Here are some of the regulatory developments of significance to broadcasters from the last week, with links to where you can go to find more information as to how these actions may affect your operations.

  • New rules went into effect on May 24 that are designed to give broadcast TV stations greater flexibility in the placement of transmitters in Distributed Transmission Systems (DTS, also known as Single Frequency Networks). DTS is seen as important as many stations convert to the ATSC 3.0 transmission standard.  For more on the new rules, see our blog article here.  While these rules have become effective, Microsoft has asked the FCC to reconsider them claiming, among other things, that the new rules harm the ability to deploy white space devices.  The FCC will be soliciting public comment on the Microsoft petition in the near future.  (Petition for Reconsideration)
  • The FCC announced this week that, at its June 17 meeting, it will vote on two petitions asking the FCC to reconsider LPFM technical rules that were issued in April 2020 which, among other things, permitted greater use of directional antenna by LPFM stations. In its draft order on those petitions, the Commission appears ready to reject them which, according to Acting Chairwoman Rosenworcel, will help pave the way for a window for the filing new LPFM applications in the near future.  (Draft Order on Reconsideration).  Look for more details on these LPFM issues in an article that should be posted on our blog on Tuesday.
  • At the same June 17 meeting, the Commissioners will vote on updates to its Emergency Alert System (EAS) and Wireless Emergency Alerts rules that it proposed in February, including introducing a new class of alerts called “National Alerts” and updating the process for reviewing and approving state EAS plans and for reporting false alerts. We wrote at length about the draft rules, here.  The Commissioners will also vote on a request for comments on whether certain irrelevant EAS event codes should be deleted, changed, or replaced and whether EAS should support “persistent” display and notification of severe threats to loss of life.  (Draft Report and Order and Further Notice of Proposed Rulemaking). The February FCC notice also asked whether emergency alerts can and should be delivered via streaming services The FCC is still accepting reply comments on its inquiry into that issue through June 14.

As the calendar flips to June, pandemic restrictions across the country continue to loosen, and we inch closer to summer.  Broadcasters could be forgiven for not having regulatory dates and deadlines on the top of their minds.  There are, however, many important dates and deadlines to keep track of during June – we provide details of some of them below.  As always, be sure to stay in touch with your FCC counsel for the dates and deadlines applicable to your operations.

Radio stations in Arizona, Idaho, Nevada, New Mexico, Utah, and Wyoming and television stations in Michigan and Ohio should be putting the final touches on their license renewal applications, which are due by June 1.  See our article, here, about preparing for license renewal.  These stations must also file with the FCC a Broadcast EEO Program Report (Form 2100, Schedule 396) and, if they are part of a station employment unit (a station or a group of commonly owned stations in the same market that share at least one employee) with 5 or more full-time employees, upload to their public file and post on their station website a link to their Annual EEO Public Inspection File report covering their hiring and employment outreach activities for the twelve months from June 1, 2020 to May 31, 2021. Continue Reading June Regulatory Dates for Broadcasters: License Renewal and EEO Filings, Comments and Replies, Auction Upfront Payments, Streaming Rates Announcement, and More

The Copyright Royalty Board decision on the rates to be paid in the next 5 years by webcasters, including broadcasters who simulcast their programming on the internet, to SoundExchange for the digital public performance of sound recordings is supposed to be released by June 14.  These royalties are collected by SoundExchange from noninteractive webcasters (see our articles here, here and here on the difference between interactive and non-interactive webcasters) and are distributed to the artists who perform on recordings and to the copyright holders of those recordings – usually the record labels.  The CRB sets these rates in 5-year increments.  The rates at issue in the current proceeding are for 2021-2025.  As we wrote here and here, these rates would normally have been determined before the end of the last rate period at the end of 2020 but, as the trial to determine the rates was postponed by the pandemic, the CRB has been given to June 14 to announce the new royalties, presumably to be made retroactive to January 1.

The proposals made in this proceeding vary widely.  SoundExchange and its associated record labels are arguing that the rates should substantially increase, from their current level of $.0018 per performance (per song per listener – see our article here) for nonsubscription streams to rates of $.0028 per performance for 2021, with cost of living increases each succeeding year.  For subscription webcasting, SoundExchange proposes that the rates increase from $.0024 to $.0031.  In these cases, each party makes arguments as to what a willing buyer and willing seller would pay in a marketplace transaction for such rights.  The parties introduce expert witnesses to testify as to what that rate would be, usually by looking at other similar marketplace transactions.  To arrive at its proposed rates, SoundExchange introduced experts who looked at the market price for the use of music by interactive services.  These prices are set by direct negotiations.  From those prices, the experts attempted to calculate an appropriate adjustment to remove the value of the interactivity to determine the rates that a noninteractive service would pay.  This proposed increase in royalties was, of course, countered by representatives of the services who will pay the royalties to SoundExchange. Continue Reading Copyright Royalty Board Decision on Webcasting Royalties Expected by June 14 – What Will the Streaming Rates for 2021-2025 Be?

