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Yesterday, a day in advance of the November 24th statutory deadline to adopt rules implementing the Satellite Television Extension and Localism Act, the FCC released a flurry of STELA-related orders. STELA governs the satellite carriage of broadcast stations, and in particular, the importation of distant network stations, in local markets. Because STELA and its predecessor statutes lie at the nexus of communications and copyright law, they represent very complex and arcane matters that often leave even communications lawyers scratching their heads if they aren’t experienced in the area.

For those interested in the details of yesterday’s three Orders and the FCC’s request for additional comments, I recommend taking a look at our Client Advisory on the subject from earlier today. For the rest of the population, suffice it to say that the major impact of these orders for broadcasters is how they affect the ability of satellite operators to import a “significantly viewed” (“SV”) duplicating network signal into portions of a local market, thereby undercutting the local network affiliate’s ratings, ad revenue, and retransmission negotiations.

As detailed in the Client Advisory, of the FCC’s three Orders, one favors satellite operators by making it easier to import distant network stations into a market, while the other two favor broadcasters by limiting the proportion of satellite subscribers in a market that are eligible to sign up to receive a distant network station.

Of particular note is the FCC’s conclusion in one of the Orders that “because SV status generally applies to only some areas in a DMA and not throughout an entire DMA, we find it unlikely that an SV station could permanently substitute for a local in-market station, even in the provision of network programming to the market.” The FCC further stated that “because most viewers want to watch their local stations, we do not think that carriage of only SV stations would satisfy most subscribers for an extended time.”

That is a comforting conclusion for broadcasters, and probably an accurate one. However, it may be cold comfort for the local broadcaster in heated retransmission negotiations where the satellite operator threatens to import a duplicative network station into the market. Because of that, and despite the complexity of the law in this area, television station owners and satellite operators need to acquire a keen understanding of each other’s rights under STELA and the FCC’s related rules, or proceed at their own peril.

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Yesterday, the Federal Communications Commission issued three Orders and a Public Notice designed to implement the new requirements of the Satellite Television Extension and Localism Act (STELA).

The FCC beat by one day the November 24, 2010 statutory deadline for adopting new rules governing several aspects of satellite operators’ carriage of television broadcast signals under STELA. The first of three Orders favors satellite providers by making it easier for them to import the signals of significantly viewed (“SV”) stations from neighboring markets into a station’s local television market. However, the other two Orders favor broadcasters in updating the procedures for subscribers wishing to qualify to receive distant network television stations from their satellite operator. Lastly, the FCC issued a Public Notice seeking comments and data for a required report to Congress regarding the availability of in-state broadcast stations to cable and satellite subscribers located in markets straddling state borders.

Significantly Viewed Stations Order
In this Order, the FCC concluded that, under STELA, a satellite subscriber must generally subscribe to the local-into-local package before it can receive the signal of an out of market station significantly viewed (over-the-air) in that subscriber’s area. Illogically, however, the subscriber does not have to receive the signal of the local affiliate of the same network as the imported SV network station. The subscriber’s receipt by satellite of any local station is all that is needed. The FCC stated that its interpretation means that, where a local affiliate is not carried during negotiation of a retransmission consent agreement, the satellite carrier can provide certain subscribers with network programming from an SV network station in a neighboring market.

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Pillsbury’s communications lawyers have published FCC Enforcement Monitor monthly since 1999 to inform our clients of notable FCC enforcement actions against FCC license holders and others. In fact, FCC Enforcement Monitor actually predates the creation of the FCC’s Enforcement Bureau, which came into being just a few months after the first issue was published. This month’s issue includes:

  • FCC Increases Fine to $25,000 for Broadcaster’s Violations Related to Time Brokerage Agreement
  • Upward Adjustment in EAS Portion of Multiple Violation Fine Results in Total Forfeiture of $25,000
  • Noncommercial Broadcaster Fined $7000 for Late-Filed License Renewal Application


FCC Fines Florida Broadcaster $25,000 for Repeated Failure to Maintain Full-Time Personnel and Make Available a Complete Public Inspection File at Brokered Station

In September 2009, following a complaint, agents from the Enforcement Bureau’s Tampa Field Office conducted an inspection of a Florida AM station. According to the Notice of Apparent Liability (“NAL”) issued by the FCC, the AM broadcaster failed, for the second time within three years, to maintain the required number of full-time employees at its main studio in violation of Section 73.1125(a) of the FCC’s Rules, and to maintain a complete public inspection file, which violates Section 73.3526 of the FCC’s Rules.

