All posts by David Oxenford

Oxenford: Radio Ownership Subcaps on the Table for FCC Review

David Oxenford - ColorBy: David Oxenford, Wilkinson Barker Knauer, LLP
www.broadcastlawblog.com

We’ve written (see, e.g. our articles here, here and here) about the pending petitions asking the FCC to reconsider decisions reached last year to end the UHF discount, to leave the TV local ownership rules in place and to make attributable new TV Joint Sales Agreements, and to not adopt any change in the FCC radio ownership rules in “embedded markets.” Recently, that list of items on the table before the FCC has expanded, with a number of radio groups making a concerted push to change the FCC rules on ownership “subcaps” – limiting the number of AM or FM stations that can be owned in a single market. Thus, while a broadcaster can own up to 8 radio stations in the largest markets, no more than 5 can be either AM or FM. In the smallest markets, broadcasters can own up to 3 as long as they do not exceed half the stations in a market, but only 2 can be of the same service. The new petitions seek to eliminate those subcaps, allowing owners to own up to the maximum number of stations in a market without regard to whether those stations are AMs or FMs.

A group of radio broadcasters have filed a letter with the FCC asking that these subcaps be abolished, citing the change in the media landscape in the 20 years since the rules were adopted. A more detailed economic study was submitted by a Syracuse radio broadcaster, here, showing that the growth in digital and mobile advertising to local companies already exceeds the share of advertising enjoyed by radio generally, and is likely to grow in the coming years. Google alone, according to this analysis, has as much local advertising in Syracuse as the entire radio industry. To compete against these growing new media entities that are eating into local advertising dollars, the radio broadcasters have asked that they be allowed to own more radio stations in a single service – AM or FM – than currently allowed.

As the FCC has told the Court of Appeals (where some parties filed an appeal of last September’s ownership decision) that they plan to review the entire ownership decision, not just those areas singled out by petitions for reconsideration, the radio ownership issue is now before the FCC. There has been some limited grumbling against these new proposals, some observers suggesting that AM radio would be further imperiled if big broadcasters gave up their AM holdings to pursue the ownership of more FM stations. Of course, if that were to happen, there would be nothing stopping ethnic programmers and others who are making more and more uses of the AM spectrum to acquire more AM stations, perhaps at lower prices, to pursue their innovative programming. This is an issue that will be debated in the coming months, as broadcasters adjust to the reality that all of the old rules are now subject to reexamination by this new FCC.

David Oxenford is MAB’s Washington Legal Counsel and provides members with answers to their legal questions with the MAB Legal Hotline.  Access information here. (Members only access).

There are no additional costs for the call; the advice is free as part of your membership.

FCC Releases First EEO Audit for 2017

Over 200 radio and almost 80 TV stations named in the audit notice, including Michigan stations.

David Oxenford - ColorBy: David Oxenford, Wilkinson Barker Knauer, LLP
www.broadcastlawblog.com

In the swirl of news about the deregulatory efforts of the new FCC, one could almost forget that there are still many regulations in place that require significant amounts of paperwork retention by broadcasters. That point was hammered home last week,  when the FCC released its first EEO audit letter of 2017 for radio and TV broadcasters. The FCC’s public notice announcing the commencement of the audit includes the audit letter that was sent to all of the targeted stations. The list of over 200 radio stations subject to the audit is here. The list of almost 80 TV stations is here. Responses are due March 28, 2017. As employment information for all stations within a named station’s “employment unit” must be provided in response to the audit, the reach of this notice goes far beyond the 300 stations targeted in the audit notices. While the FCC is considering a proposal to allow online recruiting sources to suffice to meet a broadcaster’s wide dissemination requirements (as we wrote here), that proposal is still at an early stage and, as this audit notice evidences, the underlying rules remain in place.

The FCC reminds stations that were targeted by the audit to put a copy of the audit letter in their public file. The response, too, must go into the file. For all the TV stations hit by the audit letter, and those radio stations that have already converted to the online public file, that will mean that the audit letter and response go into that FCC-hosted online public file.

The Commission has pledged to randomly audit 5% of all broadcast stations and cable systems each year to assure their compliance with the Commission’s EEO rules – including the requirements for wide dissemination of information about job openings and non-vacancy specific supplemental efforts to educate a station’s community about job opportunities in the media industry. We recently summarized FCC EEO issues here, reminding broadcasters of the possibility of being audited. The FCC also has the opportunity to audit larger broadcasters’ EEO performance when they file their FCC EEO Mid-Term Report. We also wrote about the start of the obligations for the filing of FCC Form 397 EEO Mid-Term Reports – which started the year before last for radio groups with more than 11 full-time employees and last year for TV licensees with 5 or more full-time employees in a few months, and are filed on the 4th anniversary of the filing deadline for the station’s license renewal – which will give the FCC another chance to review station EEO performance.

