Articles Posted in Low Power & Class A Television

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Earlier this month we posted our 2011 Broadcasters Calendar on CommLawCenter as well as on our Pillsbury web page. We have been annually publishing the Broadcasters Calendar, which contains much information regarding broadcast station deadlines and legal requirements, for as long as I can recall. It has always been one of our most popular publications, and I usually get calls beginning in early November asking when next year’s calendar will be available. The “easy to read” pdf version of the Calendar can be found here, and a text-searchable version is available here.

Even a brief review of the 2011 Broadcasters Calendar reminds us that 2011 will be a busy year for not just broadcasters, but for cable and satellite operators as well. October 1, 2011 is the deadline by which broadcasters qualifying for must-carry need to notify cable and satellite operators of their election between must-carry status and retransmission consent. Recent retransmission disputes once again remind us that retransmission negotiations and their associated revenue are critical to the future of broadcast television. However, the sheer volume of negotiations and carriage disputes likely to occur following the October 1 election deadline will almost certainly make this holiday season look tranquil by comparison.

Adding to the action will be continued efforts by the cable and satellite industries to draw Congress and the FCC into the fray, introducing legislative and regulatory uncertainties into an already complex negotiation process. Their chances for success will depend greatly upon how much disruption in carriage of broadcast programming occurs in 2011, and the public’s perception of who is at fault for that disruption. Regardless of the outcome of this particular Washington confrontation, look for 2011 to be the year where economics force cable and satellite providers to more tightly link the number of viewers a program service attracts with the amount they agree to pay for that service. Overpaying for niche cable networks that don’t pull in large numbers of viewers is so “last decade”.

2011 also marks the beginning of the FCC’s next eight-year license renewal cycle, with radio stations in DC, Maryland, Virginia, and West Virginia starting pre-filing announcements in April for their upcoming license renewal applications. The filing cycle will continue state by state until it concludes with television stations in Delaware and Pennsylvania running their last post-filing announcements on June 16, 2015.

However, many stations haven’t had their last license renewal application granted because of indecency complaints still pending against them. The FCC has pretty much ceased processing indecency complaints while it awaits guidance from the courts as to whether it can legally enforce the prohibition on broadcast indecency, and if so, how it will be allowed to do that. I have been told that there are literally hundreds of thousands of indecency complaints now pending at the FCC, so unless the courts do the FCC the favor of finding the prohibition on indecency completely unconstitutional, it will take the FCC years to sift through these complaints in an effort to apply any refined indecency standard announced by the Supreme Court.

It is therefore reasonable to predict that indecency complaints will continue to play a large role in the processing of upcoming license renewal applications. 2011 will hopefully be the year when the courts tell us exactly how large (or small) that role will be. If the prohibition on indecency survives this latest round of judicial scrutiny, broadcasters and the FCC can expect a lot of complaint investigations and litigation as both struggle with where the line on content is being drawn.

Of course there are numerous other events that will contribute to 2011 being one of the busiest years in memory for broadcasters. A rebounding economy is slowly lifting most boats in the broadcast industry, with the obvious exception being those that burned their critical assets for fuel during the lean times, and don’t have much boat left.

With a growing amount of money to fight over, the fights will begin in earnest (see “Retrans” above). Negotiations between the NAB and the recording industry over performance royalties will continue, and “performance tax” legislation will again rise in Congress with the same certainty that the slasher in a horror film returns for unending sequels.

Broadcasters and the FCC will also be implementing the latest generation of the Emergency Alert System in 2011, and the FCC will continue its efforts to repurpose broadcast spectrum for mobile broadband use, leading to new rules permitting multiple broadcasters to share a single channel, and potentially to legislation allowing participating broadcasters to share in the proceeds of broadband spectrum auctions. As with most of the items discussed above, there is both opportunity and peril for broadcasters here, and those that are inattentive risk missing the former and being battered by the latter.

Yes, 2011 will be a very busy year.

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Below is the text of our 2011 Broadcasters’ Calendar, which lists deadlines that broadcasters should be aware of for 2011. If you would prefer to read the PDF version of the calendar, it can be found here.

Items of Note in 2011

1. Applications for Renewal of License: June 1, 2011 is the first filing date of the three-year period during which the licensees of all commercial and noncommercial AM, FM and FM Translator stations throughout the United States and its territories will be required to file their applications for renewal of broadcast station license. Licensees in the television services will commence this process in 2012. The date on which a station’s application is due depends on the state or territory of its community of license. All licensees should familiarize themselves now with the dates associated with this important filing, including the dates on which public notice announcements must air in advance of the renewal filing; the filing date itself, which is approximately four months before the date of license expiration; and the dates on which post-filing announcements must air.
2. Biennial Ownership Report Filing Requirements for Commercial Radio and Television Stations: Licensees of commercial, full-power radio and television stations as well as Class A television and low power television stations should be ready to file their biennial ownership reports on FCC Form 323 by the new, uniform filing date of November 1, 2011. While these licensees may have filed a biennial report as recently as the summer of 2010, that report fulfilled the reporting obligation for the period that ended on November 1, 2009. Only because of difficulties with the FCC’s electronic filing system was the November 1, 2009 deadline ultimately extended to July 8, 2010.

