Chairman calls broadcasters “connective tissues” holding communities together

By John Eggerton — Broadcasting & Cable, 4/13/2010

FCC Chairman Julius Genachowski said many broadcasters were helping to hold their communities together in his keynote speech to the National Association of Broadcasters convention Tuesday (Apr. 13) in Las Vegas.

Before trying to assuage broadcasters’ fears about the FCC’s plan to encourage them to give up spectrum for wireless broadband–it is a voluntary program, he insisted, and is about giving them more choice not less–he talked about his respect for the work they do and the important service they render to the country, as well as his history on that side of the equation.

He pointed out that the last time he was at an NAB convention, it was as a broadcaster–both chief of business operations and general counsel for Barry Diller’s  IAC/InterActiveCorp/USA Broadcasting–where as he was “trying to make sure we got our DTV license applications in on time — protecting our basic must-carry rights, and hoping we might get digital must carry.”  Protecting must-carry rights carries new meaning as the Supreme Court considers whether to take Cablevision’s challenge of the rules.

The chairman said he had “enormous respect and admiration” for broadcasters who do both good business and good work through news and programming that serves their communities. “Many broadcasters still supply important connective tissue holding our communities together,” he said, implying that to kill the industry, which he said in no uncertain terms the FCC is not trying to do, would also be a serious wound to those communities.

He cited broadcasters move onto other platforms, saying that in addition to being a broadcast lifeline during the recent D.C. snowstorms, a station like WRC-TV there “used its robust Web site and Twitter feed to help residents who had lost power get up-to-the-minute information through their computers and phones.”

The “Radio Spectrum Inventory Act” (H.R. 3125), sponsored by Chairman Boucher, was called up yesterday on the House suspension calendar. The bill passed the full House by a vote of 394 to 18, a positive first step in directing the NTIA and the FCC to undertake a comprehensive survey of the nation’s spectrum resources and develop an inventory of used and vacant spectrum in each band. The bill directs the NTIA and the FCC to undertake a comprehensive survey of the nation’s spectrum and develop an inventory of used and vacant spectrum in each band. The inventory would include the identity of federal and non-federal users and the types of services they offer in each spectrum band and the amount of use of each band on a geographic basis. The FCC and NTIA would have four years to complete this inventory.  When the inventory is completed, the NTIA and the FCC will create a website to make the inventory publicly available and report the results of the inventory to Congress. The Senate Commerce Committee approved a similar measure last year. (Please note that this bill is not part of the FCC National Broadband Plan)

In advance of this legislative activity, NAB engaged Chairman Boucher (D-VA) and Rep. Blackburn (R-TN) to participate in a colloquy during debate on the bill. On the House floor, Chairman Boucher stated that the inventory is an “essential first step” that provides a baseline to inform Congress going forward.  Rep. Blackburn agreed that Congress needs to analyze the data before making any decisions about spectrum reallocation and that the process must be thorough and scientific. Boucher also stated that the right approach is for the FCC to work with broadcasters to identify spectrum that they now hold that could be repurposed, on a consensual basis, for commercial, wireless use.  Broadcasters who surrender spectrum would receive compensation in exchange for a voluntary spectrum transfer.  Boucher also stated that he would not support the FCC requiring stations to give up spectrum involuntarily.  Additionally, Rep. Stearns (R-FL) stated that Congress will ultimately decide if reallocation should occur.

As you may recall, NAB President and CEO Gordon Smith testified in favor of a full inventory of all spectrum late last year. NAB believes that the FCC should have a proper accounting of all spectrum before it seeks to reallocate broadcast spectrum for other purposes. A complete inventory and analysis of spectrum usage also would inform the current debate over spectrum needs, and help policymakers determine whether steps toward fostering greater spectrum efficiency – such as tightening service deployment deadlines for wireless licensees, or streamlining wireless licensing processes to get services to the public faster – are appropriate at this time. Additionally, this inventory will demonstrate the high efficiency and unparalleled public benefits of the use of spectrum for free, over-the-air broadcasting.

An Advisory from the law firm of Pillsbury Winthrop Shaw Pittman

by Lauren Lynch Flick and Scott R. Flick

The FCC’s Media Bureau has announced that a new version of the Biennial Ownership Report Form for commercial broadcast stations, FCC Form 323, will be available on its website as of April 9, 2010. All commercial broadcast station owners must file their biennial ownership reports using the new form by July 8, 2010. However, the data used to complete the form must be accurate as of November 1, 2009.

The FCC originally announced its intent to implement a new version of the Form 323 in an Order released in May 2009 as part of its Promoting Diversification in the Broadcasting Services proceeding. The revision required, among other things, that each holder of a direct or indirect attributable interest in a licensee secure an FCC-issued Federal Registration Number (“FRN”). The revision also mandated that information regarding attributable interest holders and their other broadcast interests be reported repeatedly and in a precisely structured manner. As a result, the number of reports and the time to complete each report increased dramatically for many broadcasters with the ultimate result that the FCC’s electronic filing system ground to a near halt and did not reliably save information entered into it. Based on these technical difficulties, the FCC stayed the filing obligation until it could improve the functioning of the form to account for these difficulties.

