FCC Announces New End Date for JSA Grandfathering

Scott R. Flick

Posted December 11, 2014

By Scott R. Flick

The FCC announced in March of this year that it would begin treating TV Joint Sales Agreements between two local TV stations involving more than 15% of a station's advertising time as an attributable ownership interest. However, it also announced at that time that it would provide parties to existing JSAs two years from the effective date of the new rule to make any necessary modifications to ensure compliance with the FCC's multiple ownership rule. As I wrote in June when the new rule went into effect, that made June 19, 2016 the deadline for addressing any issues with existing JSAs.

However, the STELA Reauthorization Act of 2014 (STELAR) became law on December
4, 2014. While the primary purpose of STELAR was to extend for an additional five years the compulsory copyright license allowing satellite TV providers to import distant network TV signals to their subscribers where no local affiliate is available, as often happens in Congress, a number of unrelated provisions slipped into the bill. One of those provisions extended the JSA grandfathering period by a somewhat imprecise "six months".

Today, the FCC released a Public Notice announcing that it would deem December 19, 2016 to be the new deadline for making any necessary modifications to existing TV JSAs to ensure compliance with the FCC's multiple ownership rule. As a result, in those situations where the treatment of a JSA as an attributable ownership interest would create a violation of the FCC's local ownership limits, the affected broadcaster will need to take whatever steps are necessary to ensure that it has remedied that situation by the December 19, 2016 deadline.

FCC Enforcement Monitor

Scott R. Flick Carly A. Deckelboim

Posted November 25, 2014

By Scott R. Flick and Carly A. Deckelboim

November 2014

Pillsbury's communications lawyers have published FCC Enforcement Monitor monthly since 1999 to inform our clients of notable FCC enforcement actions against FCC license holders and others. This month's issue includes:

  • $7,000 Fine for Late Renewal Application and Unauthorized Operation
  • Missing Wood Planks Around Tower Lead to $5,600 Fine
  • $39,000 Fine Upheld for Hearing Aid Compatibility Violations

Reduced Fine Imposed for Unauthorized Operation and Tardy Renewal Application

Earlier this month, the Audio Division of the FCC's Media Bureau (the "Bureau") issued a Memorandum Opinion and Order and Notice of Apparent Liability for Forfeiture ("NAL") against a Nevada licensee for failing to timely file its license renewal application and for continuing to operate its FM station after its license had expired. The Bureau imposed a fine for the violations and considered the licensee's renewal application at the same time.

Section 301 of the Communications Act provides that "[n]o person shall use or operate any apparatus for the transmission of energy of communications or signals by radio . . . except under and in accordance with this Act and with a license in that behalf granted under the provisions of the Act." Section 73.3539(a) of the FCC's Rules requires that broadcast licensees file applications to renew their licenses "not later than the first day of the fourth full calendar month prior to the expiration date of the license sought to be renewed."

In this case, the licensee's license expired on October 1, 2013, which meant that the licensee was required to file its license renewal application by June 1, 2013. However, the licensee did not file its renewal application until October 18, 2013, almost three weeks after its license expired, even though the Bureau had attempted to contact the licensee in June of 2013 about the impending expiration. In addition to its license renewal application, the licensee also requested Special Temporary Authority on October 18, 2013 to continue operating while its license renewal application was processed.

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FCC Proposes to Clear Airwaves of Boring Contest Rules, But State Law Issues Remain

Lauren Lynch Flick

Posted November 21, 2014

By Lauren Lynch Flick

At its Open Meeting this morning, the FCC adopted a Notice of Proposed Rulemaking to "modernize" its station-conducted contest rule, which was originally adopted in 1976. The proposal would allow broadcasters to post the rules of a contest on any publicly accessible website. Stations would no longer have to broadcast the contest rules if they instead announce the full website address where the rules can be found each time they promote or advertise the contest on-air.

Currently, the FCC's rule requires that broadcasters sponsoring a contest must "fully and accurately disclose the material terms of the contest" and subsequently conduct the contest substantially as announced. A note to the rule explains that "[t]he material terms should be disclosed periodically by announcements broadcast on the station conducting the contest, but need not be enumerated each time an announcement promoting the contest is broadcast. Disclosure of material terms in a reasonable number of announcements is sufficient."

Of course what terms are "material" and what number of announcements is "reasonable" have been open to interpretation. A review of many past issues of Pillsbury's Enforcement Monitor reveals numerous cases where a station was accused of having failed to disclose on-air a material term of a contest, or of deviating from the announced rules in conducting a contest. Even where a station's efforts are ultimately deemed sufficient, the licensee has been put in the delicate position of defending its disclosure practices as "reasonable," which has the effect of accusing a disappointed listener or viewer of being "unreasonable" in having not understood the disclosures made.

Adopting the rule change proposed by the FCC today would simplify a broadcaster's defense of its actions because a written record of what was posted online will be available for the FCC to review. Accordingly, questions about whether the station aired the rules, or aired them enough times for the listener/viewer to understand all the material terms of the contest would be less important from an FCC standpoint. Instead, the listener/viewer will be expected to access the web version of the rules and benefit from the opportunity to review those rules at a more leisurely pace, no longer subjected to a fast-talker recitation of the rules on radio, or squinting at a mouseprint crawl at the bottom of a television screen. While the FCC's willingness to accept online disclosures is certainly welcome, the question of what disclosures must be made in the first instance remains. In fact, the FCC asks in the NPRM whether its rules should dictate a set of "material" terms to be disclosed online.

In our Advertising and Sweepstakes practice, we frequently advise sponsors of contests and sweepstakes on how to conduct legal contests, including the drafting of contest rules and the sufficiency of the sponsor's disclosure of those rules in advertisements. In addition to the FCC's rule requiring disclosure of "material" terms, the consumer protection laws of nearly every state prohibit advertising the availability of a prize in a false or misleading manner. What terms will be "material" and essential to making a disclosure not false or misleading is a very fact-specific issue, and will vary significantly depending on the exact nature of the contest involved. As a result, regardless of whether the FCC dictates a prescribed set of "material" terms to be disclosed, the terms will still have to satisfy state disclosure requirements.

The FCC (with regard to station-conducted contests) and state Attorney Generals (with regard to all contests and sweepstakes) investigate whether contests and sweepstakes have been conducted fairly and in accordance with the advertised rules. These investigations usually arise in response to a consumer complaint that the contest was not conducted in the manner the consumer expected. Many of these investigations can be avoided by: (1) having well-drafted contest rules that anticipate common issues which often arise in administering a contest or sweepstakes, and (2) assuring that statements promoting the contest are consistent with those rules.

While, as Commissioner Pai noted, the public does not generally find contest disclosure statements to be "compelling" listening or viewing, and may well change channels to avoid them, the individual states are going to continue to require adequate public disclosure of contest rules, even if that means continued on-air disclosures. If the FCC's on-air contest disclosure requirements do go away, stations will need to focus on how state law contest requirements affect them before deciding whether they can actually scale back their on-air disclosures.