The audit letter requires all stations with five or more full-time (30 or more hours per week) employees to provide a significant amount of information about their EEO programs and recruiting efforts (including copies of their two latest Annual EEO public file reports and documentation backing up the efforts listed on those reports). Even stations with fewer than five full-time employees need to report the job titles of their employees and the number of hours they are assigned to work each week, and provide any information about law suits, EEOC complaints or similar employment actions brought as a result of equal employment or discrimination matters. Information about any time brokerage agreement must also be disclosed.

If any station in your cluster is on the list, all stations in that “station employment unit” (a group of commonly owned stations serving the same area with at least one common employee) must respond. But, if a cluster has been audited in 2014 or 2015, or if its renewal was granted in the last 18 months, the FCC may allow you to avoid responding to this audit – but you have to request that “pass” from the FCC. If a station that is being audited is involved in an LMA with another broadcaster, the audit may require that the broker provide employment information as well as the licensee.

All stations should review the audit letter as it provides a good outline of the documents that stations should be retaining to demonstrate their compliance with the FCC’s EEO rules. For more information about compliance with the EEO rules, see our post about an EEO webinar in which I participated, held by the FCC in early 2012 to explain its EEO rules. Also, you can find a link to a presentation that I did just over a year ago on the EEO rules for broadcasters, here. You may also want to review the last set of fines for broadcast EEO violations, about which we wrote here.

Many broadcasters complain that the EEO rules are among the more burdensome paperwork requirements, and no doubt much time and money will be spent responding to this audit notice. But whether a broader review of the EEO requirements, beyond simply looking at the acknowledgement that online recruiting is how recruiting is now done, will be in the cards at the FCC remains to be seen.

David Oxenford is MAB’s Washington Legal Counsel and provides members with answers to their legal questions with the MAB Legal Hotline.  Access information here. (Members only access).

There are no additional costs for the call; the advice is free as part of your membership.

Background on the GMR/RMLC Issues

David Oxenford - Color
David Oxenford

By: David Oxenford
Wilkinson Barker Knauer LLP
doxenford@wbklaw.com
www.broadcastlawblog.com

Commercial radio broadcasters have been seeing numerous communications over the last week about Global Music Rights (GMR) and its seemingly contentious music royalty negotiations with the Radio Music License Committee (RMLC). Many stations are confused about this controversy and what it is all about. The five questions below will hopefully shed some light on these issues. Stations need to carefully consider their options, and seek advice where necessary, to determine what they will do by January 31 with respect to the interim license that GMR has offered to stations. The questions below hopefully provide some background on these issues.

1. What is GMR and why isn’t the music they represent covered by the other organizations like BMI, ASCAP, and SESAC?

GMR is a new performing rights organization. Like ASCAP, BMI and SESAC, they represent songwriters and collect royalties from music users for the public performance of these songwriter’s compositions. They will collect not just from radio – they have already reached out to business music services that provide the music played in retail stores, restaurants and other businesses and no doubt have or will license other companies that make music available to the public. Most songwriters represented by GMR used to be represented by ASCAP or BMI, but these songwriters have withdrawn from ASCAP and BMI and joined GMR. For radio, these withdrawals became effective on January 1 of this year, when the old license agreements between ASCAP and BMI and the commercial radio industry expired.

2. What does a station need to do, in order to protect itself while negotiations are going on?

Because the penalties for playing a song without a license can be as much at $150,000 per play, stations either need to purge all GMR music from their stations or sign a license agreement with GMR. If you decide to purge their music from your stations, don’t forget about music that may appear in commercials or syndicated programming. Also remember that we are talking about the musical composition, not the recording of the song by any particular band or singer. Even the broadcast of a high school band playing a GMR song at half time of some football game, or the broadcast of a local middle school choral concert, could trigger the royalty obligation to GMR.

3. What does the “Interim License” through September mean?

The Radio Music License Committee (RMLC) is the group that represents most commercial radio broadcasters in music royalty negotiations with the various organizations that represent songwriters. They have been trying to reach a license agreement with GMR, but have not been able to reach one at rates that they consider to be an appropriate reflection of the airplay received by songs written by GMR songwriters. RMLC has actually sued GMR, arguing that GMR has violated the antitrust laws in the negotiation process, and asking that an arbitration process be set up to determine rates (and GMR has, seemingly in response, sued RMLC).

Since it was clear that no final agreement between RMLC and GMR could be reached by January 1, to avoid having stations that play GMR music being subject to lawsuits for copyright violations, GMR has offered an interim license that lasts for 9 months. Presumably, if in that time GMR and RMLC settle their disputes and arrive at a reasonable royalty rate, and that royalty rate is less than the interim rate, some credit for part of the sums paid under this interim rate could potentially be built into the new rates.

GMR has this week reached out to many station groups with specific proposals as to an interim rate. Commercial stations that did not receive information from GMR can reach out to them and ask for the rate information. GMR has given stations until January 31 to agree to that rate, sign the interim license agreement and pay the first month’s royalties. If a station does not choose to sign the interim deal and has not negotiated its own royalty agreement, and if it continues to play music written by GMR artists, then it is potentially subject to a copyright infringement lawsuit.

