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As someone who has been deeply involved in planning for the rollout of ATSC 3.0, I get a lot of questions about the next generation broadcasting standard. By far the two most common questions are “When will the transition start?” and “When will it end?”  My answers—which often lead to quizzical looks—are “Very soon.  And never.”

The visible transition to 3.0 in the United States will begin almost immediately after the FCC approves use of the new technology. Transmitters being built today are 3.0 ready, and many hundreds (perhaps more than a thousand) of these transmitters will be installed as a necessary part of the post-incentive auction repacking process.  Broadcasters are already discussing how to provide ATSC 1.0 simulcasts in many markets so that some stations can begin transmitting in 3.0.  Korean television stations will launch ATSC 3.0 broadcasts beginning in May of this year, accelerating the availability of 3.0-compatible receivers.  So, the transition will begin soon.  I would argue it is already underway.

When I say the transition will never end, I don’t mean the broadcast industry is entering its groundhog day. Quite the opposite.  I mean that ATSC 3.0 provides enormous headroom for broadcasting to continue to grow and evolve long after all stations have made the initial conversion.

And that’s the beauty of ATSC 3.0. It will bring a foundational change to the capabilities of our national television broadcast infrastructure.  Most important, it allows broadcasters to continually expand, enhance and improve the services they offer, even after all stations have converted to 3.0.  That’s why I say the “transition” will never end.

Though we can’t put a date on the end, we do know what the first steps are.

Step 1 – Upgrade to 3.0. Within a matter of years, most or perhaps all stations will have completed the transition to ATSC 3.0, in the sense that they will be broadcasting 3.0 signals.  But the services offered, and the networks and systems behind those services, can evolve to meet the changing demands of the incredibly robust and dynamic marketplace in which broadcasters must compete. Continue reading →

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As he rushes to accomplish his list of objectives before the change in administrations, FCC Chairman Tom Wheeler was able to cross one off that list last week. For the first time, the FCC imposed privacy requirements on providers of broadband internet access services (BIAS). The much-anticipated Order requires BIAS providers to notify customers about the types of information the BIAS providers collect about their customers; how and for what purposes the BIAS provider uses and shares this information; and in some circumstances requires customer consent for the use and sharing of this information. This order was an outgrowth of the FCC’s 2015 Open Internet Order, which reclassified BIAS as a telecommunications service and wrested privacy jurisdiction from the Federal Trade Commission.

Continue reading →

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The NAB has negotiated a waiver agreement with Sony Music Entertainment that will once again enable radio stations to stream Sony-licensed music unhindered by certain restrictions established by the statutory music streaming license. Stations wishing to take advantage of the Sony waiver need to opt in on the NAB website, and (depending on the amount of streaming they do) may need to place a button on their websites or apps to enable listeners to click through to purchase Sony song downloads.  A previous waiver agreement with Sony, as extended, expired on July 31, 2016, leaving stations without a waiver for the past few months.  NAB’s new agreement with Sony will last until December 31, 2020.

Continue reading →

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The era of newsgathering drones is upon us.  Since new Federal Aviation Administration rules allowing limited commercial operation of drones (also known as unmanned aircraft systems or UAS) weighing 55 lbs. or less took effect a little over a month ago, media organizations have moved quickly to utilize the technology.

Sinclair Broadcast Group, which operates or provides services to 173 television stations across the country, recently announced it was going “all in” on newsgathering drones.  It plans to have 80 trained and certified UAS pilots working in 40 markets by the end of 2017, and already has launched UAS teams for newsgathering in Washington, DC; Baltimore, MD; Green Bay, WI; Columbus, OH; Little Rock, AR; and Tulsa, OK.  Providing an example of the benefits drones can bring to newsgathering, Sinclair released footage taken over the Cedar River in Cedar Rapids, IA, showing an aerial perspective of a newly constructed flood wall as the city braced for flooding.

Sinclair’s announcement comes on the heels of CNN’s launch of CNN Aerial Imagery and Reporting (CNN AIR), a unit with two full-time drone operators dedicated to integrating aerial imagery and reporting across CNN networks.

