The Senate has reportedly once again approved the extension of the digital television transition date from February 17 to June 12 (see Press Release from Senator Kay Bailey Hutchison here).  This approval was necessary as the bill being considered by the House of Representatives is slightly different than the one passed by the Senate on Monday.  Now – it’s back to the House, which failed yesterday to pass that bill by a 2/3 vote (see our post here).  Under the expedited process that was being used, the failure to get a 2/3 vote meant that the legislation did not pass.  The legislation now must got through the normal consideration process in the House, being first approved by committee, then voted on by the full House – with only a majority needed to approve the measure.  The House is going to be out of session tomorrow through Monday, so the committee that now needs to consider the bill could review it next Tuesday, and then it could be voted on by the full House on Wednesday. So if all goes as planned, there could be an extension approved next week.  If the House process somehow gets held up, the President and the FCC cannot act on any extension without action by Congress, as the February 17 date is written into law and can only be changed by a new law.  Given that the transition is only 3 weeks away, and the extension of the transition is still not a certainty, what is a television station to do?

Initially, stations should proceed as if the February 17th deadline will stick as, for now, it is the law. So keep running all the required crawls, snipes and tickers promoting the upcoming termination of analog television.  If an extension is passed, these announcements will only have caused more people to get ready for a transition that will occur sooner or later. But the extension will also allow stations to opt to transition before the new June deadline, and cease their analog operations early.  How do these stations proceed?


Continue Reading Senate Approves DTV Extension Bill Again and it’s Back to the House of Representatives – What’s a Station to Do?

Earlier this week, we wrote about the apparent compromise in the Senate between Republicans and Democrats that would seemingly allow the Digital Television conversion deadline to be delayed from the current date of February 17 that stations have been warning consumers about for years, pushing that date back until June 12.  That compromise legislation passed the

Last week, we wrote about one issue that was addressed at last week’s Senate Judiciary Committee hearing on music royalties – the standards used to derive the royalties, and expressed hope that there was at least some interest in compromise on behalf of the Senators and industry representatives.  However, another issue which came out of those hearings suggests that compromise may not be so easy if the parties really believe what they say – as there is a fundamental distinction in both how the parties view the health of the Internet radio business, and how they view the relationship between royalties and the music business generally.  One can only hope that the gulf that was evident was just due to public posturing as, if it was not, there may well be an insurmountable differences between the parties that cannot be bridged in any settlement negotiations over the royalties that Internet radio pays for the use of sound recordings.

The gap became evident from the opening statements of the first panel – comprised of two Senators interested in the issue- Senator Wyden on behalf of the Internet Radio Equality Act stating that it was necessary to avoid having the high royalties decided by the Copyright Royalty Board destroy a fledgling technology, while Senator Corker of Tennessee talked about the importance of music to radio and the exhaustive process that the CRB had gone through in arriving at the royalties that it approved.  But in the day’s principal panel, the issues became crystal clear, as John Simson of SoundExchange talked about the "vibrant" business of Internet radio, citing an analyst’s report that Internet radio would be a $20 billion advertising market by 2020, and the statement of an employee of CBS that Internet radio was a great business and that CBS was going to "own it."  Speaking next, Joe Kennedy, CEO of Internet radio company Pandora had a dramatically different perspective – talking about an industry analyst who stated that the royalties that would result from the CRB royalties would exceed the revenue of the Internet Radio industry, and that, for Pandora, the failure to find a compromise solution to the CRB-imposed royalties would mean that his service would "die."  He pointed to Pandora’s position as the largest of the Internet radio companies in terms of listenership, the $25 million in revenue that it expects to make this year, and how $18,000,000 of that would go just to the SoundExchange royalties – 75% of its revenue to this one expense. 


Continue Reading Senate Hearing: The Search for Compromise on Music Performance Royalties – Part Two: The Issue of Perspective