Monty Tayloe

The FCC will block three Class A broadcasters from participating in the incentive auction and will disqualify an additional Class A broadcaster to make its case against the others stronger, an FCC official and several industry officials told us. The order denying reconsideration petitions from Fifth Street Enterprises, Videohouse and WMTM and disqualifying Latina Broadcasters' WDYB Daytona Beach from participating is expected to be issued later this week. Latina had been listed as being included in the auction in filings last year. "What the FCC did to Latina is almost unbelievable," said Ron Bruno, owner of Videohouse, in an interview.

The FCC Media Bureau didn't know about the largest single-station sponsorship identification enforcement action in the commission's history until the day before the Enforcement Bureau announced it (see 1601070060), said MB Policy Division Assistant Chief Robert Baker, the agency's expert on political advertising rules, of the $540,000 consent decree with Cumulus. Panelists at a Monday FCBA CLE on political ads discussed new online political file rules, ad rate regulations and the current presidential race. The Media Bureau received numerous inquiries from broadcast attorneys concerned about receiving similar violation notices after Cumulus, Baker said. But he said he believes it was a "wild card" rather than an indication of how the FCC will treat sponsorship ID violations going forward.

Opponents and supporters of FCC proposals to make the set-top box market more competitive (see 1601270064) loudly disagreed at a briefing Friday whether the plan would improve prospects for minority programmers. Officials from the Consumer Federation of America, Free Press, National Black Programming Consortium (NBPC) and Public Knowledge said making the retail set-top market more viable would create opportunities for minorities. Opponents in the crowd loudly challenged that assertion. Wednesday, the Justice Department backed the FCC issuing an NPRM (see 1602030017).

The Department of Justice's expression of support Wednesday for the FCC's planned NPRM on opening up the retail set-top box market could be a product of the numerous recent mergers in the pay-TV and set-top box industries, industry officials on both sides told us Thursday. In recent years, federal antitrust officials have reviewed and heard competitive concerns about deals that include Arris/Pace, Comcast/TWC, Charter/TWC and AT&T/DirecTV. "Every time there's a deal, interested parties go to Justice and tell them what they don't like about the deal," said Mediacom Senior Vice President-Government and Public Relations Tom Larsen. DOJ's taking a public stance in support of the NPRM before it has been voted is seen as a bad sign for multichannel video programming distributors, industry officials told us. DOJ didn't comment.

Nexstar’s proposed $4.6 billion buy of Media General is seen as likely to get FCC approval, though some details of the transaction remain unclear, communications attorneys and analysts told us. Though Nexstar has indicated it plans to divest stations in overlapping markets or sell their spectrum to get regulatory approval, CEO Perry Sook said on an investor call the specifics were still in motion. Along with specific divestitures, there are questions about how long the transaction (see 1601270040) will take to be approved, with the incentive auction just around the corner. Broadcasters are under pressure to expand to match with their growing and numerous competitors, making this deal “not surprising,” said BIA/Kelsey Chief Economist Mark Fratrik.

The Media Bureau received over 400 applications from Class C and D AM stations looking to relocate FM translators Friday, FCC officials told us Monday. “Almost one in ten AM stations in the country applied for an FM translator during the first 24 hours of the modification window,” said Commissioner Ajit Pai in a statement announcing those numbers. As expected (see 1601120064), the first-come, first-served aspect of the window caused applications to be front-loaded. FCC officials told us they expect the torrent of applications to slow to a trickle during the rest of the window for C and D stations. Brokers, FCC officials and broadcast attorneys told us they expected some more surges of activity as windows for A and B stations to relocate stations and 2017 windows to obtain new stations approach. Yet neither is expected to match the volume of Friday.

Despite unanimous votes to extend online public file rules to pay-TV carriers and radio stations and for an NPRM on improving the nationwide emergency alert system, there were still some party-line divides over the items, based on commissioner statements afterwards. The items were adopted largely as expected (see 1601080047 and 1601210055). The public would have been "outraged" by the original version of the EAS NPRM system because it contemplated extending EAS regulations to the Internet, said Commissioner Mike O'Rielly. Commissioner Ajit Pai said the FCC didn't quite go far enough to ease the burden of online public file on smaller entities, though he conceded the commission did "cut them slack." There "was a lot of back and forth" in the lead up to the items, said Chairman Tom Wheeler.

Industry officials expect FCC Commissioners Ajit Pai and Mike O'Rielly to oppose policy changes to move away from reliance on CableCARDs and toward successor standards, if not the NPRM set for a Feb. 18 vote that proposes the overhaul (see 1601270064). Both Republican commissioners repeatedly declined to comment Thursday on Chairman Tom Wheeler's proposed "opening up" of the set-top box market.

The public should "voice its opposition" to Nexstar's buying Media General for about $4.6 billion (see 1601270040), Cox Communications said in a news release Thursday. "Nexstar should not be allowed to become a larger company, which would force more cable TV/satellite companies and ultimately consumers to pay higher fees for retransmission consent." Nexstar is "demanding" that Cox pay triple the previous retrans price or Nexstar will remove its signal Friday, Cox said. Nexstar has expressed concern its deal could be held up by the impending incentive auction. FCC Chairman Tom Wheeler said Thursday after the agency's meeting that the question is likely academic because he expects the transaction approval process likely will take longer than the auction. He declined to give an exact estimate of the auction's length. Cox's "misguided plea to consumers" highlights "irrational thinking," Nexstar said in a released response Thursday. The expiring agreement between Nexstar and Cox dates from 2010, and Nexstar is seeking "slightly more than double" rather than triple the older rate, Nexstar said. If Cox has to raise rates to its viewers, it's because Cox has misallocated its programming fee payments, Nexstar said.

The FCC is moving forward with a rulemaking process based on the work of the Downloadable Security Technology Advisory Committee (DSTAC) even as pay-TV, content and consumer electronics companies announced (see 1601270023) the formation of a group opposing such a plan. The proposals are contained in an NPRM that FCC officials said will be circulated to eighth-floor offices Thursday and voted on at the FCC's Feb. 18 meeting. Communications Daily had first reported that the NPRM was coming (see 1512150072). Proponents framed it as injecting much-needed competition into the pay-TV device market, while cable and other incumbents criticized it.