Broadcasters and other organizations with newsgathering operations are increasingly taking advantage of the FAA’s new “Part 107” rules, which took effect on August 29, 2016.  The small drones authorized under the rules offer broadcasters and other news organizations a cost-effective way to gather aerial footage, especially as compared to the cost of using helicopters.  While the Part 107 rules have paved the way for widespread use of newsgathering drones, broadcasters and other potential UAS operators should keep in mind that some requirements must be met before UAS operations can commence.

To protect the public, the Part 107 rules come with a number of operational limitations on UAS operation.  However, if a party can demonstrate the ability to operate safely while deviating from a specific limitation, the FAA may grant a waiver of one or more of the specific limitations found in its rules.  With regard to newsgathering operations, the most relevant limitations (and therefore good candidates for waiver requests) include the prohibitions on flights above people not participating in the UAS operation, flights beyond visual line of sight, flights above 400 feet (or more than 400 feet above a building or other structure), and nighttime flights.  The FAA has added a portal to its website for waiver applications, and has recorded a standard-issue government YouTube video on the subject.  For an example of a waiver that has been granted, take a look at CNN’s waiver for flights over non-participants.

In addition, the Part 107 rules require those operating small drones to either hold a “remote pilot certificate” or be under the supervision of a person who holds such a certificate.  To qualify for a certificate, the applicant must be at least 16 years old, be vetted by the Transportation Security Administration, and pass an aeronautical knowledge test at an FAA-approved testing center.  The FAA offers a free online preparation course for the knowledge test.  In addition to pilot certification, Part 107 requires that all drones used for commercial purposes be marked and registered.  Drones can be registered through the FAA’s website.

Pillsbury launched one of the nation’s first UAS legal teams long before commercial operations were possible, and being a part of these developments has been fascinating.  Because of the myriad issues UAS operations involve, Pillsbury’s UAS practice consists of an interdisciplinary team of lawyers from our Aviation, Communications, Privacy, and Transportation practices.  Those contemplating entering the world of UAS operations for newsgathering or other purposes will find the UAS team’s blog and advisories an excellent place to start.

It’s time to stop reading about drones in the news, and start reading news brought to us by drones.

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The FCC has sent an email to those registered in the EAS Test Reporting System (“ETRS”) for tomorrow’s nationwide test, asking them to (1) stagger the filing of their EAS Form Two based on their time zone, and (2) not file Form Three until the day after the test.  The FCC explained that the request—the staggered filing times are not mandatory—is meant to “maximize the resources available to process Form Two filings.”

Specifically, the FCC would like EAS participants to file Form Two, “Day of Test Reporting,” in the ETRS as follows:

  • Facilities in Eastern Time Zone – 2:30 pm to 5:00 pm EDT
  • Facilities in Central Time Zone – 5:00 pm to 7:00 pm EDT (4:00 pm to 6:00 pm CDT)
  • Facilities in Mountain Time Zone – 7:00 pm to 8:00 pm EDT (5:00 pm to 6:00 pm MDT)
  • Facilities in Pacific Time Zone – 8:00 pm to 9:30 pm EDT (5:00 pm to 6:30 pm PDT)
  • Facilities in all other time zones – 9:30 pm to 11:59 pm EDT

The request seemed last-minute, coming so soon before the test, which is scheduled to take place tomorrow, Wednesday, September 28, 2016, at 2:20 pm Eastern Time (if necessary, the back-up test date will be October 5, 2016, at 2:20 pm Eastern Time).  As we previously discussed, it raised some eyebrows when the FCC announced that EAS participants are required to file Form Two by 11:59 pm Eastern Time on the same day as the test itself, leaving less than 10 hours after the test for all EAS participants to file.  The relevant FCC rule says that participants must file “within 24 hours . . . or as otherwise directed” by the FCC.  As for Form Three, “Detailed Test Reporting,” it must be filed “within 45 days following a nationwide EAS test,” which makes it due on or before November 14, 2016.

