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  • rickaplan 9:12 am on May 23, 2014 Permalink  

    The Point of Being a Ninja Is to Avoid Attention 

    As my 8-year-old works to navigate the travails of making friends in second grade, one of his most unfortunate emerging strategies has been to do silly things to get his peers’ attention. He took that approach to a new level this week when he spent some quality time with the school principal after dumping chocolate milk out of the school bus window on a dare.

    I was reminded of that incident when, in another second-grade moment, CEA’s CEO Gary Shapiro dumped his chocolate milk out of the window with a silly and misguided missive in The Hill (“Broadcasters’ madness hurting the public,” May 21).

    Mr. Shapiro’s innovative thesis is that NAB “implor[es] the federal government for all sorts of favors while completely ignoring what the public wants and needs.” As Exhibit A, he suggests that broadcasters have “done all [they] can to delay implementation of voluntary spectrum auctions,” and that “the NAB has dragged its feet since the law passed and is seemingly discouraging broadcasters from participating in the auction.” Mr. Shaprio’s Exhibit B is broadcasters’ suit against Aereo, an Internet service that takes free, over-the-air broadcasts and converts and repackages them and sells them to consumers for a fee.

    At the outset, Mr. Shapiro’s high-level thesis is absurd. He conveniently ignores the incredible and life-saving coverage broadcasters recently provided in communities hit hard by severe weather events. I may be way off base here, but I think what the public “wants and needs” is information that helps them stay informed and stay safe. These are services radio and television broadcasters provide across the country on a regular basis, and they are unequaled.

    In fact, if CEA really cared about the public interest, it would lean on its wireless carrier and device members to take the simple step of unlocking the FM chips already in their phones. Then, when the wireless alert system is activated to say “check your local media,” a consumer could simply hit a button and have instant access to a local radio station that provides critical information.

    With respect to the voluntary broadcast spectrum incentive auction, Mr. Shapiro is completely out to lunch. His initial claim, that broadcasters are doing all they can to delay implementation of the auction, has zero basis in fact. Indeed, he does not, and cannot, point to a single instance where NAB has attempted to delay the auction.

    NAB has been constructively engaged in the auction process at least as much as any other entity, and has consistently provided concrete solutions for every problem we have identified. We have faithfully lived up to our public statements that we will do what we can to give the voluntary incentive auction the best chance for success. At the same time, it is essential that the auction remains faithful to Congress’s intent of keeping it voluntary, and NAB will work to ensure that broadcasters who want to remain on the air and continue serving their communities can do so without any repercussions.

    What Mr. Shapiro also overlooks is how NAB played a major facilitating role in what is likely to be a $10-$15 billion auction this year of AWS-3 spectrum. As the FCC scratched its head to figure out how to auction largely valueless unpaired spectrum to meet a Congressional mandate, NAB, along with the Department of Defense worked quickly to develop a sharing framework that enabled the FCC to pair that spectrum. NAB gained nothing from that endeavor. We simply recognized that there was a significant public good to be gained by sharing our spectrum with DoD, and found a way to make it happen. NAB has clearly done its part.

    Mr. Shapiro’s second auction claim, namely that NAB is “seemingly” discouraging broadcasters from participating in the auction borders on libel. How are we “seemingly” doing this? Are we “actually” doing it or “seemingly”? I don’t even really understand his point, beyond its goal of attempting to poison the well with an irresponsible suggestion.

    That comment is akin to us saying that because CEA vigorously opposed basic laws and regulations that made electronics accessible to disabled Americans, “CEA seemingly doesn’t care about Americans with disabilities.” Or that, “CEA’s members seemingly exploit children overseas for cheap labor.” Or that, because its members manufacture millions of shiny new objects that end up polluting our oceans and landfills every day, “CEA seemingly supports devastating the environment.”

    I’m not saying these things are true, but hey, it may seem like they are.

    The other nonsensical point in Mr. Shapiro’s piece is his attack on broadcasters for taking Aereo to court. His argument is that, because broadcasters are supposed to provide their content for free, broadcasters can’t and shouldn’t prevent someone else from taking that content and selling it for profit. That makes no sense and is wholly inconsistent with his own advocacy on behalf of his members. I am confident that his members would not support the notion that they should pour a ton of investment into new technologies only to have their competitors steal it and sell it as their own.

    As Mr. Shapiro knows all too well, there are very good reasons why the law provides copyright and patent protection. Those protections are not merely there to coddle multi-national electronics manufacturers, but to protect the innovations of America’s broadcasters as well.

    NAB has an unofficial internal rule that we only respond to Mr. Shapiro’s comments once for every three or four of his outbursts. This is because, like my second-grader, if you react to something an attention-seeker does, it encourages them to keep doing it. And perhaps this blog is the equivalent of laughing at my son’s milk-scapade. But given the importance of the issues discussed, and the forum in which Mr. Shapiro elected to express his views, we believe it makes sense to correct the record.

    As I explained to my second-grader, there are appropriate and inappropriate ways to get people’s attention. In my son’s case, getting attention from others is best done through his intelligence, thoughtfulness and appropriate sense of humor. In Mr. Shapiro’s case, it’s attempting to stick to the facts, and also taking a good, long look in the mirror before penning another piece in The Hill.