Here are some of the regulatory developments of significance to broadcasters from the last week, with links to where you can go to find more information as to how these actions may affect your operations.

  • The FCC asked for public comment on a proposal to increase from 100 to 250 watts the maximum power allowed for Low Power FM stations. This proposal has previously been raised by LPFM advocates many times, and thus far it has been rejected by the FCC (see our article here on a prior attempt).  Comments on this updated petition to raise the allowable power for LPFMs are due by June 21, 2021.  (Public Notice)(Petition for Rulemaking and Appendix)
  • As we noted in updates over the last three weeks (here and here), the FCC released a Notice of Proposed Rulemaking that sets out its tentative plan for assessing broadcast regulatory fees to be collected before October 1 of this year. Broadcasters can file comments now through June 3, with reply comments due by June 18.  (Federal Register). As the FCC’s proposal includes increases in some broadcast fees for the third year in a row, the proposal has met resistance from the National Association of Broadcasters.  Members of the NAB staff talked with FCC to voice their concern about the fee increases, especially in light of broadcast revenue decreases due to COVID.  The NAB argued that the FCC’s costs, used to determine the fees each regulated industry pays, were improperly allocated and that the fees for other industries, which were not as hard-hit by the pandemic, should bear a bigger burden in paying these costs.  (NAB Letter)
  • The FCC this week extended by two weeks the dates by which interested parties can submit comments on the FCC’s rules which arose after the passage of the Twenty-First Century Communications and Video Accessibility Act of 2010 (CVAA). The CVAA was designed to make broadcasts and other communications channels more accessible.  It has resulted in requirements including audio description of television programming and captioning of TV programming delivered over the internet.  Comments on whether any of these rules should be modified are now due on June 7, 2021 with replies due by July 6.  We wrote more about the CVAA and the request for comments, here.  (Public Notice)
  • This week, in ten separate actions, the FCC either changed, or proposed to change, the channel of a full-power television station from a VHF to a UHF channel. Since the FCC late last year lifted its freeze on channel changes by TV stations (see our article here), a freeze that had largely been in place for over a decade, many stations operating on VHF channels (13 and below) have requested to change their channels to UHF.  UHF channels (14 and above) are subject to less interference and provide better building penetration for digital operations, and these channels are also seen as superior for ATSC 3.0 operations (see our article here).
  • In legislative developments, we wrote on our blog this week about a congressional effort to establish a “Future of Local News Committee” that would be tasked with examining the state of local news in the United States. The committee would ultimately deliver a report to Congress with recommendations for protecting and enhancing local news operations, and potentially the federal funding of newsrooms.  (Future of Local News Committee Bill)

 

Under the Twenty-First Century Communications and Video Accessibility Act of 2010 (commonly called the CVAA), the FCC has adopted many rules designed to enhance accessibility to broadcast communications, particularly those provided by television broadcasters.  In a recent Public Notice, the FCC asked for comments as to how the implementation of the CVAA has worked in the decade that it has been in effect, and what changes (if any) need to be made to reflect current technologies.  The FCC this week announced an extension of the comment dates.  Comments are now due on June 7, 2021 with replies due by July 6.

The adoption of the CVAA led to the FCC adopting many different rules that are designed to enhance accessibility to television programming.  These rules include the requirements for Audio Description of video programming (formerly referred to as “video description”) where the FCC required that larger market network TV stations pass through a certain amount of programming with a secondary audio channel that describes the action on the screen (see our article here on a recent expansion of that requirement).  The FCC also adopted requirements for the captioning of video programming that TV broadcasters post on the Internet that was initially broadcast over the air, with captioning, and then repurposed for online use (see our articles here, here and here).  Rules requiring TV stations to use their secondary audio channels (their “SAP” channels often used for second-language audio for TV programs) to broadcast audio versions of alerts provided by a TV station during non-news programming have also been adopted pursuant to the CVAA (see our articles here and here, here on this requirement).  And, while mandated prior to the CVAA, closed captioning requirements for TV stations and other video programmers have been reviewed in light of CVAA concepts, including the adoption of closed captioning quality standards such as accuracy and delay (see for instance, our articles here, here and here).

Given the broad reach of these obligations, broadcasters should be tracking the FCC’s actions in this proceeding and watching the comments filed to assess how their operations may be impacted by any suggested changes to these rules.  With the extended comment period, broadcasters also have the opportunity to suggest changes of their own to make these rules operate more effectively.

