Monty Tayloe

Seven percent of American TV homes “rely solely on an antenna for their television programming,” said a study released Tuesday by CEA (http://bit.ly/14gwz2j). “This study provides yet another reason why it is time for broadcast spectrum to be reallocated, and quickly,” said President Gary Shapiro in a release. The study, U.S. Household Television Usage Update, is a follow-up to a 2010 CEA report that showed 8 percent of TV households relying solely on an antenna. Consumers “have moved away in droves from traditional broadcast television thanks to a surge in programming alternatives” available over broadband, said Shapiro. “According to historical CEA research, there has been a gradual decline in the percentage of TV households using antennas since 2005,” said the study. CEA’s findings “strain the bounds of credibility,” said NAB in an emailed response. An NAB spokesman attacked the study for not being conducted independently, and for its small sample size: There were 1,009 adults interviewed over the phone, CEA said. CEA analyst Kevin Tillmann, who worked on the study, called NAB’s comments “wildly inaccurate” in an email. The telephone survey was conducted by Opinion Research Corp., not CEA staff, he said. NAB pointed to a larger study released last month by market researcher GfK which showed an increase in broadcast-only homes in 2013 to 19.3 percent of TV households (CD June 21 p20). “We're confident that GfK’s research is far more credible than that of a trade association with a track record of anti-broadcasting bias,” said the NAB spokesman. CEA’s report also points out that a 2012 Nielsen study showed 9 percent of households as broadcast only, similar to CEA’s figure. There was a 5 percentage point decrease from 2010 to 83 percent in people who get TV from cable, satellite or fiber. “The use of non-TV consumer electronics devices (such as laptops, desktops, tablets and smartphones) in the home to consume content is likely affecting pay-TV subscriptions,” said CEA. The association also pinned that decline on “increasingly accessible Internet sourced television programming.” It found that 28 percent of U.S. TV households receive programming on their TVs through the Internet, and 4 percent of TV households report using the Internet exclusively as their source of television programming for their TVs. The FCC also found increased penetration of Internet connected TVs in its recent Video Competition Report (CD July 23 p7). “This is why Congress had it right when they authorized the FCC to hold voluntary broadcast spectrum incentive auctions to reallocate broadcast television spectrum to greater uses, like wireless broadband,” said Shapiro, referring to CEA’s findings.

Sinclair Broadcast Group will use shared service agreements and joint sales agreements to comply with FCC ownership rules in its $985 million buy of seven Allbritton TV stations, Sinclair said Monday. Along with seven ABC affiliates covering 4.9 percent of U.S. households, Sinclair will acquire Allbritton’s D.C.-area 24-hour local news cable channel, NewsChannel 8. The transaction will create “synergies,” Sinclair said. Free Press attacked Sinclair’s “rapid expansion.” “The FCC needs to scrutinize these proposed deals and stop allowing covert consolidation through shared services agreements that allow Sinclair to run two or even three stations in a single market,” said Free Press President Craig Aaron in a press release Monday.

The FCC will likely approve the proposed $1.5 billion merger between Gannett and Belo despite petitions to deny the transaction filed Wednesday by the American Cable Association, Time Warner Cable, DirecTV and multiple public interest groups, said several industry observers in interviews Thursday. “It’s unlikely that the petitions to deny would result in the commission not approving the transaction,” said former FCC Commissioner Robert McDowell, now a visiting fellow at the Hudson Institute.

The proposal to require multichannel video programming distributors to provide emergency video description over mobile devices isn’t based on a congressional mandate, said DirecTV. In the CVAA, Congress told the FCC to implement emergency video description for TV, and to study providing the service over IP, DirecTV said. “The juxtaposition of an explicit grant of authority with respect to closed captioning of programming delivered via IP and the mere requirement for a study of the issues potentially relevant to providing video description via IP is especially telling.” DirecTV referenced MPAA v. FCC, where rulemakings were struck down under similar circumstances.

Public interest groups clashed with trade associations and media owners over cross-ownership rules in comments filed in docket 09-182 on the Minority Media & Telecommunications Council’s cross-ownership impact study. Monday was the filing deadline for comments on Impact of Cross Media Ownership on Minority/Women Owned Broadcast Stations, which was released in May (CD May 31 p1). “The MMTC Study is not adequate to support the conclusion that any cross-ownership rules should be changed in this proceeding,” said the National Association of Black Owned Broadcasters in its comments. Groups such as NABOB and Free Press attacked the study for not being sufficiently quantitative and having a small sample size, while trade associations and others pointed to what they said is a lack of evidence supporting cross-ownership rules and urged the FCC to change them. “The record in fact supports broader reform of the broadcast ownership rules, including the local television and local radio rules, to allow broadcasters to achieve economies of scale and scope and enhance their service to the public,” said NAB.

