TVN’s FCC Watch | A Broadcaster’s Guide To Washington Issues
2020 has been one of the busiest — and most unusual — years yet for broadcasters. The coronavirus pandemic has upended much of daily life since March, leading to significant drops in advertising revenue and general economic turmoil and uncertainty for radio and television broadcasters. And even though the FCC’s headquarters has been empty for months, with its leadership and staff working remotely since March, the commission’s regulatory activity has continued, in most cases, without missing a beat. The pandemic has itself brought its own set of novel issues before the FCC.
The FCC continues to act on matters both large and small as the broadcast industry evolves while trying to navigate through a pandemic. In July 2020, full-power television broadcasters largely completed the repacking of television spectrum that began in 2018 following the incentive auction, bringing to a close an effort dating to the 2010 National Broadband Plan to reallocate TV spectrum for wireless use. The television license renewal cycle began in June and does not end until 2023.
The industry is also approaching a general election that is sure to look unlike any election we have seen before, bringing political broadcasting legal issues to the top of every station’s agenda. Because elections matter, the results of this November’s voting could have significant impacts on the agenda of the FCC starting in 2021.
This briefing on some of the major issues currently being considered in Washington is prepared by David Oxenford and David O’Connor, attorneys in the Washington office of law firm Wilkinson Barker Knauer LLP. You can reach Oxenford at [email protected] or 202-383-3337 and O’Connor at [email protected] or 202-383-3429. This briefing is provided for informational purposes only and does not constitute legal advice.
In alphabetical order:
ATSC 3.0 (NextGen TV)
In 2017, the FCC voted to adopt new rules authorizing TV stations to use the ATSC 3.0 standard on a voluntary, market-driven basis. The new rules become effective in 2018 (see our discussion here) and the FCC announced in May 2019 that it would begin accepting applications for 3.0 licenses. Together with that announcement, the FCC released a new Form 2100, the application to be used to apply for a 3.0 license. Live 3.0 signals have been introduced this year in a number of television markets. See our article here for more on these recent actions.
The 2017 decision was the culmination of years of efforts to introduce this new standard (aka NextGen TV). The ATSC 3.0 standard was developed by the Advanced Television Systems Committee (ATSC). The new standard incorporates Internet-protocol digital encoding and allows for many other major advances, including 4K capabilities, high-efficiency video coding, enhanced compression and significant improvements for both mobile reception and data transmission.
The FCC’s decision incorporates only a portion of the new standard into its rules — specifically, it incorporated two parts of the ATSC 3.0 “physical layer” standard into the rules: (1) the ATSC A/321:2016 “System Discovery & Signaling” (A/321), which is the standard used to communicate the RF signal type that the ATSC 3.0 signal will use, and (2) the A/322:2017 “Physical Layer Protocol” (A/322), which is the standard that defines the waveforms that ATSC 3.0 signals may take. With respect to A/322, the FCC decided to apply the standard only to a Next Gen TV station’s primary free over-the-air video programming stream and incorporate it by reference into the FCC rules for a period of five years. The FCC recently denied a petition seeking to eliminate the regulatory sunset, thus allowing the transmission standard to evolve over time (see our article here).
The 3.0 standard is an alternative to, but not a replacement for, the current ATSC 1.0 DTV transmission standard. Stations are not required to transition to the new standard. The FCC also declined to mandate that TV manufacturers include a 3.0 tuner in television sets, in keeping with the voluntary nature of this new standard.
Stations choosing to operate using the 3.0 standard will be required to simulcast the primary video programming stream of their 3.0 channels in an ATSC 1.0 format, so that viewers will continue to receive 1.0 service. Stations can comply with this requirement by partnering with another station (i.e., a temporary “host” station) in their local market to either:
- Air a 3.0 channel at the temporary host’s facility, while using their original facility to continue to provide a 1.0 simulcast channel, or
- Air a 1.0 simulcast channel at the temporary host’s facility, while converting their original facility to provide a 3.0 channel.
Until July 17, 2023, the programming aired on the 1.0 simulcast channel must be “substantially similar” to the programming aired on the 3.0 channel. LPTV and TV translator stations are exempt from the local simulcasting requirement.
A full-power 3.0 signal will not have mandatory carriage rights while the FCC requires local simulcasting, but these carriage issues can be addressed in retransmission consent agreements. MVPDs will be required to continue to carry 1.0 signals under the must carry rules. In the recent reconsideration decision, the commission clarified that a station will retain its current significantly viewed status on MVPDs even if its signal changes because of a sharing agreement allowing it to broadcast in both the old and new transmission standards. Other conditions and restrictions apply, so stations that are considering deploying 3.0 should review the FCC’s decisions carefully.
In mid-2020, the FCC adopted a declaratory ruling and a Notice of Proposed Rulemaking regarding “Broadcast Internet” services, which is essentially datacasting using a station’s 3.0 signal. The declaratory ruling clarified that the leasing of television spectrum for datacasting uses does not trigger FCC multiple ownership issues (this means an entity can lease capacity of one or more TV stations for datacasting purposes, and those leases are not considered attributable interests for multiple ownership purposes). The rulemaking seeks comment on how the FCC can change its rules to encourage Broadcast Internet deployment and use. Comments and reply comments in this proceeding were due in August of this year. See our article here.
In 2015, the FCC issued a Notice of Proposed Rulemaking proposing to eliminate outdated rules in order to promote the conversion of analog remote pickup facilities to digital. The NPRM is available here. The pleading cycle in this proceeding closed in 2015.
CALM Act/Loud Commercials
In 2011, Congress enacted the CALM Act with the aim of ending loud commercials on TV, and the FCC’s rules implementing the CALM Act went into effect in 2012. To comply, TV stations must use equipment that adheres to the A/85:2013 standards adopted by the Advanced Television Standards Committee (ATSC), a standard that has been in place since June 2015. See our summary of CALM Act requirements here and here.
The FCC has indicated that it is monitoring complaints related to loud commercials, and suggested that if a particular station receives a sufficient number of complaints, the FCC will issue a Letter of Inquiry regarding the station’s CALM Act compliance. So far, there have been no public actions by the FCC for CALM Act violations. Stay tuned to see if anything changes with enforcement of CALM Act issues.
The FCC recently modified its rules relating to the protection of TV ch. 6 stations by FM stations operating in the portion of the FM band reserved for use by noncommercial stations, allowing FM stations to make a showing that they will not interfere with digital ch. 6 operations. The commission will further review this issue to assess if the ch. 6 protections are still necessary. See more on this issue here.
From time to time, the FCC has asked in various proceedings if ch. 6 should be reallocated to FM use. See, for instance, our articles here and here. That proposal does not appear to be actively under consideration currently.
In July 2019, the FCC adopted major reforms to the children’s television rules, including the elimination of minimum programing requirements for multicast channels and providing additional flexibility to broadcasters for meeting the 3-hour minimum requirement per week. These changes allow for a station to meet approximately one-third of its obligation with programming broadcast on a digital subchannel, and one-third with programs that had not previously been considered “Core Programming” (e.g., specials or short-form programs).
The FCC also eliminated the quarterly reporting and certification requirements, moving to an annual process instead. The first annual report, covering Sept. 16, 2019, to Dec. 31, 2019, was due by July 31, 2020. Starting in 2021 and on a going-forward basis, the report (on FCC Form 2100, Schedule H) will be due annually by Jan. 30. See our articles here and here for more on the rule changes. The final order also eliminated the need for noncommercial stations to identify on screen educational and informational programming to be identified on-screen with an “E/I” symbol. The obligation for such identification remains for commercial broadcasters.
In connection with that obligation, note that in 2017, the FCC entered into a consent decree with a TV station that had not been identifying educational and informational programming addressed to children with the on-air “E/I” symbol. For this and other related violations, the station agreed to make a $17,500 payment to the government. See our description of this decision here. This enforcement action is similar to past cases, where fines were issued for not including the “E/I” symbol on educational and informational programs, and for broadcasting the URL of a commercial website in the body of a program directed to children ages 12 and under. See our summaries of some of these cases here and here. In the past, fines have also been issued for stations that failed to publicize that educational and informational programming in local program guides. See, e.g., the FCC decision here.
There are numerous other aspects of the children’s television rules to which stations must pay close attention. In July 2015, a station group agreed to pay $90,000 to the federal government and enter into a compliance program in order to resolve claims that the stations were using multiple reruns of one-time programs to meet their obligations to provide three hours of weekly educational and informational children’s programming. The FCC asserted that to meet their “core” programming obligation, stations must run regularly scheduled episodes of eligible programs, and not just repeats of one-off programs. See our summary of this case here.
In another 2015 decision, the FCC warned stations to carefully assess the educational and informational aspects of such programs to make sure that there can be no reasonable question as to whether the programs have, as a “significant purpose,” the positive development of children’s cognitive and social skills.
