TVNewsCheck

A National Association of Broadcasters request for the Federal Communications Commission to launch a National Broadcast Plan may not be in the industry’s best interests -- at least not according to Commissioner Michael O’Rielly.

“I worry what could be in parts of such a plan for your business,” said O’Rielly, one of the two Republican FCC commissioners. Commissioner O’Rielly suggested that broadcasters think twice before opening the door for a review by the same commissioners who recently voted to crack down on joint sales agreements, “the same people who just decided things that were against your interests.”

FCC Chairman Tom Wheeler said the agency would conduct such a review, if Congress mandated and funded it. That was a sentiment his two Democratic colleagues -- Mignon Clyburn and Jessica Rosenworcel -- subsequently shared.

NBCUniversal plans to launch its TV Everywhere app in June, rolling out first with the NBC Owned Stations followed by the affiliates in the fall.

At a closed-door meeting with more than 100 affiliates Monday at the National Assocation of Broadcasters Show in Las Vegas, NBC showcased its plan to launch its TV Everywhere app, which has not yet been named, and how affiliates can participate in the initiative, sources say.

The Federal Communications Commission won’t retaliate against broadcasters who refuse to participate in a planned agency outreach effort intended to educate broadcasters about why they might want to participate in the agency’s incentive auctions, a top agency official said.

“If someone from the FCC calls ... and you’re not interested and you don’t want to talk, ‘No thank you,’ is fine, and there will be absolutely no penalty,” said Howard Symons, vice chair of the FCC’s Incentive Auction Task Force.

Some broadcasters have raised concerns about the appropriateness of the planned agency outreach because the FCC licenses broadcasters and reviews station transactions. But Symons told broadcasters during the National Association of Broadcasters session that the FCC takes “very, very, very seriously” the statutory directive that auction participation be voluntary.

“I don’t think we can be passive as an agency and make this auction work,” Symons said. “But that doesn’t mean that you’ve got to take the meeting, that you’ve got to be interested,” Symons continued. “That’s not what voluntary means.”

With growing consumer demand for video on smartphones and tablets, broadcasters need to take charge in making mobile TV a robust business, even if other players like manufacturers are hedging, industry leaders say.

“Mobile TV is really in the hands of the broadcast industry,” Salil Dalvi, an NBCUniversal Digital Distribution SVP, said during a panel discussion on mobile TV at the National Association of Broadcasters Show. “TV stations have a lot of power to both light up for mobile as well as create awareness and bring people to the table.”

Dalvi said that was proven during the 2013 holiday season when Dyle, a mobile TV product backed by broadcast groups including NBCU, tested its viability in 12 markets across the country. That test run showed that consumers like the idea of mobile TV, with 15% of Dyle mobile TV consumers watching at least two hours of TV a week on their smartphones or tablets, he said.

TV ads were instrumental in building demand for Dyle, he said. “We went from zero awareness to significant awareness,” he said. But mobile TV won’t thrive if broadcasters don’t push it rather than wait for other segments of the industry, such as electronics manufacturers, to take the lead, he said.

Meantime, indicators point to growing consumer interest in mobile TV, said Jamie Spencer, a Magid Associates VP. He said research shows that “smartphones and tablets are becoming full-blown TVs.” About 44% of Smartphone owners and 61% of table owners currently watch video on their devices -- and local broadcasters have opportunity to capitalize on that interest, Spencer said. Nearly 40% of consumers who don’t watch local TV news said they would be more likely to do so if it were available on mobile, he said.

The pay TV industry’s effort to include major retransmission consent reform provisions in satellite TV legislation appears iffy at best -- at least according to key congressional staffers.

“We have made it very clear in the House side that STELA [the Satellite Television Extension and Localism Act] is not the right place to address retransmission consent reform,” said Grace Koh, a House Commerce Committee staffer.

Also during the same session, Shawn Bone, a top Senate Commerce Committee staffer, said that the committee’s chairman -- Sen Jay Rockefeller (D-WV) -- has previously taken the position that retransmission disputes are between two companies, and should remain that way. “There’s a great deal of reticence -- I think both from Chairman Rockefeller’s perspective and broadly on the Senate Commerce Committee -- from intervening in these disputes,” Bone said, although adding that, “nothing’s off the table.”

Judge Koh also said House GOP committee leaders believe a cable TV industry request to include a reform provision in STELA that would eliminate the must-buy rule should be shifted to a planned multi-year review of the entire Communications Act.