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Posted in: Children & Media
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The FCC’s Media Bureau released a Public Notice today announcing a freeze on the filing of applications for new digital low power television (“LPTV”) and TV Translator stations, and major modifications to existing analog and digital LPTV and TV Translator stations in “rural areas.”

After the completion of the nationwide transition to digital broadcasting by full-power television stations, the FCC announced that it would permit the filing of applications for new digital LPTV and TV Translator stations on a first-come, first-served basis. The FCC announced the filings would commence in two phases, with the filing of applications in “rural areas” beginning on August 25, 2009, followed by “non-rural areas” on January 25, 2010. The January 25, 2010 filing date for non-rural areas was delayed until July 26, 2010, and then ultimately suspended indefinitely. “Rural” area stations are those with a transmitter site that is farther than 75 miles from the reference coordinates for the 100 largest cities listed in Appendix A of the Media Bureau’s original Public Notice on this matter.

Today’s Public Notice indicates that the FCC will continue to accept and process applications for minor changes to existing facilities, flash-cut applications, digital companion channel applications for existing analog stations, and displacement applications where the applicant can demonstrate actual interference from existing full-power television operations, or from stations still operating on channels 52 to 69.

As the basis for its action, the Media Bureau cited the recommendation in the National Broadband Plan to make an additional 500 MHz of spectrum available for broadband use over the next ten years. The Media Bureau stated that the freeze would allow the FCC “to evaluate its reallocation and repacking proposals and their impact on future licensing of low power television facilities.” The Public Notice goes on to state that, after the FCC has completed its broadband rulemakings, the Media Bureau will determine when LPTV filings can be made again. However, given the number of rulemaking proceedings the National Broadband Plan will generate, it is reasonable to assume that a lifting of the freeze will not occur anytime soon.

For assistance in analyzing a station’s options in light of the Media Bureau’s action, please contact any of the attorneys in the Communications Practice Section.

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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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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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The FCC has announced that full payment of all applicable Regulatory Fees for Fiscal Year 2010 must be received no later than August 31, 2010.

As mentioned in a July 9, 2010 Report and Order, the Commission will mail assessment notices to licensees/permittees reflecting payment obligations for FY 2010, but intends to discontinue such notifications beginning in 2011. Be aware that the notices sent may not include all of the authorizations subject to regulatory fees, and do not take into account any auxiliary licenses for which fees are also due. Accordingly, you should not assume that the notice is correct or complete. Similarly, if you do not receive a notice letter, that does not mean your authorizations are exempt from regulatory fees. It is the responsibility of each licensee/permittee to determine what fees are due and to pay them in full by the deadline.

Annual regulatory fees are owed for most FCC authorizations held as of October 1, 2009 by any licensee or permittee which is not otherwise exempt from the payment of such fees. Licensees and permittees may review assessed fees using the FCC’s Media Look-Up website – www.fccfees.com. Certain entities are exempt from payment of regulatory fees, including, for example, governmental and non-profit entities. Section 1.1162 of the FCC’s Rules provides guidance on annual regulatory fee exemptions. Broadcast licensees that believe they qualify for an exemption may refer to the FCC’s Media Look-Up website for instructions on submitting a Fee-Exempt Status Claim.

For more information on annual regulatory fees, including assistance in preparing and filing them with the FCC, please contact any of the lawyers in the Communications Practice Section.

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Posted in: Fees
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July 2010
FCC Eliminates Earlier Proposed Fee Reductions for Radio and Sets Hefty Increases for UHF Television Stations
Last week, just as broadcasters were finishing up with their new Biennial Ownership Report filings, the FCC released its final order setting the annual regulatory fee amounts stations must pay for Fiscal Year 2010. In so doing, the FCC erased promised reductions in annual regulatory fees for radio broadcasters and reallocated the television fee burden from VHF broadcasters to UHF broadcasters, resulting in considerable increases in the fees paid by UHF broadcasters over last year and even over the Commission’s prior proposals for FY 2010.

Background
Each year, the FCC reports to the Office of Management and Budget the amount of money that the FCC estimates it will need to run its operations in the coming year. Congress generally accepts this estimate and sets it as the amount that the FCC is statutorily obligated to raise from its licensees through annual regulatory fees. Between 2008 and 2009, fee amounts increased by about 10%, prompting outcries from broadcasters that the fee increases have historically been too high year to year, and that they were simply intolerable in a year in which the industry was so adversely affected by the economic downturn.

