Here’s a quick briefing on the FCC proceedings affecting broadcasters from communications attorneys David Oxenford and David O’Connor. The topics: CALM Act … Class A TV … Closed Captioning … EEO Rules … Emergency Alert System … License Renewals … LPTV Stations and TV Translators … Must Carry and Retransmission Consent … Online Public Inspection File … Ownership Limits and SSAs … Political Advertising … Public Interest Disclosure … Regulatory Fees … Spectrum Reallocation … Sponsorship Identification … Tower and Antenna Issues … Video Descriptions … White Spaces.
With so many regulatory issues to follow, how are TV broadasters to keep up with it all? With FCC Watch, an exclusive briefing on the major (and some minor) issues at the agency prepared by David Oxenford and David O’Connor, attorneys in the Washington law offices of Wilkinson Barker Knauer. You can reach Oxenford at [email protected] or 202-383-3337 and O’Connor at [email protected] or 202-383-3429.
In alphabetical order:
CALM Act Implementation
In December 2011, the FCC adopted rules for the implementation of the CALM Act, requiring TV stations and MVPDs to keep the volume of commercials at the same level as their accompanying programming. The commission has essentially allowed stations to comply by adopting a protocol set out by the Advanced Television Standards Committee. Stations and MVPDs must be in compliance with this standard by Dec. 13, absent waivers.
Class A LPTV
In a series of recent actions, the FCC has asked whether certain Class A TV stations should be reclassified as LPTVs, as they had not filed their required Children’s Television Programming Reports, produced and aired the amount of local programming required for Class A stations, or otherwise complied with the rules applicable to full-power TV stations. Class A stations that do not meet these obligations and are reclassified by the FCC as LPTV stations may be in jeopardy of losing their interference protections and being displaced in the FCC’s likely spectrum repacking in preparation for selling some of the TV spectrum to wireless broadband users. Some Class A TV stations have already been reclassified as LPTVs in light of their failure to respond to these requests from the FCC.
TV Closed Captioning — In late 2011, the FCC overturned nearly 300 waivers previously issued to providers of television programming exempting them from compliance with the television closed captioning rules on the basis that compliance would constitute an undue economic burden. Finding that the earlier waivers had been granted in error, the FCC reversed the waivers and clarified the proper standard that will apply to undue economic burden waivers.
That standard is significantly higher than the review initially applied to these particular programming providers. Parties whose waivers were rescinded had 90 days to seek new waivers and many such waiver requests have been filed thus far in 2012. The FCC has begun reviewing the captioning waivers and issuing public notices soliciting comments. Consumer groups have actively opposed the waiver requests. So far the commission has dismissed some requests as deficient, and sought additional information from others. The FCC’s review of these waivers will continue throughout the year.
IP Captioning — In January 2012, the FCC adopted rules that require closed captioning of full-length video programming delivered via Internet protocol (i.e., IP video) that is published or exhibited with captions on TV after the effective date of such regulations. The rules are a result of the 21st Century Video and Communications Accessibility Act, which was enacted by Congress and signed into law by the president in 2010 to improve the accessibility of media and communications services and devices.
The IP captioning rules became effective on April 30 and will be phased in over time. Beginning on Sept. 30, all nonexempt full-length prerecorded video programming that is not edited for Internet distribution and is delivered using Internet protocol must be provided with closed captions, if the programming is published or exhibited on television in the U.S. with captions on or after Sept. 30. This requirement governs 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.
Similar requirements for live and “near-live” programming apply beginning March 30, 2013. (Near-live is defined as any programming performed and recorded less than 24 hours before being shown on TV for the first time). Finally, pre-recorded programming that is “substantially edited” for the Internet must be captioned if it is shown on TV with captions on or after Sept. 30, 2013.
The rules also impose new requirements on manufacturers of equipment (such as set-top boxes, PCs, smartphones DVD players, Blu-ray and tablets) designed to receive or play back video programming transmitted simultaneously with sound and integrated software. Consumer-generated media, defined as content created and made available by consumers to online websites and services on the Internet, including video, audio, and multimedia content, are exempt from the captioning rules.
The FCC 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.
The FCC issued fines earlier this year to stations that did not widely disseminate information about job openings beyond broadcasting announcements on the station’s airwaves and posting the opening on the station website, and using online sources. The FCC held that other non-station, non-Internet recruiting sources (such as newspaper publication or notices to community organizations) must also be used to announce job openings.
Emergency Alert System
The FCC recently adopted standards for equipment to be used by broadcast stations for compliance with the Common Alert Protocol (CAP), an IP-based system for the delivery of emergency alerts. Stations were required to be CAP-compliant by June 30.
