CBS TV Network won’t transmit any DTV programming after summer 2003 “if a broadcast flag is not implemented and enforced” by then, parent Viacom told FCC. Commenting on rulemaking (MB 02-230), Viacom said sale of digital sets and broadband subscriptions had “reached the tipping point at which it can no longer afford to expose its content to piracy.” Viacom said potential revenue loss by CBS due to program piracy, and resulting “devaluation” of over-air broadcasting, “could reach hundreds of millions of dollars.”
In current wireline broadband proceeding, FCC Comr. Martin suggested Thurs. that Commission could treat DSL services in same way as cable modem service. That would mean it would need to alter Computer II rules so incumbents wouldn’t be required to provide underlying transmission services as retail offerings.
FCC proposal to require “broadcast flag” copy protection in DTV sets “represents an alarming and illegal reversal of consumer rights to record and watch television programming,” said coalition of consumer groups in filing on FCC rulemaking (MB 02-230). More than 1,000 comments were filed in proceeding, virtually all by individuals, including hundreds via Citizens for Sound Economy. Consumer groups also said broadcast flag wouldn’t be effective in preventing commercial piracy of digital content and wouldn’t significantly speed DTV transition, which also is being slowed by factors such as lack of cable compatibility and weak consumer awareness. “By reducing functionality, the broadcast flag is much more likely to slow the transition and leave the new digital media far less innovative and consumer friendly than they could be,” said Mark Cooper of Consumer Federation of America. Groups said Hollywood and broadcasters were trying to use broadcast flag to reverse freedom consumers have had since VCRs arrived to record programming. They also questioned FCC’s authority to mandate broadcast flag technology. Filing also was signed by 11 state consumer groups, 2 other groups. TiVo, meanwhile, said it purposefully designed copy protection into its personal video recorders and supports protection. But it said some media companies’ goals “go far beyond protecting copyrighted material” from illegal copying. It said companies seemed intent on using govt. intervention to prevent copying that was acceptable under current laws.
Cable’s focus on number of channels in FCC rate proceeding contrasts sharply with its focus on bandwidth in DTV must-carry proceeding, NAB said in comments on Commission cable rate rulemaking (MB 02-144). Cable has contended it shouldn’t have to carry ancillary services because that would use up bandwidth, but NAB said that amounted to “shaving” bandwidth allocated to broadcasters for use in other services. Cable focuses on number of channels in rate case “in order to increase cable rates as much as possible,” NAB said, but on bandwidth in carriage case “to commandeer bandwidth.”
FCC told 9th U.S. Appeals Court, San Francisco, that it had “reasonably” concluded that cable modem service was interstate information service. “The Commission’s reading of the statute makes good sense,” agency wrote court last week. Court is reviewing FCC’s classification of cable modem service, which is being challenged by Earthlink, Verizon, WorldCom, consumer groups and several others. In March, FCC said that cable modem service was interstate information service and that Internet delivered over cable wasn’t subject to common carrier regulations (CD March 15 p1). Ruling went to heart of questions about rights of local franchising authorities, their ability to levy taxes on such services, whether cable modem ever would be subject to universal service requirements and whether cable operators would have to offer “open access” to Internet service providers (ISPs). In its filing, FCC said court’s ruling 2 years ago in AT&T v. Portland, Ore., didn’t require agency to classify cable modem as telecom service, just that law classified telecom component of cable modem service as such. Because Telecom Act doesn’t define clearly how it should be classified, “this court must defer to the FCC’s reasonable interpretation of ambiguous statutory terms,” Commission said. Agency said it believed cable operators were using telecom to provide end users with information service. Therefore, it said, it concluded that cable operators’ offering of telecom to ISPs constituted private carrier service, not common carrier telecom service. FCC said it asserted federal jurisdiction properly because Internet communications frequently crossed state and national boundaries. Court should reject any suggestion that agency’s order “somehow impairs the ability of local governments to manage their rights of way,” agency said: “The Commission has not yet decided how (if at all) its classification of cable modem service will affect local regulation of rights-of-way.” That question is subject of separate proceeding. FCC in March opened rulemaking to examine which govt. agencies, if any, had power to regulate cable modem service and invited comment on whether, “in light of marketplace developments, it is necessary or appropriate at this time” to require multiple ISP access. FCC asked court to dismiss challenge by Verizon, which said Commission should adopt same classification for wireline broadband services. Again, FCC said that question was part of separate proceeding and shouldn’t be considered by court.