Perhaps because of this, for 2010, the Commission requested, and Congress required, that it raise 1.8% less revenue than it had in 2009. Based on that reduction, in April the FCC released a Notice of Proposed Rulemaking proposing modest, across the board cuts in the amounts paid by radio licensees. Only AM construction permits were to increase–by $20. In contrast to the broad increases in television fees experienced in 2009, the FCC’s proposals were for modest increases in some, but not all, television categories. In most television categories where an increase was proposed, it only amounted to a few hundred dollars over the 2009 level. Even the three categories that were hardest hit (VHF stations in Markets 26-50, and UHF stations in Markets 1-10 and Markets 11-25) only saw increases of a few thousand dollars. Article continues — the full article can be found at FCC Releases Final Regulatory Fee Amount
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One of many questions persisting since the release of the FCC’s National Broadband Plan has been “what is the impact on low power television stations?” Officially, the NBP’s call for repurposing television broadcast spectrum was not to affect LPTV stations, as the NBP indicated that LPTV stations would not be required to participate in the spectrum repacking and reallocation proposed for full power television stations.

As we noted at the time, however, it was unclear how the NBP’s spectrum reallotment proposals could not have a substantial impact upon the LPTV service. When full power stations are repacked into fewer channels to make room for wireless broadband, the secondary status of LPTV stations seems to ensure that they will be squeezed out of existence by the repacking. The NBP’s sunny language regarding the future of LPTV service therefore appeared more about selling the plan politically than about actually addressing the reality of spectrum repacking.

Today, President Obama issued a Presidential Memorandum directing the heads of all Executive Departments and Agencies to cooperate in “unleashing” the wireless broadband revolution by working with the NTIA and FCC to free up the 500 MHz of additional spectrum envisioned by the NBP. Immediately after the President’s action, the FCC’s Media Bureau released a Public Notice slamming the door on a much-anticipated opportunity to file digital LPTV and Translator applications that was scheduled to begin on July 26, 2010.

The Media Bureau had announced this filing opportunity on June 29, 2009, almost a year ago to the day of today’s announcement rescinding it. The filing opportunity was to have been for those seeking authorizations to build new digital LPTV stations. It was announced just after the conclusion of the nationwide DTV transition and the channel-shifting by full power stations (and displacement of LPTV stations) that process entailed. Applicants that had been prevented from filing before could now examine this vastly changed spectrum landscape with an eye toward providing LPTV service in places and on channels not previously available. Applications were to be considered on a first come, first served basis. To prevent a potential deluge of applications, the Media Bureau broke the process into two steps. In the first step, the FCC began permitting the filing of digital LPTV applications in rural areas in August 2009. The second step was to permit such applications in all areas of the country beginning in January 2010. As mentioned above, that date was first delayed until July 2010, and now, indefinitely.

Today’s announcement that new LPTV applications will not be permitted in urban areas, at least until the spectrum rulemakings surrounding the National Broadband Plan are resolved, officially confirms that the LPTV service is indeed going to be affected by the NBP’s thirst for broadcast spectrum. In a nod to that future reality, the Media Bureau also announced that the FCC will allow existing analog LPTV stations to apply for companion digital channels. While that may at first seem contrary to the goal of clearing broadcast spectrum, the purpose is to encourage the transition of the LPTV service to digital, which will ultimately allow it to be packed into less spectrum. However, even the transition of LPTV service into digital format is not likely to clear the amount of television spectrum envisioned by the NBP. As a result, if today’s action dropped the proverbial shoe on applicants for new LPTV stations, there likely will be one more shoe to drop… on existing LPTV stations.

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The FCC announced in April 2009 its intent to implement a new version of its biennial Ownership Report form, and to require that all commercial broadcast stations file a new Ownership Report with the FCC by November 1 of odd-numbered years. Since that time, the FCC has had to delay the original November 2009 filing deadline a number of times, for reasons ranging from its electronic filing system grinding to a halt and being unable to handle the sheer mass of the new reports, to technical glitches with the form itself, delays in Office of Management and Budget approval, and fierce opposition from broadcasters at the FCC, OMB and now in court based upon the paperwork burden and privacy concerns the new form raises. As we discussed in an earlier Client Alert, the FCC’s revised deadline requires parties to report their November 1, 2009 ownership data on the new form by July 8, 2010.