4. Is this going to lead to more people making demands for payment for songs broadcast on the radio?

If GMR is successful in collecting enough money to pay its songwriters more than writers receive from ASCAP and BMI, this could encourage other organizations to create similar licensing organizations. Some large publishing companies have already suggested that possibility, and there are certain other companies that specialize in maximizing royalties for songwriters that have the potential to do the same thing. However, starting a performing rights organization like ASCAP, BMI and SESAC is not easily accomplished as it requires setting up infrastructure for collection, reporting, distribution and enforcement activities. It also requires waiting for existing contracts granting performance rights to expire. Thus, new organizations are not likely to pop up overnight.

5. Is this related at all to the radio streaming waiver with SONY that the NAB is urging stations to consider?

The GMR issues all involve the rights to perform the underlying words and music to a song, not the rights to perform a recording of that song as recorded by any particular band or singer. The recording by a particular performing artist is called a “sound recording” or “master recording.” Broadcasters do not pay for the over-the-air performance of sound recordings, but they do pay performance fees when those recordings are streamed. The Sony waiver involves the digital performance right to sound recordings, and some of the rules that apply under the license for those digital performances. It is unrelated to the GMR controversy.

For more detailed information about some of these issues, I have written a number of articles discussing music rights on my Blog – www.broadcastlawblog.com.

On the Interim license issued by GMR, see my article here: http://www.broadcastlawblog.com/2016/12/articles/gmr-and-rmlc-agree-to-interim-license-for-commercial-radio-stations-providing-9-months-to-reach-final-deal-for-public-performance-of-musical-compositions/

On the litigation between GMR and RMLC see my articles here http://www.broadcastlawblog.com/2016/11/articles/rmlc-files-antitrust-lawsuit-against-gmr-and-seeks-to-enjoin-new-music-license-fees-on-radio-stations/ and here: http://www.broadcastlawblog.com/2016/12/articles/gmr-sues-rmlc-claims-antitrust-violations-for-negotiating-royalties-on-behalf-of-the-radio-industry-what-are-the-implications/

On the Sony waiver, see my article here: http://www.broadcastlawblog.com/2016/10/articles/nab-announces-agreements-with-sony-and-warner-to-waive-performance-complement-and-other-statutory-requirements-for-broadcasters-who-stream-their-signals/

For more information about some of the other potential players in music licensing, see my article here: http://www.broadcastlawblog.com/2016/07/articles/socan-buys-audiam-the-consolidation-and-fragmentation-of-music-rights-what-does-it-mean-for-music-services/

For a general summary of many of the music issues that affect broadcasters, see my article here and the presentation slides that are referenced in that article: http://www.broadcastlawblog.com/2016/08/articles/whats-up-with-music-rights-for-broadcasters-and-webcasters-a-presentation-on-pending-issues/

FCC Extends for 18 Months SAP Emergency Information Deadline

David Oxenford - Color
David Oxenford

By: David Oxenford, Wilkinson Barker Knauer, LLP
www.broadcastlawblog.com

The FCC released an order on November 16 giving TV stations an additional 18 months to comply with a requirement that emergency information conveyed to the TV audience during non-news programming in a visual or graphical manner (e.g. on-screen weather maps during entertainment programming) be converted to audio that is broadcast on the TV station’s SAP channel.

We wrote about the FCC’s request for comments on the extension here. If the extension had not been granted, those requirements would have kicked in this week. But, as broadcast groups and those representing the visually impaired agreed that there was no available technology to make this conversion of graphics to speech, an 18 month extension of the obligation was appropriate. Thus, broadcasters have more time to comply with this requirement (though the obligation to convert text carried in non-news programming – like emergency crawls – to speech broadcast on the SAP channel is already in effect for all TV stations (see our articles here and here).

The waiver extension is subject to the condition that NAB and the other petitioners provide a status report to the FCC on efforts to develop a technical solution by November 22, 2017.

David Oxenford is MAB’s Washington Legal Counsel and provides members with answers to their legal questions with the MAB Legal Hotline.  Access information here. (Members only access).

There are no additional costs for the call; the advice is free as part of your membership.

Three Last Minute Political Issues for Consideration by Broadcasters

David Oxenford - ColorBy: David Oxenford, Wilkinson Barker Knauer, LLP
www.broadcastlawblog.com

We’re down to the last week before the election, but broadcasters can’t let up quite yet, as the last week is almost always the busiest for political advertising. Candidates, PACs and other groups try to get the last word before the voters go to the polls. Here are three issues that broadcasters should be considering in these last days before the election:

