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The Silver Lining in the FCC’s UHF Discount Order

Posted in Broadcast Regulation

silver liningOn Wednesday, the FCC issued a long-expected Order abolishing its 30-year policy of applying a “UHF Discount” when calculating a broadcaster’s compliance with the 39% National TV Ownership Cap.  At the same time, the Commission refused to adopt a “VHF Discount” in recognition of the technical inferiority of VHF channels following the digital transition.  The Order comes as a blow to television networks and large station groups that are near the national cap and whose opportunities for growth into new markets are now limited.

But those looking for a silver lining should pay attention to the FCC’s discussion of its authority to alter the UHF Discount.  Continue Reading

FCC Bids Adieu to UHF Discount

Posted in Broadcast Regulation

calculatorThey say all good things must come to an end, and for the FCC’s UHF discount, the end has arrived (pending the outcome of near-certain litigation).  Earlier today, the FCC issued a Report and Order eliminating its 30-year old policy of applying a 50% “discount” to market populations served by UHF stations when calculating compliance with the 39% national TV ownership cap, declaring that “the UHF discount cannot be justified in the digital world.” At the same time, the FCC declined to adopt a comparable VHF discount, finding that the circumstances that justified adoption of the UHF discount 30 years ago do not extend to VHF stations today.

When calculating a station’s compliance with the national TV ownership cap, the Commission considers the population of the market rather than the population served by an individual station’s contour. Recognizing the “inherent physical limitations” of the UHF band, the agency in 1985 adopted the UHF discount, explaining that the discount 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. Although the actual national ownership cap has fluctuated since that time, the UHF discount has remained in place. Continue Reading

Join Us for Destination Repack: A Multi Industry Roadmap

Posted in Broadcast Regulation, Broadcast Technology, Spectrum

Destination RepackOn October 19, 2016, Wiley Rein’s Telecom, Media & Technology Practice will be partnering with The Association of Federal Communications Consulting Engineers (AFCCE) to host an educational program on the challenges faced by broadcasters post the Federal Communications Commission’s (FCC) Spectrum Auction.

Join us to discuss approaches to the post-auction repacking process, including:

◾Repack 101: Defining the Challenge
◾Ready, Set, File: The Three Month CP Sprint
◾Show Me the Money: The TV Broadcaster Relocation Fund
◾Managing the Transition: How to Move Up to 1000 Stations in 39 Months
◾What About 3.0? Is There a Role for Next Generation TV in the Repack?

For additional details and to register, click here.

The More Things Change, The More They Stay the Same… FCC Tweeks Broadcast Ownership Rules in 2014 Quadrennial Review Order

Posted in Broadcast Regulation

ChangeOn August 25, 2016, the FCC released the text of a Second Report & Order that concludes both its 2010 and 2014 “quadrennial review” proceedings (the “2016 Order”). The Commission is required by statute to review its rules governing the ownership of broadcast radio and television stations every four years to determine whether they “are necessary in the public interest as the result of competition” and to “repeal or modify any regulation [the Commission] determines to be no longer in the public interest.” In addition to reviewing its rules according to this standard, the Commission also considered certain issues remanded to the agency by the U.S. Court of Appeals for the Third Circuit in decisions that were issued on review of the Commission’s 2006 and 2010 quadrennial review proceedings.

In the combined 2010/2014 proceeding, the Commission determined that its existing media ownership rules, with some minor modifications, remained necessary in the public interest. In addition, the FCC reinstated its decision to consider television joint sales agreements (“JSAs”) to be “attributable” ownership interests, established a definition for “Shared Services Agreements” and adopted disclosure requirements for such agreements, and reinstated its revenue-based eligible entity standard. Continue Reading

Incentive Auction Update: Onward to Stage 2

Posted in Spectrum

The FCC has declared the end of Stage 1 of the Incentive Auction, with total forward auction revenues of $23.1 billion.

PRS

According to the Public Reporting System:

“Bidding in the forward auction has concluded for Stage 1 without meeting the final stage rule and without meeting the conditions to trigger an extended round. The incentive auction will continue with Stage 2 at a lower clearing target.  The FCC will release a public notice announcing details about the next stage, including the clearing target for Stage 2, and the time and date at which bidding in Stage 2 of the reverse auction will begin.”

The second stage of the reverse auction will begin no sooner than 5 business days from today, or Wednesday September 7.

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New Certification Requirement for TV Closed Captioning Not Yet Effective

Posted in Broadcast Regulation, Captioning

On Tuesday, the FCC’s new TV closed captioning quality rules, which we discussed in detail here, were published in the Federal Register.  Fed Reg publication often signals that new rules are effective, or will be soon.  Such is notCC the case for the video programmer registration and captioning certification requirements, which are subject to approval by the Office of Management and Budget.  That approval likely won’t come for months.  The FCC also has to build-out its website to house the new registration and certification forms, which could take more or less time depending upon the IT complexities involved.  Once OMB approval is secured, the FCC will issue a Public Notice announcing the effective date of the registration and certification requirements.  The Consumer and Governmental Affairs Bureau will also issue guidance on where and how to file, which should answer questions such as whether a parent entity may register and certify on behalf of its children, or whether each individual child must register and certify separately.

