The FCC’s Media Bureau issued a Public Notice today seeking comment on a petition for declaratory ruling urging the Commission to prohibit stations’ use of the Last-In-First-Out (or “LIFO”) method of selling preemptible advertising time to political candidates or, if not prohibited, to require that stations using the LIFO method always give political candidates preemption priority over commercial advertisers. Comments are due March 2, 2015, and replies are due March 17, 2015.
As required by the Communications Act, during the 45-day period preceding a primary and the 60-day period preceding a general election, all spots sold to candidates must be provided at the station’s “lowest unit rate.” The lowest unit rate (or “LUR”) is the amount that is offered or charged to the station’s most preferred commercial advertiser for the same class (e.g. immediately preemptible spot) and amount of time (e.g., 30 seconds) for the same period (e.g., 11:00 news or morning drive time). Some stations use the LIFO method to determine the priority by which spots in a particular class of preemptible time will be preempted by spots purchased in a higher class of time. Specifically, under the LIFO method of preemption priority, the “First-In” advertiser within the preemptible class of time – i.e., the advertiser who booked its spot first – will be the last to be preempted.
Canal Partners Media, LLC, a media buyer for political candidates, filed the petition for declaratory ruling arguing that the LIFO method violates the LUR provision of the Communications Act because it favors commercial advertisers who are able to purchase their time well in advance of the political season and unfairly forces candidates to purchase higher classes of time in order to avoid preemption. If the LIFO method is not prohibited, then Canal argues that because the Communications Act requires that stations treat candidates as their most-favored commercial advertisers, a candidate should be entitled to the same priority against preemption that the station gives the First-In advertiser even if the candidate was the last to book his or her spot on the station.