  1. Weekend Access. The FCC has said that if a station has, in the year prior to the election, made its employees available to a commercial advertiser for new orders or changes in copy, they need to make employees available for those activities to political candidates. Even if the station completely shuts down on the weekend and no salesman ever signs a deal with an advertiser during a Saturday golf outing and no weekend employee ever agrees to change the copy on a big advertiser’s spots, the station may still need to make employees available during the last weekend before the election to allow candidates to exercise equal opportunity rights, which brings us to number 2.
  2. Practice Inventory Management. In these last days before the election, there will be many demands on the commercial inventory of many stations and stations will need to be careful in managing that inventory. Remember, all candidates have the right to buy equal time to the time bought by opposing candidates in the last 7 days. While candidates cannot sit on their equal opportunity rights until the last minute, equal opportunity buys placed in the first part of next week probably need to be accepted. Plus, you may be getting demands from candidates for new time and requests from PACs and other political advertisers, so be sure that you have practiced wise inventory management so that there is room for all of the spots that you are obligated to run. Be particularly careful about selling a new schedule this coming week to a candidate, as the opposing candidate will need to be able to get his or her equal opportunities before Election Day – even if it means signing contracts and adding spots to the traffic system over the weekend – even if you have never in the last year been open on the weekend for a commercial advertiser.
  3. Be Prepared for Take-Down Demands. In the last days before the election, the ads are no doubt going to get nasty, and some may trigger take-down notices from candidates who are being attacked in the ads. Remember, if the attack ad is run by a candidate’s authorized campaign committee, you can’t censor the ad based on its content. That means you are legally forbidden to pull the ad even if it lies about the opponent. But, ads bought by PACs and other non-candidate groups can be refused based on their content. So you need to carefully evaluate the claims made by the party demanding that the spot be pulled, as if the claims made in the spot are in fact false and defamatory, the station could have liability for continuing to run the non-candidate attack ads after receiving notice demanding that they be taken down. We wrote more about this subject here.

Soon it will all be over and your station will be back to simply dealing with its normal commercial advertisers. But, for the next few days, be prepared for the onslaught of political issues, and have your communications lawyer’s phone number on speed dial!

David Oxenford is MAB’s Washington Legal Counsel and provides members with answers to their legal questions with the MAB Legal Hotline.  Access information here. (Members only access).

There are no additional costs for the call; the advice is free as part of your membership.

More Lawsuits for Unauthorized Use of Photos – Even on Social Media Sites

David Oxenford - ColorBy: David Oxenford, Wilkinson Barker Knauer, LLP
www.broadcastlawblog.com

In recent weeks, we have continued to see copyright lawsuits against broadcasters filed by photographers who allege that their photos have been used without permission. This spate of lawsuits has not been confined to filings against broadcast companies – even the Donald Trump campaign has reportedly been sued recently for his son’s tweet of a picture of a bowl of Skittles in his now-famous tweet comparing Syrian refugees to the candy treats. We have written about this issue before (see for instance our posts here and here), but what makes these issues worth writing about again is that several of the recent suits involve not just the unauthorized use of a photograph on a station’s website, but the use of photos in social media posts including tweets on Twitter and posts on Facebook. Is this really an issue?

It certainly is a concern, especially for commercial businesses. As we have written before, just because someone posts a picture on the Internet, even on a social media or photo sharing site, does not give others the right to exploit that photo, especially on a digital site of a commercial business. Posting on a social media site may give the social media site owner the right to exploit posted content consistent with their terms of use, but the person who created the content does not give up their underlying copyright in any creative work to third parties. The Skittles suit represents an instance of a photographer using copyright law to enforce these rights, apparently as he did not agree with the political sentiment expressed by the tweet in which the photo was used. But not too long ago, there was significant publicity about a lawsuit, now reportedly settled, about a New Jersey newspaper suing a cable news network because one of its personalities used a well-known 9-11 photo from the paper as the profile picture on that personality’s Facebook page – without first securing permission. But, isn’t that what these social media sites are for – sharing content?

Yes – content can be shared, but it is usually content to which the person sharing it owns the rights (e.g. vacation photos) or arguably material that is used with some degree of commentary or criticism where a fair use defense is possible (see our post here on fair use). Generally, merely posting a link to another site (which may pull in a picture used on that other site as part of the display of the link) has been seen as permissible, but note that in Europe that may be changing especially on sites that post links to other’s sites as part of a business venture, such as a search site. Even here in the US, there have been cases where there has been a problem because one site posted too much of the content from another site in connection with the posting of the link to that site, as if you post all of the important points of someone else’s article on your site, it may eliminate the need for the viewer to click on the link to go to the other site where the content creator can get credit (with advertisers or others) for the viewer’s visit to their site. Given these sensitivities, it is clear that taking a picture and posting it on a business social media feed without permission is likely to raise the hackles of a copyright owner who discovers it – as it uses their creative work for no compensation whatsoever.

So what do you do? Take your own photos and use them on your sites and in your social media is one easy answer – and many broadcasters, including radio broadcasters, have tasked their employees with taking photos of station and community events that can build up a library of images for the station to use. Plus, there are many stock photo services where, for a reasonable monthly subscription fee, you can get the rights to a whole catalog of photographs to use on your business sites. A few dollars now to subscribe to one of these services can save lots of headache (and even more dollars) later on.

