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While we await release of the text of today’s Net Neutrality order from the FCC, it strikes me as useful to take a step back and apply a broader perspective to what can be learned from the debate that led to it. While lawyers get a rush when they think they have come up with the perfect legal argument to support their client’s cause (and we’re fun at parties too!), those of us working in Washington have to concede that legal arguments are often secondary to the politics involved. Certainly, the FCC’s order will not be the last word in the Net Neutrality debate, with a number of prominent members of Congress already promising a legislative rebuke, and the near certainty of the courts being called upon to assess the FCC’s authority to adopt such rules.

In spite of the millions spent on lawyers and lobbyists on both sides of this issue, the result was in many ways preordained by the real champion in this debate, linguistics. Much of the battle was won when proponents summarized their position as being in favor of “Net Neutrality”, a term that is sufficiently innocuous yet catchy enough to crystallize the debate as being between those who want a neutral/fair apportionment of the Internet’s capabilities, and those who, well, don’t. Opponents were put instantly on the defensive, trying to explain why a neutral Internet wouldn’t be a good thing.

While other terms were also bandied about in the early days of the debate (like “broadband discrimination” or “traffic prioritization”), none had the simple positive ring (and alliteration) of Net Neutrality. “Internet Indifference” might have been a good candidate as well, but no one seems to have thought of it at the time.

Added to this linguistic head start is the fact that the concept itself is simply easier to explain in positive terms than in negative ones. Stories on the Washington Post’s website today described Net Neutrality as a regulation that “ensures unimpeded access to any legal Web content for home Internet users” and which marks “the government’s strongest move yet to ensure that Facebook updates, Google searches and Skype calls reach consumers’ homes unimpeded.” Based on that description, readers would be hard pressed to conclude that Net Neutrality is a bad thing, and much of the mainstream press used terms similar to the Post’s in describing today’s action by the FCC.

Taking the contrary position, there are two big problems with arguing that Net Neutrality is “an intrusive government interference into the management of broadband networks that will impede the evolution of new models of business on the Internet while requiring Internet innovators to first consider and navigate government regulations before implementing new Internet services.” First, it doesn’t exactly roll off the tongue like the Post’s description of Net Neutrality. Second, it requires several additional explanations of exactly how Net Neutrality regulations would have that effect. It isn’t necessarily obvious from the statement alone.

The point of this is not to debate the merits of Net Neutrality itself, but to note that taking the time to carefully craft and package a proposal before presenting it (to the FCC or any other part of the government, including Congress) frames the debate in your favor. It is not an irrefutable advantage, but claiming the linguistic high ground forces opponents to expend far more of their resources fighting their way uphill, while the proponent conserves its legal and political resources waiting at the top. Many opponents will falter before they reach the top, and those that do make it will be exhausted from the climb.

In the case of Net Neutrality, vast resources were arrayed on both sides of the debate, but the political and public popularity engendered by the phrase “Net Neutrality” and the easily understood arguments on its behalf proved to be insurmountable today. It is safe to say, however, that opponents of Net Neutrality regulations are already regrouping for their next charge in Congress and in the courts, and that today’s skirmish was merely the first of many to come.

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Members of the Communications Industry that don’t keep up with legal and political developments in Washington aren’t in the industry for long. That truism has been particularly apt in the past few months, starting with the President’s October signing of the Twenty-First Century Communications and Video Accessibility Act of 2010 which, among other things, cleared the way for reinstatement of the FCC’s former Video Description rules for television broadcasters, extended closed captioning of video programming to the Internet, and required the FCC to examine methods of increasing the accessibility of emergency information.

Normally, the weeks before a congressional election and the lame duck session afterwards are not a fertile environment for communications legislation, which has a tendency to be controversial because of the stakes involved (can you say “net neutrality”?). However, the Twenty-First Century Communications and Video Accessibility Act, which was spurred to passage by a congressional desire to commemorate the 20th anniversary of the Americans with Disabilities Act, was merely the beginning.

The lame duck session has now generated several more pieces of successful legislation. Last week the President signed the first of these, the Commercial Advertisement Loudness Mitigation Act, which requires television stations to transmit at a consistent volume level (rather than make viewers lunge for their mute button at every commercial break). Congress followed the CALM Act with passage of the Truth in Caller ID Act of 2009, which is now awaiting the President’s signature. This legislation prohibits manipulation of caller ID information with intent to defraud or harm others.

Apparently building steam, Congress proceeded to adopt the Local Community Radio Act of 2010 this past weekend, which reduces the extent of interference protection that full power radio stations will receive from Low Power FM stations, thus clearing the way for many more LPFM stations to be wedged into the FM radio band. This legislation is also now waiting for the President’s signature.