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In what has become one of our most popular posts at CommLawCenter, a few months ago I discussed a radio ad that contained an “attention getting” Emergency Alert System tone that was activating broadcast stations’ EAS equipment around the country. The post noted that airing the commercials violated Section 11.45 of the FCC’s Rules (“No person may transmit or cause to transmit the EAS codes or Attention Signal, or a recording or simulation thereof, in any circumstance other than in an actual National, State or Local Area emergency or authorized test of the EAS.”).

The earlier post also noted that these ads potentially violated Section 73.1217 of the FCC’s Rules, which is the FCC’s prohibition on airing broadcast hoaxes. These rules are the result of the FCC’s longstanding concern with the airing of material that could cause public panic, dating all the way back to the Orson Welles Halloween broadcast of War of the Worlds in 1938, just four years after the FCC was created by Congress.

Television stations have now joined their radio brethren in unintentionally airing Emergency Alert System tones. The Society of Broadcast Engineers disclosed yesterday that a television ad for the new movie Skyline, which hits theaters tomorrow, began airing earlier this week with an EAS tone repeated six times throughout the length of the spot. A copy of the spot can be found on the SBE website here, with the EAS tones being very audible in the background.

Stations airing such spots put themselves at risk of adverse action by the FCC, particularly for any airings that occur after the station has learned of the issue. However, stations that aired the spot before SBE’s announcement yesterday are not off the hook, as the FCC holds broadcasters liable for the content they air, and normally takes the position that stations should have checked the spots before they aired for problematic content.

While an EAS tone sounds like digital hash to the human ear, it contains a lot of information that is used to trigger the EAS receivers of stations in a “daisy chain” fashion to quickly spread emergency information. In that regard, each signal is like human DNA, containing information that allows you to determine its origin. In this case, the EAS signal being used is a recording of a Pennsylvania statewide monthly test that fails to include the normal “End of Message” tone. As a result, stations whose EAS equipment is activated by another station airing the false tone could suddenly find themselves retransmitting the content of the other station for a couple of minutes after the tone airs.

Unfortunately, because it is generally the broadcast station and not the creator of the ad that will be held liable, advertisers are not always adequately incentivized to make sure their ads comply with FCC regulations. That means it is up to broadcasters to check each and every ad they run for violations of the law, including violations of the FCC’s sponsorship identification rule, the FCC’s rules involving ads in children’s programming, and ads with questionable content, whether it be indecency, defamation, false product claims, or, in this case, false EAS alerts.

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With the Fox-Cablevision carriage dispute grabbing headlines, and the cable and broadcast industries preparing for battle in Congress and at the FCC over retransmission issues, you would be hard pressed to find common ground between these two media players. However, I have seen it, and it is now on file at the FCC.

When FEMA signed off on a technical standard for the next generation of emergency alert technology, known as CAP, a few weeks ago, it activated a 180 day deadline for the government to certify CAP-capable equipment and for media entities to acquire and install that certified equipment. At the time, we wrote that 180 days likely would not be enough time to have equipment based on the new standard manufactured, certified by FEMA (and possibly the FCC), installed, tested, and operational. While no one wants to hinder deployment of this next-generation emergency alert technology, the immense complexity of CAP, which is intended to distribute alerts not just on television and radio, but potentially through cell phones, the Internet, and myriad other communications channels, makes implementation very challenging. There are still a lot of issues to work out, and just as important as deploying the technology is making sure that it will work properly once deployment is complete.

To ensure that happens, and to try to facilitate an orderly rather than rushed deployment of EAS CAP technology, earlier today Dick Zaragoza and Paul Cicelski of our firm filed a request to extend the time period during which media entities must implement the CAP standard. The current deadline for EAS implementation is March 29, 2011. Today’s extension request urges the FCC to extend the implementation period through at least September 30, 2011, and to consider a longer implementation period tied to completion of the FCC’s own potential CAP equipment certification process and/or the FCC’s anticipated proceeding to modify its rules to complete the implementation of CAP.

This is the interesting part. Participating in today’s extension request were 46 of the state broadcasters associations, the National Association of Broadcasters, the National Cable and Telecommunications Association, the Society of Broadcast Engineers, the American Cable Association, the Association for Maximum Service Television, National Public Radio, the Association of Public Television Stations, and the Public Broadcasting Service.

