Public Interest Obligations/Localism

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The sale of a noncommercial radio station is often controversial, especially when it’s clear that the format of the station will change after the transfer.  In a decision released last week denying a Petition to Deny challenging the application for the sale of KTRU, the noncommercial radio station owned by Rice University, the FCC again made clear that they are not in the business of regulating the formats of broadcast stations.  For 30 years, the FCC has held firm to its position that the marketplace is best for deciding on what format a station should broadcast.  Thus, when Rice University students argued that the sale of their station and the loss of the diverse format that the station had programmed would harm localism and diversity, the FCC rejected the argument.  Seemingly, that decision makes sense, as we don’t want a government agency becoming a czar of the programming offered by broadcast stations.  When we see decisions from the regulatory bodies in the United Kingdom or Canada sanctioning stations that don’t stick to their legally proscribed formats, we wonder how such a system could possibly function in the US.  Can you imagine the FCC fining a station because it played too many hits on an alternative station?  Of too much rock on an Adult Contemporary station?  Once the FCC or any government agency gets into regulating formats, these sorts of decisions will follow.  Luckily, based on this decision and the prior 30 years of precedent, we won’t have to worry about such an eventuality.

The Commission also rejected other objections to the sale of KTRU. The Petitioners had challenged the noncommercial purpose and educational plan of the buyer – an argument summarily rejected as the buyer was already the licensee of another noncommercial station in the market.  The ownership of that station led to another argument – that the sale would violate ownership limits by concentrating too many noncommercial stations in the hands of one operator.  But the FCC made clear that there are no ownership limitations on how many noncommercial stations one company can own. Continue Reading FCC Makes Clear It Doesn’t Regulate Formats – Rejects Petition Against Sale of Noncommercial Station

The start of the FCC’s license renewal cycle for radio stations is close at hand, and we have issued an advisory to help radio stations prepare for the process.  A copy of the advisory is available here, and contains information about the pre- and post-filing announcements that stations are required to air, as well…

On February 8, 1996, the Telecommunications Act of 1996 was signed into law by President Bill Clinton.  While the Act had significant impact throughout the communications industry, the impact on broadcasters was profound, and is still being debated.  The Act made changes for broadcasters in several major areas:

  • Lengthened license renewals to 8 years for both radio and TV, and eliminated the "comparative renewal"
  • For radio, eliminated all national caps on the number of radio stations in which one party could have an attributable interest and increased to 8 stations the number one party could own in the largest radio markets
  • For television, raised national ownership caps to having stations that reached no more than 35% of the national audience, with no limits on the number of stations that could be owned as long as their reach was under that cap.
  • Allocated spectrum that resulted in the DTV transition

Obviously, the DTV spectrum began the profound changes in the way television is broadcast, and led to the current debate as to whether over-the-air television should be further cut back in order to promote wireless broadband (see our recent post on the FCC’s current proceeding on this issue).  While the other changes have now been in effect for 15 years, the debate over these provisions continue.  Some argue that the renewal and ownership modifications have created too much consolidation in the broadcast media and lessened the broadcaster’s commitment to serving the public interest.  Others argue that, in the current media world, these changes don’t go far enough. Broadcasters are under attack from many directions, as new competitors fight for local audiences (often with minimally regulated multi-channel platforms, such as those delivered over the Internet) and others attack broadcasters principal financial support – their advertising revenue. Even local advertising dollars, traditionally fought over by broadcasters and newspapers (with some competition from billboards, direct mail and local cable), is now under assault from services such as Groupon and Living Social, and from other new media competitors of all sorts.  With the debated continuing on these issues in the current day, it might be worth a few looking back at the 1996 changes for broadcasters, and their impact on the current broadcast policy debate.Continue Reading On the 15th Anniversary of the Telecommunications Act of 1996, The Effect on Broadcasters is Still Debated

In a speech given last week, FCC Commissioner Michael Copps called for a new regime to review the public interest performance of broadcasters – suggesting that license renewal become a more rigorous exercise for radio and television operators.  In his address called "Getting Media Right, A Call to Action", given to the Columbia University School of Journalism, Copps specifically suggested a "Public Value Test" for broadcasters when they file their license renewals.  If the broadcaster passes the test, the broadcaster would get a renewal.  If the broadcaster did not pass – if it does not show that it has "earned" the right to "use the people’s airways" – then the licensee would get a one year probation period to prove that it should keep its license.  If it does not improve, then the license would be taken and given to "someone who will use it to serve the public interest."

