In recent weeks, with so many government officials looking to get messages out about the coronavirus pandemic, we have received many questions about issues that arise when political candidates appear on public service-type announcements – either free PSAs provided by the station or paid spots purchased by some governmental entity.  While such announcements can be run by stations, if a legally qualified candidate personally appears in the spot (their recognizable voice in a radio ad or their voice or picture in a TV ad), stations need to note the advertising purchase in their FCC Online Public Inspection File, as these spots constitute a “use” by a candidate, and they can also give rise to equal opportunities by opposing candidates.

If the use is in a spot on which the candidate appears is a paid-for spot, then any equal time to which opposing candidates are entitled would be on a similar paid-for basis.  This is the same situation as if a commercial advertiser who voices or appears in their own ads decides to run for office (see our article here).  But if the spot is a free PSA, then the appearance of a legally qualified candidate, even if the PSA says nothing about their campaign, can trigger the requirement to give free equal time to any opposing candidates who make any equal opportunities request within seven days.

To avoid these issues, if the candidate does not personally appear in a spot, and the spot is not about their campaign, no equal opportunities and likely no public file obligations will arise.  So, for instance, an ad from a Congressman’s office that refers constituents to the Congressman’s website for more information about relief efforts, that is voiced by a staff person to the Congressman, likely will not trigger these obligations.  Similarly, a professionally voiced ad on behalf of the state Attorney General or Secretary of State would likely not trigger public file or equal time issues, even if the office-holder is running for office, as long as the candidate does not appear, and as long as the ad does not raise political or controversial issues.

Appearances by political candidates in exempt programs – news or public affairs or on-the-spot-coverage of a news event – don’t trigger equal opportunities or public file obligations.  A discussion with a Congressman or other local elected official on your news or talk program to discuss current issues, where the program and its content is controlled by the station and where decisions about guests are made on the basis of their newsworthiness and not for partisan purposes, should not trigger equal opportunities or public file obligations.  The same would be true for coverage of press conferences or similar events that have current news value.  See our article here for more on these exempt programs.

Of course, all these legal determinations depend very much on the facts, and thus on any specific legal issue, you should talk to your station’s own attorney who can provide a more detailed answer based on the circumstances in specific cases.   Just be alert to these circumstances where the appearance of a candidate in a PSA can trigger both public file and equal opportunities issues.

Courtesy Broadcast Law Blog

Here are some of the FCC regulatory and legal actions of the last week of significance to broadcasters, with links to where you can go to find more information as to how these actions may affect your operations.

