FCC ACCEPTS BROADCAST FLAGGING TECHNOLOGY TO PROTECT CONTENT

As expected, the FCC late Tues. adopted the broadcast flag, an antipiracy technology embraced by over-the-air broadcasters and the movie industry but opposed by some consumer groups and free speech advocates. The vote also opens the door to additional technologies that would have the same effect but perhaps operate differently. The 3 Republican commissioners voted in favor of it and the 2 Democrats approved in part and dissented in part. The FCC said the flag was intended to further the DTV transition and preserve broadcasting for years to come.

Chmn. Powell said the decision “strikes a careful balance between content protection and technology innovation in order to promote consumer interests.” He said he believes it would promote innovation in content protection technologies. Comr. Abernathy said digital recordings made on legacy devices would play on future compliant machines. She also said she believed the FCC’s approval process should help quell fears of some consumer groups that the movie studios would have control over the technologies adopted. Acknowledging that the consumer electronics industry had questioned whether the FCC actually had jurisdiction in that area, Abernathy said she believed the Commission’s congressional mandate to promote the DTV transition warranted action. “I am hopeful that any court review of this decision can occur before the effective date of our rules,” she said.

Comr. Copps said the decision was “not ideal,” but was a “workable compromise.” He stressed that the order wasn’t adopted as proposed by the broadcasters and that it was substantially improved to protect consumers’ ability to manipulate content for home use. He said he dissented in part because the Commission didn’t preclude the use of the flag for news or for content that already was in the public domain. “This means that even broadcasts of government meetings could be locked behind the flag,” Copps said. He said the criteria the FCC adopted for accepting new technologies didn’t consider the impact on personal privacy, such as tracking viewer habits: “Protecting personal privacy is too important to leave to chance. We should state explicitly that we will consider this issue in the approval process.” Comr. Adelstein said he believed the agency failed to take into account the effects on standing copyright law. He said he dissented in part because the order didn’t rule out use of the flag for content in the public domain. The order’s “boundless scope” could even affect the State of the Union address, he noted. He also dissented because he believed the interim criteria for assessing technologies failed to consider consumer interests, including privacy.

The agency stressed that consumers’ ability to make digital copies of programs wouldn’t be affected and that the flag sought only to prevent mass redistribution of content over the Internet. The FCC said implementation of the broadcast flag wouldn’t require consumers to purchase any new equipment -- something some consumer advocates disputed. The flag itself is a digital code that can be embedded into a digital broadcasting stream. It signals digital TV reception equipment to limit the indiscriminate redistribution of digital broadcast content.

While some groups say consumers would have to buy new equipment if they wanted to record digitally, the FCC said the rules were targeted only at products that were capable of receiving DTV signals over the air. Under the rules adopted, the products would have to comply with the broadcast flag requirements by July 1, 2005. Other products such as digital VCRs, DVD players and personal computers that weren’t built with digital tuners installed weren’t required to comply with the new rule. In addition, the FCC explained that existing TVs, VCRs, DVD players and related equipment would remain fully functional under the new broadcast flag system.

The rules permit use of the flag at the discretion of the broadcaster, allowing some to choose no flag at all. The FCC said the current lack of digital broadcast content protection could be an impediment to the DTV transition and that the absence of content protection could cause high-value programming to migrate from broadcast TV to more secure platforms such as cable and satellite TV service. The FCC declined to prohibit the use of the flag with certain types of programming, such as news or public affairs. Some local broadcasters had feared their news would fall under a proposed exemption.

The FCC also established an interim policy that allowed proponents of a particular content protection or recording technology to certify to the Commission that the technology was an appropriate tool, subject to public notice and objection. The FCC said its interim certification decisions would be guided by “a series of objective criteria aimed at promoting innovation in content protection technology.” It also adopted a Further Notice of Proposed Rulemaking (FNPRM) seeking comment on a permanent process for the approval of protection technologies.

The agency also determined that multichannel video programming distributors (MVPDs), such as cable and satellite TV operators, should have latitude to implement the flag as appropriate for their distribution platforms, whether via direct passthrough or by effectuating the flag’s intent through their own conditional access system. The FCC said MVPDs could not assert greater redistribution control protection for digital broadcast content than what the broadcaster had selected. In the case of content which a broadcaster had not marked with the flag, MVPDs must pass it through unflagged. The FCC is seeking further comment on whether cable operators that retransmit DTV broadcasts may encrypt the digital basic tier in order to convey the presence of the flag through their conditional access system.

MPAA Pres. Jack Valenti called the order a “big victory” for consumers. “This puts digital TV on the same level playing field as cable and satellite delivery. All the way around, the consumer wins, and free TV stays alive,” he said.