So what would this Public Value Test look like?  The Commissioner suggested that the following factors would be reviewed: 

  1. A Meaningful Commitment to News and Public Affairs Programming – an increased commitment to news, local public affairs, election debates and issues oriented programming would be reviewed according to some quantitative benchmarks.
  2. Enhanced Disclosure – requiring broadcasters to provide more information about their programming performance, on the Internet, as the Commissioner believes that information in the public file is "laughable", and also requiring that the FCC review that information at renewal time
  3. Political Advertising Disclosure – requiring more information about the sponsors of political ads
  4. Reflecting Diversity – looking to increase the gender, ethnic and racial ownership of broadcast stations
  5. Community Discovery – requiring that broadcasters be required to, in some formal way, communicate with their communities to determine local programming needs and the interests of various groups within a station’s community
  6. Local and independent programming – requiring that broadcasters provide more local and independent programming instead of "homogenized music and entertainment from huge conglomerates – the Commissioner suggesting 25% of local programming being dedicated to local and independent programs.  More local PSAs too.
  7. Public Safety – requiring that all broadcasters have a plan to address emergencies and be either staffed during all hours of operation or be otherwise able to respond immediately to any local emergency.

 What’s likely to happen to these proposals?Continue Reading FCC Commissioner Copps Calls For Stricter Broadcast Station License Renewal Standards – Could It Happen?

So does the mid-term election have any impact on broadcast regulation?  While no one knows for sure what the political winds of Washington will have in store, in reading the analysis of the Tuesday election results, I was struck by the conclusions contained in one Op-Ed article in the Washington Post on the message of last week’s Mid-Term elections, and the contrast of that perceived message to an article that had run in the same pages just a week before.  The earlier article dealt specifically with the future of media in the 21st century, and the suggested that, rather than cutting back on taxpayer funding of public broadcasting, as some have suggested, the government should take more steps to provide funding.  this article suggested that there be a tax on commercial broadcasters, and the monies received from the tax should be used to fund public media.  A similar proposal had been included in a Federal Trade Commission staff discussion draft issued earlier this year in the FTC’s exploration of the effect of new technologies on newsgathering.  Both of these proposals were made in the name of providing funding to public broadcasting sources to produce more news in light of the struggles of commercial news outlets in today’s media world.  The FCC’s own Future of Media task force is expected to issue a report before the end of the year on how the government should take steps to ensure that the media in the 21st century provides citizens with the information that they need to make informed decisions on civic issues.   Proposals made in both the FTC and FCC proceedings involve everything from changes to copyright law to provide more Federal protection to news reporting, to suggestions similar to those made in the FCC’s localism proceeding for specific mandates as to how much and what kind of news and information programming licensees must provide.

The proposals for the government to get involved in making the media better stuck me as being in stark contrast to the findings of a Democratic pollster reported in Sunday’s Washington Post, finding that the voters in last week’s elections were most interested in a government that was limited and efficient.  Voters were not totally adverse to government involvement – but favored that involvement only in connection with issues where it was perceived that the action could really make a difference, and only where the involvement was clear, efficient and effective.  While this opinion piece had nothing specific to say about media regulation – if in fact the article accurately reflects the message of the election, does it make sense that the government should be getting involved in the decisions about the future of the media?  Will any regulation that comes out of these proceedings be regulation that will be efficient and effective, with a minimum of red tape?  From my discussions with broadcasters, many are afraid that it will not. Continue Reading The Mid-Term Election and Broadcasting – What’s the Effect on the Future of Media?