• The FCC released the agenda for its June 9 Open Meeting announcing that it will consider an item of interest to TV broadcasters planning to transition to ATSC 3.0, the next generation television transmission standard. The item deals with what the FCC is calling “Broadcast Internet services,” new IP based services compatible with other Internet devices that will allow TV broadcasters to monetize their ATSC 3.0 spectrum in new ways.  If adopted at the June meeting, the item, which we summarized in this article on the Broadcast Law Blog, would do two things:
  • It would allow a broadcaster to enter into spectrum lease agreements with other companies who offer Broadcast Internet services on the spectrum of several television stations in the same market without triggering the Commission’s attribution or multiple ownership rules.
  • It would seek comment on ideas for changing the FCC’s rules to further promote the deployment of Broadcast Internet services as part of ATSC 3.0. (draft of the Declaratory Ruling and Notice of Proposed Rulemaking)
• The FCC last week announced that comments are due by June 22 in the review of its video description rules. Video description refers to an audio channel provided to accompany TV programming giving a narration of what is happening on the screen to aid blind or visually impaired persons.  Currently, ABC, CBS, Fox, and NBC stations in the top 60 markets must supply video described programming, but under the FCC’s proposed new rules, those requirements would extend to markets 61 through 100 by January 1, 2021, with ten markets being added in the following four years.  For more on the proposed rule changes, see our post at the Broadcast Law Blog.  (Public Notice)
• After announcing the settlement terms earlier this month, the FCC released the details of its consent decree with Sinclair Broadcast Group. The consent decree dealt with (i) disclosure issues around Sinclair’s failed takeover of Tribune Media Company; (ii) the accuracy and completeness of certain Sinclair applications; (iii) complaints of Sinclair’s noncompliance with the good-faith rules for retransmission consent negotiations; and (iv) on-air sponsor identification lapses.  Though the Commission ultimately found that Sinclair structured the Tribune deal and made disclosures about its plans according to a good faith interpretation of the Commission’s rules, Sinclair nevertheless agreed to a $48 million penalty and four-year compliance plan to resolve all issues about these matters.  (Order)  See Broadcast Law Blog articles on the sponsorship identification issue when it was first raised  in a 2017 Notice of Apparent Liability (here) and a prior Sinclair issue with retransmission consent negotiations (here).
• FCC staff last week clarified, albeit informally as part of a webcast (as part of the NAB Show Express, available on demand here), that stations in states where the primary election date has been pushed back due to public health concerns may be subject to longer lowest unit charge (LUC) periods. In states where the 45-day window opened and then the primary election date was pushed back, a new window begins 45 days before the new date of the primary election.  This could potentially result in a nearly 90-day LUC window tied to one election.  See our article here from the Broadcast Law Blog where we explained how the postponed primaries would extend LUC windows.
  • As part of that same webcast, FCC staff reminded stations running special COVID-related public service announcements that featuring a candidate standing for election this year can trigger equal opportunities and public file obligations. If the candidate appearance is on a paid spot, the equal opportunities rights of opposing candidates would be to buy an equal number of paid spots.  If the PSAs were run for free, then the candidate’s opponents are entitled, upon request, to the equivalent amount of free airtime.  Look for more on this issue in the Broadcast Law Blog this week.
• The FCC acted last week in two TV market modification proceedings that are good illustrations of the necessary elements of a petition for a change in the television market to which a county or other geographical subdivision is assigned for determining which stations are local for cable of satellite television carriage purposes. In the first, it rejected a petition submitted by Montezuma County, Colorado to modify the county’s DMA, so the county’s DISH Network customers could receive Denver’s KUSA.  The Commission found that the county did not submit enough evidence to prove the need for market modification.  In the second, the Commission upheld its Media Bureau’s decision to modify the markets of three Georgia counties, so that DISH and DIRECTV customers in those counties could receive four Atlanta TV stations.  The Commission denied the appeal of the Greenville-Spartanburg-Asheville-Anderson DMA TV stations carefully analyzing the factors necessary to support the modification of the market and finding no reason to change the Bureau’s ruling.  (Montezuma Market Modification) (Atlanta Market Modification)
• The FCC declined to review its decision to cancel the license of KCPM(TV), Fargo, ND. The Media Bureau found that the station failed to transmit a signal for twelve consecutive months, which resulted in an automatic expiration of the license.  This is a good reminder for station operators, and especially important for stations that may have gone silent during the current pandemic, to notify the FCC when a station goes silent and to re-commence operations within a year to avoid automatic cancellation  of the station’s license. (FCC Letter) See this article from the Broadcast Law Blog about the FCC requirements for notice when a station goes silent, the article here about actions that the FCC can take against stations that fail to operate regularly during a license renewal term, and the article here about the strict interpretation that the FCC gives to Section 312(g) of the Communications Act which provides for the automatic cancellation of a license if a station has been silent for a year unless the FCC finds that preserving the license is necessary for reasons of equity and fairness, a finding rarely made.

Courtesy Broadcast Law Blog

The FCC currently requires what they now call “video description” by commercial television broadcast stations that are affiliated with one of the top four commercial television broadcast networks (ABC, CBS, Fox, and NBC) and located in the top 60 television markets.  Video description is also required of MVPDs with 50,000 or more subscribers passing through content of the Top 5 cable networks.  TV stations subject to the rules are required to provide on a subchannel audio descriptions of at least 50 hours of video programming per calendar quarter during prime time or on children’s programming, as well as an additional 37.5 hours of video-described programming per calendar quarter at any time between 6 a.m. and midnight.  These descriptions are provided by the networks and passed through by the local station affiliates to allow the blind and visually impaired people to follow the action in video programming on their TVs.