In fact, while a violation of the FCC's contest disclosure requirements often results in the imposition of a $4,000 fine, an improperly conducted contest can subject the sponsor, whether it be a station or an advertiser, to far more liability under consumer protection laws and state and federal gambling laws. In addition, state laws may impose record retention obligations, require registration and bonding before a contest can commence, or impose a number of other obligations. As promotional contests and sweepstakes continue to proliferate, knowing the ground rules for conducting them is critically important. If the FCC proceeds with its elimination of mandatory on-air contest disclosures for station-conducted contests, it will make broadcasters' lives a little easier, but not by as much as some might anticipate.

FCC Enforcement Monitor

Scott R. Flick Carly A. Deckelboim

Posted October 22, 2014

By Scott R. Flick and Carly A. Deckelboim

October 2014

Pillsbury's communications lawyers have published FCC Enforcement Monitor monthly since 1999 to inform our clients of notable FCC enforcement actions against FCC license holders and others. This month's issue includes:

  • $86,400 Fine for Unlicensed and Unauthorized BAS Operations
  • Missing "E/I" Graphic for Children's Television Programs Results in Fine
  • Multiple Rule Violations Lead to $16,000 in Fines

Increased Fine for Continuing Broadcast Auxiliary Services Operations After Being Warned of Violations

Earlier this month, the FCC issued a Notice of Apparent Liability for Forfeiture ("NAL") against a Texas licensee for operating three broadcast auxiliary services ("BAS") stations without authorizations and operating an additional six BAS stations at variance with their respective authorizations. The FCC noted that it was taking this enforcement action because it has a duty to prevent unlicensed radio operations from potentially interfering with authorized radio communications in the United States and to ensure the efficient administration and management of wireless radio frequencies.

Section 301 of the Communications Act provides that "[n]o person shall use or operate any apparatus for the transmission of energy of communications or signals by radio . . . except under and in accordance with this Act and with a license in that behalf granted under the provisions of the Act." In addition, Section 1.947(a) of the FCC's Rules specifies that major modifications to BAS licenses require prior FCC approval, and Section 1.929(d)(1) provides that changes to BAS television coordinates, frequency, bandwidth, antenna height, and emission type (the types of changes the licensee made in this case) are major modifications. The base fine for operating a station without FCC authority is $10,000 and the base fine for unauthorized emissions, using an unauthorized frequency, and construction or operation at an unauthorized location, is $4,000.

In April 2013, the licensee submitted applications for three new "as built" BAS facilities and six modified facilities. The modifications pertained to updates to the licensed locations of some of the licensee's transmit/receive sites to reflect the as-built locations, changes to authorized frequencies, and recharacterization of sites from analog to digital. The licensee disclosed the three unauthorized stations and six stations operating at variance from their authorizations in these April 2013 applications. As a result of the licensee's disclosures, the Wireless Telecommunications Bureau referred the matter to the Enforcement Bureau (the "Bureau") for investigation. In November 2013, the Bureau's Spectrum Enforcement Division instructed the licensee to submit a sworn written response to a series of questions about its apparent unauthorized operations. The licensee replied to the Bureau in January 2014 and admitted that it operated the nine BAS facilities either without authorization or at variance with their authorizations. The licensee also admitted that it learned of the violations in May 2012 while conducting an audit of its BAS facilities. Finally, the licensee noted that it could not identify the precise dates when the violations occurred but that they had likely been ongoing for years and possibly since some of the stations were acquired in 1991 and 2001.

The FCC concluded that the licensee had willfully and repeatedly violated the FCC's rules and noted that the base fine amount was $54,000, comprised of $30,000 for the three unauthorized BAS stations and $24,000 for the six BAS stations not operating as authorized. The licensee had argued that a $4,000 base fine should apply to the three unauthorized BAS stations because the FCC had previously imposed a $4,000 fine for similar violations when the licensee had color of authority to operate the BAS stations pursuant to an existing license for its full-power station. The FCC rejected this argument and noted that its most recent enforcement actions applied a $10,000 base fine for unlicensed BAS operations even where the full-power station license was valid.

The FCC concluded that the extended duration of the violations, including the continuing nature of the violations after the licensee became aware of the unlicensed and unauthorized operations, merited an upward adjustment of the proposed fine by $32,400. The FCC indicated that the licensee's voluntary disclosure of the violations before the FCC began its investigation did not absolve the licensee of liability because of the licensee's earlier awareness of the violations and the extended duration of the violations. The FCC therefore proposed a total fine of $86,400.

Reliance on Foreign-Language Programmer Did Not Affect Licensee's $3,000 Fine

The Chief of the Video Division of the FCC's Media Bureau issued an NAL against a California licensee for failing to properly identify educational children's programming through display on the television screen of the "E/I" symbol.

The Children's Television Act of 1990 introduced an obligation for television broadcast licensees to offer programming that meets the educational and informational needs of children ("Core Programming"). Section 73.671(c)(5) of the FCC's Rules expands on this obligation by requiring that broadcasters identify Core Programming by displaying the "E/I" symbol on the television screen throughout the program.

The licensee filed its license renewal application on August 1, 2014. The licensee certified in the application that it had not identified each Core program at the beginning of each program and had failed to properly display the "E/I" symbol during educational children's programming aired on a Korean-language digital multicast channel. In September 2014, the licensee amended its license renewal application to specify the time period when the "E/I" symbol was not used and two days later amended the renewal application again to state that it had encountered similar issues with displaying the "E/I" symbol on the station's Chinese-language digital multicast channel.

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Breaking News: FCC Suspends Construction Deadlines and Expiration Dates for New LPTVs and Translators

Lauren Lynch Flick

Posted October 10, 2014

By Lauren Lynch Flick

Late today, the FCC released a Public Notice stating that "[e]ffective immediately, the expiration dates and construction deadlines for all outstanding unexpired construction permits for new digital low power television (LPTV) and TV translator stations are hereby suspended pending final action in the rulemaking proceeding in MB Docket No. 03-185 initiated today by the Commission."

As referenced in that statement, the FCC simultaneously released a Third Notice of Proposed Rulemaking (NPRM) seeking comment on a number of issues related to the transition of LPTV stations to digital and their fate in the post-auction spectrum repacking. Specifically, the FCC states in the NPRM that:


In this proceeding, we consider the measures discussed in the Incentive Auction Report and Order, other measures to ensure the successful completion of the LPTV and TV translator digital transition and to help preserve the important services LPTV and TV translator stations provide, and other related matters. Specifically, we tentatively conclude that we should: (1) extend the September 1, 2015 digital transition deadline for LPTV and TV translator stations; (2) adopt rules to allow channel sharing by and between LPTV and TV translator stations; and (3) create a "digital-to-digital replacement translator" service for full power stations that experience losses in their pre-auction service areas. We also seek comment on: (1) our proposed use of the incentive auction optimization model to assist LPTV and TV translator stations displaced by the auction and repacking process to identify new channels; (2) whether to permit digital LPTV stations to operate analog FM radio-type services on an ancillary or supplementary basis; and (3) whether to eliminate the requirement in section 15.117(b) of our rules that TV receivers include analog tuners. We also invite input on any other measures we should consider to further mitigate the impact of the auction and repacking process on LPTV and TV translator stations.