The FCC sent its revisions to the form to the Office of Management and Budget (“OMB”) for approval on March 25, and OMB approved the modified form on March 26. The revised form uses a new XML Spreadsheet template that will allow information to be entered into the spreadsheet and then uploaded to the form, thereby reducing the time and effort needed to enter the data. The spreadsheet must be downloaded from the FCC form and comes with detailed instructions regarding the proper use of the XML Spreadsheet. Of particular note are the following:

The XML Spreadsheet comes with 25 empty rows for data entry that contain embedded validation codes necessary for the proper functioning of the form. Any licensee needing more than 25 lines must copy and paste the original 25 lines as many times as necessary and not create new lines.

The XML Spreadsheet must be saved with an .xml extension, not the .xls or .xlsx extensions that the Excel program will assign by default. Licensees must not change or delete any data in Cell B1. Information must be entered in all capital letters. The new version of the form also retains the requirement that each attributable interest holder secure an FRN. The instructions state that where, after a good faith effort, a licensee is unable to secure an interest holder’s social security number, which is needed to  complete the FRN registration process, a button on the form will allow the licensee to secure a Special Use FRN. The instructions to the form state that the Special Use FRN can only be used for the Biennial Ownership Report filing, and not for any other filing, such as a post-consummation Ownership Report filing.

The Commission’s May 2009 Order also adopted November 1 as a new uniform reporting date for all commercial stations nationwide, regardless of the station’s license renewal filing anniversary (the deadline previously used by the FCC). Because the original November 1, 2009 filing requirement was stayed while the form was revised, the reports filed by the new July 8, 2010 deadline must still reflect the ownership data as it existed November 1, 2009.

The substantial difference in time between the new filing deadline and the time for which ownership information is being reported leads to some interesting questions. For example, where a station has been sold since November 2009, should the report be filed under the name of the new licensee or the prior licensee? If it is to be filed by the new licensee, how will the FCC deal with the fact that the new licensee may not have any personal knowledge of the prior licensee’s November 2009 ownership structure? These questions may be answered by a follow up public notice from the FCC, but if not, we will be pursuing them with the FCC’s staff.

Article from The Hill

By Tony Romm and Kim Hart – 04/06/10 10:55 AM ET

A federal appeals court on Tuesday dealt a significant legal blow to the Obama administration and net neutrality advocates, ruling that the Federal Communications Commission has no authority to regulate how Web providers manage their network traffic.

The decision overturns the FCC’s order in 2008 that Comcast cease blocking subscribers’ peer-to-peer file sharing applications, including BitTorrent, which the company said had over-burdened its strapped broadband network and slowed users’ connections.

Previously, the FCC argued that a smattering of federal laws, policy statements and court cases endowed the agency with the implicit authority to regulate Internet service providers’ (ISP) Web practices. It invoked that authority in late 2008, when it ordered Comcast to stop blocking or “throttling” traffic to BitTorrent.

But the Federal Court of Appeals in Washington D.C. on Tuesday disagreed with the agency’s assessment and subsequently ruled on a 3-0 vote to toss the FCC’s landmark order.

According to the court, “The Commission may exercise this ‘ancillary’ authority only if it demonstrates that its action—here barring Comcast from interfering with its customers’ use of peer-to-peer networking applications—is ‘reasonably ancillary to the . . . effective performance of its statutorily mandated responsibilities.’”

However, the judges noted, “The Commission has failed to make that showing. It relies principally on several Congressional statements of policy, but under Supreme Court and D.C. Circuit case law statements of policy, by themselves, do not create ’statutorily mandated responsibilities.’”

Neither Comcast nor the FCC have released a statement responding to the decision.

Still, the court’s move ultimately doubles as a major roadblock for the FCC, which drafted its comprehensive National Broadband Plan this year under the assumption that it possesses regulatory power over the Internet and the companies that provide users’ access to it. Many of its provisions also include clarion calls for net neutrality, which the agency may no longer have the authority to institute and enforce on its own.

Net neutrality is a top priority for President Barack Obama, who won the allegiance of the tech community during his campaign by promising to support an “open-Internet” regime.

The decision is a set-back for lawmakers that are trying to legislate net neutrality, also with the assumption that the FCC has the authority to codify such rules. Senators including Byron Dorgan (D-ND) and Olympia Snowe (R-Maine) have been big backers of net neutrality. In the House, Rick Boucher (D-Va.), Henry Waxman (D-Calif.) and Ed Markey (D-Mass.) have repeatedly pushed for formal net neutrality rules.

It’s also a major defeat for Google, Skype, Amazon.com and other Internet firms that have been huge propoents of net neutrality. Google has led the charge for “open” platforms that prevent Internet service providers and wireless companies from discriminating against certain applications and devices.

FCC Chairman Juilus Genachowski has indicated he will try to reclassify broadband as a Title II service in the communications statute, which would allow the FCC to enact net neutrality. Currently, broadband is classified as a Title I service, which, according to the court, does not give the FCC the necessary authority.