In a Notice of Proposed Rulemaking adopted in April, the FCC proposes to expand the video description requirements to network-affiliated stations in television markets 61 through 100 starting January 1, 2021, followed by an additional 10 TV markets each year for the next four years.  This proposal was just published in the Federal Register, setting a deadline for the filing of comments of June 22, 2020, with reply comments due by July 6, 2020.

In the NPRM, the FCC proposes additional actions and asks questions including the following:

• Proposes that the Commission determine in 2023 whether to continue expanding to an additional 10 DMAs per year, subject to the reasonableness of associated costs.
• Proposes that, in determining which DMAs are subject to the video description requirements, the FCC should use an updated, current Nielsen determination.
• Seeks comment on the costs and burdens associated with this expansion and whether it should account for the current coronavirus pandemic in evaluating the reasonableness of those costs.
• Seeks comments on the standards to be used for evaluating requests for waivers of the requirements for video description by those subject to the requirements of the rules.
• Proposes to begin using the phrase “audio description” instead of “video description” in line with a recent recommendation from the Commission’s Disability Advisory Committee.

Interested parties should look at the details of the NPRM and decide if they want to file their comments by the deadlines established in this week’s Federal Register publication.

Courtesy Broadcast Law Blog

The transition to ATSC 3.0, the next generation of television transmission, is underway as authorized by the Commission in 2017 (see our post here and our posts here, here and here on subsequent actions making that order effective and allowing TV stations to file to convert to the new standard).  This week, the FCC released a draft of an item to be considered at its June open meeting dealing with lingering legal issues about the services to be provided by television stations that are part of this transition.  The item to be considered, if adopted in June, will take two actions.  First, it will issue a declaratory ruling that the leasing of auxiliary and supplementary spectrum capacity on digital television stations for non-broadcast uses does not trigger the application of the FCC’s multiple ownership rules, which limit the number of stations that one entity can own or program in any given TV market.  Secondly, the item will issue a Notice of Proposed Rulemaking to address what regulatory changes, if any, are needed to govern the types of non-broadcast content that will be provided by stations operating with this next generation television transmission standard.

The declaratory ruling addresses concerns that the use of broadcast television spectrum by various companies or consortia that plan to use that spectrum for all sorts of non-broadcast applications could trigger violations of the FCC’s ownership rules.  Those rules limit one owner from owning (or providing more than 15% of the broadcast programming to) more than two television stations in a given TV market (and only one station in some smaller markets).  When stations convert to ATSC 3.0, there are plans to offer a plethora of non-broadcast services, which the FCC describes in its draft decision as “Broadcast Internet” services.  These services could include sending updates to smart dashboards in automobiles and in other Internet of Things smart devices, updating utility meters, providing telehealth and emergency communications information, distributing smart agriculture applications, or distributing popular pay-video programming to user’s devices.  In many cases, to provide these applications, one company or consortium would seek to lease the ancillary and supplementary capacity of multiple stations in a market to assure that content was distributed as broadly as possible.  The fear was that such users leasing capacity on multiple stations could be deemed to have an “attributable interest” in such stations for multiple ownership purposes or simply for purposes of having to be reported on ownership reports and other broadcast applications.

In the draft declaratory ruling, the FCC seeks to allay these fears.  It proposes to clarify that its broadcast ownership and attribution rules apply only to the provision of free over-the-air broadcast programming to viewers, and not to these Broadcast Internet services.  The FCC looks at the history of its broadcast ownership rules and decides that these rules were meant to assure the diversity of video programming to the public, not to regulate these non-broadcast services, and declares that the leasing of ancillary and supplementary spectrum capacity to providers of such services would not trigger application of the ownership rules.

