FCC Chairman Proposes to Eliminate the Main Studio Rule . . . And Possibly More

Posted in Broadcast Regulation

filingcabinetFCC Chairman Ajit Pai formally unveiled two proposals on Thursday to remove outdated broadcast regulations.  First, the Commission released a draft Notice of Proposed Rulemaking that would eliminate the main studio rule for all services (including the associated minimum staffing requirements).  Second, the Commission released a draft Public Notice seeking comment on media-related rules to modify or repeal.  Both items are on the agenda for the FCC’s May 18 open meeting (where they will share the dais with Chairman Pai’s proposal to remove Title II regulation of broadband Internet access service).

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Now Effective – The FCC’s Streamlined Broadcast Foreign Ownership Rules and New Rules Governing Foreign Ownership Compliance

Posted in Broadcast Regulation, Foreign Ownership, Transactions

With the publication of an announcement in the Federal Register on April 20, 2017, the FCC’s new foreign ownership rules, originally adopted on September 30, 2016, are now finally effective. The FCC’s September 2016 order made two significant changes to the agency’s foreign ownership rules. First, the new rules contain “streamlined” procedures that broadcasters must follow when filing a petition for declaratory ruling seeking FCC approval to exceed the foreign ownership limits set forth in Section 310(b)(4) of the Communications Act. Second, the FCC reformed the methodology for publicly traded broadcasters and common carriers to assess compliance with the statutory foreign ownership limits set forth in Sections 310(b)(3) and 310(b)(4) of the Act, and made clear that private companies are expected to have full knowledge of the extent of their foreign ownership.

The effectiveness of these new rules clears the way for additional foreign investment in broadcast companies, by extending to broadcasters procedures for declaratory rulings that are similar to those which have long applied to common carriers. The new rules also set forth a uniform methodology for publicly traded companies subject to the foreign ownership restrictions to assess their compliance with those restrictions. Although this new methodology provides increased transparency regarding the steps that the FCC expects public companies to take, it also heightens the need for such companies to exercise due diligence by monitoring foreign investments consistent with the new requirements.

FCC Releases Draft Orders that Would Eliminate FRN/RUFRN Requirement for NCEs and Allow NCEs More Flexibility to Conduct Third Party Fundraising

Posted in Broadcast Attribution, Broadcast Regulation

On March 30, 2017, the FCC or Commission released two draft items that, if adopted at the Commission’sFCC April Open Meeting, would reduce regulatory burdens on noncommercial educational (NCE) broadcasters.

FCC Form 323-E and Permissive Use of SUFRNs

The first item is a draft Order on Reconsideration (Draft Recon Order) that would roll-back a requirement that officers, directors, and other individuals with attributable interests in NCE stations obtain FRNs or “Restricted Use” FRNs (RUFRNs) for purposes of completing and filing ownership reports. To obtain an FRN or RUFRN, an individual must disclose his/her social security number, date of birth, or other personal information. NCE broadcasters objected to the requirement, adopted in January 2016, and argued that such disclosure would discourage volunteers from serving on the governing boards of NCE stations and pose unique challenges for board members who are politically elected or appointed. Continue Reading

Draft FCC Order Would Restore UHF Discount

Posted in Broadcast Regulation

calculatorOn Thursday afternoon, the FCC released the text of a draft Order that would grant a Petition for Reconsideration and reinstate the “discount” applied to UHF television stations when calculating compliance with the 39% national TV ownership cap.  The Commission will vote on the Order at its April 20, 2017 open meeting.

The FCC adopted the UHF discount in 1985, explaining that it compensated for the fact that the signal strength of a UHF television signal decreased more rapidly with distance, resulting in smaller coverage areas and smaller audience reach.

In September, the Commission voted to eliminate the UHF discount, finding that there is “there is no remaining technical justification” for the discount.

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FCC Grants First Petition for Declaratory Ruling Allowing 100% Foreign Ownership of Broadcast Station Licensees

Posted in Broadcast Regulation, Foreign Ownership, Transactions

The Media Bureau of the Federal Communications Commission (FCC) has released the first-ever decision permitting foreign citizens to own 100% of broadcast station licensees. In the declaratory ruling, the FCC authorized two Australian citizens each to own 50% of Frontier Media, LLC, the parent company of broadcast licensees owning seven AM radio stations, eight FM radio stations, thirteen FM translators, and one TV translator in Alaska, Arkansas, and Texas.  As a condition of approval, the owners must obtain prior consent for any additional foreign owners, but the ruling imposes no other significant conditions.  Continue Reading

A Regulatory Play-By-Play Of Intel’s Super Bowl Drone Show

Posted in Broadcast Technology

Originally posted on WileyConnect, the Internet of Things Blog by Wiley Rein LLP.