The court’s decision is a victory for big telecom companies that provide the bulk of U.S. broadband services. AT&T and Verizon are on Comcast’s side in this debate and have forcefully pushed back against net neutrality. The top Washington lobbyists for both AT&T and Verizon have said that the FCC will wind up back in court if it tries to reclassify broadband

By JOELLE TESSLER, AP Technology Writer Joelle Tessler, Ap Technology Writer – 1 hr 49 mins ago

WASHINGTON – A federal court threw the future of Internet regulations into doubt Tuesday with a far-reaching decision that went against the Federal Communications Commission and could even hamper the government’s plans to expand broadband access in the United States.

The U.S. Court of Appeals for the District of Columbia ruled that the FCC lacks authority to require broadband providers to give equal treatment to all Internet traffic flowing over their networks. That was a big victory for Comcast Corp., the nation’s largest cable company, which had challenged the FCC’s authority to impose such “network neutrality” obligations on broadband providers.

Supporters of network neutrality, including the FCC chairman, have argued that the policy is necessary to prevent broadband providers from favoring or discriminating against certain Web sites and online services, such as Internet phone programs or software that runs in a Web browser. Advocates contend there is precedent: Nondiscrimination rules have traditionally applied to so-called “common carrier” networks that serve the public, from roads and highways to electrical grids and telephone lines.

But broadband providers such as Comcast, AT&T Inc. and Verizon Communications Inc. argue that after spending billions of dollars on their networks, they should be able to sell premium services and manage their systems to prevent certain applications from hogging capacity.

Tuesday’s unanimous ruling by the three-judge panel was a setback for the FCC because it questioned the agency’s authority to regulate broadband. That could cause problems beyond the FCC’s effort to adopt official net neutrality regulations. It also has serious implications for the ambitious national broadband-expansion plan released by the FCC last month. The FCC needs the authority to regulate broadband so that it can push ahead with some of the plan’s key recommendations. Among other things, the FCC proposes to expand broadband by tapping the federal fund that subsidizes telephone service in poor and rural communities.

In a statement, the FCC said it remains “firmly committed to promoting an open Internet and to policies that will bring the enormous benefits of broadband to all Americans” and “will rest these policies … on a solid legal foundation.”

Comcast welcomed the decision, saying “our primary goal was always to clear our name and reputation.”

The case centers on Comcast’s actions in 2007 when it interfered with an online file-sharing service called BitTorrent, which lets people swap movies and other big files over the Internet. The next year the FCC banned Comcast from blocking subscribers from using BitTorrent. The commission, at the time headed by Republican Kevin Martin, based its order on a set of net neutrality principles it had adopted in 2005.

But Comcast argued that the FCC order was illegal because the agency was seeking to enforce mere policy principles, which don’t have the force of regulations or law. That’s one reason that Martin’s successor, Democratic FCC Chairman Julius Genachowski, is trying to formalize those rules.

The cable company had also argued the FCC lacks authority to mandate net neutrality because it had deregulated broadband under the Bush administration, a decision upheld by the Supreme Court in 2005.

The FCC now defines broadband as a lightly regulated information service. That means it is not subject to the “common carrier” obligations that make traditional telecommunications services share their networks with competitors and treat all traffic equally. But the FCC maintains that existing law gives it authority to set rules for information services.

Tuesday’s court decision rejected that reasoning, concluding that Congress has not given the FCC “untrammeled freedom” to regulate without explicit legal authority.

With so much at stake, the FCC now has several options. It could ask Congress to give it explicit authority to regulate broadband. Or it could appeal Tuesday’s decision.

But both of those steps could take too long because the agency “has too many important things they have to do right away,” said Ben Scott, policy director for the public interest group Free Press. Free Press was among the groups that alerted the FCC after The Associated Press ran tests and reported that Comcast was interfering with attempts by some subscribers to share files online.

Scott believes that the likeliest step by the FCC is that it will simply reclassify broadband as a more heavily regulated telecommunications service. That, ironically, could be the worst-case outcome from the perspective of the phone and cable companies.

“Comcast swung an ax at the FCC to protest the BitTorrent order,” Scott said. “And they sliced right through the FCC’s arm and plunged the ax into their own back.”

The battle over the FCC’s legal jurisdiction comes amid a larger policy dispute over the merits of net neutrality. Backed by Internet companies such as Google Inc. and the online calling service Skype, the FCC says rules are needed to prevent phone and cable companies from prioritizing some traffic or degrading or services that compete with their core businesses. Indeed, BitTorrent can be used to transfer large files such as online video, which could threaten Comcast’s cable TV business.

But broadband providers point to the fact that applications such as BitTorrent use an outsized amount of network capacity.

For its part, the FCC offered no details on its next step, but stressed that it remains committed to the principle of net neutrality.

“Today’s court decision invalidated the prior commission’s approach to preserving an open Internet,” the agency’s statement said. “But the court in no way disagreed with the importance of preserving a free and open Internet; nor did it close the door to other methods for achieving this important end.”