David Oxenford is MAB’s Washington Legal Counsel and provides members with answers to their legal questions with the MAB Legal Hotline.  Access information here. (Members only access).

There are no additional costs for the call; the advice is free as part of your membership.

What Could Possibly Go Wrong With a Broadcast Contest? – From the Legal Side

David Oxenford - ColorBy: David Oxenford, Wilkinson Barker Knauer, LLP
www.broadcastlawblog.com

Recently, our friends at the broadcast and digital media consulting and research firm Jacobs Media posted an article on their blog called What Could Possibly Go Wrong,” dealing with the financial and reputational issues that can arise if a contest is not fully thought out. That article reminded me of all of the legal issues that we have written about over the years that can arise if all of the issues with a broadcast contest are not carefully considered. Those potential issues range from an FCC fine if the contest is not conducted as advertised, to the threat of civil liability if the contest results in an injury to a contestant or observer. I thought that I would highlight some of the articles that we have written in the past to remind broadcasters of those potential liabilities.

On the FCC side, the FCC has always been a stickler on the rules, requiring that broadcasters, when conducting their own on-air contests, announce the rules of those contests and to follow those rules as announced. While that burden has become somewhat lighter in the last year as the FCC has allowed stations to publicize the material rules of a contest on a station’s website rather than having to announce them on the air (as long as the online location of those rules is, itself, publicized sufficiently on air, see our post here), that rule change has not affected the underlying obligation of a broadcaster to conduct the contest as announced, in accordance with the contest’s announced rules.

We have written many times about FCC fines imposed on broadcast stations that announce rules for a contest and then don’t conduct the contest according to those rules. These issues can include not properly identifying the prize (e.g. this case that fined a station for announcing that it was giving away a car when it was actually giving away a two-year lease for a car, a decision that discussed another case where a station was giving away passes to a movie opening without disclosing that it was possible that there would be insufficient seats in the theater to accommodate all pass holders). Broadcasters, in planning a contest, need to anticipate all possible eventualities, from tie-breaking methods in case multiple people qualify for a grand prize, to anticipating the potential that a prize will not be available when the winner comes to collect it (e.g. that the concert tickets that you are giving away is to a concert that gets cancelled after a winner has been selected). Always give the station an “out,” for instance, by allowing the substitution of a prize of equal value should the award of an announced prize become unavailable.

Even ambiguities in the rules can lead to fines. See our article here about a fine on a station for saying that entries would be accepted “through” a particular date, when in fact the deadline was the previous day, as the award was to be made on the announced deadline date. That article also provides some thoughts about the process of drafting contest rules. In another case summarized here, a fine was issued when the rules of a contest stated that there was to be one winner, but also included boilerplate language lifted from the rules of another old contest that implied that there would be multiple winners – and a listener claimed to be confused about how many winners would be selected. That article also talks about a fine issued to a station that dragged its feet in giving away the prize that a listener had won.

Similarly, know that you are conducting a contest and make sure that everyone at the station knows what the rules are. See our article here about one case where a prize was to be given to someone who called in to the station with a correct answer to a question that was posed on the air. When a caller called with the correct answer, the announcer decided out of the blue to ask the caller another question before the prize would be awarded, even though the rules did not provide for that second question. That article describes the even more bizarre case of an announcer who was bored while on the air over a holiday weekend and he decided to spice things up by announcing that the station was giving away a million dollars when in fact it was not – and listeners complained to the FCC when they did not get their million dollars after they called the station. In both cases, the FCC imposed fines on the stations.

We’ve also written about the potential civil liability for a contest that puts contestants at risk of physical harm. The article describes some of the take-aways for broadcasters from the well-publicized contest “hold your wee for a wii” where the idea of the contest was that contestants had to drink water and the winner of the Nintendo Wii was the last to have to use the bathroom – which led to the death of a contestant as the result of water intoxication. Any contest involving physical feats or races to get somewhere fast need to be carefully thought out, as the promoting station could be looking at potential liability if injuries to contestants or bystanders result.

Even how you conduct the contest can raise issues. Under the Telephone Consumer Protection Act (the “TCPA”), sending texts to persons who have not given their explicit consent to receive automated commercial messages can result in big fines. We wrote here about some of the issues broadcasters should consider in conducting contests or promotions that involve text messaging.

These are but some of the many legal issues that can arise if broadcasters are not very careful in conducting their on-air contests. We haven’t even talked about carefully following state laws to make sure that your contest is legal where it is conducted; about disclosing the odds of winning (if, for instance, the contest is being broadcast on multiple stations, making sure that listeners know who they are competing against); or the issues that can arise if outside contest companies don’t fulfill on their obligations (e.g. some situations have arisen where broadcasters hire third parties to conduct a big contest, thinking that the company has adequate resources to give away a big prize if there is a winner, only to find out that the company did not in fact have the resources to pay out when a winner won big). There are many, many other issues that can arise. While we don’t want to ruin everyone’s fun, any business, and particularly one as high profile as the broadcast industry, needs to conduct their contests very carefully. So consult legal counsel for the details to avoid having these legal issues become the real answer to the question of “what could possibly go wrong?”