     
  • Zamir Ahmed 9:49 am on May 21, 2014 Permalink  

    Broadcasters Show Their Commitment to Public Safety 

    Much attention has been paid to KSFY (Sioux Falls, S.D.) anchor Nancy Naeve’s recent on-air rebuke of viewers who complained about the station breaking into regular programming to report on a tornado in the area on May 11. It has been heartening to see that a vast majority of those weighing in on the subject have supported broadcasters putting their public safety commitment above all else.

    The video of Naeve is just the latest example of broadcasters being credited for educating the public about staying safe when danger is approaching. Tupelo, Miss. residents have praised WTVA meteorologist Matt Laubhan for saving their lives during a tornado outbreak in April, after his on-air evacuation order to station personnel led many viewers to seek shelter.

    Radio and television broadcasters are serious about our roles as “first informers.” We do not take lightly a decision to preempt regular programming with live reporting regarding emergency situations. Broadcasting is very often the first place residents, and many first responders, turn to for information when danger is headed towards a community.

    However, the recent order from the FCC on the incentive auction could significantly interfere with television stations’ ability to keep their audiences informed.

    The incentive auction order proposes changes to the methodology and software that determines the coverage area of a broadcaster’s signal and the potential elimination of TV translators that could result in millions of viewers being left without access to the local television programming that they currently rely on. As NAB has made clear to the Commission, these proposed changes dramatically alter broadcasters’ coverage areas and the population they serve today. In more densely populated areas where TV stations are located in cities closer together, viewers may be able to receive signals from other nearby broadcasters. That’s an option that may not exist in lesser populated areas where TV stations are farther apart, such as in Sioux Falls. That could be the difference between life and death for some.

    The tornado that KSFY reported on that sparked the complaints touched down in Hospers, Iowa – about 70 miles from the station’s base of Sioux Falls. Under the FCC’s proposed signal contour methodology, those residents in the path of the storm might not have seen the lifesaving emergency information KSFY provided. In many areas of the country, particularly rural states, broadcast stations may be unable to reach significant portions of the populations due to terrain or geographic reasons. Translators allow broadcasters to fill in gaps in this coverage by transmitting their signal. Americans should not be put at risk to natural disasters because the translator service they used to watch broadcast TV was not protected by the FCC.

    NAB is supportive of a broadcast spectrum incentive auction that is truly voluntary. We believe in a future that is both broadcasting and broadband, a partnership that can be particularly beneficial when it comes to public safety. It appears our friends in the wireless industry believe so as well.

    CTIA-The Wireless Association recently tweeted an article about a cellphone alert awakening Charlotte, N.C. residents to an approaching tornado. The alert directed residents to tune into their local broadcast television station for more information. It is a perfect example of how broadband and broadcasting can work hand-in-hand to save lives.

    As the FCC proceeds with creating a framework for the incentive auction, it must refrain from instituting rules that jeopardize the pledge broadcasters’ have made to serve their communities during times of need. We take that pledge seriously. We hope the FCC does too.

     
  • NAB 3:51 pm on May 19, 2014 Permalink
    Tags: App, , Hybrid FM, Hybrid Radio, Mobile Phone, NextRadio, Radio App, TagStation   

    Broadcast Radio: Owning its Place in the Tech World 

    Guest Blogger Paul Brenner is senior vice president and chief technology officer of Emmis Communications Corp. Brenner works both within the broadcast industry and with pure-play IT development companies. He currently serves on NAB’s Digital Radio Committee.

     

    BrennerThe radio industry needs to “own” a unique technology. Google owns search. Wireless companies own the mobile subscriber. Facebook rules the social platform. Apple dominates the app and music store. Pandora is the go-to for user-programmed streaming. As an industry, radio by revenue and consumer consumption should by all accounts own something in the technology sector. While many can successfully debate that radio owns the local advertising market and in-car listening time, those are not technology driven growth opportunities. Those outside of radio, and a few naysayers inside radio, debate that radio has a place in the future at all.

     

     

    Radio broadcasters can make hybrid, interactive radio on smartphones the technology that consumers look to as the reinvention of local broadcast radio. NextRadio, the only hybrid FM app available, can be the ultimate hyper-local platform with mass market local radio stations using calls-to-action and thousands of local sellers to own mobile advertising and the growing mobile ad market. Consumers can benefit from enhanced content on the radio dial, efficiency of FM radio (more handset battery life, lower data bills) and most importantly, keep radio at their fingertips in times of emergency.

    So, in this changing media and technological landscape where the mercurial consumer bounces between seemingly endless apps and choices, what unique offering can radio provide? Hybrid radio is the term being used ubiquitously to describe a melding of one-way technology (like broadcast radio) with two-way technology (like mobile broadband). Traditional broadcast radio is the most efficient way to reach the mass market with entertainment and information. Two-way technology may be better at direct one-to-one engagement with the consumer, but is not the best solution to deliver mass-market content for technical and economic reasons. When we launched NextRadio for FM smartphones and connected cars, our creative intent was to visualize the value of FM radio as localism, calls-to-action and well programmed radio stations to translate the strongest relationship elements into a system that would automatically link to the two-way smartphone. “Hey listeners, call this number, text-to-win, attend our promo event, go to this website!” Simplicity is extremely difficult but if you look at what Google, Apple, Twitter and others “own,” they keep it simple, and I think we have achieved something similar with NextRadio.