The FCC has warned stations about taking too broad an interpretation of “children’s programming,” noting that the FCC “does not automatically accept” a licensee’s claim that its programming adequately meets the standards for children’s programming, but will instead “require the licensee to present credible evidence to support its position in such a situation.” See our summary here.
Throughout the last license renewal cycle, the FCC issued significant fines to TV stations for late-filed FCC Form 398 children’s programming reports. In fact, the FCC has been reviewing station’s online public files to more easily locate late-filings. See our article here.
Stations should take the time and effort to learn the new rules and be sure they are complying, as these issues may well come up during the current television license renewal cycle.
TV Closed Captioning — In 2015, new closed captioning obligations for TV broadcasters became effective. These new “quality” standards for captioning include four distinct areas: Accuracy, synchronicity with the words being captioned, caption completeness from the beginning of a program to its ending, and caption placement, so that the caption text does not obscure other important on-screen information.
TV stations are required to use “best efforts” to obtain compliance certifications from their programming providers. For more on the obligations for quality captioning, see our article here.
In 2016, the FCC adopted a Second Report and Order which reallocates responsibility for compliance with the closed captioning rules between video programming distributors and video programmers (VPs). The new rules also include methods for measuring closed captioning compliance and responding to consumer complaints. New certifications by VPs to the FCC will also be required. The rules became effective in 2017.
At the same time, the FCC has restricted the waiver process for closed captioning under the “undue economic burden” standard. That standard is significantly higher than in previous years. The FCC has been reviewing the captioning waivers and issuing public notices soliciting comments. Consumer groups have actively opposed waiver requests.
The Media Bureau has denied a number of closed captioning waiver requests filed by various churches and other organizations. In doing so, the bureau has conducted a detailed analysis of the financial status of the requesting party, and frequently has concluded that the organization had adequate finances to pay for captioning, and thus a waiver was not warranted. The bureau has concluded that there are no religious freedom constitutional issues presented by these cases. See our commentary here.
From these cases, it is clear that waivers will be granted only when the captioning responsibilities would put a burden on the overall financial health of a program producer, and not simply because the cost of captioning would cause the producer to lose money on the program itself.
Top-4 network stations in the top 25 markets have long been prohibited from using the Electronic Newsroom Technique (ENT) to caption their news and other live programming. While other stations can still rely on that technique, the FCC now requires stations to take additional actions with their ENT, including scripting in-studio produced programming, weather information and pre-produced programming (to the extent technically feasible).
Live interviews and breaking news segments need to include crawls or other textual information (to the extent technically feasible). Stations must train news staff on ENT scripting and appoint an “ENT coordinator” accountable for compliance. See this article here for further information.
The FCC required the broadcasting community to submit a report detailing their experiences with the new ENT rules and the extent to which the new ENT rules have been successful in providing full and equal access to live programming on television. The NAB submitted a report on behalf of the TV industry in 2015, and a copy is available here. The FCC’s Disability Advisory Committee continues to review ENT rules and other accessibility issues, and additional recommendations from that Committee may be forthcoming.
IP Captioning — FCC rules require the closed captioning of certain video programming delivered via Internet Protocol (i.e., IP video). The rules are a result of the 21st Century Communications and Video Accessibility Act (CVAA), a federal law designed to improve the accessibility of media and communications services and devices.
Under the rules, if programming is delivered using Internet Protocol, whether it is prerecorded video programming, live, or “near live” programming, it must be provided with closed captions if the programming was shown on television in the United States with captions. However, if the programming aired on TV before certain dates in 2012 and 2013, it may be exempt until it is shown again on TV (the dates will depend on the type of programming — e.g., live programming had a later phase-in date).
TV stations and other video programming distributors are required to make captions available for “archival” IP-delivered video programming within 15 days of the date that an archived program aired on television with captions.
Brief video clips and outtakes (including excerpts of full-length programming) taken directly from captioned TV programming and displayed online must be captioned. In addition, “montages” of multiple clips from captioned TV programs must also be captioned if they are displayed online. Clips from live and “near-live” TV programming must also be captioned if they are displayed online. However, such clips may be posted online initially without captions if captions are added to clips of live programming within 12 hours, and to clips of “near-live” programming within eight hours, after the conclusion of the television showing of the full-length programming. The FCC accepted reply comments through March 6, 2020 on a request by Pluto TV, an online video aggregator, for a limited waiver of the rules regarding captioning of video delivered by internet. Pluto delivers video over multiple platforms and has petitioned for a waiver from compliance saying that, on some of its platforms, compliance with the captioning rules is difficult and the company requires more time to upgrade its systems. It also seeks a longer-term waiver for certain platforms the company says are not regularly updated and require more sweeping technological changes to reach compliance.
The FCC has an open proceeding about how to deal with clips of captioned TV programs that are contained in a “mash-up” with other content that has not been shown on TV with captions. This proceeding also asks whether the grace period provided for live and near-live clips should be phased out over time, and whether the captioning rules should be extended to clips that run on third-party websites or apps. For background, see our summaries here and here.
These requirements govern cable systems, TV stations, broadcast and cable networks and virtually every other professional video program producer who is now, or will be in the future, making programming available online, to the extent that the programming is also exhibited on TV.
In 2016, new FCC rules became effective which give broadcasters greater flexibility in their disclosure of the material terms of contests which they conduct. Under these rules, broadcasters may disclose material contest information online in lieu of making on-air announcements, subject to certain requirements. Click here for further information, and click here for our discussion of potential pitfalls when running station contests.
The FCC recently issued fines to two radio stations for failing to conduct their contests substantially as advertised by not awarding prizes in a timely manner. Station management eventually awarded substitute prizes to the winners and, though both winners appeared satisfied by those prizes and withdrew their FCC complaints, the FCC nevertheless issued the fines finding that the contests had not been conducted as promised. See our article here for more on these enforcement actions.
Copyright Infringement Lawsuits For Unauthorized Uses Of Internet Photos And Videos
There are regular reports in the broadcast trade press of new lawsuits filed against broadcasters for using photos on their websites and even in their social media accounts without permission of the photographer. In most cases, these photographs were found by station employees on the Internet and used to illustrate articles on station websites without obtaining permission of the copyright holder.
Similar complaints have been leveled against TV stations for taking Internet photos or video and using them in their on-air programming. Simply because material has been posted on the Internet does not mean that the material is in the public domain and can be reused without permission of the creator. See our articles here, here, here, here and here for more information about these issues.
In 2015, the Copyright Office began a proceeding to study how to best protect the rights of photographers and others who produce digital images, while making it possible for users to get the rights to use such photos. See our summary of the initiation of the proceeding here.
A bill was introduced in Congress in 2016 seeking to establish a copyright small claims court that would allow photographers and others to more easily enforce their rights. See our analysis of that bill here. Congress has not moved on these proposals, but they may well be considered in the future. See our update here. In fact, in January 2019, the Copyright Office wrote to Congress, again expressing the need for reform, including the creation of a small claims court for copyright matters. See the Copyright Office’s letter to the Senate Judiciary Committee, here.
The FCC has taken a number of actions to help broadcasters navigate the ongoing public health pandemic and taken other actions made necessary by the FCC staff’s inability to work from FCC headquarters.
One of the actions with perhaps the greatest ongoing impact was the FCC’s decision concluding that free advertising schedules provided to businesses to help them through the pandemic (and to help the broadcaster fill unsold advertising time) would not be considered in assessing the lowest unit charge that is applicable to advertising sold to political broadcasters in the 45 days before a primary or the 60 days before a general election (see the section on Political Broadcasting below). Such advertising is excluded from LUC calculations, as long as it is not associated with any paid advertising schedule. This policy remains in effect as of this writing. See our blog entry here for suggestions on ways to implement this policy without running afoul of the political broadcasting rules.
Acknowledging that stations may be left with fewer crews to cover local events as infections and quarantining take place and because no one wants a crowd of camera crews and reporters at every news event, the FCC has made news sharing easier for stations. Such news sharing agreements entered into during the crisis for news sharing do not need to be in writing and do not need to be in the public file — an exemption to the normal obligation to reduce any sharing agreement between TV stations to writing and add it to the online public file. Pandemic-related agreements fall under the “on-the-fly” exemption. We wrote about this guidance here.
The FCC announced in April that, in light of the shifting economic situation facing many broadcast advertisers, it would allow stations to air certain PSAs, using time donated by commercial entities to organizations involved in the pandemic relief effort, without identifying the commercial entities paying for the time as would otherwise be required by the sponsorship identification rules. That waiver expired Aug. 31. We wrote about the waiver here.
The FCC in April announced a policy relieving broadcasters of wide-dissemination EEO obligations in rehiring laid-off employees in a post-shutdown world. This policy shift allows broadcasters who were forced to terminate employees because of the pandemic to rehire those same employees within nine months of the time that they were laid off, without having to go through the “wide dissemination” that the FCC rules normally require before an employment vacancy is filled. See more about this policy here.