While primarily focused on the future of the LPTV and TV translator services, the NPRM definitely includes some issues of interest to full-power TV stations as well, including the idea that repacking full-power stations may necessitate the construction of digital-to-digital translators to address situations where such stations "experience losses in their pre-auction service areas". The extent to which the FCC may create such losses is of course one of the issues currently on appeal before the courts, but such losses might also result from stations voluntarily moving from UHF to VHF channels in the auction, or moving from a High VHF to a Low VHF channel. The FCC proposes to permit such translators only where a loss of service has occurred, and to limit such translators to replicating, rather than extending, a station's prior coverage area.

Another interesting issue for which the FCC is seeking input in the NPRM is whether to allow LPTV and TV translator stations to channel-share with full-power and Class A TV stations. That issue, as well as the proposal to allow Channel 6 LPTV stations to provide an analog FM audio service as an ancillary service, will make this a particularly interesting proceeding likely to attract lots of comments.

The comment dates have not yet been set, but Comments will be due 30 days after the NPRM is published in the Federal Register, with Reply Comments due 15 days after that. Those operating LPTV and TV translator stations will no doubt be happy to see that the FCC is taking steps to "mitigate the potential impact of the incentive auction and the repacking process on LPTV and TV translator stations," but the many issues covered by the NPRM make clear that, for many of these stations, it will definitely be an uphill climb.

FCC Announces Grant of 700 Delayed Broadcast License Renewals

Scott R. Flick

Posted October 9, 2014

By Scott R. Flick

In a post today on the FCC's Blog, Diane Cornell, Special Counsel to Chairman Wheeler, described the FCC's efforts to reduce backlogs of applications, complaints, and other proceedings pending at the FCC. The post announces that the Consumer and Governmental Affairs Bureau has closed 760 docketed proceedings, and is on track to close another 750 by the end of the year. The post also indicates that the FCC's Wireless Bureau resolved 2046 applications older than six months, reducing the backlog of applications by 26%.

Of particular interest to broadcasters, however, is the news that the "Enforcement Bureau has largely completed its review of pending complaints, clearing the way for the Media Bureau to grant almost 700 license renewals this week." Many of these pending complaints were presumably based on indecency claims, which have in recent years created such a backlog of license renewal applications (particularly for TV stations) that it has not been unusual for a station to have multiple license renewal applications pending at the FCC, even though such applications are only filed every eight years.

For those unable to buy or sell a broadcast station, or to refinance its debt, because that station's license renewal application was hung up at the FCC, this will be welcome news. Just two years ago, the number of indecency complaints pending at the FCC exceeded 1,500,000, dropping to around 500,000 in April of 2013, when the FCC proposed to "focus its indecency enforcement resources on egregious cases and to reduce the backlog of pending broadcast indecency complaints."

While indecency and other complaints will certainly continue to arrive at the FCC in large numbers given the ease of filing them in the Internet age, today's news brings hope that most of them will be addressed quickly, and that long-pending license renewal applications will become a rarity at the FCC. That would be welcome news for broadcasters, who frequently found that the application delays caused by such complaints were far worse than any fine the FCC might levy. Such delays were particularly galling in the many cases where the focus of the complaint was content wildly outside the FCC's definition of indecency ("language or material that, in context, depicts or describes, in terms patently offensive as measured by contemporary community standards for the broadcast medium, sexual or excretory organs or activities").

For a number of years, complaints that merely used the word "indecent" were put in the "indecency complaint" stack, resulting in multi-year holds on that station's FCC applications. I once worked on a case where a politician who had been criticized in a TV's newscast for his performance in office filed an FCC complaint stating that the station's comments about him were "indecent". You guessed it; this exercise of a station's First Amendment right to criticize a public official resulted in a hold being placed on the station's FCC applications for years while the complaint sat at the FCC.

The FCC's efforts to eliminate these delays, and the inordinate leverage such delays gave to even the most frivolous complaints, are an excellent example of the FCC staff working to accomplish the Commission's public interest mandate. While broadcasters may feel they have not have had many reasons to cheer the FCC in recent years, today's announcement certainly merits some applause.

Hotels Jamming Wi-Fi Signals?

Scott R. Flick

Posted October 3, 2014

By Scott R. Flick

In the U.S., jamming communications signals is illegal. Over the years, I've written a number of posts about the FCC's persistent efforts to prevent jamming. Among these were fines and other actions taken against an Internet marketer of cell phone jamming devices; a variety of individuals and companies selling cell phone jamming devices through Craigslist; an employer attempting to block cell phone calls by its employees at work; a truck driver jamming GPS frequencies to prevent his employer from tracking his whereabouts; and an individual jamming the frequencies used by a shopping mall for its "mall cop" communications systems.

In each of these cases, the FCC went after either the party selling the jamming device, or the user of that device. Normally, jammers work by overloading the frequency with a more powerful interfering signal, confusing the signal receiver or obliterating the lower-powered "authorized" signal entirely. Historically, jammers have often been individuals with a grudge or an employer/employee trying to get the electronic upper hand on the other.

It was therefore a new twist when the FCC announced today that it had entered into a Consent Decree with one of the largest hotel operators in the U.S. "for $600,000 to settle the [FCC's] investigation of allegations that [the operator] interfered with and disabled Wi-Fi networks established by consumers in the conference facilities at the Gaylord Opryland Hotel and Convention Center in Nashville, Tennessee ... in violation of Section 333 of the Communications Act of 1934, as amended...."

The FCC's Order describes the basis for its investigation and the Consent Decree as follows:

Wi-Fi is an essential on-ramp to the Internet. Wi-Fi networks have proliferated in places accessible to the public, such as restaurants, coffee shops, malls, train stations, hotels, airports, convention centers, and parks. Consumers also can establish their own Wi-Fi networks by using FCC-authorized mobile hotspots to connect Wi-Fi enabled devices to the Internet using their cellular data plans. The growing use of technologies that unlawfully block consumers from creating their own Wi-Fi networks via their personal hotspot devices unjustifiably prevents consumers from enjoying services they have paid for and stymies the convenience and innovation associated with Wi-Fi Internet access.

In March 2013, the Commission received a complaint from an individual who had attended a function at the Gaylord Opryland. The complainant alleged that the Gaylord Opryland was "jamming mobile hotspots so that you can't use them in the convention space." Marriott has admitted that one or more of its employees used containment features of a Wi-Fi monitoring system at the Gaylord Opryland to prevent consumers from connecting to the Internet via their own personal Wi-Fi networks. The Bureau investigated this matter to assess Marriott's compliance with Section 333 of the Act and has entered into the attached Consent Decree. To resolve the Bureau's investigation, [the operator] is required, among other things, (i) to pay a $600,000 civil penalty to the United States Treasury, (ii) to develop and implement a compliance plan, and (iii) to submit periodic compliance and usage reports, including information documenting to the Bureau any use of containment functionalities of Wi-Fi monitoring systems, at any U.S. property that [it] manages or owns.