As that deadline draws near, however, it looks like there are still a few obstacles that the FCC must navigate. As we reported in a recent Client Alert, the FCC yesterday responded to a petition filed with the U.S. Court of Appeals for the DC Circuit by a group of broadcasters. Those broadcasters have asked the court to stop the FCC from implementing the revised Form 323, arguing that the requirement that all “attributable” principals provide their Social Security Number (SSN) to obtain a Federal Registration Number (FRN) for the new ownership report violates the Administrative Procedure Act and the Privacy Act. In its court-ordered response to these allegations, the FCC claims it has complied with the law, and that the broadcasters’ claims are moot in any event because filers are no longer actually required to provide their SSNs and can instead apply for a “Special Use FRN” (SUFRN) (love that acronym!) to complete the new ownership report form.

That response is not, however, entirely accurate. The FCC initially refused to create a Special Use FRN for purposes of reporting ownership interests. It feared that broadcast investors would choose to use that option rather than supplying their SSN, thereby undercutting the FCC’s ability to determine precisely which “Ted Jones” was the owner of a particular radio station. The FCC relented only when it became clear that many broadcasters would be unable to file their Ownership Reports at all since they had no ability to force their investors to reveal SSNs, and the FCC’s electronic filing system would not accept an ownership report if all attributable investors listed did not have an SSN-obtained FRN.

Even when the FCC later relented and created the SUFRN, it limited its use to the filing of biennial ownership reports (as opposed to post-sale ownership reports or other FCC applications). The FCC also made clear that the use of a SUFRN, while technically allowing broadcasters to file their ownership reports through the electronic filing system, did not comply with its rules and that it expected broadcasters to have obtained SSN-obtained FRNs before the next biennial ownership report is due in November 2011.

Since that time, and under continuing pressure from communications lawyers and privacy advocates (who are often one and the same), the FCC appears to be growing more flexible about the use of SUFRNs in completing ownership reports. Action by the court in the short time remaining until the July 8, 2010 filing deadline may determine just how flexible the FCC will need to be in that regard, and whether the filing deadline might have to be extended yet one more time.

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I wrote a while back about the Downside of Downsizing, in which I noted an increasing number of calls from broadcasters who had trimmed their staffs to the bare minimum, only to belatedly discover that the remaining employees lacked either the experience or the time to ensure the station’s compliance with FCC and other regulations. This afternoon, the FCC released seven Notices of Apparent Liability announcing the financial damage that taking your eye off the regulatory ball can have.

The seven NALs (1, 2, 3, 4, 5, 6, 7) all involved Children’s Television violations, with the proposed fines ranging from $25,000 to $70,000. The FCC’s grand total for the afternoon was $270,000 in proposed Children’s Television fines. While the simultaneous release of the forfeiture orders may be meant to send a message about the seriousness with which the FCC views violations of the Children’s Television rules, the FCC has been working hard on Chairman Genachowski’s watch to clear out backlogs of enforcement proceedings of all types, and it may be that these particular cases are merely the latest result of that effort.

What is certainly not a coincidence, however, is the hefty size of these fines. These NALs appear to confirm a recent FCC trend of imposing heavier fines for a variety of regulatory offenses. While cynics might argue that the government just needs the money at the moment, there does seem to be a concerted effort at the FCC to “update” its fine amounts to make violations sufficiently painful that licensees will not view them as merely a cost of doing business. It is also worth noting that while the seven NALs involve a variety of kidvid violations (exceeding commercial limits, program length commercials, failure to notify program guide publishers of the targeted age range of educational programs, failure to place the appropriate commercial certifications in the public inspection file, failure to publicize the existence and location of the station’s Children’s Television reports), they all have one other feature in common: each of the stations confessed its transgressions in its license renewal application.

In addition to giving no quarter for the licensees having confessed their own sins, the NALs are quite stern in assessing the severity of the violations. Noting that human error, inadvertence, and subsequent efforts to prevent the recurrence of such violations are not grounds for reducing the punishment imposed, the NALs apply a strict liability standard, cutting stations no slack even where the violation was based upon a misapplication of the rule (e.g., assessing compliance with children’s commercial time limits based upon a programming hour (4:30-5:30pm) rather than a clock hour (5:00-6:00pm)), where a program-length commercial was caused by a fleeting and tiny/partial glimpse of a program character during a commercial, or where the program-length commercial was caused by network content.

To be clear, the FCC staked out no new legal ground in these decisions, which for the most part apply existing precedent, and the NALs do indicate that some of the stations involved had over 100 kidvid violations. What catches the eye, however, is not just the size of the fines, but the terse manner in which the violations are listed, the defenses rejected, and the fine imposed, with each NAL noting that the base fine for a kidvid offense is $8,000, but that an upward adjustment is merited in this particular case, with the ultimate amount often appearing to have been plucked out of the air. The impression licensees are left with is that the FCC has lost patience in plowing through the backlog of enforcement cases, and there will be little or no room for error in FCC compliance going forward.

It’s good that the broadcast advertising market has begun to resuscitate, as now would be a good time to rehire those FCC compliance personnel, particularly the ones that prescreen children’s television content.