In addition to that decision, the item if adopted as set out in this week’s draft, would initiate a rulemaking proceeding to look at what other FCC rules need to be amended to deal with the new services that can be provided through Broadcast Internet services.  The FCC asks questions in a number of areas including the following:

• Whether there are existing FCC rules that impede the development of Broadcast Internet services.
• Whether particular services will develop in different ways and whether the rules need to be adapted to allow for such development. These include specific inquiries into:
  • how noncommercial educational television stations will use this Broadcast Internet capacity and whether there needs to be clarifications as to how the rules against advertising on noncommercial television stations should be applied to these non-broadcast services
  • whether LPTV stations are more likely to roll out the new Broadcast Internet services and whether any regulatory changes are needed for these stations
• How should the FCC define the standard definition free broadcast service that all TV stations must provide? The FCC suggests that a 480i resolution minimum service should be required.
• How should fees be assessed for these non-broadcast services? The FCC currently collects a percentage of the revenue generated by these services.  Among the specific questions asked were:
  • Should the fees be lower or even zero for certain publicly beneficial services, like emergency communications and telehealth uses?
  • The FCC proposes that the fees be based on the income received by the licensee and any affiliates of the licensee – but revenues received by the independent third-parties leasing the spectrum should not be included in determining the fees to be paid.
  • Should there be caps on the fees?
  • Should the reporting of revenue for these services be changed?
• Where broadcasters provide services that are similar to services provided by other non-broadcast entities that are regulated by the FCC, should the rules that apply to these analogous services apply to the Broadcast Internet services? If so, which services are analogous?

These are highlights of the more detailed questions set out in the draft Notice of Proposed Rulemaking.  All interested parties should carefully read the draft item, watch the FCC discussion at its June meeting, review the final document that is adopted by the FCC, and participate in the rulemaking proceeding that will follow that will help to determine the regulations that will apply to these next-generation television services.

Courtesy Broadcast Law Blog

When a broadcaster files certain types of applications with the FCC, the public must be informed.  Last week, the FCC issued an Order which will change the rules regarding the public notice that must be given – consolidating what was a confusing process with different language and timing for notice about different types of applications into one providing standardized disclosures and scheduling for all public notices.  The decision (once it becomes effective) will eliminate obligations for the newspaper publication that was required for some public notices and also ended the obligation of broadcasters to give a “pre-filing public notice” before the submission of a license renewal application.  It will also require the inclusion of an “FCC Applications” link on the homepage of each commercial station’s website, whether or not they have any applications pending.  Let’s look at some of the changes adopted in last week’s Order.

First, the FCC did not change the requirements as to what applications require notice to the public.  Public notice is required for applications for new stations and major technical changes, for assignments (sales) or transfers of station licenses (except for pro forma changes where there is no real change in control over the station), for license renewal applications, minor change technical applications that involve a city-of-license change, and certain applications involving international broadcast stations or the export of programming to foreign stations to be rebroadcast back into the US.  Notice of designation for hearing of any application is also required.  We will concentrate here on the more common applications for changes to US stations, sale and license renewals.

For commercial broadcasters, the FCC abolished all requirements for the publication of public notices in a local newspaper.  Instead, broadcasters are required to place a link to “FCC Applications” on the homepage of their website or, if the station does not have a website, on the website of a parent or affiliated company, or if they do not have such a site, on some publicly accessible site (like a community bulletin board, local newspaper site, or that of a state broadcast association).  That link must connect another webpage on which the specific text that the FCC has now provided is displayed – stating when an application was filed, the name of the applicant, the type of application, and providing a link to the application itself in the FCC’s database.  That link on the homepage for FCC Applications needs to be on the site of all commercial stations whether or not they have applications pending.  If at any time the station has no applications pending, they need to note that fact on the page to which the link takes a website viewer, with a date as to when that notice was last updated.

The written public notice needs to be on the site within 5 days of the FCC’s acceptance for filing of an application.  An application is “accepted for filing” when the FCC itself issues a public notice which starts the clock running for petitions to deny an application.  The notice must be maintained on the website for 30 days.  Broadcasters are encouraged to maintain a screenshot or other proof of this publication in case someone ever challenges whether proper notice was given.

Operating noncommercial stations are not required to provide this written public notice.  Instead, they can instead rely simply on broadcast public notice.