Also, the FCC conducted its first national test of the EAS system in November 2011, and stations were to have filed reports on their experiences with the test by late December. Commission sources have indicated that reporting by stations was less than complete, so additional requests for information may go out soon. A report on the test is expected later this year, and additional national tests are also expected.
Radio license renewals continue this year with numerous stations in the South and Midwest moving through the process, including stations in Wisconsin and Illinois which have renewal applications due on August 1. Television stations began the renewal process this year starting with TV stations (including LPTV stations, TV translators and Class A stations) in Maryland, Virginia, West Virginia and the District of Columbia, which filed their renewal applications on June 1. Renewal applications for TV stations in South Carolina and North Carolina are due on Aug. 1.
In reviewing license renewals, the FCC is continuing to focus on issues that have been important in previous cycles, such as public inspection file issues. This renewal cycle also introduced a few new certifications, including whether a station has been off the air for any significant period of time during the last license term, and whether stations have complied with the policy regarding nondiscrimination in the sale of advertising time.
The FCC no longer mails reminders to licensees, so it is incumbent upon stations to know when their license expires and file their renewal applications on time. Without a timely filed renewal application, stations are not authorized to operate and face the potential of fines or license cancellation.
LPTV Stations and TV Translators
In an order released last year, all LPTV stations and TV translators operating out-of-core (on channels above ch. 51) were to have ceased operations by the end of 2011. All analog LPTV and translator stations must convert to digital operations by Sept. 1, 2015.
Must Carry and Retransmission Consent
In 2011, the FCC issued a Notice of Proposed Rulemaking seeking comments on whether its must carry-retransmission consent regime should be modified. The NPRM was driven in part by complaints by certain members of Congress expressing concern when channels are blacked out on MVPDs (multichannel video programming distributors) during the course of retransmission consent negotiations. Both Congress and the FCC may be considering these issues further in the coming months.
Online Public Inspection File
The FCC has adopted rules mandating that all TV stations have an online public inspection file. The FCC received OMB (Office of Management and Budget) approval for the new rules on June 22. Based on that approval, the FCC has announced that the new rules will go into effect on Aug, 2. The NAB has appealed and requested an FCC stay of the effective date of this decision. However, unless there is action on the stay request, the Aug. 2 effective date will remain in place.
The online files will be maintained by the FCC on its computer servers. The FCC will be responsible for adding electronically-filed forms to the online public files, but licensees will be require to upload all other paper file information into their public files, with the exception of letters and emails from the public, which should not be posted online for privacy reasons. The FCC will be conducting a demonstration of its new online system on July 17 at 10 a.m. ET. That session will also be webcast.
Once effective, all stations will need to upload any new information that they create (including, for instance, Quarterly Issues Programs Lists and Annual EEO Public Inspection File Reports). All material already in a station’s paper file will need to be uploaded within six months of the effective date.
In addition, top-four network affiliated stations in the top 50 markets must place their political files online on a going-forward basis once the new rules are effective. Other TV stations will have until July 1, 2014, to come into compliance with the online political file requirements.
Ownership Limits/Shared Service Agreements
In March, comments were filed on the FCC’s Notice of Proposed Rulemaking, looking to revise and update its broadcast multiple ownership rules. The issues set out in the FCC’s NPRM include proposed liberalization of the restrictions on the cross-ownership of broadcast stations and newspapers, and the elimination of rules restricting the ownership of radio and TV stations in the same market.
The FCC has also proposed the attribution of TV shared services agreements (i.e., potentially making a shared services agreement count as if it were an ownership interest in a multiple ownership analysis). The FCC did not propose to change its local TV ownership limitations, which currently prohibit combinations of any of the top-four stations in a market, and limit an owner to only two TV stations in a market provided there are at least eight independent marketplace TV station owners after the combination.
However, the FCC did ask whether waivers of these rules should be allowed in any particular circumstances. The commission is also looking for suggestions on how these rules can be used to promote the minority ownership of broadcast stations.
Political season is underway in anticipation of this November’s election. Many stations have already faced political issues, including the computation of the Lowest Unit Rates that will apply in the periods 45 days before any remaining primaries and 60 days before a general election. The FCC has informally cautioned stations that, while Internet-only advertising is not subject to the FCC rules, when the sale of such advertising is coupled with the sale of on-air ads, the on-air ads in those contracts cannot be excluded from consideration in political rate computations.
Stations must also deal with claims about falsity and other content in third-party advertising from super PACs and other non-candidate groups that could potentially give rise to liability. While stations are generally immune from any liability for statements made in candidate ads, there is potential liability if they are put on notice of defamatory content or other illegal material in non-candidate ads that could subject stations to civil liability.
Public Interest Programming Disclosure
In February, the FCC received comments on a Notice of Inquiry, looking for a standardized disclosure form that would replace the previous FCC Form 355, a form adopted by the FCC in 2007, but which was never approved by the Office of Management and Budget under the Paperwork Reduction Act. Such a form would replace the current issues/programs lists, to detail the public service programming provided by TV stations.
