even when carefully educated about the V-Chip and its uses, do not use it.  This seems to indicate that parents are not as concerned about the issue as is the FCC, and suggests that the real motivation is not restricting what is presented to children, but instead what is available to adults.

 

Continue Reading Violence on Television – FCC Issues Report Suggesting That Congressional Action Is Appropriate

The Internet Radio Equality Act was introduced in the House of Representatives today, proposing several actions – most significantly the nullification of the decision of the Copyright Royalty Board raising royalty rates for the use of sound recordings by Internet radio stations.  Our summary of the decision and its aftermath can be found here.  In addition to nullifying the decision of the Board, the Act does the following:

  1. Changes the "willing buyer, willing seller" standard used to determine royalty rates for Internet radio to the "801(b)" standard – named after section 801(b) of the Copyright Act, which considers a variety of factors in determining royalties – factors including possible disruption to the industry of royalties, the maximization of the distribution of the copyrighted work to the public, the relative value of the contributions of the copyright holder and the service, and the determination of a fair rate of return to the copyright holder.  The 801(b) standard is the used for determining rates for satellite radio and digital cable radio.
  2. Establishes an interim royalty rate for 2006-2010 of  (at the choice of the webcaster) either .33 cents per Aggregate Tuning Hour of listening or 7.5% of the service’s revenues directly related to Internet radio
  3. For noncommercial radio, places the royalty determination into Section 118 of the Copyright Act, which is where other noncommercial royalties (including the royalty for ASCAP and BMI for over-the-air use of musical compositions) are found, using the standards set forth in that section; and
  4. Establishes a royalty for 2006-2010 for noncommercial entites at 150% of the fee that the service paid for the sound recording royalty during 2004.
  5. Requires three studies to be conducted after the initiation of the next royalty proceeding, that will be submitted to the Copyright Royalty Board for their consideration in that case.  One study, by the National Telecommunications and Information Administration ("NTIA"), would study the economic impact of royalties on the competitiveness of the Internet radio marketplace.  A second, to be conducted by the FCC, would study the impact of royalties on local programming, diversity of programming (including foreign language programming), and the competitive barriers to entry into the Internet radio market.  A final study, by the Corporation for Public Broadcasting, would provide information to the CRB on the impact of the royalties on public radio operators. 

Continue Reading Internet Radio Equality Act Introduced to Nullify Copyright Royalty Board Decision

As we’ve discussed before, here, the FCC has been reviewing their power to regulate violent programming on broadcast stations.  Despite the apparent constitutional and practical issues involved in such restrictions (e.g. are Roadrunner cartoons covered?), published reports indicate that a majority of the FCC Commissioners will issue a report asking Congress to give the FCC authority to regulate violent programming.  The Washington Post today published a story stating that the FCC will this week release its report and ask Congress for the authority to regulate not only broadcast stations, but also basic cable programming.  In the indecency area, the Courts have stepped in to prevent the FCC from regulating cable, given its subscription nature and its ability to block specific channels of programming upon request of a subscriber.  If the FCC does in fact ask for the ability to regulate basic cable, this will break new ground, and will surely end up in court.

 At a legal panel in Las Vegas, held in connection with the National Association of Broadcasters Convention, panelists speculated that the Chairman of the Commission and Commissioner Copps favor the report – while Commissioners Adelstein and McDowell are more concerned about the constitutional implications of this action – making for coalitions on this issue different from those that usually are in place on most FCC decisions relating to broadcasting.

This report, which many had expected to be released prior to the NAB Convention, will no doubt provoke heated arguments in Congress, the Courts and at the FCC.  It’s one more programming issue in a year where proposing new programming restrictions seems to have become the rage.