There are also new details available on what the test itself will look and sound like.  According to senior FEMA staff, the audio portion of the test, including attention signals, will last approximately 50 seconds.  In addition, FEMA was asked to delete a previously included statement in the text scroll—“No action is needed.  This is only a test”—to avoid creating a difference between the aural and visual presentations, which had the potential to generate confusion among those with hearing or vision issues.

The test will start when FEMA sends the alert message, which will be in both English and Spanish.  The alert will use a new nationwide test event code, NPT, and a new nationwide geographic zone code, 000000.  As of July 30, 2016, all EAS Participants were required to have equipment in place capable of receiving and passing these codes.  If you want to see what the 2011 test looked like for TV viewers, YouTube can help you there.

It will be interesting to see if the 2016 nationwide EAS test improves on the 2011 edition.  As we previously wrote, the FCC found a number of technical areas where the system could be improved in the 2011 test.  Let’s hope that the capacity of ETRS to process filings, or a lack thereof, is not a lesson learned from the 2016 national test.

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Just before the Labor Day weekend, the FCC issued its Report and Order launching the annual regulatory fee payment process for Fiscal Year 2016.  The FCC has also opened the “Fee Filer” system that must be used to pay regulatory fees.  More information and FAQs about the FY 2016 regulatory fees can be found here.

Payment in full of regulatory fees must be made by 11:59 p.m. Eastern Time on September 27, 2016. Late payment of regulatory fees will result in a 25% penalty and “red light” status, which restricts the FCC’s processing of a late payer’s applications until payment of the fees and penalties has been made.  The FCC specifically reminded participants in the ongoing TV broadcast Incentive Auction that they must pay regulatory fees for FY 2016 if they held a license or construction permit as of October 1, 2015 (and will be liable for next year’s fees if they hold a license or CP as of October 1, 2016).  The FCC also noted that payment of regulatory fees is required before Incentive Auction participants can receive any proceeds resulting from the auction, although given the pace at which the auction is proceeding, that seems unlikely to be an issue until well into next year.

As expected, regulatory fees for broadcast stations generally increased over last year, and the total fees assessed rose from $339,844,000 in FY 2015 to $384,012,497 in FY 2016.  Although the fees assessed for “operational expenses” remained the same as last year, the FCC (in a move which some might find ironic) assessed an additional $44,168,497 to offset FCC “facilities reduction costs.”  According to the FCC, those costs reflect the one-time expense of reducing the FCC’s office footprint and/or moving the FCC to a new location, and are required by Congress to be collected.

Despite the increase in total fees, middle market TV stations caught a break, with fees for stations in markets 51-100 falling from $16,275 last year to $15,200 this year. Fees for TV stations in markets 1-10, on the other hand, took the biggest jump — going from $46,825 to $60,675.

As for radio, rates increased over last year for most, but not all, stations.  In light of comments asserting that the regulatory fees proposed by the FCC last May were too burdensome for small independent radio stations, the FCC reduced the fees in the two lowest population tiers for AM and FM broadcasters.  Stations located in markets with populations of more than 3 million, previously the highest of the radio fee tiers, have been split into two groups by the FCC: (1) markets of 3,000,000-6,000,000, and (2) markets over 6,000,000.  Charts showing the regulatory fees for the various TV and radio groups are below:

Broadcast Television and TV/FM Translators and Boosters

Markets 1-10 $60,675
Markets 11-25 $45,675
Markets 26-50 $30,525
Markets 51-100 $15,200
Remaining Markets $5,000
Construction Permits $5,000
Satellite TV Stations (all markets) $1,750
Low Power TV, Class A TV, TV/FM Translators & Boosters $455

 

Broadcast Radio (AM and Full Power FM)