The NOI asked for comment about the burden that would be imposed on broadcasters if they were required to report detailed information about the amount of local news, public affairs and electoral programming, as well as information about local emergencies, that they broadcast on specified days selected at random by the FCC.
Parties were also to comment on the public interest benefits of such reporting. Any collected information would go into the online public file which the FCC recently required for TV stations.
The annual FCC regulatory fees charged for broadcast stations have generally held steady in the past few years, and this year’s proposed fees, set forth in a May 4 Notice of Proposed Rulemaking, do not depart significantly from the recent amounts. The annual regulatory fees, which are typically due sometime between mid-August and mid-September, are apportioned by the FCC every year and are imposed on a sliding scale with large market VHF TV stations at the high end of the scale and small market radio stations at the low end.
The FCC has discontinued mailing hardcopy regulatory fee assessment letters to media licensees, so it is incumbent upon licensees to know how much to pay and the deadline for making such payments.
The commission has also proposed the notion of spectrum usage fees, both in the 2010 National Broadband Plan and in its most recent budget to Congress. Such usage fees, which would require FCC licensees to pay annually for the right to use their spectrum, have not gained traction thus far and have been strongly opposed by NAB, CTIA and others.
In February, a new federal law was enacted to permit the FCC to conduct incentive auctions to clear parts of the TV band for wireless broadband uses. TV stations may voluntarily participate in one of three ways, and share in auction revenues: 1) by agreeing to give up all 6 MHz of spectrum and exiting the business; 2) by channel sharing with another station in the market, giving up one 6 MHz channel but retaining must-carry rights for both program streams carried on the shared channel; or 3) by agreeing to give up its 6 MHz of UHF spectrum in exchange for 6 MHz of VHF spectrum.
The law requires that the FCC attempt to replicate the current service of any stations that are forced to change channels in order to “repack” the band to make it available for wireless users. The law also authorizes the FCC to compensate TV stations for the costs of repacking, up to $1.75 billion. The FCC will have to conduct further proceedings to implement the legislation, designing auction procedures and specific repacking plans. One or more Notices of Proposed Rulemaking may be issued as soon as this Fall.
Video News Releases — The FCC has recently issued fines to television stations for airing video news releases without identifying the party who provided the VNR, or 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.
Other Sponsorship ID Issues — The FCC issued an NPRM in 2008, proposing, among other things, to require the sponsorship identification of embedded content and product placement at the time that the product is shown on the TV screen. That proceeding is still unresolved.
Tower and Antenna Issues
Following several years of consideration, in December 2011, the FCC adopted new rules governing the review and registration of broadcast and communications towers. The new rules, which provide for greater opportunity for public comment, are an outgrowth of a decision from the Court of Appeals in 2008 in which the court found the FCC’s tower registration procedures to be deficient. The recent order also adopted interim procedures to address concerns about the effect of tall towers on migratory birds.
The FCC will issue a further public notice, likely this spring, to announce the implementation of the new rules and to detail the changes to the its Antenna Structure Registration database.
In addition to the new IP closed-captioning rules mentioned above, the FCC recently reinstated its video description rules as required by the Accessibility Act. The FCC had adopted similar rules a decade ago, but they were struck down by the U.S. Court of Appeals for the D.C. Circuit.
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, and are carried on the secondary audio program (SAP) channel. Starting July 1, the rules require the provision of specified quantities of video-described programming by broadcast television stations in the top 25 markets affiliated with the top four national networks, and by multichannel video programming distributor systems (MVPDs), such as cable operators and DBS systems, with more than 50,000 subscribers.
The rules also require that all television stations and MVPDs, regardless of market or system size, “pass through” any such video-described programming.
Last year, the FCC affirmed its rules allowing the deployment of unlicensed devices on unoccupied frequencies within the television spectrum bands, also known as the “TV white spaces.” It is generally anticipated that unlicensed devices operating in the TV white spaces will be used to provide “Wi-Fi”-like services for consumers and businesses. The unlicensed devices, which may operate on either a fixed or mobile basis, will seek to take advantage of the television spectrum’s superior propagation characteristics.
In order to identify suitable vacant channels on which to operate without causing harmful interference to incumbent licensed television stations and other users, the unlicensed devices must include geo-location capability and the ability to access a database via the Internet.The FCC has authorized several database managers to manage those interference databases.
The first white spaces devices are now starting to be introduced to the market, with more likely to follow this year as new equipment becomes certified and more database managers are approved by the commission. It remains to be seen whether any repacking of the TV spectrum, which could result in significantly less white space among broadcast operations, may limit the opportunities for white space device operations.