There can be no doubt that local newspapers have been significantly impacted over the last two decades by the ascent of the Internet.  And, as we have written before (see, for instance, our article here), digital media has also had a significant impact on the local revenues of broadcasters, who also have traditionally specialized in covering local events.  To study the effect of the decline in local news sources, legislation has been introduced in both the House and Senate to create a government committee to look at various aspects of this issue. The “Future of Local News Committee” would include individuals appointed by the majority and minority in the House and Senate, as well as individuals selected by the Corporation for Public Broadcasting, The National Endowment for the Humanities, and the US Agency for Global Media.  Each appointee is to be someone experienced in some aspect of local media.  The committee would have one year to deliver a report to Congress.

What would they study?  The legislation suggests that the committee would have broad investigatory powers to review how the change in local media has affected local communities.  The bill’s preface includes language stating that over 2000 newspapers have gone out of business since 2004, and that of the 6,700 remaining, 1000 could be classified as “ghost newspapers” whose staffs have been so reduced that they cannot effectively cover local events.  The bill also cites a Pew Research study that shows that local newsroom employees at newspapers, broadcast outlets and digital sources dropped 25% from 2008-2018.  Perhaps most startling is the statement that newspapers alone lost more than $35,000,000,000 in revenue between 2004 and 2018.  All these factors, and many others cited in the bill, are alleged to show that local media can no longer effectively cover local events. Continue Reading Does Local News Need Government Assistance to Survive – Legislation Proposed to Set Up Commission to Study the Impact of Changes in Local Media on Local Communities  

Here are some of the regulatory developments of significance to broadcasters from the last week, with links to where you can go to find more information as to how these actions may affect your operations.

  • In a speech to the Media Institute, FCC Commissioner Starks spoke of the importance of diversity in media ownership and how it should be considered in making any decisions on revisions to the media ownership rules. In addition, the Commissioner stated that a proposal is now circulating among the Commissioners to regularly gather details from broadcasters on the race and gender of their employees.  That information has not been collected for almost 20 years after questions were raised about the constitutionality of the use of such data in assessing broadcasters hiring practices.  The text of the Commissioner’s speech is here.
  • Commissioner Carr issued a statement arguing that the Commission should not interfere with a broadcast station’s newsroom decisions following a complaint filed by the Baltimore City State’s Attorney’s Office about a TV station’s coverage of its office. [Complaint and Carr Statement]. We looked at this complaint and similar cases and the role of the First Amendment in broadcast regulation, here.
  • The NAB released a study prepared by BIA Advisory Services finding that social media and other online platforms underpay broadcasters by billions of dollars each year for use of their content, undermining the economic support for local news that these stations provide. [NAB Statement and Study].  NAB President Gordon Smith at the NAB Leadership Conference this week mentioned this report and Congressional proposals to remedy this situation. [Smith Statement].  We wrote here about the details of the pending legislative proposal to give broadcasters more bargaining power with tech platforms.
  • The regulation of online platforms was much discussed at the Leadership Conference and has otherwise been in the news. In another article, we wrote about how this regulation (including reforms of Section 230 which insulates online platforms from liability for content posted by others) could affect advertising on such platforms.
  • As we noted in last week’s update, the FCC released a Notice of Proposed Rulemaking that sets out its tentative plan for assessing broadcast regulatory fees to be collected before October 1 of this year, with comments due on or before June 3 and reply comments due by June 18. (Federal Register). The FCC’s proposals include increases in some broadcast fees and questions as to whether the Commission needs to accommodate broadcasters and other regulated companies who experienced economic hardship because of the pandemic.  The Commission this week released several decisions by its Office of Managing Director on individual requests for waivers of the payment of annual regulatory fees – decisions that made clear the high burden that an applicant faces in receiving such a waiver. [Summary of denials, full decisions available at links in FCC’s Daily Digest]
  • The FCC’s Media Bureau this week released announcements of consent decrees with nine different radio broadcasters over late uploads to their online political file disclosed in their license renewal applications. The FCC in the previous week announced ten additional consent decrees with other broadcasters.  The consent decrees mandate training programs for station employees on political file obligations and two years of regular reporting requirements where these broadcasters must provide specifics on their compliance to the FCC.  These consent decrees show just how seriously the FCC takes violations of a broadcaster’s obligations to immediately upload information about political advertising orders to their online public inspection files.  We wrote about political consent decrees and what they require here.