Today's Order makes clear that the FCC's concerns about "signal jamming" are not limited to traditional brute force radio signal interference. In this case, the jamming was done by "the sending of de-authentication packets to Wi-Fi Internet access points." Also of interest is that the FCC did not assert, as it often has in past jamming cases, that it was concerned about the impact of jamming communications on those in nearby public spaces. It appears that the "de-authentication" was limited to areas inside the hotel/convention center, and the FCC made clear that even this limited jamming was "unacceptable".

This is not the first time the FCC has exercised its authority in ways affecting the hospitality industry (for example, fining hotels because their in-house cable systems don't comply with FCC signal leakage limits designed to protect aviation communications). However, the FCC's willingness to step in and regulate access to Wi-Fi on hotel property indicates that the FCC might be a growing influence on hotels' business operations, particularly as hotels seek to make an increasing portion of their revenues from "guest fees" of various types, including for communications services. The Order indicates that the hotel here was charging anywhere from $250 to $1,000 per wireless access point for convention exhibitors and customers, providing a powerful incentive for the hotel to prevent parties from being able to sidestep those charges by setting up personal Wi-Fi hotspots.

Figuring out ways to drive up demand for these hotel services is Business 101. Doing it in a way that doesn't draw the FCC's ire is an upper level class.

FCC Enforcement Monitor

Scott R. Flick Carly A. Deckelboim

Posted September 30, 2014

By Scott R. Flick and Carly A. Deckelboim

September 2014

Pillsbury's communications lawyers have published FCC Enforcement Monitor monthly since 1999 to inform our clients of notable FCC enforcement actions against FCC license holders and others. This month's issue includes:

  • Unenclosed and Unpainted Tower Leads to $30,000 in Fines
  • $20,000 Fine for Missing Issues/Programs Lists at Two Stations
  • Increased Fine for Intentional Interference and Unlicensed Transmitter Use

Multiple Tower Violations Result in Increased Fine

Earlier this month, a Regional Director of the FCC's Enforcement Bureau (the "Bureau") issued a Forfeiture Order against the licensee of a New Jersey AM radio station for failing to properly paint its tower and enclose the tower within an effective locked fence or other enclosure.

Section 303(q) of the Communications Act requires that tower owners maintain painting and lighting of their towers as specified by the FCC. Section 17.50(a) of the Commission's Rules says that towers must be cleaned or repainted as often as necessary to maintain good visibility. Section 73.49 of the FCC's Rules requires "antenna towers having radio frequency potential at the base [to] be enclosed with effective locked fences or other enclosures." The base fine for failing to comply with the lighting and marking requirements is $10,000, and the base fine for failing to maintain an effective AM tower fence is $7,000.

In March of 2010, agents from the Bureau's Philadelphia Office inspected the licensee's tower in New Jersey. The terms of the Antenna Structure Registration required that this particular tower be painted and lit. During their inspection, the agents noticed that the paint on the tower was faded and chipped, resulting in significantly reduced visibility. During their inspection, the agents also found that an unlocked gate allowed unrestricted access to the tower, which had radio frequency potential at its base. The agents contacted the owner of the tower and locked the gate before leaving the site.

In April of 2010, the Philadelphia Office issued a Notice of Violation ("NOV") to the licensee for violating Sections 17.50(a) and 73.49 of the FCC's Rules. The next month, in its response to the NOV, the licensee asserted that it inspects the tower several times each year and had been planning for some time to repair the faded and chipped paint and promised to bring the tower into compliance by August 15, 2010 by repainting the structure or installing white strobe lighting. The licensee also indicated that it had never observed the gate surrounding the tower be unlocked during its own site visits and noted that several tenants, each of whom leased space on the tower, also had keys for the site.

In November of 2010, agents inspected the tower again to ensure that the violations had been corrected. The agents discovered that the licensee had neither repainted the tower nor installed strobe lights and that now a different gate to the tower was unlocked. The agents immediately informed the licensee's President and General Manager about the open gate, which they were unable to lock before leaving the site. The following day, the agents returned to the tower and noted that the gate was still unlocked. The agents again contacted the President, who promised that a new lock would be installed later that day, which did occur. At the beginning of December 2010, agents visited the tower with the President and the station's Chief Engineer. The tower still had not been repainted, nor had strobe lights been installed. On January 7, 2011, the Chief Engineer reported to the FCC that white strobe lighting had been installed.

The Philadelphia Office issued a Notice of Apparent Liability for Forfeiture ("NAL") on October 31, 2011 for failure to repaint the tower and failure to enclose the tower with an effective locked fence or enclosure. In the NAL, the Philadelphia Office adjusted the base fines upward from the combined base fine of $17,000 because the "repeated warnings regarding the antenna structure's faded paint and the unlocked gates . . . demonstrate[ed] a deliberate disregard for the Rules." The Philadelphia Office proposed a fine of $20,000. In its response to the NAL, the licensee requested that the fine be reduced based on its immediate efforts to bring the tower into compliance with the rules and its overall history of compliance.

In response, the FCC declined to reduce the proposed fine because corrective action taken to come into compliance with the Rules is expected and does not mitigate violations. In addition, the FCC rejected the licensee's argument that it had taken "immediate action" to correct the violations because the licensee was first notified about the chipped paint in March 2010 and did not install the strobe lights until January 2011. Finally, the FCC declined to reduce the fine based on a history of compliance because the licensee had violated the FCC's Rules twice before. Therefore, the FCC affirmed the imposition of a $20,000 fine.

Fine Reduced to Base Amount for Good Faith Effort to Have Issues/Programs Lists Nearby

The Western Region of the Enforcement Bureau issued a Forfeiture Order against the licensee of two Colorado stations for failing to maintain complete public inspection files.

Continue reading "FCC Enforcement Monitor"

October 1 Must-Carry/Retrans Elections Drive the Future of Local Broadcast TV

Scott R. Flick

Posted September 18, 2014

By Scott R. Flick

Few dates on the broadcasters' calendar are easier to miss than the deadline for TV stations (and a few fortunate LPTV stations) to send their must-carry/retransmission election letters to cable and satellite providers in their markets. Because it doesn't occur every year, or even every other year, but every third year, the triennial deadline can slip up on you if you don't closely monitor our Broadcast Calendar. For those that haven't been paying attention, October 1, 2014 is the deadline for TV stations to send their carriage election letters to MVPDs. The elections made by this October 1st will govern a station's carriage rights for the three-year period from January 1, 2015 to December 31, 2017, and this will be the first set of election letters that stations must immediately upload to their online public inspection file at the FCC.