The Federal Communications Commission’s new crackdown on joint sales agreements is not part of an agency effort to spur TV stations to participate in the incentive auction -- or so said Bill Lake, chief of the FCC’s Media Bureau.

“The FCC is not having a war with over the air broadcasters,” Lake said. He also said that while the FCC regularly granted new JSAs over the past decade, the agency also has regularly warned broadcasters that a crackdown might be coming.

In addition, he said that the spectrum that the FCC needs to make the incentive auction a success is mostly in larger markets, and that the about 130 existing JSAs are mostly in smaller markets.

“So there’s really a disconnect there,” Lake said. He said the FCC will entertain requests for both types of waivers but that ones based on programming independence face an uphill battle. “I frankly think it would be very difficult for someone to justify a waiver of that particular ilk,” he said.

The Advanced Television Systems Committee’s work on the next-generation broadcast standard — ATSC 3.0 -- is progressing well and should yield a proposal or “candidate” by early 2015 and a final standard by late 2015, according to the technology experts.

As described by Madeleine Noland of LG Electronics, ATSC 3.0 represents a giant leap forward in the kinds of services that broadcasters will be able to provide and in how they can generate money from them. The standard will allow broadcasters to present 4K ultra HD and possibly 3D programming to big sets with fixed antennas in the home and HD programming to mobile devices in the hand or in the car with some degree of interactivity. Such services are made possible by the combination of a “fatter pipe” and “skinnier content, said Rich Chernock of Triveni Digital, who chairs the top ATSC 3.0 committee.

A group of 15 TV station group owners calling themselves the Television Licensee Coalition (TLC) have asked the Federal Communications Commission to stop its “targeted outreach” efforts to convince stations to participate in the commission’s spectrum incentive auction.

The groups comprising the TLC said they are not identifying themselves "due to the sensitive nature of the issues...." Now, in a filing to the commission, TLC says that while it recognizes that “the FCC has quite properly embarked on a process of generally educating TV stations about this opportunity,” its plan to hold one-on-one sessions could be interpreted as “introducing an element of compulsion into the process.”

Because the Spectrum Act mandates a voluntary auction, TLC says, “the commission risks tipping the delicate balance” between a truly voluntary auction “and one in which the government is overreaching,” which would violate its statutory dictate.”

The National Association of Broadcasters obliquely threatened to take the Federal Communications Commission to court if it insists on using its "different and novel methodology" for calculating the over-the-air coverage of TV stations when it repacks the TV band in conjunction with the planned incentive auction.

In comments filed with the FCC, the NAB said that the FCC should stick to the traditional OET-69 methodology. Using its novel approach "contradicts the plain language of the Spectrum Act," which authorizes the FCC to conduct the incentive auction and requires the agency to make "all reasonable efforts" to preserve stations' current coverage in the repack.

Nothing in the incentive auction rulemaking, and no construction of the FCC's delegated authority, authorizes the commission to rewrite the OET-69 interference analysis methodology, the NAB said. In addition, it said, the FCC's procedures for releasing and publicizing new versions of its methodology violate the Administrative Procedure Act and deny the public adequate notice to provide meaningful comment.

[Commentary] After nearly four decades of gradually and carefully loosening the rules governing how many TV stations a broadcaster may own and where it may own them, FCC Chairman Tom Wheeler and his two Democratic colleagues decided to more strictly enforce the local ownership rule, which forbids broadcasters from owning two stations in small and medium markets or from owning two top four stations in large markets.

They did that by reversing the FCC's 10-year-old policy of allowing broadcasters to operate (or at least enjoy the economies of) second stations through joint sales and shared services agreements in markets where they could not own them outright. They threw out 10 years of precedents, and they did so in a punitive way. No existing deals would be grandfathered and no pending deals would be approved. Broadcasters with joint sales agreements (JSAs) would have two years to unwind them.

I agree with FCC Commissioner Pai that in reneging on all its JSA approvals to date, the FCC is discouraging investment in broadcasting and, perhaps more important to Chairman Wheeler, undermining his planned incentive auction, through which he hopes to reallocate spectrum from TV to wireless broadband.

Unless overturned by the courts, the crackdown on JSAs is going to disrupt a lot of businesses. It's already caused a lot of financial damage. Chairman Wheeler says it's going to create more opportunities in broadcasting for small businesses, especially those owned by minorities and women, but he makes no good case for it. He offers no evidence that it will.