    How NextRadio Works

     

    CHART_TagStation_HowItWorks
    Making Radio Cool

    People listen to local radio. The numbers show that. In a recent focus group performed by Coleman Insights, NextRadio on an HTC One Red smartphone was put in the hands of people of all ages and genders. Two reactions were common. “Wow, this is cool.” What?! Radio IS cool. In this world of Twitter, Snapchat and Angry Birds, “This is cool” is exactly what you need to hear from this generation. The second reaction was, “Huh, I didn’t know I could listen to FM radio outside my car.”  If you are a broadcaster you should be swallowing a big lump right about now. Usage curves of FM radio show morning drive and afternoon drive as the times people listen to radio in the car. If we want to sustain and grow the broadcast radio industry, we must make radio cool again and educate listeners on its availability outside the car.

    NextRadio launched with Sprint in August of 2013. One phone, the HTC One, was our soft launch and this was our opportunity to work out the prototypical system bugs. By Black Friday 2013, we had five more smartphones to launch and about the time people started unwrapping their Christmas gifts our install rates and listening became a hockey stick curve. NextRadio now has over 400,000 activated users and is growing daily. FM radio is preloaded on 15 Sprint, Boost and Virgin Mobile phones. Over 30 models will be FM-enabled and commercially available by the end of this year, and tablet development is in progress. What does this mean for incremental FM listening, assuming people would otherwise be listening to streaming music on their smartphone? The first quarter of 2014 saw month-over-month listening grow an average of 56 percent. And, those smartphone listeners are listening primarily between 10 a.m. and 3 p.m., outside of their car!

    Looking at the current forecasts for FM-enabled smartphone sales of 3-5 million units in Q2 2014, we expect by mid-year 2014 to have at least 5 million FM-enabled smartphones in the hands of consumers and continuing to grow. Broadcasters need to care a lot about this evolution. Why? Because the first time that consumer launches NextRadio and hears local FM radio, they will make a choice instantly to either continue using FM radio on their smartphone or switch to an internet-friendly, visual alternative. Broadcasters can use a tool like TagStation to create an experience that radio can own. This is how the radio industry looks to the future: by blending what we are great at with what the consumer expects in today’s tech heavy world.

    Lastly, but most importantly, is the public service aspect of FM in smartphones. My parents live in rural southern Indiana. Recently, tornadoes and 120 mph winds hit their town. The house of my 75+ year old parents was damaged and they were without power for three days. Mom had switched to a smartphone some time ago to be part of the texting and picture sharing world of grandchildren. However, in the event of the storm and soon after, I could not reach her on the phone. As day two and three wore on, my mom and dad needed help so my sister drove out to them. My parents had naturally turned to radio and TV for help, yet neither was available. Yes, I had told my mom to get a Sprint phone, but she is a Verizon customer. Maybe I can change that based on this emergency. The moral of the story is: radio is a lifeline to people in emergencies to give them comfort and much needed information. FM-enabled smartphones can be one way of helping people in times of need, especially when other resources are not available.

    Radio can truly own something unique with NextRadio. Consumers will benefit from interactive FM-enabled smartphones, and in an emergency when people need a lifeline for information, the FM radio will be the distribution platform most likely to be there for them. Make your radio stations interactive for NextRadio, promote the value to your listeners, and in the words of David Pogue at the 2014 NAB Show, stand on the mountain top and tell everyone about NextRadio.

     
  • rickaplan 1:20 pm on April 29, 2014 Permalink
    Tags: , ,   

    I Suppose It’s Worth A Try (When You Are On a Roll…) 

    There is overstating and then there is overstating.

    Last week, NAB proposed to the FCC commissioners some changes to the 600 MHz band plan included in the draft incentive auction order currently under review at the Commission. Specifically, NAB asked the FCC to shelve its planned 6-to-11 megahertz duplex gap that would be shared between wireless and unlicensed services, and instead adopt NAB’s “Plan B” and use a flat 10 or 11 megahertz duplex gap, of which 4 or 5 megahertz would be reserved exclusively for wireless microphones. NAB believes this is both fair and essential, as licensed wireless microphone users will be foregoing the current two exclusive 6 megahertz channels in favor of only 4 or 5 megahertz vital to providing breaking news coverage in local communities throughout the country.

    In response, New America Foundation’s Michael Calabrese blasted NAB’s proposal, saying that it “would be a death sentence for unlicensed broadband and innovation post-auction.”

    That statement almost made me feel badly. Were we essentially recommending an end to unlicensed innovation as we know it? Would our proposal lead to no more WiFi, garage door openers or cordless phones? Are we proposing to kill off baby monitors, and putting infants at risk across the nation? What have we become?

    After some serious soul-searching, my grandmother’s famous chicken soup (good for the soul) and a long hard look in the mirror, I looked to the facts to see if Mr. Calabrese was really on to something.

    Fact #1: In March, the FCC massively expanded the spectrum designated for unlicensed services by allocating more than 100 megahertz for that purpose in the 5 GHz band.

    Fact #2: Just last week, the FCC launched a proceeding to free up as much as 150 megahertz more spectrum for unlicensed services, this time at 3.5 GHz.