I noted in a post here three years ago that the impact of these elections is becoming more significant with each three-year cycle. In particular, that post focused on the fact that network-affiliated stations can no longer consider retrans revenue to be "found" money, but instead as revenue essential to both short-term and long-term survival. Short-term, in that stations must compete for programming and advertising against cable and satellite programmers that have long had two revenue streams--advertising and subscriber fees. Long-term, in that there was little doubt that networks were looking to charge affiliates more for network programming by taking an ever larger share of retrans revenue, and that it was only a matter of time before networks began selecting their affiliates based not upon past performance, but upon which station could bring the best financial package to the network going forward.

As we've learned over the past year in particular, that means not just negotiating the best retransmission deals possible, but sending an increasing portion of those revenues to the network. Wells Fargo analyst Marci Ryvicker, who will be one of our speakers at the 2014 Pillsbury Trends in Communications Finance event in New York next month, noted that pattern just a few weeks ago. Using CBS's recent projections on the overall revenue it expects to receive from affiliates, she was able to calculate the monthly affiliate cost for CBS programming at $1.30 per subscriber by 2020. Add to that the station's costs for negotiating retrans deals, as well as the increasing cost of producing local programming and securing attractive syndicated content, and it is clear that no network affiliate can afford to be cutting substandard retrans deals and hope to survive in the long term. MVPDs may grumble about those "greedy stations" during retrans negotiations, but generating the revenue necessary to retain the programming that attracts cable, satellite, and over-the-air viewers (not to mention advertisers) is not an optional activity for local TV stations.

The impact of this is not, however, limited to purely matters of retransmission. Yes, broadcasters can no longer afford to enter into amateur retrans deals that threaten to alienate their networks by providing below-market rates, or which sloppily authorize retransmission or streaming rights far outside the local broadcaster's market (this mistake becoming even more consequential if the FCC moves forward in eliminating the network non-duplication rule). The bigger trend is that these economic forces are driving consolidation in the TV industry.

Building large broadcast groups allows co-owned TV stations the critical mass necessary to negotiate difficult retrans deals against the much-larger cable and satellite operators, and, where necessary, to withstand the economic impact of a retrans impasse when it happens. Similarly, larger TV groups are better positioned to negotiate the best possible programming deals with their networks (keeping in mind that "best possible" isn't necessarily the same as "good").

Single stations and small station groups routinely have to punch well above their weight by employing smart executives and counsel with deep experience in retrans negotiations to survive in this increasingly harsh environment. That is what makes the FCC's prohibition earlier this year on certain joint retrans negotiations, as well as current efforts on Capitol Hill to broaden that prohibition, so perverse. By eliminating one of a small broadcaster's best options for cost-effectively negotiating viable retransmission agreements, the government is pushing those broadcasters to sell their stations to a larger broadcaster (or some would say, to the government itself). In the current environment, a station that fails to sell to a larger broadcaster possessing the skill and mass necessary to effectively negotiate retransmission agreements risks losing its network affiliation to just such a station group, precisely because that group can frequently deliver better retrans results.

So as you send out your elections this year, keep in mind that while the election process itself hasn't changed, what you will need to do afterwards has changed dramatically. More to the point, think hard about what you need to be doing with your retrans negotiations if you still want to be around in three years to send out that next batch of election letters.

FCC Moves Quickly to Reject Political Ad Sponsorship ID Complaints

Scott R. Flick

Posted September 2, 2014

By Scott R. Flick

Broadcasters let out a small sigh of relief today when the FCC made clear there is no requirement that TV stations have private investigators on staff.

With TV stations' political files now available online, three political activist organizations have been jointly filing complaints against TV stations alleging various errors and omissions in online public file paperwork relating to political ad buys by third-party advertisers. These three organizations, the Campaign Legal Center, Sunlight Foundation, and Common Cause, expanded their campaign (no pun intended) substantially in mid-July, when they filed complaints against a Washington, DC and a Portland, Oregon TV station. Rather than paperwork problems, however, these complaints claimed that the stations had failed to accurately disclose on-air the true identity of the sponsor behind certain "Super PAC" political ads. In both cases, the complainants asserted that their own research indicated the PACs were mostly or entirely funded by a single individual, and that the stations should have therefore identified that individual rather than the PAC as the sponsor of the political spot.

While there is ample precedent for requiring broadcasters to be comfortable that the sponsorship information in a political spot is accurate, the most recent complaints concerned broadcasters for two reasons. First, there apparently was no question that the PACs had indeed been the ones to write the check for the ads and were valid legal entities, so a TV station altering the sponsorship identification text to specify the station's opinion as to who the "real" sponsor is raises numerous legal issues, not the least of which is that the station could well get it wrong. For example, it would be a pretty brazen station that would change the sponsorship identification on Microsoft ads to "paid for by Bill Gates" on the theory that Bill Gates was the main "person" behind the organization that wrote the check. Of course, in this example the station would be doubly wrong, as Bill Gates ceased being the largest shareholder of Microsoft in May of this year, demonstrating the risk a station takes in attempting to be the arbiter of who is "behind" an advertiser.

This example also demonstrates the second issue that concerned broadcasters about the complaints. If, in the absence of an obvious sham advertiser, broadcasters had an obligation to ignore the "name on the check" and attempt to discern the actual source of the check writer's income, they would need a full-time staff of researchers doing nothing but verifying the structure of advertisers. In addition, the airing of political ads would be perpetually delayed while stations seek adequate certainty that they have discerned the true source of all ad funds.

The result would be a no-win situation for broadcasters, who would have to expend enormous resources trying to determine where an advertiser's money comes from, and having done that, expose themselves to both private liability (from the advertiser who wasn't credited as the sole sponsor of the spot, as well as from the individual who was) and regulatory liability (if the government disagrees with the licensee's sponsorship conclusions).

Today, the FCC wisely avoided placing broadcasters in that conundrum, ruling in a letter decision that:

We conclude that the complaints do not provide a sufficient showing that the stations had credible evidence casting into doubt that the identified sponsors of the advertisement were the true sponsors. As the Commission has stated previously, "unless furnished with credible, unrefuted evidence that a sponsor is acting at the direction of a third party, the broadcaster may rely on the plausible assurances of the person(s) paying for the time that they are the true sponsor." While the complaint against [the station] presented some evidence that station employees may have come across facts in the course of news reporting on political issues that could have raised questions in their minds concerning the relationship of NextGen Climate Action Committee and Tom Steyer, we exercise our discretion not to pursue enforcement in this instance, given the need to balance the "reasonable diligence" obligations of broadcasters in identifying the sponsor of an advertisement with the sensitive First Amendment interests present here.

