Once upon a time, August was a quiet month in Washington, when everyone went on vacation. Sure, there are plenty of vacations that will happen this coming month, but it seems that regulatory activity no longer takes a break. For example, August 1 is the due date for the filing with the FCC of license renewals for all radio stations (including translators and LPFM stations) in North and South Carolina, and the filing of associated EEO forms for all full power radio stations in those states. With the renewal filing comes the obligation that these stations start airing, on August 1 and August 16, their post-filing announcements informing the public about the submission of the license renewal applications. Radio stations in Maryland, Virginia, West Virginia and the District of Columbia, who filed their renewals on or before June 2, also need to keep running their post-filing announcements on these same dates. Radio stations in Florida, Puerto Rico and the Virgin Islands, who are in the next license renewal group with their renewal applications to be filed by October 1, need to start broadcasting their pre-filing announcements this month, also to run on the 1st and 16th of the month. See our post here on pre-filing announcements.

Commercial and noncommercial full power and Class A Television Stations and AM and FM radio stations in California, Illinois, North Carolina, South Carolina, and Wisconsin that are part of an employment unit with five or more full-time employees must place their annual EEO public inspection file reports in their online public file. Links to those reports should also be placed on the home pages of these station’s websites, if they have a website. The effectiveness of these EEO public file reports, and the EEO programs of which they are a part, are being reviewed by the FCC in a proceeding started by a Notice of Proposed Rulemaking about which we wrote here. Comments on this notice asking for suggestions about how to make the EEO rules more effective are due August 21, with reply comments due by September 5.
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Press reports indicate that the Department of Justice is nearing the completion of its study of whether to suggest the revision of the antitrust consent decrees that have bound ASCAP and BMI for over a half century (see our summary of the issues that DOJ is considering here). Much of the impetus behind this review comes from claims from songwriters and their associated publishing companies that they simply are not receiving enough money from digital music services. In the music industry trade press, one can barely go a day without seeing some article about a songwriter whose song was played a million times on a digital music service like Pandora or Spotify, with the artist only receiving some relatively small amount of royalty revenue from that seemingly large number of plays. In looking at this question, I think that there are a number of issues that are misunderstood – perhaps the greatest being the meaning of big numbers – what is really meant when a song is played a million times by a digital music service. I’ve moderated two panels in the last month where royalty experts debated royalties generally and this topic specifically, and I will be moderating another at the RAIN Summit West in Las Vegas on Sunday. Before that discussion, and for those who won’t be at the RAIN Conference, I thought that it would be worth exploring some of this confusion about this issue here.

Last month, the Senate Judiciary Committee’s Antitrust Subcommittee held a hearing on the DOJ’s review of the antitrust consent decrees (video of the hearing, and written witness statements, are available here). During the course of the hearing, a songwriter representative, when asked by a Senator about the alleged impact of digital royalties on the songwriting community, made the assertion that when his song was played a million times on terrestrial radio, he could pay his bills, but when that song was played a million times on a digital service, he received only a few hundred dollars. While this kind of claim is made every day by songwriter representatives, and has contributed to the examination of music royalties being conducted by Congress (see our articles here and here), the Department of Justice and the Copyright Office (see our article here), in many ways, these claims seem to evidence a fundamental misunderstanding of the nature of digital services. It is truly a comparison of apples and oranges (or maybe apples and watermelons might be more appropriate) that has distorted the conversation about royalties. The claim was challenged at the Judiciary Committee hearing by a representative of Pandora, who pointed out that the million people reached by the million spins of a record on Pandora is the equivalent audience reached by something like 16 spins on a New York radio station. I thought that this exchange was crucial to the understanding of the issues involved in the examination of changes to the ASCAP and BMI royalty structure, yet I saw little or no coverage of the issue in press reports after the hearing.
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While we hate to turn this into the JSA/SSA blog, it appears that events are moving quickly on that front, so there is seemingly some news almost every day.  The week before last, the big news was comments of the Department of Justice filed with the FCC, suggesting that Joint Sales Agreements be attributable (meaning that they should count for multiple ownership purposes. i.e. you can’t do a JSA with another station in your market unless you can own that station), and that the FCC review Shared Services Agreements and similar arrangements on a case-by-case basis.  This is pretty much the position that the FCC’s new Chairman was expected to take, based on rumors floating around Washington (see our article here).  The way that the trade press reacted to the filing of the DOJ’s comments was an expectation that the “fix is in,” so that the expected action at the March FCC meeting was now a foregone conclusion.  But this past week has been filled with stories about broadcasters making the case that there is more to consider here, and late last week came an public filing from NABOB (the National Association of Black Owned Broadcasters), summarizing positions it took in a meeting with FCC Commissioners last week, to, prehpas reluctantly, support at least some limited continuation of these agreements as they could be a force for promoting minority ownership of broadcast stations.

The DOJ’s comments certainly did say that they supported the attribution of JSAs, though the reasoning of that determination was not especially compelling or even internally consistent.  The DOJ recognized that some JSAs could actually be beneficial to competition.  Even though they recognized the potential benefits of JSAs, because they had supported the attribution of JSAs for radio, over 15 years ago, and as any agreements between competitors had the potential for impeding competition in a market, they contended that JSAs should be attributable.  As TV NewCheck put it in a very good article published on Friday, the DOJ’s reasoning is “so 1997.” But beyond that, had the DOJ’s brief not been signed by the DOJ, there would have been numerous reasons for the Commission to give it little weight in its consideration of JSAs and SSAs
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