    Fact #3: In the draft incentive auction order, the proposal for the 600 MHz band is likely to render the duplex gap unusable for unlicensed services. It envisions scenarios where the duplex gap would be anywhere between 6 and 11 megahertz. Any plan allocating less than 11 or 12 megahertz between LTE uplink and downlink will, according to the unlicensed community, render that spectrum far less valuable.

    Fact #4: The FCC’s draft incentive auction order opens up channel 37 and a new guard band that will give unlicensed users brand new nationwide bands, including, for the first time, spectrum in major markets such as New York and Los Angeles.

    Fact #5: Under the draft incentive auction order, not only do wireless microphones lose well over half of their shared spectrum, but licensed wireless mic operators lose all 12 megahertz that are designated for exclusive use. Thus, if approved, wireless microphones will have gone from more than 60 megahertz of exclusive spectrum to zero in just five years. If there is any kind of “death sentence” in the draft order, it’s clearly just for wireless microphones.

    Unlicensed spectrum advocates – primarily Google and Microsoft – are on a serious roll in the spectrum department. In proceeding after proceeding, they keep racking up more free spectrum. And I completely subscribe to the theory of when you are on a roll, you should keep shooting. Mr. Calabrese’s play is really no more than a “heat check” for the spectrum world and Mr. Calabrese, along with Google and Microsoft, is probably feeling a lot like the Golden State Warriors’ Steph Curry right now.

    Thirty-foot jump shots aside, it is clear that absolutely no innovation is lost under NAB’s “Plan B.” In fact, the unlicensed community will exit 2014 having earned massive allocations of spectrum, including new nationwide spectrum blocks in the 600 MHz band. Thus, NAB’s proposal does nothing to drive a stake through the beating heart of unlicensed broadband innovation.

    On the other hand, it is hard to overstate the harm the current draft order would do to wireless microphones and the essential public service they help deliver. These devices – an innovation themselves, for what it’s worth – help broadcasters on a daily basis cover breaking news and weather in local cities and towns across the nation. When the president followed developments in the Boston bombing tragedy, he watched multiple local Boston broadcast TV stations to get well-informed, up-to-date, on-scene reporting. In order for that to happen, broadcasters relied on wireless microphones to deliver the news as it was breaking.

    Some unlicensed spectrum advocates believe the TV white spaces database to be some kind of panacea. It is not. FCC rules require that devices check the database only once every 24 hours. Thus, broadcasters can only be sure to be free from interference from unlicensed devices sharing their wireless microphone channels if the world is kind enough to inform them of breaking news a day in advance. And even if the FCC finally amends its rules to permit more frequent checking – which it should have done at the outset – in times of crisis wireless networks often go down, rendering the database useless. That is exactly what happened in Boston following last year’s horrific bombing.

    In a more temperate moment, Mr. Calabrese also noted that his coalition “strongly supports the NAB’s position that the FCC should continue to reserve two vacant broadcast channels for priority use by licensed wireless microphones.” He states that “[t]hese channels could be designated post-auction in each market and therefore would not in any way reduce the Commission’s flexibility during the auction.”

    To be clear, NAB’s “Plan A” that Mr. Calabrese refers to involves retaining today’s two exclusive channels pre- and not post-auction. This is because a post-auction reservation means essentially nothing in all of the major markets. In most of the top 100 markets, following the auction there will be no spectrum whatsoever available for reservation. Repacking and reallocation will take care of that.

    Now I understand the eagerness of many companies – especially major tech companies and wireless carriers – to feed off of the broadcaster carcass in the upper 600 MHz band. The Chicken Little approach, however, won’t get it done. Facts will. And the fact is that wireless microphones need some small exclusive home in their 600 MHz band in order for newsgatherers to keep providing the kind of on-scene up-to-date information for their viewers. There is a place for nearly everyone in the incentive auction, and both NAB’s Plan A and B for wireless microphones reflects the best and most appropriate balance.

     
  • rickaplan 2:03 pm on April 9, 2014 Permalink
    Tags:   

    The Missing Piece of Chairman Wheeler’s Broadcast Vision 

    At the annual NAB Show in Las Vegas on Monday, NAB President and CEO Gordon Smith publicly called for the Federal Communications Commission (FCC) to develop a National Broadcast Plan. He suggested that this plan, inspired by the National Broadband Plan, should outline the FCC’s vision for how the government can help drive, or at least not impede, innovation and investment in broadcasting.

    Broadcasters have been craving a coherent and holistic FCC vision for their industry for quite some time. Rather than be subject to piecemeal and often contradictory regulations and expectations, broadcasters yearn to understand where the agency sees them as part of the overall telecommunications landscape. Are broadcasters “special” because they are the lone voice of localism and diversity, and therefore will be regulated as such? Or is the FCC going to measure the relative value of the industry on how it competes with the wireless and cable industries, and thus level the playing field by freeing up broadcasters from their shackles of unparalleled regulation?

    FCC Chairman Tom Wheeler responded in a speech Tuesday to Smith’s call by setting forth his high-level vision for broadcasters. The chairman should be commended for sharing his long-term view of the industry. It’s essential that broadcasters understand how their regulator perceives their role within the overall telecommunications landscape.