Population AM Class A AM Class B AM Class C AM Class D FM Classes A, B1 & C3 FM Classes B, C, C0, C1 & C2
25,000 or fewer $990 $715 $620 $685 $1,075 $1,250
25,001-75,000 $1,475 $1,075 $925 $1,025 $1,625 $1,850
75,001-150,000 $2,200 $1,600 $1,375 $1,525 $2,400 $2,750
150,001-500,000 $3,300 $2,375 $2,075 $2,275 $3,600 $4,125
500,001-1,200,000 $5,500 $3,975 $3,450 $3,800 $6,000 $6,875
1,200,001-3,000,000 $8,250 $5,950 $5,175 $5,700 $9,000 $10,300
3,000,001-6,000,000 $11,000 $7,950 $6,900 $7,600 $12,000 $13,750
Greater than 6,000,000 $13,750 $9,950 $8,625 $9,500 $15,000 $17,175

In addition, initial AM Construction Permits were assessed a $620 regulatory fee per station for FY 2016, with initial FM Construction Permits drawing a regulatory fee of $1,075 per station.

Finally, the FCC rejected a proposal by the Puerto Rico Broadcasters Association to reduce regulatory fees for stations located in Puerto Rico by 30% to reflect the economic hardships being experienced there.  The FCC responded that individual stations in Puerto Rico may request waivers of regulatory fees if they believe their conditions warrant such relief, but the Commission was unwilling to reduce the fees on a blanket basis.

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As we previously reported, the FCC last year adopted a number of changes to its rules and policies aimed at revitalizing the AM radio service, which for many years has lived in the shadow of the more robust FM service.  One of these changes was to expand the ability of AM broadcasters to use FM translators to rebroadcast their AM signals, thereby improving coverage, particularly at night.  To accomplish this, the FCC gave each AM station the right to file one, and only one, application to move an FM translator up to 250 miles and change the translator’s frequency, provided that it is used to rebroadcast the designated AM station for the next four years.  If that application does not make it through the FCC process for any reason, the broadcaster is barred from filing another.

The FCC gave smaller Class C and D AM stations first crack at its new policy by opening a window on January 29, 2016, during which Class C and D licensees could file modification applications on a first-come, first-served basis.  In other words, if you filed your application on January 29, you trumped anyone who filed a conflicting application after that date.  If parties file mutually exclusive applications on the same day, the applicants need to resolve the mutual exclusivity through settlement negotiations and/or technical amendments (e.g., one or both parties move to a different frequency).

The first window, limited to Class C and D AM stations, closes on July 28, 2016.  On the next day, July 29, a second window opens during which Class A and B AM stations (as well as Class C and D stations that did not file in the first window) may file modification applications to relocate FM translators to be used for AM station rebroadcasts.

AM stations that have not yet filed should keep in mind that:

  1. If you have a Class A or B AM station and plan to relocate an FM translator for AM rebroadcast purposes, you should get your modification application filed on July 29 in order to give yourself the maximum protection against being bumped by an earlier-filed mutually exclusive application.  If you are planning to buy a translator but haven’t actually acquired it yet, there are still ways to get the modification application on file before closing the acquisition.
  2. If you have a Class C or D AM station and plan to relocate an FM translator for rebroadcasts (and haven’t filed a modification application yet), file by July 28.  While Class C and D stations will not be precluded from filing in the second window, July 29 is sure to bring a wave of new modification applications that will change the translator landscape significantly.

But even having these deadlines circled on your calendar won’t help if your modification application is dismissed.  When it comes to modification applications filed in either of these windows, the FCC has made clear that its policy is one and done.  A dismissed application means that you not only lose your place in the processing line, but cannot file again in the windows.  Such a dismissal could occur due not only to deficiencies in the application itself, but also if your deal to acquire the translator falls through.  AM broadcasters buying a translator are therefore well advised to pay careful attention to the due diligence process, the closing conditions in the acquisition agreement, the compliance of the proposed move with FCC technical rules, and their financing for the acquisition.  If a deal falls through, the reason is irrelevant.  You’ll be sitting out the filing window watching your competitors get their FM translators.