FCC Commissioner Meredith Atwell Baker recently delivered a speech in Washington, DC, where she addressed calls for the government to take action to assist the traditional media deal with the economic issues brought about by the new media.  From time to time, there have been calls for the government to assist the traditional media, either through some sort of direct subsidies, or through regulatory changes that could assist in their news coverage to make these entities competitive in the new media world.  While the Commissioner’s speech did not detail those efforts, calls have, for the most part, not suggested direct government subsidies to support traditional news media sources.  Instead, more indirect efforts have been suggested to insure that these media sources continue to serve their communities.  Calls have been made to change tax laws to allow newspapers to operate as nonprofit entities (while still soliciting advertising).  In a draft FTC option paper, there was a suggestion of taxing commercial media to provide more support to noncommercial public broadcasting entities.  Other proposals have been more direct – simply mandating more news and public affairs programming from broadcasters (with little or no discussion of the source of the revenues for such mandates).  In her speech, the Commissioner noted that some suggestions may be forthcoming from the FCC’s own Future of Media report due at the end of the year (see our summary of the issues that they are exploring here), but she seemed to rule out these types of proposals, instead suggesting that the Commission could assist companies meet the new media challenge by loosening FCC restrictions on ownership.

The Commissioner suggested that no government action to bail out the media is necessary to preserve service to the public – citing the many examples of how that service is provided through new media sites that serve all sorts of communities and community groups – providing timely and detailed information on specific topics, often on a neighborhood level.  We have made that same point on these pages – the new media is already filling any void that may exist in local media coverage.  Some of these sites are produced by old media companies – as TV stations, newspapers and others develop microsites targeted to very local needs and interests.  Other sites are totally independent – developed by local interest groups or new media entrepreneurs.  So how can the Commission help these sites to develop?Continue Reading FCC Commissioner Baker Suggests No Government Support for Media, But Possible Relaxation of Broadcast Ownership Rules

Are you ready to file your next license renewal application?  It seems like the last license renewal cycle just ended (in fact, the last cycle is not over, as evidenced by the fact that the FCC in the last week has released several decisions dealing with late-filed renewals from the last cycle, and many TV stations still have license renewals that have not been granted due to pending indecency issues).  Nevertheless, a whole new cycle of Form 303 license renewal applications will soon be upon us – beginning in less than a year. The cycle begins with radio stations in Virginia, West Virginia, Maryland and the District of Columbia, who are due to file their license renewal applications on June 1, 2011.  Then, every two months thereafter, stations in another group of states files applications, until April 1, 2014 when radio stations in Pennsylvania and Delaware bring the radio renewal cycle to a close.  Television station renewal applications will be due on a state-by-state basis beginning one year later – starting with TVs in DC and the same three states in 2012.  A schedule for the radio renewal filings is available here.  With these deadlines almost upon us, what should stations be doing now to get ready? 

In the last renewal cycle, the biggest source of problems dealt with public file issues.  Remember, stations need to certify in their renewal applications that their public file is complete and accurate and, if it is not, to specify areas where there are deficiencies.  In the last cycle, many stations in particular had issues with Quarterly Programs Issues Lists that were missing from the files, in many cases incurring fines of $10,000 or more where there were many such reports missing from the files.  These reports are also very important, as they are the only required official records to demonstrate the programming that a station broadcast to serve the public interest needs of its service area.  If that service is ever challenged, you will need the reports to demonstrate how your station’s programming met the needs and interests of your city of license and the surrounding area.  Check out our last advisory on the Quarterly Programs Issues Lists, here.Continue Reading FCC License Renewal Application Cycle Begins in Less Than A Year – What Stations Should Be Doing to Get Ready

The FCC yesterday released a Notice of Inquiry, formally beginning its Quadrennial Review of the Multiple Ownership Rules.  While the FCC informally began the process of the Congressionally-mandated review of the ownership rules last November through a series of informational panels and workshops, the Notice of Inquiry ("NOI") provides the first formal opportunity for the public to comment on the ownership rules.  The FCC will take the comments that it receives in response to the NOI, and formulate some more specific proposals on how it plans to change the current rules (if at all), which will then be released for additional comments in a Notice of Proposed Rulemaking.  The NOI is a broad-ranging document that gives little indication of the FCC’s final direction in this proceeding – though it does go into detail as to how the media marketplace has changed in recent years, citing declining advertising revenues, and more media outlets providing competition to broadcasters for both audience and advertising revenues.   The NOI posed dozens of detailed questions asking how the Commission should assess the various aspects of the ownership rules, and what impact the changes in the media marketplace should have on its consideration of rule changes.