While it is reassuring that the FCC moved quickly to reject the complaints, today's action leaves the political sponsorship identification waters somewhat murky. In addition to the less than comforting "we exercise our discretion not to pursue enforcement in this instance" language, the FCC proceeded to state that "[o]ur approach might have been different if the complainants had approached the stations directly to furnish them with evidence calling into question that the identified sponsors were the true sponsors." In using this language, the FCC suggests that the only problem with the complaints "might have been" that the complainants didn't present their evidence to the stations while the spots were still airing so that the stations could have assessed the evidence at the time and decided whether to modify the sponsorship identification.

While that ruling is generally consistent with past FCC rulings, in that a broadcaster must be presented with "credible, unrefuted evidence that a sponsor is acting at the direction of a third party," the FCC sidestepped the equally important issue of when a PAC's sponsorship identification may be deemed adequate, or if PAC contributors must be listed instead. As a result, broadcasters are left wondering if a sponsorship identification will be second-guessed when 80%, 90%, 95%, 99%, or some other percentage of the sponsor's income comes from one source. Similarly, what if only 50% comes from one individual, but the other 50% comes from another individual, and the two are say, brothers? Once again, broadcasters are being asked, on pain of liability, to make disclosure decisions for PACs that are more correctly the province of the Federal Election Commission.

Of course, the sponsorship identification requirement is not limited to political ads, and the flaws in the approach suggested by the complainants seem jarringly obvious when applied in the context of a business advertiser. For example, should ads for every Mom and Pop business disclose that the real sponsor is not the business, but Mom and Pop, who gave up their vacation this year in order for the business to be able to afford broadcast advertising? Similarly, if it is not the entity writing the check for advertising that is relevant, but the principal source of its income, shouldn't all ads placed by defense contractors need to disclose the U.S. government as the actual sponsor of their ads?

On the other hand, if, as the FCC has suggested in past sponsorship decisions, the real issue is the identity of the decision maker for that advertiser, how could a broadcaster ever know that information with adequate certainty to reject the assurances of the advertiser and take on the liability of unilaterally changing sponsorship identifications in ads?

To be clear, no one is suggesting that a sponsor should be able to avoid on-air attribution by creating a phony front organization whose faux nature is obvious to all, including the broadcaster. However, a Political Action Committee is an entity legally recognized under the law, which is also regulated by law. If more information about its contributors is deemed a public good, Congress and the Federal Election Commission have the authority and the responsibility to take action to accomplish that result. In the absence of such action, the task should not fall to broadcasters by default.

Client Alert: FCC Sets September 23, 2014 Deadline for 2014 Regulatory Fees

Christine A. Reilly

Posted August 29, 2014

By Christine A. Reilly

I wrote a post here in June on the FCC's release of its proposed regulatory fees for Fiscal Year 2014. Normally, the FCC releases an order adopting the official fee amounts and the deadline by which they must be filed in early to mid-August of each year. This year, however, licensees were beginning to get nervous, as August was coming to a close and there had still been no word from the FCC as to the final fee amounts and how quickly they must be paid.

Fortunately, the FCC was able to get the fee order out this afternoon, on the last business day of August. Unfortunately, because the Public Notice of the release occurred on the Friday before a three day weekend, many licensees may miss that announcement. According to today's Public Notice, full payment of annual regulatory fees for Fiscal Year 2014 (FY 2014) must be received no later than 11:59 PM Eastern Time on Tuesday, September 23, 2014. As of today, the Commission's automated filing and payment system, the Fee Filer System, is available for filing and payment of FY 2014 regulatory fees. A copy of the Public Notice with the details is available here.

Also, as noted in a footnote to that Public Notice, "[c]hecks, money orders, and cashier's checks are no longer accepted as means of payment for regulatory fees. As a result, it is the responsibility of licensees to make sure that their electronic payments are made timely and the transaction is completed by the due date." Time to rack up those credit card frequent flyer miles!

FCC Enforcement Monitor

Scott R. Flick Carly A. Deckelboim

Posted August 22, 2014

By Scott R. Flick and Carly A. Deckelboim

August 2014

Pillsbury's communications lawyers have published FCC Enforcement Monitor monthly since 1999 to inform our clients of notable FCC enforcement actions against FCC license holders and others. This month's issue includes:

  • Nonexistent Studio Staff and Missing Public Inspection File Lead to $20,000 Fine
  • Failure to Route 911 Calls Properly Results in $100,000 Fine
  • Admonishment for Display of Commercial Web Address During Children's Programming

Missing Public Inspection File and Staff Result in Increased Fine

A Regional Director of the FCC's Enforcement Bureau (the "Bureau") issued a Forfeiture Order against a Kansas licensee for failing to operate a fully staffed main studio as well as for failing to maintain and make available a complete public inspection file.

Section 73.1125(a) of the FCC's Rules requires that a broadcast station have a main studio with a "meaningful management and staff presence," and Section 73.3526(a)(2) requires that a broadcast station maintain a public inspection file. In July of 2012, a Bureau agent from the Kansas City Office tried to inspect the main studio of the licensee's station but could not find a main studio. Although the agent was able to find the station's public inspection file at an insurance agency in the community of license, the file did not contain any documents dated after 2009. After the inspection, the licensee requested a waiver of the main studio requirement, which the FCC's Media Bureau ultimately denied.

In May of last year, the Bureau issued a Notice of Apparent Liability for Forfeiture ("NAL") against the licensee. In the NAL, the Bureau noted that the base fine for violating the main studio rule is $7,000 and the base fine for violating the public file rule is $10,000. However, due to the over two-year duration of the public inspection file violation and the 14 month duration of the main studio violation, the Bureau increased the base fines by $2,000 and $1,000, respectively, resulting in a total proposed fine of $20,000.

In its response to the NAL, the licensee did not deny the facts asserted in the NAL. Therefore, the Forfeiture Order affirmed the factual determinations that the licensee had violated Sections 73.1125(a) and 73.3526(a)(2) of the FCC's Rules. However, in its NAL Response, the licensee requested that the proposed fine be reduced because the licensee's station serves a small market and it would face competitive disadvantages if it were required to fully staff the main studio.

The Bureau rejected the licensee's request to reduce the fine based on an inability to find qualified staff because there is no exception to Section 73.1125(a)'s requirement of a main studio due to staffing shortages. The Bureau also pointed out that the licensee had no staff presence at the main studio for more than a year. The Bureau briefly entertained the idea that the licensee had intended to argue that it was financially unable to maintain a fully staffed studio; however, since the licensee did not submit any financial information with its response to the NAL, the Bureau dismissed the possibility of reducing the fine amount based on the licensee's inability to pay.

The Bureau also rejected the licensee's argument that maintaining a main studio would place the station at a competitive disadvantage because the licensee's main studio waiver request was based only on financial considerations, which is not a valid basis for a waiver of the main studio rule. Moreover, the Bureau pointed out that even if the waiver had been granted and the licensee had then staffed the studio, corrective action after an investigation has commenced is expected by the FCC, and does not warrant reduction of cancellation of a fine. Therefore, the Bureau affirmed the fine of $20,000.