    The chairman explained that the broadcast industry is at a crossroads, saying, “We are at an inflection point where broadcast licensees can move from being the disrupted, to being the disruptor.”

    He is right on the money. Broadcasters have the potential collectively to be a major disruptor. They can provide the increasingly vital competition to the heavily consolidated – and ever consolidating – cable and wireless industries.

    The chairman is off target, however, with respect to the manner in which broadcasters can most significantly be disruptive. In his mind, broadcasters should aim to become another Netflix; in other words, they should focus on delivering their content over the Internet. He asked broadcasters to focus on “digital,” meaning they should focus more on their Web properties than broadcasting over their own wireless networks.

    I don’t know about you, but a future that gives even more power to the incredibly consolidated and exceedingly powerful cable and wireless industries – one that puts them as our gatekeepers – sounds like a future that ultimately only disrupts broadcasters, and not the overall ecosystem.

    In my view, with the right policies and flexibility in place, broadcasters can leverage their exceptional local content and, perhaps most notably, superior transmission system, to truly shake up the wireless and cable grip on the marketplace. Broadcasters even have a terrific opportunity to serve as a driver of the over-the-top industry (as opposed to a mere client), by allowing cord-cutters to receive free broadcast TV while supplementing with over-the-top content.

    The chairman’s own words brought our differing visions into stark focus:

    “[Broadcasters] possess the two most important components of a successful digital strategy: compelling content – specifically, the most important content: local content – and the means to promote it.”

    What is most notable about this passage is what is missing. Most TV broadcasters in attendance assumed that the chairman would note that the two best broadcast assets are local content and a unique and spectrally efficient architecture. The omission of the latter is important because it demonstrates that the chairman does not see, as many broadcasters do, a game-changing value in our one-to-many architecture. At no point did he acknowledge this competitive advantage. The only value of our architecture in his mind was as a wireless sandwich board, advertising how great our over-the-top content is.

    It is not lost on many broadcasters that the chairman’s vision happens to fit nicely into two of his three highest priorities: the spectrum incentive auction and the open Internet. First, if broadcasters buy into his vision of them as over-the-top content providers, they don’t really need their spectrum and therefore they should participate in his incentive auction. Second, if broadcasters become over-the-top content providers, they should be concerned about broadband providers slowing down their service or demanding payments for delivery to consumers, and thus should line up in support of the chairman’s controversial drive for robust rules governing the Internet.

    To what degree the chairman’s vision is truly comprehensive or instead a clever way of convincing broadcasters to support his legacy items is anyone’s guess. At this point, it’s frankly too hard to judge.

    Either way, forward-thinking broadcasters truly understand the value of their transmission system and the value of their spectrum. They also know that spectrum value will only increase. That’s why broadcast companies have spent over $50 billion in buying and selling stations for years. Despite the chairman’s not-so-subtle warning that the incentive auction is a “once-in-a-lifetime opportunity,” broadcasters get that their spectrum values will not drop anytime soon.

    Indeed, many broadcasters are looking to do far more with their spectrum, whether it is higher quality video (4K and 8K), robust delivery to mobile devices or new IP-based solutions for emerging needs such as machine-to-machine technologies. They are also looking to help address the challenge of delivering wireless video; that pesky issue that causes wireless networks to slow down and even fail altogether. And broadcasters can do this for consumers for free; i.e., video delivery over a broadcaster’s transmission system that won’t eat into expensive wireless data plans.

    The chairman’s remarks demonstrate that broadcasters have their work cut out for them. Unlike the chairman, they don’t, and likely never will, view themselves as mere content companies or websites. Obviously their digital properties are a strong compliment to their core businesses. In fact in most markets the most viewed local websites are already broadcast television and radio websites. And local broadcasters continue to find new ways to go over-the-top with their network partners. But the industry also possesses a unique and spectrally efficient delivery system that should not be overlooked. In fact, the FCC can’t overlook it. Our architecture – both radio and television – has to be a key component in addressing our nation’s spectrum needs in the future.

    A National Broadcast Plan would look at the ways in which our transmission system could make a meaningful difference in spectrum policy and services to which all Americans have access. A meaningful National Broadcast Plan would not shrink broadcasting into a mere Web service, but grow it into a real competitive force against wireless and cable. If all we do is ride on their backs, we will ultimately always be beholden to them. For a chairman whose watchwords are “competition, competition, competition,” his remarks conspicuously overlooked meaningful intermodal competition in the delivery of video content.

    Broadcasters want to be a major part of the future, and not just in the way in which they’ve been an integral part of the past. Broadcasters – both radio and television – want to continue to morph technologically to help address the need for competition, localism and diversity. We cannot do that by surrendering spectrum and putting ourselves and our viewers at the mercy of the wireless and cable industries. We must be a true competitive force, and we need the FCC to have the vision and courage to be a partner in allowing us to do so.

     
  • jmago2014 12:31 pm on March 11, 2014 Permalink
    Tags: , JSA, media ownership   

    Looking to the Law 

    As a General Counsel – now at NAB and formerly of the FCC – I tend to believe that adhering to the law is a good thing.  That is why I am very troubled by the broadcast ownership order now circulating at the Commission and the blog posts filed by senior FCC officials supporting it.