All operating stations, commercial and noncommercial, must also broadcast notice about the filing of applications.  Here, too, the FCC standardized the language of the required public notice.  It also standardized the timing for these notices – requiring that they be run 6 times, on 6 different days, at least one each week in the 30-day period following the acceptance for filing of the application.  The public notice can be run anytime between 7 AM and 11 PM local time.  TV stations must give the public notice both by reading the required text and by providing it visually on the screen (not in a crawl).  Once completed, specifics as to the dates and times of the required public notice must be placed in the station’s online public file.  If a station is multicasting, the notice must be provided only on the primary channel of the station.

The FCC also eliminated the pre-filing announcements that had been required for the two months preceding the filing of a license renewal application.  In a separate Order, the FCC made this change effective immediately, even though the rest of the order will be effective at a later date.  As the FCC already waived pre-filing announcements in connection with accommodations made during the current pandemic (see our post here), the FCC deemed it unnecessary to restart those announcements when they will just end again when the new order becomes effective.  Post-filing announcements are still required, though once the new rules are effective, they will be given on the new schedule adopted for all applications in the order.

Special rules were adopted for silent stations, for new stations, and for some less common applications and events (like the designation for hearing of an application).  Broadcasters should carefully review the details of all the changes that we have merely highlighted here before they become effective (upon publication of an effective date in the Federal Register) to see how they will affect any notices that you must give – and to make sure that, once the rules are effective, your website has the new FCC Applications link on your station’s homepage, whether or not you have any applications pending.

Courtesy Broadcast Law Blog

Here are some of the regulatory and legal actions in the last week of significance to broadcasters, with links to where you can go to find more information as to how these actions may affect your operations.

• In connection with the Commission’s required monthly Open Meeting which was held last week, the FCC adopted two items of importance to broadcasters, which we previewed in last week’s update.
  • The first item adopted new rules implementing streamlined and standardized public notice obligations associated with various broadcast applications. The revised rules abolish requirements for printed notices in local newspapers and pre-filing announcements for license renewal.  (News Release)  (Second Report and Order).  The effective date of these changes will be announced later, although in a separate Order, the FCC immediately waived the requirement for license renewal pre-filing announcements for all future renewal windows.   The requirements for license renewal post-filing announcements are unchanged
  • The second item proposed for public comment the amounts of the annual regulatory fees to be paid in September by broadcasters and other FCC-regulated communications entities.  In addition to asking for comments on the allocation of the fees to be paid, the FCC asks if it can do anything to assist those who pay the fees in light of the current pandemic.  While the FCC is required by Congress to collect the regulatory fees, it asks if there are actions it can take while still complying with its statutory obligations, e.g. by allowing some companies to pay their fees over a greater period of time.  The FCC also completed the transition of TV fees to a system based on population in a station’s service area instead of the size of the market in which the station operates.  It also reduced the fees to be paid by certain VHF television broadcasters.  The comment period for the proposed 2020 regulatory fees will be set after the notice is published in the Federal Register.  (Report and Order and Notice of Proposed Rulemaking).

• The FCC Public Safety and Homeland Security Bureau released its report on the August 7, 2019 test of the broadcast Emergency Alert System.  The report set out concerns identified by the test, including issues with the technical quality of some alerts, the monitoring of the proper sources for the alerts, and the lower participation among low power broadcasters (particularly LPFM licensees).  However, the Bureau found that the broadcast-based EAS distribution method is largely effective, as the test reached 82.5% of EAS participants.  (Report)
• The initial comment period closed in the FCC’s proceeding on Significant Viewing.  As we wrote in the Broadcast Law Blog, the proceeding asked, among other things, for comments as to whether the FCC should update its rules for establishing whether a TV station is “significantly viewed” in a market other than the one in which it is located.  A designation of significantly viewed status is important for determining whether a cable or satellite system will carry a TV station in areas that are not part of its home market.  (Significant Viewing Comments).  Reply comments are due by June 15.
• Last week, the comment period was set in the FCC’s Distributed Transmission System (“DTS”) proceeding.  Comments are due by June 12, reply comments are due by July 13.  The notice seeks comment on changes to the FCC’s rules on DTS that could expand and improve the coverage of television stations throughout their service areas as the industry begins to deploy the new ATSC 3.0 television transmission technology.  We wrote more about this rulemaking at the Broadcast Law Blog.  (Federal Register)
• The Commission last week revised its rules governing good faith negotiations for retransmission consent between large station groups and “qualified MVPD buying group.” The revisions were tied to passage of the Television Viewer Protection Act of 2019 which allowed small cable companies to negotiate jointly for retransmission consent with large broadcast group owners.  The Commission defined a “large station group” as one whose individual stations collectively have a national reach of more than 20%, and allowed for the MVPD buying groups to negotiate on behalf of MVPDs that collectively serve no more than 25 percent of the households receiving service from any MVPD in a given local market.”  (Report and Order).