Drones/Unmanned Aircraft Systems (UAS)
In late 2018, President Trump signed the “FAA Reauthorization Act of 2018,” a comprehensive statute that includes more than 45 sections related to drones. The UAS-specific sections represent the most extensive codification to date of federal goals, policies, and directives concerning the drone industry. The FAA has already initiated new rulemaking proceedings on multiple UAS topics to implement the Act’s provision.
The most significant development over the last year has been the FAA’s release of its proposed rule for remote identification of UAS. Requiring such “license plates” will allow the FAA and other authorities to pinpoint a drone’s origins. The new regulations will apply to all UAS weighing more than 0.55 pounds and will affect the news media, other commercial drone operators, hobbyists, and drone manufacturers.
More than 50,000 comments were filed by the time the comment cycle on the remote ID proposal closed in early March. The FAA has committed to issuing the new regulations by the end of this year.
Remote ID rules will bring numerous UAS industry benefits. For the last several years, federal security agencies have blocked the FAA’s efforts to adopt rules allowing expanded UAS operations because of the lack of a Remote ID system. Once Remote ID is put in place, the FAA will be able to move forward on adopting rules allowing flights “beyond visual line of sight” (BVLOS). The FAA will then allow drone operations over people. Indeed, when the FAA considered rules last year for flight operations over people and at night, the agency said it would condition the implementation of any such rules on adoption of a remote ID system. With Remote ID, the media industry will finally be able to explore the true technological potential of drones.
New remote ID rules will also lay the groundwork for development of a UAS traffic management system, or air traffic control, for drones.
The drone industry continues to be one that is regulated principally “by exemption” or grants of special authority. Within the last year, the FAA has begun to issue more Section 44807 exemptions to various parties, including media parties. Since 2016, the FAA’s rules for flying drones have been codified in Part 107 of its rules, but those rules only apply to drones weighing less than 55 pounds. Parties wanting to fly heavier drones must seek exemptions under Section 44807 of the 2016 FAA Reauthorization Act, a process that replaced the Section 333 exemptions on which thousands of drone operators relied before 2016. Applicants utilizing Section 44807 are also able to seek authority for expanded operations for which waivers under Part 107 may not be available.
Finally, a number of parties, including several in the media industry, have benefited from participation in the Department of Transportation’s Integrated Pilot Program, which has authorized cutting edge operations for the relatively small number of participants (and their affiliates) selected in May 2018 to participate in the IPP. The IPP program will expire in October 2020, and the DOT and FAA are working on a replacement approach.
EAS — Emergency Information
In 2018, the FCC adopted a requirement that, within 24 hours of a broadcaster’s discovery that it has transmitted or otherwise sent a false alert to the public, the broadcaster must send an email to the FCC Ops Center ([email protected]), informing the FCC of the event and of any details that the EAS participant may have concerning the event. This rule and other rules regarding emergency alerting, including the use of live test codes, went into effect in 2019. See our article here.
Broadcasters were required to participate in the nationwide test of the Emergency Alert System in August 2019. In May 2020, the FCC released its findings from the 2019 test, showing that the broadcast-based distribution of EAS messages is “largely effective,” reaching 82.5% of EAS participants. The IPAWS Modernization Act, enacted in 2016, requires among other things, a nationwide EAS test at least once every three years going forward. Since 2016, FEMA and the FCC have conducted a nationwide EAS test annually. The 2020 test was cancelled due to the ongoing public health emergency. Our comments on cancellation of the test are here.
In 2017, the FCC released a new EAS Operating Handbook, which supersedes all other EAS Handbooks. The Handbook is available here.
Also in 2017, the FCC added a dedicated event code to facilitate the delivery of “Blue Alerts” over the EAS and Wireless Emergency Alert (WEA) services. This new BLU event code is available for state and local officials to notify the public of threats to law enforcement, similar to current AMBER Alerts for missing children. Broadcasters were required to implement the BLU event code in 2019.
The FCC has specifically declined to mandate multilingual emergency alerts by EAS Participants. In 2017, the DC Circuit Court of Appeals upheld the FCC’s decision not to require multilingual EAS messaging. The full DC Circuit denied a request for rehearing of that decision. See our articles here and here for more details on the appeal. However, the FCC is still reviewing how emergency communications can be conveyed to non-English speaking communities. In November 2017, EAS participants were required to provide their State Emergency Communications Committees (SECCs) with information about the ways in which they make EAS information available to non-English speakers, if any. SECCs were required to compile and submit that information to the FCC in 2018.
FCC rules require TV stations to ensure that their EAS messages are accessible to members of the public, including those with disabilities. Specifically, EAS messages must appear at the top of the TV screen or elsewhere on the screen where they will not interfere with other visual messages.
In addition, EAS messages must be displayed in a manner that is readily readable and understandable, and in a manner that does not contain overlapping lines of EAS text or extend beyond the viewable display (except for video crawls that intentionally scroll on and off of the screen). Finally, the entire text of the EAS message must be displayed at least once.
Broadcasters must comply with an FCC requirement that emergency information provided in crawls or in other on-screen presentations during non-news programming be made accessible to individuals who are blind or visually impaired. In doing so, broadcasters must use the secondary audio (or SAP) stream to convey televised emergency information aurally, when such information is conveyed visually during programming other than newscasts (e.g., in an on-screen crawl run during entertainment programming). See our summary here for information about these obligations.
The obligation to convert visually-presented emergency information into speech on the SAP channel has been on hold in one instance — where the information is provided graphically, e.g. by broadcasting a weather map or similar non-textual display. In 2018, the FCC extended the deadline for complying with this requirement for another five years. See our summary of these issues here and here.
For information about these obligations to deliver emergency information to those with disabilities, see our article here reporting on a recent FCC reminder about these issues.
The FCC has adopted what amounts to a strict liability standard for the use of EAS tones (or even EAS tone simulations) in non-emergency situations. In 2015, the FCC fined iHeartMedia $1 million over the use of EAS tones in a non-emergency. See our article here. In 2017, a broadcaster agreed to pay a $55,000 penalty and enter into a three-year compliance plan with reporting obligations, in connection with a television commercial which incorporated a simulated EAS tone (see our article here). In a 2019 Enforcement Advisory, the FCC has even suggested that false EAS tones conveyed in online programming could be subject to these rules (see our article here).
In 2018, the FCC announced that it was moving EEO enforcement from the FCC’s Media Bureau to its Enforcement Bureau. For a discussion of the potential impact this may have on EEO audits and other enforcement, see our article here.
The FCC in June 2019 opened a rulemaking seeking comment on changes to EEO compliance and effectiveness of the rules. Among the questions the commission asked are whether elements of its EEO enforcement program are effective, whether the commission’s auditing program captures the correct information, whether its auditing procedures are properly designed to uncover discrimination, and more. Our discussion of this open rulemaking is here.
The FCC also continues to enforce its EEO rules by randomly auditing 5% of all broadcast stations annually, as well as through the review of Form 396, which summarizes a station’s EEO performance in the two years prior to the filing of a station’s license renewal filing. Random EEO audits targeting radio and TV stations were announced in February 2020 and again in June 2020. See our summaries here and here.
In 2019, the FCC decided to eliminate the mid-term EEO reports known as FCC Form 397 filed by TV stations with five or more full-time employees on the fourth anniversary of the filing of their renewal applications. See our discussion of this decision here and here. The FCC will still review EEO compliance at the mid-term of a license renewal (as well as at license renewal time), but the information will come from a broadcaster’s online public inspection file, not from a separate filing.
In another deregulatory move, the FCC in 2017 determined that broadcasters can rely solely on Internet recruitment sources to meet their requirement to widely disseminate information about their job openings. If a broadcaster, in its good faith judgement, determines that an online source will reach members of all of the significant groups in its community, it can rely solely on this online source when seeking candidates for new job openings. The FCC suggested that stations should still reach out to community groups and educational institutions when recruiting for job openings, and still use its own airwaves for such recruiting.
However, these additional outreach efforts are not mandatory if the online source being used reaches members of all significant groups within a broadcaster’s recruitment area. See our summary of the decision here. Broadcasters still need to notify specific community groups about job openings if those community groups specifically ask the station to receive such notices, and broadcasters still must conduct non-vacancy-specific outreach efforts to educate the community about broadcast employment.
These include the EEO menu options such as attending job fairs, hosting interns, conducting broadcast scholarship programs, and speaking at community groups and educational institutions about what jobs there are at broadcast stations, how to train for them, and how to find them. For more on the remaining obligations, see our article here.
A reminder that the FCC is still enforcing its EEO rules came in December 2017, when the Enforcement Bureau announced a $20,000 proposed fine for a broadcaster that apparently failed to sufficiently document its EEO compliance. See our summary here.
The outcome of the 2020 election could shake up the leadership of the FCC. Currently serving are Chairman Ajit Pai (R) and Commissioners Jessica Rosenworcel (D), Michael O’Rielly (R), Brendan Carr (R), and Geoffrey Starks (D). Commissioner O’Rielly’s nomination for another five-year term was recently withdrawn by President Trump, who has nominated Nathan Simington to be his replacement. Simington is a senior adviser at the National Telecommunications and Information Administration.