It’s time to answer the most important question on everyone’s mind after Super Bowl LI: what type of regulatory approvals and deviations were required to enable Intel’s massive display of 300 choreographed unmanned aircraft systems (UAS) that kicked off Lady Gaga’s Super Bowl halftime show?

Image source: https://www.drones.nl/media/wysiwyg/images/1486361360-super-bowl-2017-lady-gaga-drones.jpg

The halftime show begins with Gaga singing a mashup of “God Bless America” and “This Land Is Your Land” while standing on the open roof of Houston’s NRG Stadium.  The camera pans out to reveal a sky of 300 UAS shimmering like stars behind the headliner.  Still swirling around the sky, the white lights of the UAS fade to red and blue.  The aircraft then shift to form the image of an American flag to accompany the patriotic number.  After concluding with a line from the Pledge of Allegiance, Lady Gaga appears to jump into the stadium, and the sky fades to black.  At the end of the performance, the drones return to form the logos for Pepsi (the sponsor of the halftime show) and Intel. Continue Reading

What to Expect When You’re Expecting (to be repacked)

Posted in Broadcast Regulation, Spectrum

MH900212043The FCC’s confidential letters to television stations that did not submit successful bids to relinquish their spectrum in the reverse auction could arrive in broadcaster mailboxes any day now.  For some stations, this letter will confirm that it’s business as usual, and that they will continue to operate on the same channel after the auction.  But for more than 1,000 stations, the letters could represent the beginning of a long, challenging process not only to seamlessly move to a new channel, but to do so in a manner that minimizes out-of-pocket costs and maximizes reimbursement from the FCC.   Broadcasters should have a head start of 6-8 weeks before the FCC issues its Closing and Reassignment Public Notice, and it would be helpful to use that time wisely. 

Perhaps the most important two things a station owner can do upon receiving its letters are organize and prioritize.  For a single station owner, this will be fairly simple: review the materials from the FCC and contact your consulting engineer and/or attorney to begin the process.  For a large group owner, however, it will be helpful to asses: (i) how many stations you have in each transition phase; (ii) the nature of your channel moves; and (iii) any commonalities among your stations and their repacking efforts.  With this information, your can prioritize.  Engineers, equipment manufacturers, and attorneys are going to be flooded with calls and e-mails, and even their most important clients (e.g., you) may need to wait in a queue.  You can help these professionals help you by identifying the stations that you need them to focus on first based on your organization and your business priorities. Continue Reading

So Your Station Submitted a Successful Incentive Auction Bid, Now What?

Posted in Broadcast Regulation, Spectrum

MM900236467Now that television stations can openly discuss the results of their participation in the Incentive Auction, it is an appropriate time for all television stations to assess their market position and think about what comes next.  In this space, we will discuss how stations with various auction outcomes should approach their post-auction transaction.  Today, we begin with stations that submitted a successful bid to relinquish their spectrum.

The first two questions on the minds of many broadcasters that submitted winning bids are: (1) when will I receive my money; and (2) how much should I publicly say about my auction results?

Winning reverse auction bidders will receive their proceeds from the FCC only after the Commission issues licenses to winning forward auction bidders.  The earliest that the FCC can issue those licenses is approximately one month (and likely 2-3 months) after it releases the Closing and Reassignment Public Notice.  We estimate that the FCC will start releasing payments to broadcasters in late Q2 or early Q3 2017, although those dates are subject to change depending on the length of the forward auction.  If the FCC does not process all of the forward auction licenses at one time, it will make payments to broadcasters on a rolling basis.  The FCC will issue a public notice explaining how it will distribute auction proceeds and the steps each winning station must take to receive those proceeds. The person responsible for managing the receipt of auction proceeds must create a username and password in the new CORES. That website is found here: https://apps.fcc.gov/cores/userLogin.do. Continue Reading