And, next week, we expect to be writing about any broadcast issues that the FCC will consider at its June 9 Open meeting.  The FCC will announce the agenda for that meeting on May 19.

Courtesy Broadcast Law Blog

The FCC’s proposal to expand the use of Distributed Transmission Systems by television stations operating with the new ATSC 3.0 transmission system was published in the Federal Register today (here). That publication announces that the comment deadlines on the FCC’s DTS Notice of Proposed Rulemaking are due by Friday, June 12, 2020, and reply comments will be due by Monday, July 13, 2020.  While we mentioned this proposal in passing when discussing a proposal to allow FM stations to use boosters to provide an FM version of a distributed transmission system, we have not written in detail about this proposal.  With the comment deadline now set, let’s look at some of the questions asked in the rulemaking proposal.

First, it is worth explaining the concept of a distributed transmission system (sometimes referred to as a “single frequency network” as it uses multiple stations on the same frequency to reach its audience).  Traditionally, television stations have operated with a single high-power transmitter from a location central to their coverage area.  Thus, viewers close to the transmitter get the strongest signal, and that signal dissipates the further that a viewer gets from that central transmitter site.  Station signals are protected from interference to a certain contour where it is assumed that the majority of viewers will be able to receive over-the-air an acceptable signal most of the time.  But even at the edge of these protected contours, the FCC’s projections assume that many viewers will not be able to receive an acceptable signal at all times.  Distributed transmission systems are already in use by television stations in certain markets to fill in holes in station coverage – and have been particularly useful in markets with irregular terrain where mountains or other obstructions preclude one centrally located transmitter from reaching audiences far from the transmitter site.  Locating a second transmitter on the same frequency behind the terrain obstruction allows better reception for viewers who might otherwise not receive an acceptable over-the-air signal. However, currently, the DTS transmitters cannot extend the noise-limited protected contour of a station “more than a minimal amount” beyond that which the TV station would be predicted to have from a single centrally-located transmitter site.  The NPRM in this proceeding, based on a petition filed by the NAB and America’s Public Television Stations (see our article here on the Petition for Rulemaking filed by these groups), looks to allow for wider use of DTS.

The proposal is to expand the area in which DTS transmitters could expand the service of a TV station.  While the proposal would still require that the transmitter site of any DTS transmitter be located within the noise limited contour of the station from a centrally-located transmitter site, the requirement that the extension of the contour be no more than a minimal amount would change.  Proponents of the expansion argue that DTS systems should be allowed to be used to better serve the residents of a station’s service area by providing more uniform strong signals throughout a station’s service area.  Those on the fringes of a coverage area should not get weaker signals that those in the middle of the market.  By providing stronger signals throughout the market, ATSC 3.0 proponents argue that the new services that can be provided by the new transmission system can better be enjoyed by all residents of the service area.

The FCC proposes that, for UHF stations, the expansion of the station’s service be allowed to what would be the 36 dBu contour of the centrally-located station (different limiting contours would be used for VHF stations).   The Commission asks for comments on that choice of contour.  It also asks for details about the benefits that such an expansion would provide, and costs that would be incurred.

But the NPRM also asks questions raised by parties who are unsure of the merits of any proposal for expansion of service by these TV stations.  Would the greater spillover of the signal beyond the noise-limited contour (and the minimal amount of spillover now allowed) create the potential for interference with LPTV and TV translator stations?  If so, how should that interference be treated?  Is the spillover part of the primary signal of the TV station that would be allowed to interfere with the LPTV or translator operation, or would it need to protect these otherwise secondary signals?