David Oxenford is MAB’s Washington Legal Counsel and provides members with answers to their legal questions with the MAB Legal Hotline.  Access information here. (Members only access).

There are no additional costs for the call; the advice is free as part of your membership.

Oxenford: Programmatic Advertising Buying and the FCC’s Political Broadcasting Rules

David Oxenford - ColorBy: David Oxenford, Wilkinson Barker Knauer, LLP
www.broadcastlawblog.com

With the national presidential conventions complete, and most of the state primaries for Congressional, state and local offices either behind us or to occur in the next few weeks, the most concentrated period for the purchase of political advertising on broadcast stations is now upon us, to peak in the late October/early November frenzy. While most of the principles governing the FCC rules on political broadcasting are relatively established (and many are summarized in our Political Broadcasting Guide available here), there are always new advertising practices and opportunities that throw some new wrinkles into how those rules are applied. At a number of political advertising seminars that I have conducted this past year and in discussions with broadcasters, one of the new wrinkles this year that has not captured the attention that it deserves is the political broadcasting issues raised by programmatic buying of advertising time.

In the last year or two, programmatic buying has become the buzzword in broadcast advertising circles for both radio and TV. It is intended to make ad buying easier and more akin to the experience that ad buyers have when they place online advertising, where most of it can be done from a computer with a few clicks of a mouse, anywhere at anytime. While programmatic buying is becoming more and more common in broadcast circles, it is difficult to easily say exactly what it is, as what is called “programmatic buying” comes in so many different flavors. Not only does the concept mean different things in different systems, it is also being provided by all sorts of different companies, from rep firms, to broadcast technology companies, to companies that have specialized in specific types of advertising – like remnant ad sales (i.e. sales of unsold advertising inventory that broadcasters may have). And some station owners are signing up with multiple providers – sometimes at the same station.

The computerized sale of remnant advertising – where the providers of the programmatic buying give advertisers the opportunity to buy left-over advertising on multiple stations so as to reach a total audience in the market in which the stations operate – is akin to systems developed years ago, which the FCC had issues with in trying to decide how they affected lowest unit rates (see our article here).   These sales of remnant ads tend to raise one set of issues. This kind of advertising – sold in packages, where advertisers are offered delivery of a certain number of advertising impressions in a given market, where that delivery may well come from placement of ads on multiple stations – may be the least problematic for individual stations in terms of how it affects their political broadcasting compliance. Because the spots are usually packaged with multiple co-owned stations to give the advertiser the number of advertising impressions that they seek in a given market, these ads have no impact on the lowest unit rate on any one station (as ads that are sold in a package on multiple stations do not affect the lowest unit rates on the individual station, although such combination packages on multiple stations must be disclosed and made available to candidates by the company making such combination sales). Moreover, as remnant ads can usually run at almost any time in a broadcaster’s schedule (they are not run in fixed programs or at specific times) and are usually very preemptible, the ads are usually in advertising classes not very attractive to candidates, further minimizing their impact on most station’s political broadcasting sales. But sellers of these packages of remnant advertising may themselves be subject to political rules (as the Commission has traditionally applied such rules to “unwired networks”), so the sellers need to be cognizant of their own political broadcasting obligations.

But other forms of programmatic buying can be more significant for political advertising and need to be carefully tracked by broadcasters. Some of the programmatic systems that are available seemingly let advertisers use computerized systems to essentially buy any advertising time that is available in a station’s inventory. Advertisers can in effect have access to a station’s traffic system and schedule their own advertising schedules, and can pick and choose among the rates available to advertisers in a station’s traffic systems. It’s this ability to pick and choose what the advertiser wants that could raise political broadcasting issues – especially in the later weeks of the election season. If the programmatic deals allow discounts off of a station’s rates for specific classes of time, either simply because they are booked through the programmatic system or because of the volume bought by the advertiser, these discounts could affect the lowest unit rates of the spots that are included in the schedule that the advertisers buy. Alternatively, the ability of an advertiser to get access to the station’s ad schedule to schedule their own ads, toward the end of an election season, could affect a station’s ability to squeeze in political ads as necessary to meet reasonable access and equal opportunities rights. And, if political advertisers use the programmatic systems to themselves buy and schedule advertising, all sorts of issues could arise, especially to the extent that such ads are bought with higher protection levels where they preempt political ads, or simply because they have other impacts on political schedules that stations need to be tracking.