Next week, I will be discussing regulatory issues for media companies with Eriq Gardner of the Hollywood Reporter (who covers legal issues on their must-read THR, Esq site) in a “Candid Conversation” hosted by Matrix Solutions (more information here, including a registration link).  The sponsor of this conversation consults on media advertising matters, so the content will likely be geared toward the impact of changes on the advertising industry.  While the conversation will cover structural media regulation issues, like broadcast ownership, the relationship between television and various multichannel video providers (both traditional, like cable and satellite television, and online), and similar matters, I think one of most interesting topics will be a discussion of the proposed regulation of tech platforms.  In thinking about that issue (about which we have written many times, including recent articles here and here), it occurs to me that such regulation could have a huge impact on the digital and social media giants that have arisen in the modern media world.

Much has been written, particularly in recent days, about the antitrust regulation to which these tech giants may be subject – with calls for action from both the political right and left (see, for instance, this article drawing parallels between the books recently written about this subject by Amy Klobuchar and Josh Hawley).  Even if such sweeping changes are not adopted, there are more targeted regulatory proposals that could have a direct impact on the advertising on these online platforms.  As we have noted before, advertising on online platforms is now estimated to constitute over 50% of the local advertising sales in virtually every geographic market.  Certainly, privacy regulation limiting the ability of companies to track users across various online platforms could affect such sales.  Less publicized has been the impact of Section 230 reform, which in at least one bill would exempt advertising from the protections afforded companies for the online content that they host. Continue Reading Regulation of Online Platforms and the Effect on Advertising – Including Section 230 Reforms

Everyone knows that a fundamental principle of American democracy is the First Amendment – guaranteeing many freedoms to US citizens including freedom of the press and freedom of speech.  It is one of those concepts that underlies our society, but is often mentioned only in passing, and rarely considered in practice.  Few people – even broadcasters and other media companies – have cause to think about First Amendment principles in their day-to-day operations.  The concepts embodied by the First Amendment are almost a given – except when they are not.

In our politically polarized society, there are more and more arguments made about regulation of speech in various contexts – often made without significant consideration of those First Amendment principles.  On the broadcast side, we have seen Commissioner Carr react to two cases where the FCC has seemingly been called on to regulate the speech (or anticipated speech) of broadcasters.  One case involved a call to deny the sale of a broadcast station allegedly based on a perceived change in the political orientation of its programming from liberal to conservative (see the Carr statement here), and another calling for the FCC to investigate a TV station in Baltimore for allegedly being too focused on investigations into a local government official (see the Carr statement here and an NAB statement also weighing in on the controversy here).  While there may well be issues in each case that go beyond the question of the proposed speech of the broadcasters involved, the issue of whether the FCC can get involved in the regulation of political positions taken by broadcasters is one that is addressed both by the Communications Act and past FCC precedent. Continue Reading The First Amendment’s Role in Broadcast and Online Regulation

Here are some of the regulatory developments of significance to broadcasters from the last week, with links to where you can go to find more information as to how these actions may affect your operations.

  • The FCC released a Notice of Proposed Rulemaking that sets out its tentative plan for assessing broadcast regulatory fees to be collected before October 1 of this year to pay for FCC operations for the current fiscal year. The notice proposes sticking with last year’s decision to assess television fees based on the population served by a station.  The proposed fees to be paid by each TV station are included in an Appendix to the Notice.  While proposing to use these unique fees for each station for this year, the FCC proposes for next year to group TV station fees within tiers, and it seeks comments on the tiers to be used.  While the total fees to be paid this by the radio industry are the same as last year, each station is proposed to pay more, apparently based on the FCC’s estimates that there will be fewer total stations paying fees.  The FCC also asks if it should again provide some relief to companies that, because of COVID-related financial difficulties, cannot pay their fees or cannot pay them on time.  Comments on the FCC’s proposal are due by June 3 and reply comments are due by June 18.  (Notice of Proposed Rulemaking)
  • As we noted a few weeks ago, FEMA has now officially chosen August 11, 2021 as the date for the next national EAS test (with August 25 as a backup date). The test will originate through Primary Entry Point facilities (i.e., principally through broadcast transmissions) rather than through internet dissemination via the Integrated Public Alert & Warning System (IPAWS) to test how well alerts are distributed if internet delivery is unavailable.  (FEMA Letter)
  • The C-band Relocation Payment Clearinghouse (RPC) posted its Draft C-band Handbook and will accept comments on the draft before 6:00 p.m. Eastern on May 14. The handbook covers, among other things, how funds will be distributed from the money received from entities that purchased C-band spectrum rights to those entities, like broadcasters, eligible for reimbursement for clearing the spectrum. In the past week or two, many broadcasters who are eligible for reimbursement, either through lump-sum payments or through the actual reimbursement of out-of-pocket expenses, have heard directly from the companies coordinating the reimbursement process asking questions about the details for such reimbursement.  Stations should be sure to quickly respond to these inquiries to avoid delays or other problems with those payments.