Similarly, proponents of white spaces devices ask about the impact that expanded contours would have on service from their operations.  The FCC even asks whether, by allowing stations to expand their coverage area, they are being granted rights to service that should be open to competing applications – asking how the “Ashbacker Doctrine” (which states that the FCC cannot award new licenses without providing an opportunity for competing applications) applies to these proposals.  Here, as the 36 dBu contour of UHF stations is the contour at which a station would interfere with another station, some would argue that Ashbacker is not triggered as no service could be provided in these areas anyway.

Questions of timing, scope and implementation are also asked.  Should these changes be implemented now, or should they wait until ATSC 3.0 is up and running and the FCC and operators have more experience with the service?  Should LPTV, Class A and TV translators be able to provide similar DTS operations?  Should the expansion even be allowed for stations that continue to operate in ATSC 1.0?  Are there special considerations for signals of stations that may be hosting multiple licensees through some sort of channel sharing?  Can single sites accommodate multiple licensees looking to provide DTS operations?

These and many other questions are teed up by the FCC in the NPRM.  Interested parties now have a date by which they can weigh in on the many issues advanced by the FCC.  Note the June 12 comment deadline and, if you have an opinion, now is the time to advance it as the Commission weighs this proposal.

Courtesy Broadcast Law Blog

The requirement that television broadcasters and MVPDs (including cable and satellite television providers) negotiate in good faith over the provisions of retransmission consent agreements is often cited in arguments by one side or the other when negotiations over the fees to be paid under those agreements break down.  In a consent decree released last week, the FCC showed that the requirement is more than just a few words in the statutes and rules governing these negotiations, reaching an agreement with TV licensee Howard Stirk Holdings, LLC to pay a penalty of $100,000 for violations of those requirements and to also adopt a compliance plan setting up internal corporate controls to ensure that similar violations do not occur in the future.

The consent decree was based on violations described in a decision of the FCC’s Media Bureau released last November (here) finding that 18 television station licensees, operating stations in separate markets, had failed to negotiate retransmission consent in good faith.    The Stirk company and the other stations covered by the November decision had used a single negotiating agent who the Bureau found failed to comply with three of the Commission’s nine “per se” good faith negotiating standards set out in Section 76.65(b)(1) of the Commission’s rules.  Specifically, the Bureau found that the stations had not operated in good faith based on these perceived violations: (1)  refusal to negotiate retransmission consent agreements; (2) refusal to meet and negotiate retransmission consent at reasonable times and locations, or acting in a manner that unreasonably delays retransmission consent negotiations; and (3) failure to respond to a retransmission consent proposal of the other party, including the reasons for the rejection of any such proposal.

In reaching this conclusion, the Bureau pointed to instances where the negotiating agent did not respond to offers for the carriage of single stations in the negotiating group, did not put forward proposals for the carriage of such stations and was slow in responding to proposals put forth by the MVPD and did not respond in detail to those proposals or make meaningful counterproposals.  The Bureau, at the time, ordered the stations to negotiate in good faith and reserved questions of liability, indicating that those could be taken up in the future.  The future appears to be now in last week’s consent decree, as least for the Strik company.

Takeaways for TV stations?  While the FCC will not get into the substance of retransmission consent negotiations (it will not question the economics proposed by either side – see this article from over a dozen years ago where the FCC made that clear), it does require that the parties seriously negotiate over the terms of such carriage.  Parties cannot simply say no and not advance proposals as to what they would accept to resolve the negotiations.  Parties cannot unilaterally cut off negotiations.  And the obligation is one that is unique to each station – so unrelated stations cannot join together and refuse to even consider deals offered for any particular station.  This decision shows that there are real teeth in these regulations – and penalties may follow for violation of the Commission’s standards.