Foreign Ownership, Programming and Investment
In September 2020, Chairman Pai announced the commencement of a Notice of Proposed Rulemaking to determine whether to adopt new sponsorship identification rules requiring that a broadcaster who airs programming directly or indirectly sponsored or provided by a foreign government make clear on-air disclosures about the source or funding for such programs. The proposal would require specific standardized disclosures identifying the foreign government that is involved. See the FCC press release here for more information.
For many years, Section 310(b)(4) of the Communications Act was viewed as strictly limiting foreign ownership in a broadcast licensee to 20% of the company’s stock, and no more than 25% of a licensee’s parent company stock. The FCC has taken several steps to emphasize that the 25% limit is not a hard cap on foreign ownership of broadcast stations, but instead is simply a point at which specific FCC approval is needed for additional foreign ownership.
In 2016, the FCC released an Order extending the same foreign ownership flexibility currently applicable to common carriers, and those rules became effective in 2017. Under this approach, and with a few broadcaster-specific changes, broadcasters are now able to file petitions for declaratory ruling with the FCC to seek authority:
- To have up to 100% foreign ownership.
- For any controlling foreign entity to obtain an additional ownership interest of up to 100% without further FCC approval.
- For a disclosed, non-controlling foreign interest holder to obtain an additional ownership interest of up to 49.9% without further FCC approval.
In addition, any grant of authority by the FCC pursuant to a Section 310(b)(4) petition filed by a broadcaster automatically will extend to all after-acquired broadcast licenses acquired by the broadcaster. See our summary of the Order here.
Parties seeking to exceed the 25% indirect foreign ownership cap must file a petition for declaratory ruling which details the foreign ownership being proposed. The petition needs to set forth the public interest benefits of the transaction and demonstrate why the alien ownership would not jeopardize any of the security interests of the United States. The FCC will allow the public to comment on the petition, and Executive Branch agencies (aka Team Telecom) will be permitted to review the proposal for any national security implications prior to any grant. See our articles here and here for examples.
Even more regulatory relief was granted to U.S. broadcasters that may have incidental foreign ownership. Specifically, broadcasters must consider the citizenship of shareholders only if the shareholder is known or reasonably should be known to the broadcaster in the ordinary course of business exercising due diligence. This approach focuses on only those shareholders that have a reasonable likelihood of influencing the operations of a broadcaster. The FCC will no longer require the use of random shareholder surveys or require broadcasters to assume that unidentifiable shareholders are foreign.
In 2017, the FCC staff approved, for the first time, 100% foreign ownership of a US broadcast station when it allowed an Australian couple to acquire various broadcast licenses in Alaska, Arkansas and Texas. See our article here. In May 2018, the FCC approved 100% Mexican ownership of radio stations in California and Arizona. In August 2018, the FCC approved 100% foreign ownership of a New York radio station by citizens of Poland and the U.K. A proposal by an Italian company to acquire a number of radio stations in Florida was granted in 2019. See our summaries of these issues here and here.
The incentive auction of UHF TV spectrum ended in 2017, with total auction proceeds of about $19.7 billion and with 84 MHz of TV spectrum to be cleared (channels 37-51). The repacking of TV stations into UHF channels 14-36 began in late 2018. The last stations to move were to have been transitioned to their post-auction channels by July 3, 2020. The 39-month phased timeline was controversial, but reports indicate that 99% of stations completed their transition by the end of Phase 10 — with only a few waivers due to COVID-19 delays, and those stations are to complete their transition shortly. See our article here.
Repacked stations are entitled to reimbursement for their repacking costs. Initially there were concerns that the cost estimates for the repacking for broadcasters and MPVDs was more than the amount allocated by Congress. However, Congress alleviated that concern in 2018 with the passage of the Consolidated Appropriations Act, which should make sufficient funds available for all repacked full power TV stations, and even for low power TV and radio stations affected by the repack. See our summary of that proposal here. The reimbursement process for LPTV and radio stations is ongoing. See our summary here.
Repacked stations were required to submit quarterly progress reports throughout the transition, with additional reports due as each station’s transition deadline approached. In addition, the FCC announced that it would randomly audit repacked stations to help ensure the integrity of the repack funding process. See our summary of these issues here.
While not a major enforcement priority of late, the FCC continues to have enforcement authority over broadcast indecency. In 2015, the full commission issued a Notice of Apparent Liability proposing the statutory maximum fine of $325,000 for a television station that “aired graphic and sexually explicit material” during a 3-second video clip on its 6 p.m. newscast. The licensee argued that the image had not been visible on the monitors in the station’s editing bay, and therefore the station’s management who had reviewed the story did not see the offending material prior to broadcast. The bipartisan nature of this decision suggests that the FCC may not change course on indecency regulation whether the FCC is led by Republicans or Democrats.
In a news release, the then-chief of the FCC’s Enforcement Bureau noted that the decision sent a clear signal that there are “severe consequences” for broadcasting sexually explicit material when children are likely to be in the audience. More information on this decision is available here.
Meanwhile, a 2013 proceeding on whether to make changes to the FCC’s indecency policies remains pending. In that proceeding, the FCC asked for comments on whether it should continue to apply the hard-line enforcement standard against fleeting expletives that was adopted by the FCC in the early 2000s, or whether it should go back to the old standard that required a more conscious and sustained use of expletives to warrant FCC action. For a description of some of the issues involved in this proceeding, see our articles here, here, here and here.
Chairman Pai has not acted on the open proceeding on fleeting expletives. His only statement on the substance of indecency policy so far was that “the law that is on the books today requires that broadcasters keep it clean so to speak.” Indecency enforcement continues, with a New York broadcaster entering into a $10,000 consent decree to resolve indecency allegations in 2017.
Joint Sales Agreements/Shared Service Agreements
In November 2017, the FCC repealed the attribution rules for TV joint sales agreements (JSAs), meaning that such agreements would not count against another in-market station for purposes of assessing compliance with the local ownership rules limiting the number of TV stations in the same market in which one party can have an interest. That decision was overturned in 2019 by the Third Circuit Court of Appeals (along with other changes to the ownership rules discussed below) and remanded to the FCC for further consideration.
That means that, under the law that is now in effect after the Third Circuit decision, a TV station cannot enter into a joint sales agreement to sell more than 15% of the advertising time on another local station unless the broadcaster can own that station. The FCC has petitioned the U.S. Supreme Court for review of the Third Circuit decision. See our summary here. The Third Circuit’s decision remains in effect while the Supreme Court appeal is being considered. TV stations are also required to upload copies of any JSA to their online public inspection files.
The FCC has also required commercial TV stations to disclose any shared service agreements (SSAs), regardless of whether the agreement involves commercial TV stations in the same market or in different markets, by uploading copies to their online public inspection files. That decision became fully effective in 2018. However, the FCC clarified that it would not require the filing of “ad-hoc” agreements such as news sharing of a particular event, or clearly non-broadcast issues like the sharing of the costs of the upkeep of a building, or of janitorial services.
But shared service agreements dealing with broadcast operations must be posted in online public files. The decision stated that the filing was not for purposes of regulation, but instead for purposes of understanding the marketplace. More information is available here.
In the December 2018 Notice of Proposed Rulemaking initiating the next Quadrennial Review, discussed below in the Ownership Limits section, the FCC has asked whether it should continue to require the disclosure of SSAs, or whether that requirement can be eliminated.
The license renewal cycle for television stations (including LPTV stations, TV translators and Class A stations) began in June 2020, with the filing of renewals by stations in Maryland, Virginia, West Virginia and the District of Columbia. Renewal applications will be filed by stations in specified states every other month for three years, with the TV renewal cycle ending in 2023. Several changes have been made to the TV renewal application form since the last renewal cycle. For example, stations are no longer required to report on any comments received from the public about violent programming. Stations with renewal applications due in the next few months should begin preparing by reviewing the new form and discussing any relevant issues with counsel.
In reviewing license renewal applications, the FCC has paid particularly close attention to public inspection file issues. For example, many stations were fined in the last renewal cycle for failing to timely file FCC Form 398 children’s programming reports (see our discussion above for changes to children’s programming report filings). In addition, the online nature of public files now makes it very easy for FCC staff and the public to verify the timeliness (or untimeliness) of station uploads to the public file, including the uploading of the Quarterly Issues/Programs Lists. See our article here about some of those fines, and our article here about issues to consider during this renewal cycle. The timeliness of uploading political file documents is also likely to be scrutinized during the license renewal process. See our article here on consent decrees entered into by radio broadcasters for political file issues.
LPTV Stations And TV Translators
All LPTV stations and TV translators will be required to operate digitally by the end of the repacking process — July 13, 2021 — unless they receive specific extensions or tolling of their construction permit based on unique circumstances. See the FCC’s Public Notice here, and our summary here.