    The very first line of the Chairman’s blog post makes it surprisingly clear that the agency must take a closer look at the law before moving forward on the proposed order. His post describes the FCC’s quadrennial obligation to review the broadcast ownership rules as one to “determine if they need to be modified to serve the public interest.”  That is not the law.

    Section 202(h) of the 1996 Telecommunications Act which imposes the quadrennial review requirement on the FCC was adopted as part of a deregulatory framework. The statute states that the Commission “shall determine whether any [broadcast ownership] rules are necessary in the public interest as the result of competition.” And, it goes on to say that the Commission “shall repeal or modify any regulation it determines to be no longer in the public interest” (emphasis added).

    Given this directive, I find it very hard to understand how one could conclude that reaching back to a docket from 2004 to increase regulation of joint sales agreements (JSAs) without any consideration of the larger picture or change in the marketplace is consistent with the directive of Section 202(h).

    I am even more perplexed and troubled that the apparent basis of the decision to declare television JSAs attributable is a sweeping and inaccurate generalization that JSAs necessarily create de facto ownership and thus violate existing ownership rules.  The blogs do not reference or apparently consider the very significant database of JSAs that resides at the FCC. Instead, they draw conclusions from Securities and Exchange Commission (SEC) filings.  Those filings respond to rules and goals established by the SEC for a very different purpose than FCC licensing. SEC filings are not a part of FCC precedent or law.

    Indeed it is striking that the blogs make no reference to the decades old FCC indicia of control: decision-making authority over programming, personnel and financing. Those indicia led the FCC staff to approve at least 50 JSA arrangements since 2011, making clear in their review that the licensee must control at least 85% of programming and retain at least 70% of net advertising revenue. Also, to pass muster, the terms of the deal must apply at least 20% of station value to the license value.  The FCC is not free to ignore precedent.

    Similarly, as a matter of law, the FCC is not free to simply ignore the record before it. Here, basing a decision on gross generalizations that JSAs are intended to get around ownership rules is wrong.  Adhering to the law in this case requires the agency to take a hard look at the evidence in its own records and consider the presentations made by NAB and others – presentations that demonstrate the varied nature and very real public interest benefits of television JSAs.

    Finally, adhering to the law in this case means taking the directive of Section 202(h) seriously. The Commission must look at the local television ownership rules in light of current competitive conditions. That cannot mean starting another never-ending quadrennial review while tightening restrictions on local broadcast stations alone. 

     
  • rickaplan 2:00 pm on January 28, 2014 Permalink
    Tags:   

    What to Expect When You Are Expecting 

    For those interested in the voluntary broadcast spectrum incentive auction, this should be an interesting week at the Federal Communications Commission (FCC). At the FCC’s monthly meeting, the Commission’s staff will lay out its timeline and project plan for the upcoming auction. This update should be helpful, as all stakeholders seek to get a better handle on what to expect next. Most of all, we hope that the staff seizes this opportunity to go beyond a discussion of dates and timelines – auction timelines have garnered the bulk of the headlines so far – and delve into their current thinking on the substance of the auction and its components. This week’s meeting comes nearly 500 days after the incentive auction Notice of Proposed Rulemaking (NPRM) was adopted, and the FCC has since collected approximately 350 ex parte submissions and 375 written comments on the subject. The time certainly is ripe for the staff to let the public in on its proposed approach to a variety of hotly contested topics. 

    To be more specific, here are some things NAB would like to see emerge from Thursday’s meeting:

    • The staff discusses its latest thinking on the 600 MHz band plan.
    • The chairman announces that he is forming an “expert user group” of outside stakeholders who are willing to commit the time and resources to evaluating the auction and repacking software once it has been created. This group will test the software to ensure the final product will produce the intended results, without unpleasant surprises.
    • The staff provides a substantive update on its latest work on the international front. The report will not merely list the number of meetings with Canada and Mexico; but rather, will detail how the staff intends to proceed if it has no agreement in place with one or both countries. The chairman indicated in a House hearing last month that he does not expect to have such agreements. Assuming that it is even lawful to proceed with the auction without these agreements (and NAB believes it is not), how will a lack of meaningful coordination affect the auction and the amount of spectrum recovered across the country?
    • The chairman announces that the Commission will move certain parts of the incentive auction order sooner, rather than later. Discrete pieces of the order, such as which broadcasters will receive protection in the repacking, the process for relocating and protecting translators and low-power TVs and the eligibility constraints, if any, placed on forward auction bidders, can and should be decided now, helping the process move more swiftly overall.
    • The staff announces that it will release the long-awaited Public Notice on co-channel interference.
    • The staff of the Office of Engineering and Technology announces that it has dropped its proposed incentive-auction-specific changes to OET-69, and instead will focus all of its energy on ensuring the accuracy of the repacking model. The proposed changes, as well as literally 12 different versions of the TVStudy software (in less than a year), have only served to introduce uncertainty into the process and threaten to slow down the auction process considerably.
    • The staff discusses its plans for wireless microphones, in light of the fact that the NPRM suggests displacing their operations although offers no solution as to where this critical service might find a home.