So, is there something in the DC drinking water that has a lame duck Congress suddenly tackling communications issues as though “gridlock” was only a term from morning traffic reports? Maybe. But the truth is more complicated than that. With regard to the CALM Act, controversy about loud television commercials dates back decades. The FCC long ago considered adopting rules to prohibit such “variable volume” broadcasting, but concluded in 1984 that “due to the subjective nature of many of the factors that contribute to loudness, it would be virtually impossible to craft new regulations that would be effective.” However, the transition to digital television has made it far more feasible to craft and enforce objective technical standards for loudness, lessening somewhat broadcasters’ concerns that regulation would lead to free-roaming loudness police second-guessing a station’s engineering practices.

Similarly, the LPFM interference issue has been simmering for a decade, with a succession of bills trying and failing to eliminate the requirement that LPFM stations protect full power stations’ third-adjacent channels from interference. However, what finally put the Local Community Radio Act over the top was a legislative compromise that, among other things, assured full power broadcasters that LPFM will be categorized as a secondary service to full power stations. This means that full power broadcast stations can continue to modify their facilities to improve their audience reach without finding themselves blocked by the interference such a modification might cause local LPFM stations. In light of this and other modifications to the bill, broadcasters were able to offer their support for its adoption, finally breaking the longstanding impasse.

So what’s next? Well, Congress remains keenly interested in communications issues, as evidenced by the lively discussion (and legislative threats) surrounding the FCC’s upcoming net neutrality order. Broadcasters, however, are hoping that this lame duck session concludes quickly, leaving the Performance Rights Act and its goal of requiring broadcasters to pay royalties to the recording industry the subject of continued inter-industry negotiations, rather than the latest statutory mandate emerging from the twilight hours of the 111th Congress.

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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. This month’s issue includes:

  • Failure to Heed Warning by FCC Field Agent Costs Broadcaster $10,000
  • FCC Fines AM Broadcaster $6,000 for Excessive Nighttime Power Levels
  • AM Broadcaster’s Limited Disclosure of Contest Rules Nets $4,000 Fine

FCC Fines Pennsylvania Broadcaster $10,000 for Repeated Failure to Employ Adequate Personnel

In keeping with lasts month’s “meaningful management and staff presence” Notice of Apparent Liability (“NAL”), the FCC again upwardly adjusted a fine, totaling $10,000, against a Pennsylvania broadcaster for repeated failure to maintain at least one management level and one staff level employee at the main studio during regular business hours as required by Section 73.1125 of the FCC’s Rules. At the time of the initial inspection by a local Enforcement Bureau Field Agent, the “main studio”, which was located within a church, was unattended and locked.

The FCC requires that licensees maintain a “meaningful management and staff presence” at a station’s main studio. Based on a 1991 FCC decision, the FCC defines “meaningful” as at least one management level employee and one staff level employee generally being present “during normal business hours.”

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As we discussed in a previous post and separate Client Advisory, the FCC released a Public Notice to implement a provision of the Satellite Television Extension and Localism Act (STELA) that requires the FCC to submit a report on in-state broadcast programming to Congress by August 11, 2011. The Public Notice was published in the Federal Register yesterday, which means that comments are due by January 24, 2011, with reply comments due by February 22, 2011.

As we discussed previously, the purpose of the FCC’s Report to Congress is to address a concern of some members of Congress that subscribers located in markets that straddle a state line may be unable to receive broadcast news and information from their own state because the local stations made available by cable and satellite providers are all located in the “other” state. According to the FCC, the report will: (1) analyze the number of households in a state that receive the signals of local broadcast stations assigned to a community of license located in a different state; (2) evaluate the extent to which consumers in each local market have access to in-state broadcast programming over-the-air or from a multichannel video programming distributor; and (3) consider whether there are alternatives to DMAs for defining “local” markets that would provide consumers with more in-state broadcast programming.

This proceeding is relevant to retrans because there have been some efforts on Capitol Hill to introduce legislation allowing cable and satellite operators to import the signals of television stations from another market. While the official description of this situation describes these subscribers as being deprived of news and information regarding their own state, the more pragmatic concern of such viewers it is argued is that they aren’t able to watch sports teams from their state as often as they would like. However, creating a legislative opportunity to import distant stations carrying such in-state sports (and other) programming would often mean importing a station that duplicates the network and syndicated programming of a local station already carried by cable systems and satellite providers in the market. Importing stations in this manner raises complex issues with respect to potentially siphoning off the local station’s viewers (and advertisers), undercutting the local station’s program exclusivity, and impacting the local station’s leverage when it commences retransmission consent negotiations.