The FCC decided during the incentive auction process that LPTV and TV translator stations, including digital replacement translators (DRTs), would not be protected in the repacking process. However, the FCC opened a Special Displacement Window giving displaced LPTV, TV translator, and DRT stations an opportunity to select a new channel. See our articles here and here.
In 2015, the FCC decided that LPTV operations may continue on new wireless band frequencies until the wireless companies have “commenced operations,” which the FCC defines as the date the wireless company conducts “site commissioning tests.” In other words, the wireless operator needs to buy and test equipment before it fully starts operations, and once it starts the process through testing on the new spectrum, the LPTV operators need to cease operations. See our article here for further details. However, LPTV stations and TV translators operating on chs. 38, 44, 45 and 46 should have vacated those channels by July 13, 2020. See our article here.
The FCC also announced that LPTV stations and TV translators can share channels or can even share channels with full-power stations. Channel sharing with a full-power station would confer some degree of protection against their channel being bumped by future full-power TV facilities changes, as long as the channel sharing arrangement is in place. See our article here.
It remains an open question whether LPTVs on ch. 6 may continue transmitting, post-digital transition, an analog audio channel (known as “Franken FMs”). The analog audio from these stations act as radio stations as they can be received on FM radio receivers on 87.7 MHz. In December of 2019, the FCC issued a Public Notice seeking additional comment and to refresh the record on Franken FMs. See our summaries of the proposals here and here.
Main Studio Rule
In 2017, the FCC decided to abolish all main studio requirements, including the requirement that a station maintain a minimum staff presence and program origination requirements. The elimination of these requirements was effective as of Jan. 8, 2018. See our summary here.
See Retransmission Consent section below.
Modernizing Media Regulation
The FCC continues to make media modernization items a priority. The FCC has initiated a number of proceedings to eliminate or modify outdated media regulations, and has already eliminated the following: the main studio rule; the obligation to maintain paper copies of the FCC’s rules; the obligation to post copies of FCC licenses at station control points; the obligation to file paper copies of various contracts with the FCC; the requirement to file ancillary/supplementary DTV service reports annually, unless a station actually provided ancillary/supplementary services; the obligation to file mid-term EEO reports; the requirement for broadcasters to notify MVPDs by mail of must carry/retransmission consent elections; the obligation to air pre-filing announcements and the requirement to publish public notices in a newspaper (allowing stations to instead post notices to their website).
Among the proposals the FCC is actively considering are changes in the 1970s-era rules for establishing whether a TV station is “significantly viewed” in a market other than its home market, and whether the FCC has the statutory authority to make changes to these rules. A designation of being a significantly viewed station has implications for whether a cable system or satellite television company will carry a TV station in areas that are not part of its home market and whether the station is subject to the network nonduplication and syndicated exclusivity protections provided to home market stations. See our summary of these issues here and here.
The Department of Justice is reviewing the antitrust consent decrees under which ASCAP and BMI currently operate. See our articles here and here. The DOJ held a workshop on the issues raised by the potential for the abolition of the decrees in July 2020, and the NAB spoke out against any significant changes.
Litigation between Global Music Rights (GMR) and the Radio Music Licensing Committee (RMLC) is ongoing, with no end in sight. The dispute centers on whether the rates set by GMR should be subject to some sort of antitrust review. The rates set by ASCAP, BMI and SESAC are all subject to review by a rate court or arbitration panel. The TV industry has not yet entered into an industry-wide agreement with GMR. Fines for copyright violations can reach $150,000 per violation. We wrote about the GMR-RMLC litigation and licensing issues here.
Over-The-Top Video As A Multichannel Video Programming Distributor (MVPD)
The Supreme Court’s 2014 Aereo decision prompted renewed questions about what it means to be an MVPD, and whether the definition of MVPD should include over-the-top (OTT) providers like Hulu and Sling. That same year, the FCC released a Notice of Proposed Rulemaking proposing to modernize its interpretation of the term “MVPD” to include “services that make available for purchase, by subscribers or customers, multiple linear streams of video programming, regardless of the technology used to distribute the programming.”
The comment cycle in this proceeding has closed, and it remains an open matter at the FCC. Click here for more on this item.
Copyright issues about OTT systems continue to be litigated in the courts. A 2015 court case in California determined that, under the Copyright Act, OTT providers qualified as “cable systems” that could rely on the statutory license to retransmit the signals of local television stations. See our summary here. However, in December 2015, a District Court in Washington, DC reached the opposite conclusion (see our summary here), and in March 2016, another court in Illinois agreed with the DC court’s decision (see our summary here).
The Ninth Circuit Court of Appeals then overturned the California decision, concluding in March 2017 that FilmOn X, an Aereo-type service, is not a “cable system” for Copyright Act purposes. See our summary of that decision here. Following the defeat in the Court of Appeals, FilmOn reached a settlement with broadcasters and dismissed all further appeals, so these cases may be over for now. The Copyright Office sought comments on its tentative conclusion that the Copyright Act’s definition of a cable system does not include online video services like those of Aereo and FilmOn. Reply comments in that proceeding were due by October 2018, and the rulemaking remains open. See our articles here and here for more information.
In the wake of the Aereo and FilmOn decisions, a nonprofit service called Locast has arisen, retransmitting over-the-air TV signals to viewers through the Internet. Founders of the service claim that a nonprofit service like this is legal under an exception to the Copyright Act provisions that blocked the Aereo and FilmOn services. The Locast service has surpassed one million registered subscribers and was sued in 2019 by ABC, CBS, Fox, and NBC. The suit alleges that Locast violates copyright law because it has not secured the right to retransmit broadcast signals.
Network Nonduplication/Syndicated Exclusivity
See the Retransmission Consent discussion below.
Every four years, the FCC is required by Congress to review and consider updating its broadcast multiple ownership rules. In August 2016, the FCC released an order dealing with its ownership rules. The FCC retained the local TV ownership restrictions, the dual network restriction, and the radio/TV cross-ownership restrictions. The FCC also decided to adopt a new obligation for commercial TV stations to disclose any shared services agreement by placing a copy of the agreement in their online public inspection file (but the FCC did not make SSAs attributable). The FCC also retained the newspaper/broadcast cross-ownership prohibition but added a waiver exception for failed and failing broadcast stations and newspapers.
In November 2017, under a new administration and in response to petitions for reconsideration of the August 2016 decision, the FCC took steps to roll back its regulation of media ownership. Specifically, the FCC:
- Repealed the newspaper-broadcast cross-ownership rule.
- Repealed the radio-television cross-ownership rule.
- Eliminated the requirement that at least eight independently-owned television stations remain in the market after ownership of two stations is combined — the ‘Eight Voices’ test.
- Incorporated a case-by-case review option of the prohibition against common ownership among the top four stations in the market.
- Repealed the attribution rules for television joint sales agreements (JSAs).
- Retained the disclosure requirement for shared service agreements (SSAs) involving commercial television stations.
- Adopted an incubator program to promote new entry and ownership diversity in the broadcast industry. These revisions went into effect in February 2018.
However, the Third Circuit in late 2019 vacated the FCC’s November 2017 changes, forcing the FCC to reinstate the pre-November 2017 rules. See our articles here and here for more on the court’s decision and the FCC’s actions. The FCC has petitioned the Supreme Court for review of the Third Circuit decision. A decision as to whether or not the Supreme Court will review this case may come in late September.
In December 2018, the FCC initiated a new Quadrennial Review of its multiple ownership rules. A copy of that Notice of Proposed Rulemaking is available here. Among other things, the FCC is seeking comment on all aspects of the local TV ownership rule, and whether the current version of the rule is necessary to serve the public interest in the current television marketplace.
If retained, the FCC asks if there should be more explicit rules as to when two top-4 TV stations in a market can be co-owned, rather than the ad hoc process adopted in November 2017 and rejected in 2019. The FCC is also seeking comment on whether the Dual Network Rule, which effectively prohibits a merger between or among the Big Four broadcast networks (ABC, CBS, Fox, and NBC), is still necessary and in the public interest, or whether it should be modified or repealed. See our look at the issues that were teed up for comment in the NPRM here. Comments and reply comments were due in spring 2019 but consideration is on hold pending the outcome of the Supreme Court appeal of the Third Circuit decision.
All commercial and noncommercial broadcasters were required to file biennial ownership reports by Jan. 31, 2020. These reports provided a snapshot of broadcast ownership as of Oct. 1, 2019. See our summary of this obligation here.
As part of its media modernization efforts, the commission eliminated the obligation to file with the FCC paper copies of network affiliation agreements, lender agreements, corporate bylaws, and similar documents. Instead, a broadcaster may either upload copies of those materials to its online public file, or provide a list of such documents in its online public file, and provide a copy to any requesting party within 7 days of the request. Copies of time brokerage agreements and shared service agreements also must be uploaded to the online public file. See our summary here.
