NAB Convention Notebook...

April 11, 2002 by Patrick Ross|Miscellaneous

There’s “real opportunity” in current round of retransmission consent negotiations between cable and broadcasters for broadcasters to make progress on getting DTV signals carried, attorney Robert Rini said at NAB convention in Las Vegas. He said analog signals are still important to cable, and broadcasters can link carriage rights to long-term carriage of DTV. Broadcasters have to be careful, however, to make sure entire DTV signal is carried, not just main video signal, Rini said. He also suggested broadcasters seek most-favored-nation status guaranteeing that if any other local broadcasters get better carriage deal, station gets equal treatment. Broadcasters “have to be realistic” about what to expect from carriage negotiations, said attorney Scott Johnson. He said there was “great hope” about earlier rounds of negotiations, but “in most cases it didn’t pan out.” “Good news” is that all but one FCC commissioner who voted on earlier decision not to grant DTV dual must-carry has left Commission, said attorney Julian Shephard, but he said he still wasn’t optimistic on DTV must-carry: “It may well be that for the duration of the DTV transition there will only be DTV retransmission consent.” -- MF

Librarian of Congress has until late May to complete review of Feb. Copyright Arbitration Royalty Panel (CARP) ruling that set per-performance royalty rates for streamed audio -- and one NAB attorney told group’s convention in Las Vegas Tues. that those rates could come down. “At the present level of review, there’s a reasonable chance of convincing the Librarian to scale back the rates” by arguing that they are onerous, said Bruce Rich, partner with Weil, Gotshal & Manges. NAB has been arguing in court that AM and FM stations shouldn’t have to pay royalties if they stream their over-air service over Internet. They have lost every court case on that argument so far and now are appealing to 3rd U.S. Appeals Court in Philadelphia. In meantime, CARP panel ruled that radio stations should pay 0.07 cents per performance for their over-air signals that are streamed, and independent Webcasters should pay 0.14 cents per performance (defined as any portion of any recording to single listener). After Librarian rules, broadcasters and Webcasters could appeal that decision to federal court, but Rich was less optimistic on that approach. “There’s a sense in the federal courts that rate-setting is a specialty,” he said, and judges tend to find entire process “baffling.” “The only good news,” Rich told audience of radio executives, “is that the rate for broadcasters is one-half that of Webcasters.”

Concern of content providers that their product cannot be protected in digital form also should concern broadcasters, attorney told NAB audience Tues. in Las Vegas. “Broadcasters have an indirect interest but a direct impact” if studios such as ABC owner Disney or Fox owner News Corp. decline to distribute high-quality digital productions to broadcasters, said John Stewart, partner with Crowell & Moring. No simple solution is in sight, he cautioned: “The difficulties of creating such a system are really substantial.” He said that even if bill by Senate Commerce Committee Chmn. Hollings (D-S.C.) were to become law today, industry officials would negotiate for year, then FCC would conduct rulemaking to validate their conclusions or develop solution if there were gridlock, then rulemaking would need to be implemented. But beyond that calendar, Stewart said, lie technical challenges of ensuring fair use rights with digital content, for example allowing college student to copy excerpt of documentary for class project while thwarting piracy: “It’s going to be a challenge.”

Canadian law may in fact “allow Internet companies to retransmit” broadcast signals, NAB attendees were told Tues. Erica Redler, senior vp-gen. counsel for Canadian Assn. of Bcstrs. (CAB), said threat of companies such as iCraveTV.com and JumpTV has not passed (in fact, she said redesigned company called iCraveTV.biz was planning to go online next month). “The issue has never been tested legally in Canada,” Redler said, saying iCraveTV.com was shut down by U.S. court and JumpTV withdrew its request for compulsory license from Canada’s Copyright Board before decision was rendered. CAB has been lobbying Canada’s Parliament for carve-out protecting broadcast signals from redistribution online, Redler said, but hasn’t had much success. Instead, she said, lawmakers in Canada appeared to want to write legislation that would allow streaming of broadcast signals by companies other than broadcasters but with conditions or safeguards: “It is possible that Canadian law would permit some form of Internet streaming, and it would include U.S. signals.” She wasn’t sure there would be much U.S. courts could do in such situation because their intervention in iCraveTV.com was based on marketing that company was doing in U.S., but she said companies had become more savvy on U.S. law since then. Redler said MPAA Pres. Jack Valenti visited Canada recently and warned that if country did permit U.S. TV signals to be put on Internet by Canadian companies that U.S.-Canada trade war would erupt.