I can’t recall any prior issue inspiring such unanimity among this diverse group of participants, and that should provide an indication of the seriousness with which they view the upcoming task. If implemented successfully, EAS CAP will bring a more ubiquitous and content-rich emergency alert system to the United States. If implemented poorly, vast amounts of time and money will have been expended without significantly improving public safety. Knowing many individuals who have dedicated themselves to making CAP a reality over the past few years, it would be a shame to not see the full benefits of the technology realized.

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The FCC’s Further Notice of Proposed Rulemaking seeking comment on the conversion of low power television stations from analog to digital operation was published in the Federal Register today. Comments on the FCC’s proposals are due on December 17, 2010, with reply comments due on January 18, 2011.

Although Congress established a deadline of June 12, 2009 for all full-power television stations to discontinue analog operations and begin operating only in digital, LPTV and TV Translator stations, as well as Class A TV stations, were seen as needing more time to marshal the resources to transition to digital operation. Accordingly, the Congressionally-mandated analog cut-off date did not apply to these stations. As a result, all full power television stations have ceased over-the-air analog broadcasts, but a significant number of Class A, LPTV and TV translator stations continue to transmit in analog and many questions persist as to how to transition these stations to digital-only operation. The FCC has released a Further Notice of Proposed Rulemaking (FNPRM) in its proceeding examining the digital transition for Class A, LPTV and TV Translator stations. The FNPRM seeks comment on the procedures and timelines by which these stations will complete the transition to digital operations.

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Last week, Congress passed the Twenty-First Century Communications and Video Accessibility Act of 2010 (the “Act”) which, among other things, reinstates the FCC’s former Video Description rules for television broadcasters, extends closed captioning of video programming to the Internet, and requires the FCC to examine methods of increasing the accessibility of emergency information. The President signed the bill today, October 8, 2010.

The Act is designed to update the Communications Act to account for the many new technologies available in today’s marketplace and to assure that they are accessible to persons with hearing or vision impairment. The Act outlines a decade-long timetable for the submission of various reports by a new advisory committee to the FCC, and then by the FCC to Congress, and the implementation of further regulations based on the findings of those reports. When fully implemented, the Act will require that specific amounts of digital television programming contain video descriptions, that certain video programming distributed via the Internet contain closed captions, and that consumer electronics devices contain features to promote accessibility and be hearing aid compatible. We have summarized the Act’s requirements in three phases below.

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After we published our Advisory reminding licensees of the deadline to electronically file the Quarterly Children’s Television Programming Report on FCC Form 398 for the Third Quarter of 2010, the FCC disclosed that it has modified its electronic filing system to require the entry of a Federal Registration Number (“FRN”) and password as the final step before the report can be filed. The FCC issued no advance public notice of this requirement, but instead placed the following notice on its webpage dedicated to the Children’s Television Act of 1990, although NOT on the page that licensees visit to prepare and file the report itself:

To enhance the security and integrity of the KidVid database, we now require authentication with an FRN and password associated with the broadcast facility for each Form 398 filing. After you have completed Form 398, you will be prompted to enter this information. You must enter your FRN and password to complete the form. If you have forgotten your FRN password, please contact the CORES helpdesk at 877-480-3201.

Because of the potential for surprises associated with the implementation of this new requirement, we recommend that, if possible, licensees complete their Form 398 filings in advance of the filing deadline. The filing deadline for this quarter falls on Tuesday, October 12, 2010 due to the Columbus Day holiday, so Friday, October 8, 2010 is a good target date for completing the Form 398. This will allow additional time for station personnel to address any issues that arise, such as determining which FRN and password combination(s) will be accepted by the filing system, and, if necessary, to locate the correct information.

Should you have any questions regarding this Alert or the FCC’s children’s programming requirements in general, please contact any of the attorneys in the Communications practice section.

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The FCC today released an order refining, but largely reaffirming, its earlier decision to allow unlicensed devices to operate in the TV band as long as they do not cause interference to existing users such as TV stations and wireless microphone operators. While many refer to this spectrum as “white spaces” on the theory that it is vacant spectrum located between existing television signals, veterans of the digital television transition question whether white spaces more appropriately fall into the same category of mythical creatures as unicorns.
The digital transition’s compression of television stations that previously occupied Channels 2-69 nationwide into Channels 2-51 took a miraculous feat of engineering (and the displacement of a lot of LPTV stations). Many stations had to be wedged into the shrunken TV band with a shoehorn, which, at least in urban areas, left very little free spectrum. While the phrase “white spaces” evokes a mental image of vast open prairies, the densely populated areas that are the target markets for manufacturers of unlicensed equipment are already spectrum congested, and are more likely to offer “white spots” or “white specks” than white spaces. The benefit of the Commission’s order will likely be greater in rural areas, where spectrum congestion is not an issue even after the digital transition.