The contracts with providers of programmatic advertising systems need to be carefully reviewed to assess their ability to raise issues in a political broadcasting context. If the programmatic network is used by political and issue advertisers, stations need to be sure that they are getting timely notice of the ad buys and all the necessary paperwork, so that a station can meet its political file obligations. Generally, they should also be reviewed so that buys made through the system otherwise comply with all other station legal obligations that, once upon a time in the distant past when broadcasters used printed contracts, would have been expressed in the terms and conditions for sales, which were often printed on the back of the sales contracts (we have written about these issues before, here, in the context of the required FCC advertising non-discrimination certification, which also needs to be worked into the programmatic buying process). We’ve worked with some providers of programmatic systems to help design their systems so that stations that use them can assure that their inventory can be controlled during the election season and we have looked at agreements from providers for broadcast station clients. These are not simple deals that can be entered into without thought. Any broadcaster using any programmatic buying system needs to carefully review the system that they are using and determine if there are any potential political broadcasting issues – and to assure that the contracts with the providers give stations the rights that they need to assure compliance with political broadcasting rules (and other FCC obligations), especially during these last 92 days before the November election.

David Oxenford is MAB’s Washington Legal Counsel and provides members with answers to their legal questions with the MAB Legal Hotline.  Access information here. (Members only access).

There are no additional costs for the call; the advice is free as part of your membership.

Oxenford: Rural Towers Under 200 Feet May Need To Have Lights Under New FAA Authorization Law

David Oxenford - ColorBy: David Oxenford, Wilkinson Barker Knauer, LLP
www.broadcastlawblog.com

My law firm has long provided legal advice to companies that operate communications towers, and the lawyers involved in that practice area have alerted me to the following development which will require the marking and lighting of many towers not currently covered by such rules.

Broadcasters and tower companies have long relied on FAA rules that generally don’t require the lighting of towers under 200 feet in height except when these shorter towers may interfere with the flight path of an airport. So the vast majority of these short towers used by broadcasters (sometimes simply for mounting auxiliary antennas) and by other wireless users have not been lit. That apparently will change under the FAA Extension, Safety and Security Act of 2016, passed by Congress earlier this summer and signed into law on July 15. Under provisions of this act, the FAA is required to adopt rules to require the marking and lighting of freestanding structures with heights of between 50 and 200 feet which are located in rural, undeveloped areas. The act refers to towers that will need to be marked and lit as “covered towers.” The new marking and lighting requirements will apply not just to new towers, but also to existing towers (after a one-year phase in period after the FAA’s new rules become effective).

So what is a “covered tower”? Essentially, the Act sets out the following definitions:

  • Size.  The Act defines “covered towers” as self-standing or guy wire-supported structures:
    • 10 feet or less in diameter;
    • More than 50 and less than 200 feet tall; and
    • With “accessory facilities” mounted with antennas, sensors, cameras, meteorological instruments or other equipment.
  • Location.
    • To be a “covered tower,” the structure must be located:  (i) outside the boundaries of an incorporated city or town; (ii) on undeveloped land; or (iii) on land used for agricultural purposes.
    • “Undeveloped land” means “a defined geographic area where the [FAA] Administrator determines low-flying aircraft are operated on a routine basis.”
  • Exceptions.  The following are not “covered towers”:
    • Structurers adjacent to a house, barn, electric utility station or other building;
    • Structures within the curtilage of a farmstead (for those not familiar with land-use terminology, a “curtilage” is the developed area of a farm immediately surrounding a house or other dwelling where residents have an expectation of privacy – it does not include surrounding fields);
    • Structures that support electric utility transmission or distribution lines;
    • Wind-powered electrical generators with rotor blade radius exceeding 6 feet; or
    • Street lights erected by government entities.

The new law was apparently adopted at the urging of rural flying groups, including those involved in crop dusting, members of which apparently have high rates of accidents. That is why there is the emphasis on rural towers – and the exclusions for those in developed areas where such planes are unlikely to be flying.

The FAA will be adopting rules implementing the act, setting out the specific requirements for marking and lighting and further detailing the requirements for compliance with the act. From the effective date of the new rules, existing covered towers will have one-year to come into compliance.

As these new requirements may affect many broadcasters with tower facilities in rural areas, watch the developments with respect to these obligations carefully and start making your plans now for compliance.

David Oxenford is MAB’s Washington Legal Counsel and provides members with answers to their legal questions with the MAB Legal Hotline.  Access information here. (Members only access).

There are no additional costs for the call; the advice is free as part of your membership.

Editorial: Beware – Using Online Photos/Videos Can Bring Lawsuits for Copyright Infringement

David Oxenford - ColorBy: David Oxenford, Wilkinson Barker Knauer, LLP
www.broadcastlawblog.com

Beware – Using Online Photos and Videos in Radio and TV Productions and on Websites Can Bring Lawsuits for Copyright Infringement if Rights are Not Secured in Advance

Everyone who has a computer, smartphone or other Internet-connected device, has probably spent at least some time perusing photos or videos of cute pets or babies, or of the latest amazing (or sometimes amazingly stupid) things that people do. Broadcasters, in particular, with an audience to reach both through their over-the-air facilities and on their websites and mobile apps, may well want to share the content that they have found online. But, a recent spate of lawsuits filed against radio broadcasters for using photos on their websites without permission makes clear that this can lead to issues if done without permission. There have even been claims made against TV stations for taking video found online and repurposing it over-the-air or online as part of their locally-produced programming. Just because someone has posted photos or videos on a social media site does not give permission to anyone else to take those photos and use them in other media. When an individual posts something on a social media site, what they have done is to give that site the right to use the material that they have posted in accordance with the rules of the site on which they have been posted – but the mere fact that a photo or video has been posted on one of these sites does not give others the rights to take those photos and videos and use them elsewhere.