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On a day when a major broadcast ownership decision from the U.S. Court of Appeals for the Third Circuit garnered most of the attention, the FCC worked on more prosaic matters, issuing a Notice of Proposed Rulemaking to eliminate the requirement that commercial broadcast stations maintain letters and e-mails from the public in their public file.  This requirement is one of the only vestiges of the physical public file that remained after the FCC’s decisions to move television and radio public files online.

The FCC based its proposal to eliminate the requirement in part upon the increase in communication between the public and broadcast stations on social media platforms, and the corresponding decrease in communication by letter and e-mail.  The NPRM also proposes to eliminate a requirement that cable television operators maintain the location of their cable system’s principal headend in their public file.

Initial comments on the FCC’s proposals will be due 30 days after the NPRM is published in the Federal Register, with reply comments due 60 days after Federal Register publication.

As we wrote recently, eliminating the requirement to maintain correspondence from the public in a physical file would free stations from the need to provide free and unfettered access to their offices, and to maintain staff at all times during business hours ready to handle public file requests.

The NPRM enjoyed support from all five Commissioners, each of whom issued a separate statement in support of the proposal—a somewhat rare display of unanimity by the current Commission.  Of particular interest was Chairman Wheeler’s statement that today’s proposal, if adopted, would enable broadcasters to “lock their doors and redeploy resources once used to help the public access the file at the studio.”  Many in the TV and radio community may find themselves quietly nodding in agreement.

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In a long-anticipated move towards commencement of the spectrum auction, the FCC today released a Public Notice and related Appendix providing an initial clearing target of 126 Megahertz of spectrum in what is currently the broadcast television band. The 126 MHz figure represents the targeted amount of spectrum to be repurposed from broadcast television to mobile wireless uses.  The FCC also announced that bidding in the reverse auction will commence on May 31, 2016.

The 126 MHz target is the highest the FCC was contemplating, and indicates that a large number of television stations have chosen to participate in the auction.  By setting a high clearing target, the FCC is maximizing the amount of broadcast spectrum purchased, but increasing the risk that if there is insufficient interest in the forward auction for this amount of spectrum (at the prices the FCC needs to pay selling broadcasters and cover other costs), the auction may have to be redone with a lower clearing target.

In the forward auction, the FCC will offer 10 paired blocks of spectrum, each block comprised of 10 MHz, to mobile wireless bidders.  The remaining 26 MHz of spectrum to be cleared will be used for guard band and duplex gap purposes; i.e., to protect adjacent users from interference.  If the auction is completed with the 126 MHz clearing target, the post-auction television broadcast band will consist of VHF channels 2-13 and UHF channels 14-29.  The process of repacking stations into channels 2-29 would commence following completion of the auction, and is estimated by the FCC to take approximately three years, although many have questioned whether that is sufficient time for the repack.

With the release of the clearing target information, the FCC has locked in all of the following dates for auction-related events:

May 4, 2016, noon:  Date by which each television broadcast licensee that made an initial commitment in the reverse auction must receive a third confidential status letter from the FCC.  That letter will inform the applicant whether its station(s) will be qualified to participate in the reverse auction.  Applicants who have not received this letter by noon (Eastern Time) on May 4 should contact the FCC Auctions Hotline at (717)338-2868.

May 5, 2016: FCC Incentive Auction Reverse Auction Bidding System User Guide available on Auctions webpage.

May 18, 2016:  Online Bidding Tutorial available on Auctions webpage.

May 23, 2016, 10 a.m.:  Bidding Preview Period begins.

May 24, 2016, 10 a.m.:  Clock Phase Workshop.

May 24, 2016, 6 p.m.:  Bidding Review Period ends.

May 25, 2016, 10 a.m.:  Mock Auction Bidding Round 1.  Additional Mock Auction Rounds occur throughout May 25 and May 26.

May 31, 2016:  Bidding in the reverse auction commences for qualified applicants, with a single round of bidding on May 31 and June 1, and two rounds per day starting on June 2.

While it is unclear how many rounds of bidding will be required before the auction closes, or whether the 126 MHz target might lead to a repeat of the reverse auction, today’s news brings a palpable sense that the auction has really begun.  How successful the auction will be for broadcasters, mobile wireless companies, and the FCC will be a developing story.  Stay tuned for more updates.