    It would also be a welcome sign to see the chairman publicly affirm that the Commission, under his watch, will in no way take actions to harm broadcasters in unrelated proceedings to encourage participation in the auction. Not only would such actions be unlawful, they would be bad policy. If there was ever a time the Commission needed to develop trust with broadcasters, that time is now. Our participation in all phases of the auction is essential to its success. We are eagerly watching and waiting to develop a true partnership with the Commission as it seeks to execute the first spectrum incentive auction in history. 

     
  • Dennis Wharton 11:19 am on January 22, 2014 Permalink
    Tags:   

    Spectrum Sophistry 

    Thank you, Jeffrey Eisenach.

    Thank you for driving a stake deep in the heart of one of the Beltway’s biggest whoppers – namely, that broadcasters are the boondoggle beneficiaries of “free spectrum.”

    For my 31 years living in “This Town,” it’s been presented as gospel that TV stations “got the airwaves for nothing.” It started as “the $60 billion giveaway,” morphed into $80 billion, and if memory serves me correct, eventually became a “$600 billion giveaway”. (Do I hear $600 trillion gazillion, anyone?)

    “The Largest Corporate Welfare Program in History” read one headline. “The Best Bargain Since Manhattan” screamed another.

    Which brings me to the aforementioned Jeffrey Eisenach. A few months back, this well-respected economist was asked to review the validity of claims of a “TV spectrum giveaway”.

    After an intensive review of FCC filings, the compilation of data from media research firms and an analysis of communications law and history, here’s what Eisenach found:

    Ninety-two percent of all existing full-power television broadcasters PAID MARKET RATES for spectrum licenses on the secondary market. Today, fewer than one in ten full power TV licenses is held by an original licensee, and collectively, broadcasters have shelled out $50 billion dollars for their TV licenses (which, coincidentally, just happens to be just about exactly the amount of money that the FCC has raised in spectrum auctions).

    Translation: Suggestions of broadcasters being the recipients of a “billion dollar giveaway” are – in a word – bogus.

    But wait, this gets better. Eisenach also exposed the hypocrisy of those who bemoan the government’s “broadcast spectrum giveaway.”

    As Eisenach makes clear – long before the FCC’s first spectrum auction — wireless carriers and satellite TV providers DISH and DIRECTV were the recipients of FREE spectrum themselves. Those “free” airwaves remain in the hands of the original licensees or the companies that gobbled them up.

    Moreover, these wireless and satellite TV providers who continue to operate on government-granted free spectrum have NONE of the public interest obligations of local TV stations. They have NO program decency standards, NO ownership limits, NO online political advertising requirements, and NO children’s educational programming regulations.

    Yet, is anyone calling out cellular companies for receiving spectrum “for free”? Is anyone objecting to DISH and DIRECTV’s bonanza of “free spectrum”? I didn’t think so.

    And let’s not forget: None of broadcasting’s competitors embrace the localism mandate that broadcasters embrace. None of them have the network redundancy that is built into broadcasting which allows us to remain “always on” in times of crisis. Cellphone and broadband networks were rendered inoperable by events like Hurricane Sandy in New York, killer tornadoes in Oklahoma City, Tuscaloosa, and Joplin, Mo. and by the derecho in Washington, DC. When it mattered most, broadcasting was the indispensable medium because of its “one-to-everyone” architecture.

    Harping on the false claim that broadcasters received spectrum “for free” ignores the tremendous investment local stations have made to utilize airwaves for its highest and best use. It also ignores the $15 billion broadcasters spent on the DTV transition, with no guarantee that a dime of that would be recouped.

    Every day, local television stations and our network partners invest in quality news, weather, sports and entertainment that remains the most-watched programming on TV. More than 90 of the 100 top programs every week are on broadcast TV, and are available free of charge to anyone who installs a $50 antenna. Broadcast TV is growing because of the cord-cutting phenomenon, and today there are 59.7 million people who rely exclusively on over-the-air broadcast television.

    There will always be distortions and half-truths served up by those who would love to eliminate free and local broadcasting as a competitive, innovative force in communications. Thanks to Jeffrey Eisenach, we can finally put to rest the phony claim of a “broadcast spectrum giveaway.”

     
  • rickaplan 12:40 pm on January 13, 2014 Permalink
    Tags: ,   

    Spectrum Reflections: It’s Time for A Moment of Reflection, CCA 

    CCA, please tell us you are kidding.

    In December, the Competitive Carriers Association (CCA), a trade association that represents most wireless carriers with the exception of Verizon Wireless and AT&T, filed comments at the Federal Communications Commission (FCC) in response to the FCC’s proposed rulemaking to eliminate the so-called UHF television discount. The filing would be downright funny if it wasn’t so desperate, specious and irresponsible.

    The UHF discount proceeding is a pure broadcast television issue. By way of brief background, the broadcast television ownership rule prohibits a single entity from owning stations that reach in the aggregate more than 39 percent of total television households nationwide. The “UHF discount” allows stations broadcasting in UHF to count toward that cap only half of the TV households in their markets, as opposed to all of the households for VHF stations. The FCC has proposed to eliminate that discount.

    The issue has absolutely no impact on the wireless industry. So why would CCA file? Was it a mistake?

    CCA’s comments prodded the FCC to “examine . . . rules applicable to broadcast stations and take action to eliminate remaining regulatory distortions. . . . [T]he Commission should carefully consider how the existing rules and proposed reforms would affect broadcast stations’ incentives to relinquish spectrum in the upcoming 600 MHz incentive auction and adopt reforms in light of that vital consideration.”