Two senators are promoting use of Wi-Fi wireless broadband as alternative to cable-DSL debate that has resulted in impasse in Congress. Sens. Allen (R-Va.) and Boxer (D-Cal.) are circulating “Dear Colleague” letter that encouraged more unlicensed spectrum be devoted to broadband.
FCC won’t send local franchising authorities any customer service complaints relating to cable modem service while issues still are pending in rulemaking, said Dane Snowden, chief of agency’s Consumer & Govt. Affairs Bureau. In letter to Kenneth Fellman, chmn. of FCC’s Local & State Govt. Advisory Committee (LSGAC), Snowden referred to Fellman’s concerns about handling customer service complaints while rulemaking was pending and said Commission sought comments on how its information service classification of cable modem service might affect application of state or local regulation of consumer protection and customer service standards. While FCC tentatively had concluded that Title 6 didn’t provide independent basis for assessing franchise fees on cable modem service, Snowden said, it also had sought comments on any other authority that state and local govts. might have for assessing fees or taxes on cable Internet service. Commission is reviewing comments on those issues, he said.
National Translator Assn. (NTA) asked FCC to amend its rules to establish rural translator service, saying doing so would “help equalize” Commission’s broadcast TV policies between urban and rural areas. “For various reasons, rural America has been shortchanged for more than 20 years by a Commission policy of not promoting the delivery of broadcast services to those rural areas,” association said in petition for rulemaking. Group said authorizations for translator stations for that purpose had met with Commission’s “unreasonable reliance on window filings spaces years apart” or rules that failed to differentiate among categories of auxiliary stations based on nature of service proposed. Cable can’t provide service due to prohibitive cost of wiring sparsely populated areas, group said, and DBS can’t provide full local-into-local service because of spectrum limitations. Rural areas are entitled to same level of service as urban areas, association said: “The only effective way for that service to be provided is by integrating the use of translators directly into the Commission’s policy process.” NTA is organization of owners and operators of commercial and noncommercial, over-air TV translator stations.
After 2 previous failed attempts at instituting EEO rules for broadcasters, cable and satellite companies, FCC adopted new set of rules Thurs. that it believes will hold up in court this time. That’s because new rules are basically carbon copy of part of its previous rules that U.S. Appeals Court, D.C., found acceptable last time around. Commission left out part of its old rules that court overturned on constitutional grounds.
NARUC Telecom Committee will consider policy resolutions addressing universal service portability and broadband open access requirements along with other resolutions at NARUC annual meeting next week in Chicago. Draft universal service resolution urges FCC to open rulemaking on high-cost support portability to clarify ambiguous terms in existing rules. It notes CLEC can receive universal service high-cost support if it “captures” subscriber line from incumbent or serves “new subscriber” in incumbent’s service area, but current rules don’t define what “capture” or “new subscriber” mean, so operation of rule is unclear. Draft also asks that FCC reexamine decisions to (1) expand high-cost support to cover additional lines into residential and small business premises and (2) base high-cost support to CLECs on incumbent’s costs rather than CLECs’ own costs. Draft broadband resolution proposes that all Internet users should have choice of ISP regardless of whether they use telephone or cable-based high- speed Internet access services. Resolution also says that ISPs are entitled to equal service quality from all facilities providers. Draft says efforts by providers of broadband services or facilities to steer Internet users toward favored content through restrictive access arrangements would impair free and open information exchange in marketplace of ideas. Resolution says broadband Internet access should be unrestricted as to choice of lawful content and that ISPs and end-users are entitled to meaningful information on technical limitations of their broadband service. Resolution said ISPs affiliated with facility provider can promote their preferred or favored content so long as customers have “effective” choice of ISP.