Automated Response to 911 Calls Leads to Substantial Fine

The Enforcement Bureau issued an NAL against an Oklahoma telephone company for routing 911 calls to an automated operator message in violation of the 911 Act and the FCC's Rules.

Under Section 64.3001 of the FCC's Rules, telecommunications carriers are required to transmit all 911 calls to a Public Safety Answering Point ("PSAP"), to a designated statewide default answering point, or to an appropriate local emergency authority. Section 64.3002(d) of the FCC's Rules further requires that if "no PSAP or statewide default answering point has been designated, and no appropriate local emergency authority has been selected by an authorized state or local entity, telecommunications carriers shall identify an appropriate local emergency authority, based on the exercise of reasonable judgment, and complete all translation and routing necessary to deliver 911 calls to such appropriate local emergency authority."

Continue reading "FCC Enforcement Monitor"

At Long Last, FCC Updates Its Tower Rules

Paul A. Cicelski

Posted August 15, 2014

By Paul A. Cicelski

The Federal Communications Commission recently adopted a Report and Order to streamline and eliminate outdated provisions of its Part 17 Rules governing the construction, marking, and lighting of antenna structures. According to the Commission, the goal was to "remove barriers to wireless deployment, reduce unnecessary costs, and encourage providers to continue to deploy advanced systems that facilitate safety while preserving the safeguards to protect historic, environmental and local interests." The question, as Commissioner O'Rielly put it, is "why did it take nine years to get this item before the Commission for a vote?" While it was a long time in coming, the changes the FCC made will be mostly welcomed by tower owners across the country.

The need for changes to the rules was first raised in the FCC's 2004 Biennial Ownership Review, and the FCC initiated a formal review of the antenna structure rules in 2010 in a Notice of Proposed Rulemaking. The FCC's goal in streamlining Part 17 of its rules was to improve compliance and enforcement while eliminating unnecessary and burdensome requirements for tower owners. The revised rules impact a number of regulations, and the hope is that the changes will also harmonize the FCC's rules with the safety recommendations and rules of the Federal Aviation Administration (FAA). That said, in its update, the FCC made a point of removing from its rules references to FAA Circulars that the FCC has determined are out of date.

The primary changes to the rules that tower owners should be aware of are:

Antenna Structure Marking and Lighting Specifications. The Order updated the FCC's rules to require that tower owners comply with the marking and lighting specifications included in the FAA's "no hazard" determination for that particular tower, thereby making FCC and FAA regulations consistent in this area. The Order also emphasized that changes to marking and lighting specifications on an Antenna Structure Registration (ASR) require prior approval from both the FAA and the FCC. Importantly, the FCC specifically declined to require existing antenna structures to comply with any new lighting or marking requirements unless mandated to do so by the FAA.

Accuracy of Height and Location Data. The FCC noted in the Order that its prior rules did not define what kinds of "alterations" to an existing tower required a new registration and FCC approval prior to making those changes. The new rules are clear that FCC approval is required for any change or correction to a structure of one foot or greater in height, or one second or greater in location, relative to the existing information in the structure's ASR form. The new criteria is the same as that used by the FAA for requiring a new aeronautical study and determination of "no hazard".

Notification of Construction or Dismantlement. Tower owners are now required to notify the FCC within five days of "when a construction or alteration of a structure reaches its greatest height, when a construction or alteration is dismantled or destroyed, and when there are changes in structure height or ownership." Under the prior rules, structure owners were given only 24 hours to provide notification to the FCC.

Voluntary Antenna Structure Registration. Under the FCC's prior rules, tower owners were given the option to voluntarily register structures even when the FCC's rules did not require registration. The new rules will still allow voluntary registration, but parties will be allowed to indicate that the registration is indeed voluntary, and they will not be subject to the Part 17 rules that apply to towers that are required to be registered (i.e., towers that exceed 200 feet or, for those located in close proximity to an airport, lower heights).

Posting of Antenna Structure Registrations. The new ASR posting requirement gives tower owners greater latitude regarding where they must post their Antenna Structure Registration numbers. The old rule required that the ASR number be displayed "in a conspicuous place so that it is readily visible near the base of the antenna structure." As a result of the rule change, registration numbers can now be posted at the "closest publicly accessible" location near the tower base.

Providing Antenna Structure Registration to Tower Tenants. Tenant copies of ASRs will no longer need to be given to tenants in paper. Under the new rules, a link to the FCC's website can be provided by mail or email.

Inspection of Structure Lights and Associated Control Equipment. The Order established a process allowing qualifying network operations center-based monitoring systems to be exempted from the existing quarterly inspection requirements that apply to automatic or mechanical control devices, indicators, and alarm systems used to ensure tower lighting systems are functioning properly. Specifically, systems with advanced self-diagnostic functions, an operations center staffed with "trained personnel capable of responding to alarms 24 hours per day, 365 days per year", and a backup network operations center that can monitor systems in the event of failure, may be eligible for the exemption.

Notification of Extinguishment or Improper Functioning of Lights. The FCC's rules require that when tower lights do go out, tower owners immediately notify the FAA so that the FAA can issue a Notice to Airmen (NOTAM) to make aircraft aware of the outage. Parties are also required to notify the FAA when repairs have been completed so that the FAA can cancel the NOTAM. Under the new rules, tower owners are required to keep the FAA up to date and let the FAA know when repairs are expected to be complete at the expiration of each NOTAM (which last 15 days each). The good news is that the FCC clarified its rules somewhat, stating that lighting repairs must be completed "as soon as practicable". Instead of adopting a fixed deadline for repairs to be made, the FCC will consider whether the tower owner has exercised due diligence and made good faith efforts to complete repairs in a timely manner.

Recordkeeping Requirements. Under the FCC's prior rules, there was no specification regarding how long records of improper functioning needed to be kept. Under the newly adopted rules, the FCC requires antenna structure owners to maintain records of observed or otherwise known outages or improper functioning of structure lights for two years, and the records must be provided to inspectors upon request.

Maintenance of Painting. With regard to painting, the FCC adopted the FAA's "In-Service Aviation Orange Tolerance Chart" as the standard for determining whether an antenna structure needs to be cleaned or repainted. The FCC did not say how often towers should be repainted or how close someone has to be to compare the colors on the chart with those on the tower. The FCC did say that placing the chart over a portion of the top half of the tower would give the best results, as that is where most of the wear and tear typically occurs.

The new rules will take effect thirty days after notice of the Order is published in the Federal Register (except for those provisions requiring Office of Management and Budget approval), which has not yet occurred. Despite the time it took to adopt new rules, the rule changes themselves are relatively straightforward, and tower owners should be sure to take advantage of the new rules when they take effect. It's not every day we see less regulation from the FCC.

Radio Public File Going Online?

Scott R. Flick

Posted August 8, 2014

By Scott R. Flick

For those who follow my speaking schedule on our CommLawCenter Events Calendar... wait, no one follows my speaking schedule? Disappointing. Well if you had, you would have known I was speaking on a pair of regulatory panels at the Texas Association of Broadcasters' convention yesterday (incidentally, another great show this year from Oscar Rodriguez and TAB's excellent staff).