    In plain English, CCA expressly asked the FCC to strong arm broadcasters into participating in the wholly unrelated voluntary broadcast spectrum incentive auction. CCA’s theory is that if the FCC takes actions that affirmatively harm broadcasters, more broadcasters will participate in the voluntary auction, and then CCA’s members will have access to more spectrum than they would have otherwise. 

    Underlying CCA’s advocacy is the notion that broadcasters benefit from regulations that “distort” the market. Presumably CCA is not referring to all of the obligations imposed on broadcasters (that are not imposed on the wireless industry), such as children’s programming mandates, indecency regulation and captioning requirements, just to name a few. 

    I don’t know whether to laugh or cry. Maybe both.

    Let’s have a good laugh first. CCA apparently neither understands the regulatory regime under which broadcasting is governed nor the concept of irony.

    First, no industry is more heavily regulated by the FCC than broadcasting. Unlike any other industry, the FCC’s regulations govern many facets of broadcasters’ operation. The very structure of our industry is dictated by the federal government. For example, as noted above, in terms of ownership, Congress set a cap on how big any one television group can get: no entity can reach more than 39 percent of the U.S. population. There is no corresponding rule in the wireless industry. Indeed AT&T and Verizon Wireless produce maps claiming to cover more of the country than the other. The government has also imposed a number of mandates on broadcasters to which no other industry is subject. Broadcasters have to produce a certain amount of children’s programming for example. CCA’s members, on the other hand, just have to throw up a tower and let whatever comes across – and we sure know what can come across – reach the end user. Speaking of the Internet, unlike wireless companies (including those that got their spectrum “for free”), the FCC has imposed decency standards on broadcasters. Cable channels don’t even have the same obligations. Broadcasters are also subject to accessibility regulations far beyond what CCA’s members could fathom. So it is safe to say that broadcasting is not an industry propped up by regulation – unlike small wireless carriers (a point to which I will return) – we are primarily saddled with government regulation.

    Second, unlike broadcasters it is CCA’s members that depend on government regulation.  Government intervention is their oxygen. In a largely deregulated wireless industry, CCA pays visits to the Commission time and time again, imploring the FCC to give its members preferential treatment. In fact, in the incentive auction proceeding itself, CCA is virtually begging the Commission to give its members a leg up on AT&T and Verizon Wireless. CCA also routinely seeks forced interconnection among wireless carriers, so that its members can free ride on the investment of others who have invested billions to build their networks. It asks the FCC to subsidize its members through the Universal Service Fund so they don’t have to invest. And it routinely seeks to force other carriers to interoperate with its members so they can ride off the bigger carriers’ backs on equipment orders. CCA is an association that has never met a regulation it hasn’t liked. It relies on, and affirmatively seeks to increase, government intervention in the marketplace.

    This characterization is not simply my opinion; all it takes is a quick walk through CCA’s recent filings to discover its government-prop-us-up mission. Just over the past year, CCA has fervently advocated in favor of the following market interventions:

    • Revision of the spectrum screen to impose government-mandated limits on the amount of spectrum commercial carriers may aggregate;
    • Adoption of auction rules that limit the amount of spectrum large carriers may  acquire, as well as bidding credits and other mechanisms to favor other carriers, and license areas tailored to the desires of CCA’s membership;
    • Forced provision of data roaming arrangements;
    • Mandated interconnection obligations for  incumbent Local Exchange Carriers following the IP transition, including the full panoply of Section 251 and 252 requirements;
    • Forced interoperability of handsets;
    • Revision of the USF rules to increase subsidies for rural wireless service providers;
    • Conditions on the merger of AT&T and Leap, including divestiture of spectrum in markets where AT&T exceeds the spectrum screen, as well as forced offering of roaming arrangements on the same terms and conditions carriers previously negotiated with Leap; and
    • Conditions on the Verizon-AT&T spectrum swap, including an interoperability mandate.

    Now for the part that’s no laughing matter.

    Somewhere along the way, CCA – and they are not alone in this – conveniently overlooked Congress’s clear direction that the incentive auction must be voluntary. “Voluntary” means that no broadcaster, by any means, can or should be coerced into participating in the auction. CCA is asking the FCC to violate the law by forcing broadcasters, through regulatory arm twisting, to give up their spectrum. If the FCC turns up the heat enough, says CCA, then broadcasters will have no choice but to “volunteer.” That is a big no-no, although CCA seems not to care about staying within the bounds of the law.

    If CCA were the only organization heading down this road, I likely would not be writing this post. For if a tree falls in a forest…well, you know the rest. But there are others out there with similar motives. And it is time to shine light on an issue that needs to be crystal clear. The FCC cannot, under the law, take any action designed to harm broadcasters with an eye towards encouraging participation in the auction. The lone incentive for participation is the market-based auction itself, and the compensation broadcasters are offered to relinquish their licenses.  Anything else is unlawful, and it is no laughing matter to push the FCC to violate the law.

    The voluntary broadcast spectrum incentive auction can be a success. The Commission does not need to cheat in order to make it so. NAB, as always, stands ready and is committed to doing what we can to see the Commission succeed in its auction and to do so in a way that adheres to the law.

     
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