Courtesy Broadcast Law Blog

The FCC yesterday announced a policy that will relieve broadcasters of wide-dissemination EEO obligations in rehiring laid-off employees in a post-shutdown world.  Because of the significant economic hit taken by broadcasters when so many advertisers pulled their advertising schedules as so many businesses shut down, many broadcasters who did not receive PPP loans were forced to lay off employees in order to be able to afford to continue operating.  As the economy recovers, it is hoped, some of those employees can be rehired.  The FCC Media Bureau’s order released yesterday may make some of that hiring somewhat easier.

The decision yesterday allowed broadcasters who were forced to terminate employees because of the pandemic to rehire those same employees at some point in the future (within 9 months of the time that they were laid off), without having to go through the “wide dissemination” that the FCC rules normally require before an employment vacancy is filled.  Normally, the FCC requires that before filling any full-time employment vacancy, a broadcaster must advertise broadly to reach all groups within its community to inform them of the job opening to insure a pool of diverse recruits from which to fill that position (see our article here on the wide dissemination requirement).  Under this decision, the FCC will allow broadcasters to simply rehire an employee who was let go – without any wide dissemination of the job opening – if economic conditions allow for their re-hiring within 9 months of when they were first laid off.

This will allow broadcasters to rehire much more quickly if business rebounds without having to go through the broad outreach recruiting efforts when conditions permit stations to resume their normal operations.  Having to go through the outreach process could lead to wasting the time of potential applicants who might apply for a position where there was already someone who the broadcaster knew was “right for the job” as they had previously held the exact same position.  Seemingly, it would also provide more hope to employees who were laid off during the pandemic that there may be a light at the end of the tunnel if their employment was terminated solely because of the deteriorating economic conditions – and that there may be a position to return to if the economy rebounds.  In all, some more welcome relief for broadcast employers and employees in these uncertain times.

Courtesy Broadcast Law Blog

The responses by the major record labels to Commissioner O’Rielly’s inquiry into allegations of payola practices (see our article here) were published last week while we were all distracted with pandemic issues.  While the responses (available here on the Commissioner’s twitter feed) were perhaps not surprising – saying that the record labels do not engage in any on-air pay-for-play practices where the payment is not disclosed – they nevertheless highlight some practices that should be observed at every radio station.  As I have said in many seminars to broadcasters around the country when talking about FCC sponsorship identification requirements, if you get free stuff in exchange for promoting any product or service on the air, disclose that you got that free stuff. As made clear in these responses, when the record companies give free concert tickets or similar merchandise to a radio station for an on-air giveaway to promote a concert or the release of new music by one of their artists, they agree with the station to reveal on the air that the record company provided the ticket or merchandise that is being given away.

The responses also indicate that these record companies do not provide musical artists to play at station events with any agreement – explicit or implicit – that the station will play those artists more frequently because of their appearance.  While that might happen naturally, it also might not (if, for instance, the band is one of many acts participating at some station-sponsored festival).  The record companies state that their contracts with stations for such events make clear that there is no agreement that any artist appearance is tied to additional airplay for that artist.

The responses also reference settlements with the New York State Attorney General’s office of payola allegations that occurred over a decade ago.  A number of radio companies and record labels entered into settlements with the Attorney General’s office and the radio companies also entered into consent decrees with the FCC to resolve issues raised in these investigations.  One of those settlement agreements with the FCC is available here, and sets out very specific compliance conditions including:

• Prohibiting stations and employees from exchanging airtime for cash or items of value except under certain circumstances;
• Placing limits on gifts, concert tickets, and other valuable items from record labels to company stations or employees;
• Appointing compliance officers who will be responsible for monitoring and reporting company performance under the consent decrees; and
• Providing regular training to programming personnel on payola restrictions.

Reviewing the specifics of these agreements is an important way for stations to ensure that they are not unintentionally running afoul of the payola rules.  These conditions recognize that there is some interaction to be expected between record labels trying to expose their music and radio companies deciding what to play.  But that needs to be done in a way that is limited to avoid the appearance that money or other items of valuable consideration decide what is played on a station – unless the audience is specifically informed that the programming is sponsored.  With these issues back in the news, be sure to observe these limitations.

Courtesy Broadcast Law Blog