Consumers are using TVs that can receive digital video, using DVRs and watching online video on their sets in increasing numbers, said the FCC’s 15th Annual Video Competition Report, the full text of which was released Monday. As expected (CD July 22 p12), the report showed some shifts in consumer behavior toward alternative methods of viewing content, though it also shows the number of broadcast TV viewers remaining the same since the last report. Some cable attorneys told us Monday that little in the video competition report was surprising or unexpected, in keeping with what the draft document reportedly said (CD July 18 p1).

Cable’s share of the multichannel video programming market fell between 2010 and 2012, while the number of households relying exclusively on over-the-air broadcast service has remained steady since the end of 2011, said the FCC Media Bureau’s 15th Annual Video Competition Report to Congress, which was unanimously approved at the commission meeting Friday. The report has been presented to Congress and is expected to be posted Monday.

The FCC should reinstate most of the CableCARD rules stripped away by the U.S. Court of Appeals for the D.C. Circuit in its EchoStar decision, TiVo said in a petition for rulemaking filed Tuesday (http://bit.ly/12VRaSI). The court decision stripped away the “Second Report & Order pertaining to Section 629,” including rules governing CableCARDs and encoding rules. By vacating a number of technical standards that applied to cable operators along with the encoding rules that were at the center of EchoStar, “the Court created an unhealthy amount of uncertainty in the industry -- uncertainty that harms innovation and competition as well as settled consumer expectations,” said TiVo. To comply with the court’s ruling that the FCC did not have the authority to apply encoding rules governing copy protection to DBS, TiVo’s petition asks the commission to leave the rules that affect DBS out of the rulemaking. Since the court didn’t “make any findings adverse to any of the other regulations” aside from the rules that applied to DBS, “there is nothing in EchoStar to impede the Commission from re-instating the non-controversial standards-reference regulations adopted with the Second R&O, and from re-instating the Encoding Rules, sans the language that included DBS operators in their scope,” TiVo said. Restoring the rules would promote competition and clear up confusion about the state of CableCARD regulation, TiVo said. “Given Section 629’s requirement that the Commission assure the competitive availability of retail navigation devices, it is the Commission’s statutory responsibility to resolve any uncertainty or ambiguity concerning its rules,” TiVo said. The set-top box maker pointed to the Media Bureau’s CableCARD waiver granted to Charter Communications as evidence of a need for more clarity on CableCARD regulation. “The Media Bureau’s Order speculated about, but did not purport to resolve, the status of earlier and later rules in the wake of EchoStar’s rejection of only the Second R&O,” TiVo said. “Charter formulated arguments suggesting that every FCC rule pertaining to CableCARDs and common reliance was now subject to reinterpretation and dismissal,” said TiVo. The Media Bureau didn’t comment. “I have a hard time seeing what choice the FCC has,” said Public Knowledge Senior Staff Attorney John Bergmayer. “They have a statutory obligation to do something about this -- I would expect to see most of the rules come back,” said Bergmayer. CEA also said it supports the proposed rulemaking. “They have the ability to reinstate them, it’s not a heavy lift,” said CEA’s Julie Kearney. The NCTA and American Cable Association -- both of which have opposed CableCARD requirements in the past -- did not comment on TiVo’s petition. “The petition doesn’t indicate any market impediment as a result” of the rules being vacated by EchoStar, said Davis Wright cable attorney Paul Glist, who has represented companies seeking CableCARD waivers. “This shouldn’t be controversial,” said TiVo General Counsel Matt Zinn. “These are the rules we've all lived by for years.”

The FCC’s 15th annual video competition report, in the same format as last year’s report, contains few surprises, said agency official in interviews. “It’s very close to last year’s report,” said an agency official. The report is due to be voted on by the commission Friday, the first time in several years the commission has kept to the annual schedule mandated by the 1996 Telecom Act. The 14th report was released last year, but the 13th came out in 2009. The 14th report contained data on the rise of online video distributors, the cost to multichannel video programming distributors of acquiring content, the effect of ISP data caps on competition (CD July 23/11 p6).

Broadcasters’ appeal to have their case for an injunction against online TV service Aereo reheard by a full panel of judges was denied Tuesday by the 2nd U.S. Circuit Court of Appeals in New York after a 10-2 vote. The failure of the appeal of denial by a three-judge 2nd Circuit panel of an injunction preventing Aereo from retransmitting TV stations’ content is not unexpected, said several broadcast attorneys and one of the appellants, Fox. The denial likely won’t have much effect on the several remaining court battles involving Aereo and competitor FilmOn, broadcast attorneys told us, though a dissenting opinion from 2nd Circuit Judge Denny Chin could boost future broadcaster appeals. “They can use Chin’s dissent as a roadmap of sorts in formulating their arguments,” said Fletcher Heald’s Harry Cole, who’s not involved in the case. Fox “will now review our options and determine the appropriate course of action, which include seeking a hearing in the U.S. Supreme Court and proceeding to a full trial on the merits of the case,” said the 21st Century Fox subsidiary in a statement.