FCC Could Face Challenges to Viewability Rule

Recent notices disclosing ex parte meetings with FCC staff have cited statute, legislative history and raised procedural and constitutional concerns with the FCC’s proposals. Broadcasters haven’t decided if they'll sue but believe they have a strong case to make in court, industry sources said. “Must-carry broadcasters are certainly looking at this with an eye toward a petition for reconsideration or possible appeal depending of course on what this ultimately says,” a broadcast attorney said. But those stations, many of which operate in smaller markets on smaller budgets may not have the resources for a lengthy court battle, another broadcast attorney said: “It’s expensive. That’s why they have to rely on trade associations to do that for them. They can’t take on a big expensive appeal."

Though must-carry stations don’t have their own trade association, the Independent Voices for Local TV group was formed last week to lobby on the issue (CD June 8 p17). “There are a number of members of the coalition for whom litigation and or appeal [at the FCC] are probable if this issue isn’t resolved in a way that allows comments of interested parties on the proposed solution,” said Peggy Binzel, the group’s spokeswoman. “There’s been no ability to comment on the proposed solutions.” The group and other broadcasters have complained that the reported FCC proposal to let cable operators comply with the rules by leasing digital set-top boxes to their analog subscribers that want to keep watching must-carry signals hadn’t been properly vetted in the FCC’s notice of proposed rulemaking.

A cable attorney attacked that argument in a letter to the commission filed last week. “Ion’s complaint that cable operators have advanced a new ‘Adaptor Proposal’ that falls outside of the scope of the NRPM is mere wordplay,” an attorney for Time Warner Cable wrote (http://xrl.us/bnbarv). “What ION calls the ‘Adaptor Proposal’ is simply cable operators’ longstanding interpretation of the statute to require that must-carry signals be ‘viewable’ using appropriate equipment,” the letter said. The commission “plainly invited comments explaining how the availability of low-cost digital terminal adapters and other equipment will ensure that must-carry signals are ‘viewable,” the letter said. The letter also attacked broadcasters’ interpretations of the statute and legislative history.

Meanwhile, NAB said it no longer supports a compromise it put forward that would require cable operators to provide for free the equipment necessary for analog cable subscribers to keep viewing must-carry signals if the rule expires. “It has become clear to NAB through communications with our membership and viewers of must carry stations that even a free equipment offer would present barriers to access that constitute serious practical problems for both groups, and are in our view, inconsistent with the statute,” a letter from NAB to the commission said (http://xrl.us/bnbash). It also noted that no cable operators appeared willing to agree to such a compromise. “The proposal contained in NAB’s May 23 filings was offered in the spirit of compromise, and never intended to prejudice NAB’s legal rights with respect to the proper interpretation of the statutes,” it said.

John Kneuer, who ran NTIA in the run-up to the analog cutoff, weighed into the debate on behalf of must-carry TV stations. Letting the rule expire would undo much of the work that went into the DTV transition to make sure consumers weren’t disrupted by the broadcast analog cutoff, he wrote on Independent Voices for Local TV letterhead (http://xrl.us/bnbaso). “Cable systems across the country are investing billions of dollars to upgrade their systems to all digital platforms,” he wrote. “As a result, within the three-year sunset that the Commission initially proposed in this proceeding, as much as 95 percent of cable households would be served by” all digital systems, eliminating the need for an analog carriage requirement, he said. Pushing the sunset up 30 months “serves no compelling purpose and would inflict the very consumer harm the decade-long DTV transition was meant to avoid,” he said.

Consumers Union Policy Counsel Parul Desai in separate conversations told aides to FCC Chairman Julius Genachowski and Commissioner Robert McDowell about the group’s concerns that consumers would unfairly suffer if they were required to lease additional cable equipment to keep watching must-carry programming, an ex parte notice shows (http://xrl.us/bnbaud).