The not-yet effective certification rule specifies July 1, 2017 as the first date on which video programmers must submit their captioning certification.  The Commission may extend that deadline if OMB approval and website development take longer than expected.  Once the rule is effective, video programmers must file their certifications annually on or before July 1. Continue Reading

Reminder: EAS-Related Registration and Filing Deadline

Posted in Broadcast Regulation, Broadcast Technology

On Friday, the FCC’s Public Safety and Homeland Security Bureau issued a Public Notice reminding EAS Participants of mandatory filing deadlines related to an up-coming nationwide EAS test.  Specifically, EAS Participants deadlinemust register with the EAS Test Reporting System (ETRS) and file Form One on or before August 26, 2016.  EAS Participants have until September 26, 2016 to edit their Form One filings. Two other forms – the aptly named “Form Two” and “Form Three” – are due on September 28, 2016 and November 14, 2016, respectively.  EAS Participants may register for the ETRS system and file Form One here.

The filings are required pursuant to a nationwide EAS test scheduled for September 28, 2016 at 2:20 pm EDT.

EAS Participants must use ETRS to file identifying information every year, as well as file their results following a nationwide EAS test.  Radio and television stations (including LPFM, Class A, and LPTV stations) are required to file in ETRS, as are cable systems, DBS and SDARS services.

The Public Notice provides a link to a webinar explaining how to register for ETRS and file Form One.  Attached to the Public Notice is the revised EAS Operating Handbook, a copy of which must be located at normal duty positions or EAS equipment locations when an operator is required to be on duty and be immediately available to staff responsible for administering EAS tests.  The Handbook must be in place in time for the September 2016 nationwide EAS test.

The Importance of Preparing the First Draft

Posted in Corporate/Business, Transactions

The Deal RoomOne of the most significant points in a transaction may be one of the most overlooked – the question of who will prepare the first draft of the underlying agreement.  It is generally always a good strategic decision to prepare the first draft of a purchase agreement, regardless of whether you are the buyer or the seller.

While on the surface, many purchase agreements may look the same (they all contain basic deal terms, representations and warranties, pre-closing covenants, closing conditions, deliveries, and indemnification), good transactional attorneys have quite different starting points to use if their client is the seller or the buyer.  A seller-favorable document approaches many provisions very differently from a buyer-favorable document.

Using the right starting point is a great way to put yourself in the strongest possible position at the start of a deal.  And who doesn’t want to start off a transaction in the best position rather than from a weaker position?  Continue Reading

New E-Cig Advertising Rules To Go Into Effect on August 8, 2016

Posted in Advertising Issues

cigOn August 8, 2016, new rules issued by the Food and Drug Administration (“FDA”) will go into effect concerning radio, television and online advertisements for electronic cigarettes (“e-cigs”) and other Electronic Nicotine Delivery Systems (including e-hookah, vape pens, advanced refillable personal vaporizers, and electronic pipes), regular size or large cigars, pipe tobacco, and certain other tobacco products.  Specifically, advertisements for these products cannot contain representations that the product presents a lower risk of tobacco-related disease or is less harmful than other commercially marketed tobacco products.  In addition, as of August 8, 2016, advertisements for e-cigs and other tobacco products cannot be targeted at persons under 18 years of age.  Although these rules do not apply to broadcasters directly, broadcasters should be aware of them in order to assist their clients’ compliance efforts.

In 2018, additional advertising rules will go into effect.  Beginning on May 10, 2018, advertisements for e-cigs and the other products listed above must include a new warning that states: “WARNING: This product contains nicotine.  Nicotine is an addictive chemical.”   Advertisements for regular size or large cigars must contain either the nicotine warning or any of the following warnings:

  • WARNING: Cigar smoking can cause cancers of the mouth and throat, even if you do not inhale.
  • WARNING: Cigar smoking can cause lung cancer and heart disease.
  • WARNING: Cigars are not a safe alternative to cigarettes.
  • WARNING: Tobacco smoke increases the risk of lung cancer and heart disease, even in nonsmokers.
  • WARNING: Cigar use while pregnant can harm you and your baby or SURGEON GENERAL WARNING: Tobacco Use Increases the Risk of Infertility, Stillbirth and Low Birth Weight.

Continue Reading

Denied! Internet-Only Recruitment Still A No Go Under FCC EEO “Broad Outreach” Rules

Posted in Broadcast Regulation

Thumb DownThe FCC’s Media Bureau rejected a cable company’s argument this week that online-only outreach regarding its job vacancies constituted “wide dissemination of information” of its full-time jobs throughout the community.  The FCC long ago declared internet-only recruitment constitutes “inadequate” job outreach but indicated that it would revisit this policy should Internet access become more widespread.  Full Channel TV, Inc. tried to get the Bureau to do just that, citing specific percentages of households in its community with Internet access—69% of Rhode Island homes and 72% of nearby Massachusetts’s homes—and arguing that a posting on Craigslist or the company’s website reached a broader audience than one appearing in print.  The Commission was not persuaded.

In upholding a $11,000 penalty assessed after an EEO audit, the Bureau steered clear of analyzing the effectiveness of online vs. offline job postings.  Instead, the agency focused on the fact that, by the company’s own admission, there was a portion of that community neglected by an online-only job posting—31% for Rhode Island and 28% in Massachusetts. Continue Reading