On the first of those panels, with Stephen Lee of the FCC's Houston Enforcement Bureau office, we discussed the FCC's July 1st expansion of the TV online political file requirement to all TV stations. During that discussion, an audience member asked whether radio stations would someday have to put their public inspection files online as well. I noted that when the FCC moved TV public files online in August of 2012, it had indicated that it was starting with TV, but anticipated it would eventually consider moving radio public files online as well. However, in the two years since, the FCC has focused on working the bugs out of the online public file software and has not mentioned expanding the online requirement to radio.

Unknown to most, that changed unexpectedly about two hours after the panel, when the FCC released a Public Notice rapidly responding to a petition for rulemaking filed just six days earlier by the Campaign Legal Center, Common Cause and the Sunlight Foundation. The petition asked that cable and satellite providers also be required to post their political files online. While broadcasters and those three organizations (who have filed more than a dozen complaints against TV stations for alleged online political file violations in the past few months) haven't seen eye to eye on much in the past, this might be one requirement they can agree on, albeit for very different reasons.

While the original purpose of the political file was to ensure that candidates had the information needed to enforce their rights to equal opportunity and lowest unit rate for advertising, the Campaign Legal Center, Common Cause and the Sunlight Foundation have sought to use it instead to track political spending by PACs, since that information is not available, at least in real time, from the Federal Election Commission. To make it easier for them to access this information, they demanded the FCC require that TV stations post their political files online. They have also urged the FCC to require TV stations' political files be posted in a machine-readable format to make aggregating the information easier.

Broadcasters opposed those efforts, noting the burden of keeping the fast-changing political file up to date online, and the competitive concerns with posting sensitive ad rate data online for all the world to see. In particular, they found it competitively unfair that broadcasters were required to post their ad rate information online when competing cable and satellite providers were not.

The FCC agreed, and when it decided to require that TV stations post their public files online, it originally excluded the political file from that requirement, finding that uploading and updating the political file online would be too burdensome. However, after a change in personnel at the FCC, the agency reversed course and concluded that posting the political file online wouldn't be burdensome after all.

Television broadcasters therefore likely welcomed yesterday's Public Notice seeking comment on at least leveling the information playing field with cable and satellite. However, buried in the middle of the Public Notice, and completely unrelated to the petition for rulemaking on cable and satellite political files to which the Public Notice responds, is a single sentence sending chills down the collective spines of radio broadcasters:

"We also seek comment on whether the Commission should initiate a rulemaking proceeding to require broadcast radio stations to use the online public file, and on an appropriate time frame for such a requirement."

While the need to first launch a rulemaking means that a radio online public file requirement would take at least some time to implement, it appears that it is indeed (spontaneously) back on the FCC's agenda. With staffs that are typically much smaller than those of TV stations, radio stations would undoubtedly find an online public file requirement to be far more burdensome than it was for TV (not that TV stations found it to be a picnic either). If they don't want to find themselves facing that very burden in the not too distant future, radio licensees will need to speak up in what most would have assumed is a completely unrelated proceeding. To the broadcaster who asked that question at yesterday's panel, the FCC has quietly changed my answer.

FCC's New Video Captioning Rules Go Online

Paul A. Cicelski

Posted August 7, 2014

By Paul A. Cicelski

The FCC's July 11, 2014 Order, concluding that clips of video programming shown by broadcasters are required to be captioned when delivered on the Internet, was published in the Federal Register this week. The rule specifically applies when a provider posts a video clip or video programming online that was first aired on television ("covered" Internet Protocol (IP) video). The FCC ultimately plans to expand its Twenty-First Century Communications and Video Accessibility Act of 2010 (CVAA) captioning rules to cover all forms of video programming on the Internet.

As I have discussed many times previously, the FCC requires that certain video programming delivered online by television stations be captioned if that programming previously aired on television with captions. Some of my recent posts on the subject can be found at the following links: "FCC Seeks Greater Clarity on IP Video Captioning Rules", "Second Online Captioning Deadline Arrives March 30", and "First Online Video Closed Captioning Deadline Is Here".

More recently, I noted that the FCC sought comment on information regarding whether it should remove the "video clip" exemption from its rules. The FCC's final answer was "yes". The rules will apply to video clips regardless of their content or length.

According to the FCC, the new rules are intended to accomplish the following:

  • Extend the IP closed captioning requirements to IP-delivered video clips if the video programming distributor or provider posts on its Web site or application a video clip of video programming that it published or exhibited on television in the United States with captions;
  • Establish a schedule of deadlines for purposes of the IP closed captioning requirements;
  • After the applicable deadlines, require IP-delivered video clips to be provided with closed captions at the time the clips are posted online, except as otherwise provided;
  • Find that compliance with the new requirements would be economically burdensome for video clips that are in the video programming distributor's or provider's online library before January 1, 2016 for "straight lift clips", and January 1, 2017 for "montages"; and
  • Apply the IP closed captioning requirements to video clips in the same manner that they apply to full-length video programming, which among other things means that the quality requirements applicable to full-length IP-delivered video programming will apply to video clips.

In its Order, the FCC also established the following set of deadlines for providing captions based on the type of video clip shown:

  • January 1, 2016: for "straight lift" clips, which include a "single excerpt of a captioned television program with the same video and audio that was presented on television";
  • January 1, 2017: for "montages", which are defined as a single file containing "multiple straight lift clips"; and
  • July 1, 2017: for "video clips of live and near-live television programming, such as news or sporting events", keeping in mind that there is a "grace period" of twelve hours to caption "live video programming" and eight hours to caption "near-live programming."

As part of the item, the FCC also issued a Second Further Notice of Proposed Rulemaking, which proposes to extend the reach of the FCC's captioning rules even further. Among other things, the Further Notice is specifically asking for comment regarding whether: (1) third party video programming providers and distributors should be subject to the closed captioning requirements; (2) the FCC should decrease or eliminate the "grace periods" for "live" and "near-live" programming; (3) application of the IP closed captioning requirements should be extended to "mash-ups", which the FCC defines as files that "contain a combination of video clips that have been shown on television with captions and online-only content"; and (4) application of the IP closed captioning rules to "advance" video clips "that are first added to the video programming distributor's or provider's library on or after January 1, 2016 for straight lift clips or January 1, 2017 for montages, but before the associated video programming is shown on television with captions, and which then remain online in the distributor's or provider's library after being shown on television."

Comments on the Further Notice are due October 6, 2014, and reply comments are due November 3, 2014.

As is often the case, the new closed captioning rules adopted by the FCC are complex and parties should make sure that they remain up to speed with the rapid pace of the ever evolving rules in this area. The Order and Further Notice demonstrate that the FCC appears far from satisfied with the many new closed captioning rules that it has already adopted in recent years and that there will undoubtedly be additional rules to deal with in the not too distant future.