For those who plan on filing comments or replies, keep in mind that the FCC has specifically asked for data to help it analyze the issues relating to the availability of in-state broadcast stations for consumers, including the proper “methodologies, metrics, data sources, and level of granularity” that should be used in its report to Congress. The FCC is also asking for specific information to identify counties and populations within given states that have limited access to in-state broadcast programming.

As a result of efforts currently underway on the Hill with respect to potentially allowing the importation of in-state but out-of-market signals, those interested in retransmission consent should continue to monitor this matter closely.

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As we discussed in a post back in March, the FCC’s staff had just released its National Broadband Plan, which announced a controversial proposal to reclaim 120 MHz of spectrum from television broadcasters. Yesterday evening, the FCC moved this process forward by issuing a Notice of Proposed Rulemaking to open TV spectrum to use by fixed and mobile wireless facilities, including mobile broadband. We are in the process of preparing a detailed Client Advisory analyzing the FCC’s Notice for publication later today. However, for those that can’t wait, there are a number of big issues raised by the Notice.

First, the FCC proposes to give wireless broadband providers new primary allocations in the broadcast television spectrum. If adopted, this new rule would give fixed and mobile wireless users co-primary status throughout the entirety of the TV spectrum (as opposed to just in the upper-UHF band). Having primary status is important: it means non-primary services have to accept any interference from you, and you don’t have to worry about interference you cause to non-primary services (like low power television stations). If the FCC issues fixed and mobile wireless licenses in the TV band, and gives them co-primary status, then those wireless broadband providers would have the exact same interference protections as full-power TV stations enjoy today. As a result, full-power TV stations would be prevented from modifying their facilities if the modification would cause interference to a newly-licensed wireless operator. Regardless of which licensee was there “first”, co-primary status means that neither service can propose modified facilities if interference would be caused to the existing facilities of the other service.

Second, the FCC proposes to establish a legal framework allowing two or more broadcast stations, potentially including Class A and low power television stations, to voluntarily share a single six-megahertz channel. The Notice proposes to allow parties flexibility to decide for themselves how best to share the six-megahertz channel, and envisions more than two stations potentially sharing the same channel. According to the Notice, two sharing stations could each broadcast one primary HD stream, while more than two stations sharing a six-megahertz channel would each broadcast in Standard Definition (although note that the engineering community has been pretty vocal regarding losses in picture quality caused when two HD signals jockey for room in a single 6MHz channel). The FCC also proposes, regardless of the number of stations sharing a channel, that each of the full-power stations retain must-carry rights on cable and satellite systems for their primary program stream.

Finally, the Notice asks for comment on ways to improve VHF TV reception to increase the attractiveness of the VHF band to digital TV stations. The FCC recognizes that UHF spectrum is much more desirable for flexible digital TV service (as well as for mobile broadband) than VHF spectrum. In an effort to encourage increased use of VHF channels by digital broadcasters, the FCC asks for comment on proposals to increase the performance standards of indoor VHF antennas. The Notice also proposes to make technical changes to the FCC’s VHF service rules, including allowing VHF stations to operate at higher power than the rules currently permit. The FCC is also asking for any other ideas that might improve reception of digital VHF TV signals.

To say that these proceedings represent a big deal for broadcasters and wireless operators understates the meaning of both “big” and “deal”. These proceedings will lay out the framework for how all affected services will develop and interact with each other for the foreseeable future. They also represent the FCC’s continuing shift from dedicating spectrum to specific uses to allowing multiple services to share the same spectrum. While, if done correctly, shared spectrum use can increase spectrum efficiency, the etiquette of that sharing arrangement is a critical component of how the FCC, and the residents of that spectrum, proceed from here.

There is a maxim that “good fences make good neighbors.” In moving toward shared use, the FCC is proposing to tear down the fences separating spectrum users, and each of those users is about to learn more about their neighbors than they ever wanted to know. What rules the FCC adopts to protect each party’s flower bed from being trampled by its neighbors is going to be critically important. Keep a close eye on these proceedings, and on your flower bed.

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Posted in: Spectrum
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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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As Scott Flick reported in a previous post, our firm filed a Petition on behalf of an unlikely coalition of broadcast and cable associations and their allies, including 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. The parties joined forces to ask the FCC to extend the deadline for all EAS Participants to acquire and install the equipment necessary to use the Common Alerting Protocol (CAP) standard for Emergency Alert System alerts. The unified effort paid off, as today the FCC released an Order waiving Part 11.56 of its Rules and extending the CAP deadline from March 29, 2011 to September 30, 2011.