The FCC long ago sought comment on whether biennial ownership reporting requirements should include interests, entities and individuals that are not attributable because of (a) the “single majority shareholder” exemption and (b) the exemption for interests held in eligible entities pursuant to the higher “equity debt plus” threshold. Reply comments in that proceeding were due in 2013. See our summary here. The FCC announced in 2016 that it would address these issues in a subsequent decision, but that has yet to happen.
In early 2019, the president signed into law the PIRATE Act, which increases penalties for and enforcement against pirate radio operations. The act requires the FCC to conduct yearly enforcement sweeps of the top-5 pirate-active cities (currently New York, Los Angeles, Chicago, San Francisco, and Dallas); increases daily fines up to $100,000 per violation (with a $2 million maximum); and allows the FCC to skip issuing a Notice of Violation (a warning) and immediately issue a Notice of Apparently Liability (a proposed fine) to alleged pirates. The act also extends liability to anyone who “knowingly does or causes to be done any pirate broadcasting,” which may implicate landlords who own properties on which piracy is occurring. The Enforcement Bureau has been active against pirates, negotiating settlements with two pirate operators in July 2020. See more about this issue here and here.
The Lowest Unit Charge Window for the November 2020 election opened on Sept. 4. Lowest unit charges must be extended to any political candidate (federal, state or local) 45 days before any primary or caucus and 60 days before any general election. Read more about lowest unit charges here. Federal candidates, like those running for president, have equal opportunity and reasonable access rights even outside these political windows. Once you have a legally qualified candidate for federal office, the reasonable access obligations are triggered. Reasonable access requires that broadcasters sell reasonable amounts of commercial airtime, during all classes and dayparts, to federal candidates. See our refresher on reasonable access here.
While stations do not have an obligation to sell time to candidates for state and local races, once they decide to do so, all other political obligations arise. Thus, lowest unit rates and equal opportunities apply to state and local candidates, just as they do to candidates running for federal office. See our article here for more on this obligation.
Stations also need to be careful about on-air employees who decide to run for an elective office, as their on-air appearances will trigger equal opportunities rights for their opponents. See our story about a radio sportscaster who decided to run for mayor and the issue that it raised under the political broadcasting rules, here.
In many contentious races, you may see third-party ads from SuperPACs and other non-candidate organizations. These organizations may also be buying ads on other controversial issues before Congress or in local areas, and may raise many of the same issues that are raised when they advertise in political races.
Because third-party advertising does not provide the same liability protections that candidate ads provide, stations need to be concerned with such ads. While stations are generally immune from any liability for statements made in candidate ads, there is potential liability if the station is put on notice of defamatory content or other illegal material in non-candidate ads. See our article about these issues here. Such claims have become more common. See our articles here and here. In fact, earlier this year, President Trump’s campaign committee sued a Wisconsin TV station for defamation in connection with a PAC ad critical of the president’s handling of the coronavirus. While a motion to dismiss the suit has been filed, it currently remains pending. See our article here for more on this case.
As noted above, candidate ads are covered by the “no censorship” provisions of the Communications Act. Thus, as long as the ad is a “use” by the candidate (i.e., it is sponsored by the candidate’s official campaign committee, and features the candidate’s “recognizable voice or image,” the spot cannot be rejected based on its content, and the station cannot (except in very limited circumstances not relevant here) take it down at the request of a complaining opponent.
Numerous requests for take-downs of candidate ads occurred in races across the country in recent elections, so stations need to be aware that they usually cannot honor those requests, even if the broadcaster does not like the content of the candidate’s ad. We wrote more about the no-censorship rule here.
These are just some of the political broadcasting rules. For more information on these rules, see our Guide to Political Broadcasting here. In addition, the NAB’s 18th edition of its Political Broadcast Catechism is a helpful guide to answering political advertising questions.
There have also been some recent developments on political broadcasting issues that should be top of mind during this 2020 election season.
On January 6, 2017, the FCC staff issued two decisions on complaints filed by the Sunlight Foundation and Campaign Legal Center, summarized here, which stated that broadcasters need to assess and include in their public file all of the issues of national importance addressed in political ads, and also need to ask issue ad sponsors about the identity of all of the members of their governing group (e.g., officers, board members, executives), especially if the sponsoring group lists only one name on the disclosure forms submitted to the station.
In February 2017, the Media Bureau, under Chairman Pai, rescinded the Jan. 6 guidance and decided that such issues need to be addressed by the full commission, not at the bureau level. See our article here. The FCC acted on these complaints in October 2019, issuing two Orders.
The FCC will in fact require broadcast licensees to maintain an online political file that contains information regarding any request to purchase airtime that “communicates a message relating to any political matter of national importance, including (i) a legally qualified candidate; (ii) any election to Federal office; or (iii) a national legislative issue of public importance.”
The FCC requires that the public file disclosure include “the name of the candidate to which the communication refers and the office to which the candidate is seeking election, the election to which the communication refers.” In addition to the information about any candidate mentioned, licensees must identify all political matters of national importance referenced in a non-candidate issue ad.
Finally, if the public file disclosure provided by the ad buyer includes a single name of the members of the sponsor’s governing board, the station must inquire to the sponsor as to whether there are additional officers or directors. See our discussion of the orders here and our discussion here of the FCC’s further clarification that the Orders apply only to federal issue ads (and not to candidate ads) and that the FCC is looking for good-faith compliance efforts from stations. Having to identify in the public file all candidates and all issues imposes a burden on broadcasters to scrutinize all non-candidate ads to assure themselves that all required disclosures have been made.
The timeliness of the uploading of political file documents has also been a matter of controversy. The FCC requires that information about advertising orders by political buyers ordinarily be uploaded immediately. The FCC has been scrutinizing the timeliness of such uploads during the license renewal process. See our article here on consent decrees entered into by radio broadcasters for political file issues.
There are other old petitions for rulings on political broadcasting matters that are still pending at the Commission. In 2015, the FCC sought public comment on a complaint filed by Canal Partners Media during the 2014 election cycle, in which Canal claimed that two television stations were violating Section 315(b) of the Communications Act, as amended, by prioritizing commercial advertisers over political candidates when making preemption determinations.
Specifically, Canal claimed that the stations’ “Last-In-First-Out” (LIFO) policy preempted candidates’ advertisements in favor of commercial advertisements purchased earlier. Canal’s complaint requested that “if broadcast stations are using LIFO as a method to determine preemption priorities, they must treat political candidates as being the “First-In” advertiser regardless of when the candidate purchased its airtime in order to be in compliance with Section 315(b) of the [Act].” See our summary of the issues here.
Sunlight also filed complaints against two other stations alleging that they did not adequately disclose the true sponsor of PAC ads. The complaints alleged that the sponsorship identification of the PAC that sponsored ads attacking political candidates was insufficient when the PAC was essentially financed by a single individual. In September 2015, the Media Bureau dismissed the complaints. However, the bureau did not specifically find the allegations to be incorrect. Instead, the complaints were dismissed because petitioners never went to the stations to ask that they change the sponsorship identification on the PAC spots during the course of the election.
The bureau stated that it was using its prosecutorial discretion not to pursue these complaints, going so far as to say that the ruling might have been different had the request for a proper identification been made to the stations during the course of the election. Thus, broadcasters should be alert for complaints alleging that they have not properly identified the true sponsor of a PAC ad, and treat such complaints seriously. See our summary here.
After the 2014 elections, another complaint was filed by the same groups against a Chicago TV station claiming that the station should have identified former New York City Mayor Michael Bloomberg as the true sponsor of an ad run by a PAC. In this case, the station apparently was given written notice of the claim that the sponsorship identification should have included Mr. Bloomberg, which may distinguish it from prior cases. That issue remains pending. See our summary here.
Public Inspection File
TV stations are required to place their public inspection files online on an FCC-hosted website. The elimination of the requirement to retain copies of letters and emails from the public removed any responsibility for broadcasters to maintain a paper public file at their studio. See our article here. On a related note, the FCC has changed TV renewal applications to remove the requirement that TV stations identify any comments from the public about violent programming on the station.
Copies of joint sales agreements, time brokerage agreements, and shared service agreements must be uploaded to the online public file, with confidential information redacted. See our separate discussion in the “Ownership Reporting” section above regarding the FCC’s elimination of the obligation to file paper copies of contracts but with new online public file obligations regarding those contracts. See also our reference to the political section of the online public file, above.
For a summary of the general online public file obligations, see our summary here.
The method for calculating TV regulatory fees has changed for 2020, moving to a methodology for setting fees more like that used in radio, by assessing fees for full-power broadcast TV stations based on the population covered by the station’s contour, instead of by the station’s DMA. Last year, TV stations’ regulatory fees were based on an average of the current DMA methodology and the population covered by a full-power broadcast TV station’s contour.