When I make a statement like this in one of the many seminars that I have done on digital media issues, people are always quick to jump up and say – “but isn’t the Internet all about sharing?” While in some ways it is, it really is more a medium for the dissemination of content in one way or another. And, just because a creator of content wants to share that content in one fashion does not mean that the content can be reused by others in a wholly different context.

Just providing attribution to the creator of the content that you want to use is not enough – nor is sharing a link to the site from which the content came. Creators put up their content in places where they can exploit it – whether it is through banner ads, video pre-rolls or other methods of monetization. If you take that content and put it on your site, without first securing permission, then you can deprive the creator of the traffic that they might otherwise get to their own site. Providing a link to copyrighted material is generally different than the issue that I am writing about. Links to articles and other media on the Internet is part of the essence of the Internet. But, links send viewers to the content itself to be enjoyed in its native format, with and advertising or other material that may surround it on the site where it is posted. It is the copying of the material, removing it from the site where it was posted by the rightsholder, which raises the issues.

An article in Inside Radio (8/1/16) (here, subscription may be required to view some content) quotes me in a discussion of this topic. I have also written about this issue before (see, for instance, my article here). In that article, I reminded broadcasters that, contrary to what some might think, unless necessary permissions are obtained, everything on the Internet is not free to exploit on your own site. I have worked with many broadcasters who have received demand letters from the owners of photographs that have been copied from some third-party website and re-used on the broadcaster’s site without permission. Many of the folks who received those claims settle with the copyright holder to avoid the fate of the broadcasters who have been sued – so take these demand letters seriously if you receive one.

Broadcasters can avoid these claims by using only photos that they themselves have taken, or ones to which they have purchased the rights. There are numerous companies who specialize in selling rights to stock photos – and these companies can make photos available at a very reasonable cost. Paying those costs can save a broadcaster lots of money, as copyright owners do not have to prove actual damages when their works have been infringed. Instead, copyright holders can claim what are called “statutory damages” of up to $150,000 per infringement. While a court need not impose penalties that high for every infringement, those high penalties can be claimed, and you’ll see some demand letters asking for the full amount. Other demands will be much more reasonable, and some even provide with ways to make automated payments for the use of the photo and obtaining a release. If there in fact has been a real infringement, if a demand is reasonable, it is sometimes easiest to simply settle rather than fight a prolonged legal battle over the issue.

There are, of course, defenses to any claim of copyright infringement. If you use a limited amount of a video, for instance, where the limited portion is used for purposes of commentary or criticism in a noncommercial context, fair use may be a defense. But, as we wrote here, fair use is a tricky defense, and how a court may view any particular instance of the use of a copyrighted work without permission cannot be determined with certainty in advance. So don’t think that fair use will provide a blanket defense to every claim. There may be other defenses available as well, but the best defense against a copyright claim is to have the rights in advance so that you never face the claim in the first instance.

And, it is not just photographs found on the Internet that can be a problem. In a presentation that I did on digital media issues for broadcasters about a year ago, which I wrote about here, I emphasized that any work created by an independent contractor needs to be cleared for digital use. We have even seen cases of stations who have hired an outside professional photographer to take photos of air talent for uses in a brochure or other physical media, only to receive a demand for additional fees when that photo was used on a station website. Independent contractors generally own the rights to creative works that they produce, unless there is a specific agreement to assign those rights to someone else. That is why you can’t take the photos of your kids taken by the school photographer to the local copy store and make your own copies – the photographer retains the rights. So, when you are buying creative works from an independent contractor, make sure that the creator assigns all rights to the creations to the station, or you may be faced with this same kind of issue as you seek to exploit their creations in new media in the future.

As we wrote here, the Copyright Office itself recognizes that the owner of a photo is not always clear, and last year it began a proceeding to look at the best way to identify the ownership of the rights in photographs and to give copyright holders easier ways to enforce their rights, while at the same time making it easier for users to be able to obtain the necessary licenses for the use of those photographs. But, until new rules are adopted, the burden is on the user to hunt out the owner of photographs to make sure that they have any necessary clearances, whether it be through a direct agreement with the photographer, or through a clearance house like Getty Images. Care now can avoid bigger problems later.

David Oxenford is MAB’s Washington Legal Counsel and provides members with answers to their legal questions with the MAB Legal Hotline.  Access information here. (Members only access).

There are no additional costs for the call; the advice is free as part of your membership.