As long as the FCC lives up to the Prime Directive of not causing interference to existing inhabitants of the TV band, the benefits of better utilization of spectrum are hard to dispute. Broadcasters understand as well as anyone the challenge of eking out every last ounce of potential from spectrum. However, broadcasters are understandably concerned with a significant change made by the FCC in today’s order — the elimination of the FCC’s requirement that white spaces devices be able to sense local signals and avoid causing interference to them. By eliminating that requirement, the FCC removed the “safety valve” it had installed in its original plan. Instead, the FCC is placing its faith entirely in the creation of one or more privately-created and run databases of existing spectrum users that unlicensed devices will consult before selecting a frequency on which to operate.

Many in the broadcast industry have been strong proponents of requiring unlicensed devices to have “sensing” capability rather than relying solely on a national database of existing signals. “System redundancy” is an important feature in designing reliable communications systems, and removing that redundancy inevitably makes for a less reliable system. As the FCC has noted, eliminating the “sensing” requirement will reduce the cost of unlicensed devices, but as we discovered in the recent Gulf oil spill, short term decisions to reduce costs by reducing safety margins can have far greater and more expensive long term consequences.

While lacking any backup protection, a spectrum database could be a workable solution if properly implemented. However, the challenges of implementation are immense. Ensuring the accuracy of the database itself will be a challenge given constantly changing spectrum use by new and existing operators. Also, signals propagate differently depending on frequency, what part of the country you are in, local terrain, and various other factors, making the database either incredibly complex, or inadequate to address real world circumstances.

Viewers of TV stations in Fresno, whose real world signals extend far beyond their predicted contours because of terrain effect, will suddenly be subject to interference from unlicensed devices. In addition, you have to think that users of those unlicensed devices aren’t going to be too happy when their wireless network won’t function because (unknown to them) it is receiving interference from a TV signal that the database swears isn’t there.

Because of these and many other issues, the FCC needs to keep an open mind as it implements its proposed use of white spaces. A well-performing database that keeps licensed and unlicensed operators adequately separated is in everyone’s interest. If some of the FCC’s initial conclusions need to be rethought in order to accomplish that, those discussions will be healthy ones.

Equally important is ensuring that equipment manufacturers fastidiously comply with the FCC’s interference protocols. Broadcasters are rightly concerned that non-compliant or just poorly designed and manufactured unlicensed devices can cause immense damage, and the FCC lacks the tools to put the genie back in the bottle should that occur. Fining such manufacturers after the fact won’t help much if millions of interference-inducing devices are already out there interfering with the public’s ability to watch TV, listen to a sermon, or attend a Broadway show. As the FCC proceeds down this path, getting it right is going to be far more difficult than just getting it done.

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9/22/2010

This Broadcast Station EEO Advisory is directed to radio and television stations licensed to communities in: Alaska, American Samoa, Florida, Guam, Hawaii, Iowa, Mariana Islands, Missouri, Oregon, Puerto Rico, Virgin Islands and Washington, and highlights the upcoming deadlines for compliance with the FCC’s EEO Rule.

Introduction

October 1, 2010 is the deadline for broadcast stations licensed to communities in the States/Territories referenced above to place their Annual EEO Public File Report in their public inspection files and post the report on their website, if they have one. In addition, certain of these stations, as detailed below, must electronically file their EEO Mid-term Report on FCC Form 397 by October 1, 2010.

Under the FCC’s EEO rule, all radio and television station employment units (“SEUs”), regardless of staff size, must afford equal employment opportunity to all qualified persons and practice nondiscrimination in employment.

In addition, those SEUs with five or more full-time employees (“Nonexempt SEUs”) must also comply with the FCC’s three-prong outreach requirements. Specifically, all Nonexempt SEUs must (i) broadly and inclusively disseminate information about every full-time job opening except in exigent circumstances, (ii) send notifications of full-time job vacancies to referral organizations that have requested such notification, and (iii) earn a certain minimum number of EEO credits, based on participation in various non-vacancy specific outreach initiatives (“Menu Options”) suggested by the FCC, during each of the two-year segments (four segments total) that comprise a station’s eight-year license term. These Menu Option initiatives include, for example, sponsoring job fairs, attending job fairs, and having an internship program.

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