For 2020 and going forward, the FCC will assess regulatory fees for full-power broadcast TV stations based solely on the population covered by the station’s contour. The FCC sought comment on its change of methodology, particularly as it relates to VHF stations, but ultimately decided to stick with the population-based methodology, though limiting some fees for VHF stations that have obtained waivers allowing them to operate at power levels exceeding the maximum power levels permitted by the rules. For more information, see our article here. Regulatory fee payments for the 2020 fiscal year must be made by September 25, 2020.
Retransmission Consent/Must Carry/STELAR
Must carry or retransmission consent elections for 2021-2023 must be made by Oct. 1, 2020. A broadcast station no longer needs to mail a paper letter to each MVPD in its market confirming the type of carriage it has chosen. Instead, a station must simply upload its election to the station’s online public file by Oct. 1, 2020, and every three years thereafter. If a station is changing its carriage type, it must send notice to the MVPD by email and post that notice in its public file. Read more about this rule change here and here.
In July 2016, the previous FCC chairman announced in a blog post that the FCC was ending its inquiry into the retransmission consent rules without the adoption of any new rules. He stated that, after an extensive review of the record, “it is clear that more rules in this area are not what we need at this point.” Chairman Pai has not revived any efforts to examine the retransmission consent process.
Chairman Wheeler in 2016 noted that the FCC’s existing “totality of circumstances” standard for weighing complaints about violations of the good faith requirements is sufficiently inclusive to give the FCC scope to take enforcement action. “To start picking and choosing, in part, could limit future inquiries.” See our analysis here and here.
As an example of violations of the good faith requirements in action, the Media Bureau entered into a Consent Decree with one broadcaster, who paid a $100,000 penalty, based on its stations violating three of the nine good faith requirements at two of its stations. The stations were found to have (1) refused to negotiate retransmission consent agreements; (2) refused to meet and negotiate retransmission consent at reasonable times and locations or acted in a manner that unreasonably delayed retransmission consent negotiations; and (3) failed to respond to a retransmission consent proposal of the other party, including the reasons for the rejection of any such proposal. See more on this action here.
In September 2020, the FCC denied an application for review of the Media Bureau decision on which that consent decree was based and issued a Notice of Apparent Liability in the amount of $512,228 per station to each of the 18 other stations that had not entered into consent decrees. See the FCC decision here.
As required by the STELA Reauthorization Act of 2014 (STELAR 2014), the FCC adopted a new rule prohibiting the joint negotiation of retransmission consent agreements by two stations in the same market that are not “directly or indirectly under common de jure control,” regardless of whether those stations are among the top 4 stations in the market.
In 2016, the FCC’s Media Bureau entered into a consent decree with Sinclair regarding this prohibition. While the company did not admit liability, the consent decree includes a finding that the company engaged in such negotiations on behalf of 36 non-owned stations. The company agreed to make a $9.495 million settlement payment and to implement a compliance plan. See our summary here.
Congress, at the end of 2019, effectively dismantled much of the STELAR legislation that previously allowed satellite television providers (Dish Network and DirecTV) the ability to import distant network affiliated stations into underserved areas of television markets.
The FCC itself has been looking at changes to its determinations as to which stations are “significantly viewed” in a television market. The current rules have largely been unchanged since 1972. The proposed changes are summarized in our article here. Comments were filed in June 2020 on this proposal.
In 2015, following a rulemaking proceeding to address requirements of previous STELAR legislation, the FCC adopted new rules permitting the modification of satellite television markets. Under the rules, the FCC may, upon the request of a television station, satellite operator or county government, modify a commercial TV broadcast station’s local television market to add or delete communities from the market. We wrote briefly, here, about the elements the FCC is looking for in petitions for change of market.
A related Further Notice of Proposed Rulemaking proposed eliminating the network nonduplication protection rules and the syndicated exclusivity rules, but those proposals have not advanced. See our discussion here for more details of the proceeding.
Enforcing sponsorship identification rules continues at the FCC. In 2017, the Enforcement Bureau proposed a fine of more than $13.3 million for apparent sponsorship identification violations by Sinclair Broadcast Group. The FCC alleged that program segments contained in news broadcasts of certain Sinclair stations and certain program-length reports featuring stories about the Huntsman Cancer Institute were not tagged as being sponsored – even though they were broadcast as part of a contract that required that Sinclair air advertising for the Institute and develop programming about the Institute’s activities. In May 2020, Sinclair entered into a consent decree with the FCC and agreed to pay a $48 million fine to settle the sponsorship ID inquiry and two other unrelated inquiries. See our summary of the sponsorship ID issue here and details of the consent decree here.
In 2016, the Enforcement Bureau announced a consent decree with Cumulus Radio to settle a matter in which full sponsorship identification announcements were not made on issue ads promoting an electric company’s construction project in New Hampshire. In the consent decree, Cumulus agreed to pay a $540,000 civil penalty to the FCC for the violations of the rules — plus it agreed to institute a company-wide compliance program to make sure that similar violations did not occur in the future. See our article here.
In 2014, the Enforcement Bureau entered into a consent decree with a television licensee for broadcasting “Special Reports” formatted in the style of a news report and featuring a station employee without disclosing that they were actually commercials paid for by local car dealerships, as required by the sponsorship identification rules. The licensee admitted liability and agreed to pay a $115,000 civil penalty.
The accompanying order described the rules not only as protecting consumers by “ensuring they know who is trying to persuade them,” but also as protecting competition by “providing a level playing field for advertisers who follow the rules.” See our summary here.
While a proposal was filed in 2015 suggesting that many sponsorship identification obligations be moved online, similar to the disclosure obligations for contest rules (see our summary of the proposal here), the Pai FCC has not moved ahead with that proceeding.
See the “COVID-19” section above for a discussion of a limited pandemic-related sponsorship ID waiver.
Video News Releases (VNR) — The FCC has issued fines to television stations for airing freely-distributed video news releases without identifying the party who provided the VNR, and for broadcasting other programming for which the station or program host received consideration that was not disclosed.
For political matter or other programming on controversial issues, the station must announce who provided any tape or script used by the station.
For commercial programming, if the station airs content provided by a commercial company, and that use features the product of the company in more than a transient or fleeting manner, the party who provided the content must be disclosed.
A summary of some of the FCC cases where stations were fined for VNRs is available here.
The FCC is also considering a Notice of Proposed Rulemaking to require enhanced sponsorship identification of programming provided or sponsored by foreign governments. See the discussion in the Foreign Ownership, Programming and Investment section above for more details.
Sponsorship Identification Online and In Social Media — In addition to FCC rules, the FTC requires that parties that have received any compensation in exchange for posting any materials online, disclose that the online material was sponsored. The extent of the sponsorship varies by the technological capabilities of the medium — with the FTC suggesting “ad,” “advertisement,” or “sponsored” be used for disclosure language on Twitter and Instagram, with more extensive disclosures on other platforms.
As broadcasters incorporate website content and social media mentions with on-air advertising campaigns, they should be aware of these obligations. See our summary of the FTC rules here, and an article here about letters from the FTC to over 90 online “influencers” reminding them to abide by this policy.
See Retransmission Consent section above.
The Telephone Consumer Protection Act (TCPA) is a law that restricts businesses and organizations from making calls and texts to consumers’ residential and wireless phones without having first received specific permission from the recipient. Sending texts to broadcast station viewers or listeners who are in a station’s loyal listener or loyal viewer clubs can lead to liability if the proper consents are not obtained. Collecting text addresses from contest participants and adding them to station databases similarly can be problematic. Even where proper permission has been obtained, there can be liability for calls and texts to wireless numbers that have been reassigned, as well as to viewers or listeners who have revoked their consent.
Because violations of the TCPA can result in civil liability of $500 to $1,500 per call or text plus FCC fines, and as there have been a number of law firms around the country that have been active in filing class action suits against businesses to collect those potentially very high per-call damages, broadcasters need to ensure that their practices comply with the TCPA and the FCC’s rules which implement the Act. In June 2016, iHeartMedia, settled a TCPA lawsuit for $8.5 million. Read more about this issue here.
The status of TCPA enforcement is currently in flux, with the DC Circuit having set aside the FCC’s interpretations of the statute and other circuit courts split on the interpretations of some TCPA provisions. In July 2020, the TCPA survived a Supreme Court challenge mostly intact with only a provision related to calls to collect debt owed to or guaranteed by the federal government being discarded. The Supreme Court is set to revisit the TCPA again this fall.
Tower And Antenna Issues
Under legislation enacted in July 2016 (the FAA Extension, Safety, and Security Act of 2016), Congress directed the FAA to conduct a rulemaking to adopt rules regarding lighting rural towers that are between 50 feet and 200 feet in height. See more about this issue here. Many in the communications industry expressed concern that the costs of implementing this rule outweighed any potential benefits of the rule. Congress subsequently revisited this legislation in 2018. Through a coalition including the NAB and other groups that work on tower issues, the legislation passed in 2018 (the FAA Reauthorization Act of 2018) included a carveout for towers that are between 50 feet and 200 feet in height. These towers do not need to be marked or lighted if they are registered in an FAA database.