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In a recently issued Notice of Proposed Rulemaking, the FCC asked for comments on proposed rules that would apply the traditional privacy requirements of the Communications Act to providers of broadband Internet access services. This proceeding is an outgrowth of the FCC’s decision last year in the Open Internet Order to reclassify broadband as a telecommunications service, subject to certain requirements under Title II of the Communications Act.  Specifically, Section 222 of the Act imposes privacy obligations on telecommunications carriers and, in this proceeding, the FCC is considering whether to apply those rules, or other rules that might be more applicable to protect consumers, to providers of Internet access services.

The proposed rules focus on transparency, choice and data security. According to the FCC, adoption of the rules will ensure that consumers (i) have the information needed to understand what data broadband providers are collecting and what they do with that information, (ii) can decide how their information is used, and (iii) are protected against the unauthorized disclosure of their information.

  • Transparency. The FCC expects that broadband providers’ privacy policies would include disclosure of what information they collect and for what purpose, what information is shared and with whom, and how consumers can opt in or out of use and sharing of their personal information.
  • Choice. The proposed rules allow the use of personal information as needed to provide broadband services and for other purposes that make sense within the context of the service provider-customer relationship. They also allow service providers to use customer personal information to market other communications services unless the consumer opts out of such usage, but require specific opt-in approval from customers before broadband providers can share customer information with third parties that do not offer communications services.  The proposed rules include mechanisms to document customer opt-in and opt-out choices and provisions on how to notify customers of privacy policies.
  • Data Security. Broadband providers would be required to ensure the security, confidentiality and integrity of any customer information they receive. This would include requirements for regular risk management assessments and training of employees that handle customer information.   The NPRM also proposes to require broadband providers to notify affected customers within ten days of the discovery of a data breach that triggers customer notification requirements, and seeks comment on whether broadband providers should also notify customers after discovery of conduct that could reasonably be tied to a breach.  Further, the NPRM proposes to require broadband providers to notify the FCC of all data breaches, and to notify other federal law enforcement of breaches that impact more than 5,000 customers.  The NPRM proposes to require notification to federal law enforcement within seven days of discovery of such a breach, and three days before notification to the customer, and would allow law enforcement to seek delay of customer notification.  Broadband providers would be required to keep records of any data breaches and notifications for a minimum of two years.

The FCC suggested that it broadly wants to protect personally identifiable information, which, in the broadband context, would include any information that is linked or linkable to an individual and is acquired by the service provider in connection with its provision of broadband services. This could include:  (1) service plan information, including type of service (e.g., cable, fiber, or mobile), service tier (e.g., speed), pricing, and capacity (e.g., information pertaining to data caps); (2) geo-location; (3) media access control (MAC) addresses and other device identifiers; (4) source and destination Internet Protocol (IP) addresses and domain name information; and (5) traffic statistics.  The FCC seeks comments on whether other types of information should also be protected, including port information, application headers, application usage and customer equipment information.

The FCC acknowledged that there are existing state privacy laws that could overlap with the proposed rules. To resolve any conflicts, the proposed rules would preempt state laws that were inconsistent with the FCC’s rules—with the FCC making preemption determinations on a case-by-case basis.  In addition, the rules would prohibit broadband providers from conditioning the offering of service, or the continuation of services, on a customer’s agreement to waive privacy rights guaranteed by law or regulation.

The proposed rules, like the Open Internet Order itself, drew dissents from Republican Commissioners Pai and O’Rielly.  They question the FCC’s jurisdiction to regulate Internet service providers, suggest that the Federal Trade Commission has established standards and precedents to protect consumer privacy, and question whether any rules can be effective that are not also applied to edge and content providers, such as Netflix and Twitter. The Open Internet Order is currently being appealed in the United States Court of Appeals for the DC Circuit, and a decision is expected within the next three months.

Comments on the proposed rules are due May 27, 2016.  Reply Comments are due June 27, 2016.