The FCC is concerned with all aspects of its media ownership rules.  Thus, it sets out that it will explore the following rules:

  • The Local Television Ownership cap, which limits owners to two stations in markets where there are at least 8 competing television owners and operators, and which forbids combinations of the top 4 stations in any market.  Television operators, particularly in smaller markets, have been urging the Commission to allow more consolidation in those markets so that stations can provide better service to their communities.  They argue that the current limits preclude small market consolidation, which is most needed in these markets where the costs of operation are not significantly lower than in large markets, but where revenue opportunities are far more limited.
  • The Local radio ownership caps, that currently limit owners to 8 stations in the largest markets, no more than 5 of which can be in any single service (i.e. AM or FM).  Some radio owners contend that these limits no longer make sense given the competition for audio listening from so many sources (including satellite and Internet radio, who can provide unlimited formats in any market).  Other issues include whether AM and FM still need to be treated separately, and even whether AM should be counted to the same degree as FM in a multiple ownership analysis.
  • The Newspaper-Broadcast cross-ownership rule, that forbids cross-ownership of broadcast stations and daily newspapers without a waiver – which, as the result of changes in the cross-ownership rules in 2007, will be granted on a more liberal basis, but only in the top 20 markets.  Given the economic state of the newspaper industry, many seek the repeal of this rule in its entirety. As we have written before, will the newspaper cross-ownership rule outlive the newspaper?
  • The Radio-Television cross-ownership rule, which limits the number of radio and television stations that can be owned by a single party in a single market
  • The Dual Network Rule, that prohibits the common ownership of any of the top 4 television networks.

Each of these rules is up for review, and numerous questions have been asked, and issues identified, for consideration in this proceeding. Continue Reading FCC Issues Multiple Ownership Notice of Inquiry – Formally Begins Quadrennial Review With Lots of Questions To Assess the Impact of Media Consolidation

The FCC announced an extension of the comment filing deadline in its proceeding looking at the Future of the Media (see our summary here). At the same time, the Steven Waldman, the Special Assistant to Chairman Genachowski, made a public appearance at the FCC’s open meeting last week to explain what is intended by this study – and from his comments and those of the Commissioners, this will be a wide-ranging investigation looking at how FCC and other government regulations can insure diversity in the media so that citizens and communities can "get the information that they need."  In Commissioner Copps comments, this includes looking at what public interest obligations are appropriate for the new digital media.  Comments in this proceeding, which were to be filed in March, are now to be submitted by May 7, 2010.

The appearance of Mr. Waldman (whose appointment we wrote about here) came at the very end of a long Commission open meeting where extensive discussions were held on reforming the FCC’s internal decision-making processes and about the broadband deployment report which has consumed the FCC for many months, and which will be delivered to Congress in the next few weeks.  But, while short, the discussion with Mr. Waldman was interesting as he highlighted the plans for his task force.  He opened his comments by initially noting how this was a time of great change in the media, where there is "incredible diversity" brought forth by the new technologies, but that there was also a "collapse" of traditional business models, which could bring about the end of "accountability journalism" (presumably journalism from reputable journalistic sources with some degree of accountability and reliability).  Because of these perceived changes, according to the comments made at the meeting, this task force was established to determine what the government can do to make sure that communities get the information that they need.Continue Reading FCC Extends Time For Comments on the Future of the Media – Looking at the Public’s Interest in Quality Journalism in All Media

Each year poses a new set of regulatory deadlines, and to help you remember all of those deadlines, the Davis Wright Tremaine Broadcast Group has prepared a calendar setting out the dates that broadcasters need to remember in 2010.  The calendar can be found here, and sets out FCC imposed deadlines for, among…