The FCC has aggressively enforced tower lighting and other tower-related violations, in one case seeking a fine of $25,000. Tower owners have been penalized for failing to have the required tower lights operating after sunset, failing to notify the FAA of any outages in a timely manner (so that the FAA can send out a NOTAM — a notice to “airmen” notifying them to beware of the unlighted tower), and failing to update tower registration information, particularly when the tower is acquired by a new owner.
Failing to notify the FAA of tower light failures, as required by the rules, can lead not only to FCC fines but also to huge liability issues if the worst case happens and an aircraft should hit the unlighted tower. We discuss many of these issues here and here. The FCC also fines broadcasters whose towers are not properly registered in the name of the actual owner. If a tower’s ownership changes (for instance, in connection with the sale of the station that owns the tower), be sure that the tower registration is updated and the new owner listed.
In December 2015, the FAA announced new standards for tower lighting. See our summary here. The FAA’s guidance on tower lighting is now effective and will apply to any modified towers.
Since 1985, to encourage further TV use of the UHF band over traditional VHF channels, TV licensees have received a one-half discount for UHF stations when analyzing the FCC’s 39% cap on the nationwide audience that can be reached by any one owner. In September 2016, the commission voted 3-2 to eliminate the UHF discount. See our analysis here and here. That decision was challenged in court, and a petition for reconsideration was also filed with the FCC. In April 2017, the FCC voted 2-1 to reinstate the UHF discount. See our summaries here and here. In July 2018, the US Court of Appeals in the District of Columbia dismissed, on procedural grounds, an appeal of this decision to reinstate the UHF discount.
Separately, in December 2017, the FCC initiated a comprehensive review of the national audience reach cap and the UHF discount. The FCC’s Notice of Proposed Rulemaking does not draw any conclusions, but sought comment on the following issues: 1) Whether the FCC has the statutory authority to modify or eliminate the national cap; 2) If statutory authority exists, whether the national cap should be modified or eliminated in light of increased video programming options or other factors since the FCC adopted the current 39% cap; 3) If a national cap is retained, whether it should be raised simultaneously with the elimination of the UHF discount and if so, by how much; 4) Whether the national cap continues to serve the public interest and if so, what public interest goals, such as localism, it continues to foster; and 5) The benefits and costs associated with maintaining or increasing the cap. The comment cycle has closed in this proceeding, and FCC action is unlikely pending further court review of the FCC’s multiple ownership rules generally. See our article on this rulemaking here.
The video description rules are intended to assist individuals with visual impairments by requiring the insertion of audio narrations into the natural pauses in programming to describe what is happening on-screen. These narrations are carried on the secondary audio program (SAP) channel.
Under the video description rules, Top-4 affiliates (ABC, CBS, Fox and NBC) in the top 60 markets, and multichannel video programming distributor systems (MVPDs) with more than 50,000 subscribers, must provide approximately four hours per week (for a total of 50 hours per quarter) of video-described primetime and/or children’s programming.
As of 2018, each broadcast station affiliated with a Top 4 network (ABC, CBS, Fox and NBC) in the top 60 markets, and each of the top 5 non-broadcast networks (currently Discovery, HGTV, History, TBS, and USA) must provide 87.5 hours of qualifying video-described programming per quarter on each stream or channel on which it carries an included network. This is an increase from the previous obligation to carry 50 hours of qualifying video-described programming per quarter. USA Network is operating under a limited waiver granted in 2019 that relieves it of some of its programming obligations. USA has agreed, as part of this waiver, to air at least 1,000 hours of described programming each quarter (without regard to the number of repeats) and to describe at least 75 percent of any newly-produced, non-live programming aired between 6 a.m. and 12 a.m. per quarter.
The FCC provided flexibility to allow some non-primetime, non-children’s video-described programming to count towards the additional 37.5 hours per quarter. The FCC left unchanged the rule that a particular video-described program/episode can be counted toward the benchmark no more than a total of two times on each channel on which the program is shown. The rules also require that all television stations and MVPDs, regardless of market or system size, “pass through” any such video-described programming. All of these requirements are now in effect.
The FCC issued its Second Report to Congress on its assessment of the current status of video description, which followed a mid-2019 Public Notice seeking comment on changes to the video description marketplace. That report can be found here.
A 2020 rulemaking seeks to make video programming more accessible to blind or visually impaired persons by expanding the video description requirements applicable to stations affiliated with one of the Top 4 commercial TV networks (ABC, CBS, Fox, and NBC) to television markets 61 through 100 starting Jan. 1, 2021, followed by an additional 10 TV markets each year for the next four years. We wrote about the rulemaking here.
White Spaces/Unlicensed Devices/Wireless Microphones
The FCC has proposed that, in each TV market, one UHF TV channel (above channel 21) that is not assigned to a TV station following the repacking will be designated for use by TV white space (TVWS) devices and wireless microphones. In certain markets, where TV stations are placed into the wireless 600 MHz band, the FCC proposed a second open TV channel for shared use by TVWS devices and wireless microphones, in addition to the other channel it is already proposing to reserve.
Microsoft has been pushing unlicensed TV white spaces as a rural broadband solution. The NAB has pushed back, particularly on Microsoft’s effort to set aside one 6 MHz channel in each market for unlicensed devices. Microsoft was not an incentive auction participant, and is arguably trying to get access to unlicensed airwaves without paying for them. There are numerous technological hurdles for Microsoft and other white space operators, and there is of course the potential for harmful interference to over the air broadcasting. The FCC opened a rulemaking in March 2020 seeking comment on overcoming some of these technological hurdles, and heard from interested parties on proposals to allow unlicensed white space devices to cover larger areas through increased power output and higher antenna heights while still limiting interference from incumbent band users like TV operations. Our article looking at the rulemaking is here.
The FCC has also proposed to require applicants for LPTV, TV translator and Broadcast Auxiliary Service facilities to demonstrate that any proposed facilities would not eliminate the last available vacant UHF television channel for use by TVWS devices and wireless microphones in the market. The pleading cycle has ended for this proceeding, but questions have been raised about whether these proposed spectrum reservations would unlawfully prioritize unlicensed facilities over licensed ones.
In February 2016, in response to a petition filed by the NAB, the FCC released a Notice of Proposed Rulemaking and Order, proposing to amend its rules to improve the quality of the geographic location and other data submitted for fixed TVWS devices operating on unused frequencies in the TV bands and the new 600 MHz wireless band.
According to the NPRM, the proposals are designed to improve the integrity of the white space database system and to increase the confidence of all users of these frequency bands that the white space geolocation/database spectrum management scheme fully protects licensees and other authorized users.
In November 2016, the NAB asked the FCC to either adopt and enforce geolocation requirements that allow TVWS devices to coexist with licensed operations, or eliminate or suspend TVWS operations. NAB also suggested that TVWS database managers are not complying with push-notification requirements about updated channel availabilities because there are no industry standards for implementing push notifications, and TVWS manufacturers have not taken steps to implement the requirements. More information is available here.
The use of wireless microphone devices in the 700 MHz band was prohibited by the FCC in 2010. However, the current 600 MHz band and other frequencies remain used by broadcasters and others for wireless microphones. In July 2017, the FCC announced new point-of-sale disclosure requirements for 600 MHz licensed wireless microphones. Effective as of April 2018, the required disclosure language reads as follows:
“This particular wireless microphone device operates in portions of the 617-652 MHz or 663-698 MHz frequencies. Beginning in 2017, these frequencies are being transitioned by the [FCC] to the 600 MHz service to meet increasing demand for wireless broadband services. Users of this device must cease operating on these frequencies no later than July 13, 2020. In addition, users of this device may be required to cease operations earlier than that date if their operations could cause harmful interference to a 600 MHz service licensee’s wireless operations on these frequencies.”
In July 2017, the FCC refused to permit wireless microphone users that operate on an unlicensed basis in the TV bands, the 600 MHz duplex guard band and duplex gap to register their operations in the TV white spaces databases to obtain interference protection from white space devices. However, the FCC issued a Further Notice proceeding in which it proposes to permit certain qualifying professional theaters, music, and performing arts organizations to obtain a Part 74 license that would allow them, as licensees, to obtain interference protection in the TV bands and, when needed, also to operate in other spectrum bands authorized for licensed wireless microphone operations. The pleading cycle for this proceeding has closed.
Separately, the Further Notice revisits the FCC’s previous decision that companies that use 50 or more wireless microphones have the same interference protection as low power wireless audio devices. The Further Notice proposes expanding this group to include:
- Wireless microphone users that routinely use 50 or more wireless microphones where the use is an integral part of major events or productions (as provided under existing rules).
- Wireless microphone users that otherwise can demonstrate a particular need for, and the capability to provide, professional, high-quality audio that is integral to their events or productions.
In addition, the FCC clarified various rules for licensed wireless microphone use in the 169-172 MHz band, the 941.5-944 MHz band, and the 1435-1525 MHz band.