Last September 30, FEMA announced the adoption of the CAP v1.2 standard, which triggered a 180-day deadline for implementation. In a post found here, I described CAP and what the CAP compliance deadline requires of EAS Participants.

The extension means that the estimated 25,000 to 30,000 EAS Participants now have more time to acquire the new and sophisticated equipment they need to become CAP-compliant, while giving FEMA more time to certify CAP-compliant EAS equipment. The six-month delay will also allow equipment manufacturers to test their CAP products and to make any changes needed to meet the certification requirements. This process, in turn, will give EAS Participants the certainty they need to make better informed decisions regarding what equipment they should obtain and install to ensure compliance with CAP. Finally, the extension will give all parties, including noncommercial broadcasters, smaller cable systems, and rural broadcasters more time to budget for the purchase of new equipment.

The FCC acknowledged that if it failed to extend the 180-day deadline, it could “lead to an unduly rushed, expensive, and likely incomplete process.”

The Order also leaves open the possibility of extending the CAP deadline beyond September 30, 2011. This is because the FCC will soon be conducting a rulemaking proceeding to incorporate CAP into its Part 11 Rules, and at this point it is unclear what specific Part 11 rule changes will be made as a result of the new CAP standard. According to the FCC, it plans to complete that rulemaking prior to September 30, 2011, but will ask for comments on “whether the extension for CAP acceptance by EAS Participants granted in this waiver order is sufficient, and reserves the right to further extend the date for CAP reception in any new rule we may adopt.” Given that the outcome of the rulemaking proceeding will likely result in a number of significant revisions to the FCC’s EAS Rules, another extension of the deadline is certainly plausible in order to give parties enough time to come into compliance with the new rules.

In other words, stay on alert, as we will definitely be hearing much more about CAP in the near future.

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Posted in: Emergency Alert System
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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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Along with all of the other activities of the coming holidays, December 1 represents a busy filing deadline for digital television stations and many commercial and non-commercial radio stations, depending upon their location. For those affected, below is a brief summary of the applicable deadlines, as well as links to our recent client alerts and advisories describing the requirements in more detail.

December 1 Noncommercial Ownership Reports

Noncommercial educational radio stations licensed to communities in Colorado, Minnesota, Montana, North Dakota and South Dakota, and noncommercial educational television stations licensed to communities in Alabama, Connecticut, Georgia, Maine, Massachusetts, New Hampshire, Rhode Island and Vermont must file their Biennial Ownership Reports by December 1, 2010. For a detailed discussion of the filing requirements, please see our Client Alert here.

December 1 EEO Deadlines

Radio and television stations licensed to communities in: Alabama, Colorado, Connecticut, Georgia, Maine, Massachusetts, Minnesota, Montana, New Hampshire, North Dakota, Rhode Island, South Dakota and Vermont have a number of December 1, 2010 deadlines for compliance with the FCC’s EEO Rule. For a detailed discussion of the requirements, please see our Client Advisory here.

December 1 DTV Ancillary/Supplementary Services Report

All commercial and noncommercial educational digital television broadcast station licensees and permittees must file FCC Form 317 by December 1, 2010. For a detailed discussion of this requirement, please see our Client Advisory here.

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All commercial and noncommercial educational digital television broadcast station licensees and permittees must file FCC Form 317 by December 1, 2010.

The FCC requires all digital television stations to submit FCC Form 317 each year. The report details whether stations provided ancillary or supplemental services at any time during the twelve-month period ending on the preceding September 30. It is important to note that the FCC Form 317 must be submitted regardless of whether stations offered any such services. FCC Form 317 must be filed electronically, absent a waiver, and is due on December 1, 2010.

Ancillary or supplementary services are all services provided on the portion of a DTV station’s digital spectrum that is not necessary to provide the required single free, over-the-air signal to viewers. Any video broadcast service that is provided with no direct charge to viewers is exempt. According to the FCC, examples of services that are considered ancillary or supplementary include, but are not limited to, “computer software distribution, data transmissions, teletext, interactive materials, aural messages, paging services, audio signals, subscription video, and the like.”

If a DTV station provided ancillary or supplementary services during the 12-month time period ending on September 30, 2010, it must remit to the FCC 5% of the gross revenues derived from the provision of those services. This payment can be forwarded to the FCC’s lockbox at the U.S. Bank in St. Louis, Missouri and must be accompanied by FCC Form 159, the Remittance Advice. Alternatively, the fee can be paid electronically using a credit card on the FCC’s website. The fee amount must also be submitted by the December 1, 2010 due date.

For assistance in preparing and filing FCC Form 317, please contact any of the attorneys in the Communications Practice Section.

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Posted in: Television
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