[Federal Register Volume 72, Number 157 (Wednesday, August 15, 2007)]
[Proposed Rules]
[Pages 45712-45716]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 07-3958]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 73

[MM Docket No. 99-325; FCC 07-33]


Digital Audio Broadcasting Systems and Their Impact on the 
Terrestrial Radio Broadcast Service

AGENCY: Federal Communications Commission.

ACTION: Proposed rule.

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SUMMARY: In this document, the Commission proposes rules to address 
issues that were left unresolved in the Commission's Second Report and 
Order, FCC 07-33. Specifically, the Commission seeks comment on how to 
ensure that the amount of subscription-based radio service is limited, 
whether the Commission can and should impose spectrum fees on portions 
of the digital bandwidth used by broadcasters to provide subscription 
services, whether statutory requirements and subscription regulations 
should apply to subscription-based services, whether any new public 
interest requirements should be imposed on digital audio broadcasters, 
whether enhanced public disclosure rules should apply to radio 
stations, and whether the rules regarding unattended stations should be 
reviewed and modified.

DATES: Comments for this proceeding are due on or before October 15, 
2007; reply comments are due on or before November 13, 2007.

ADDRESSES: You may submit comments, identified by MM Docket No. 99-325, 
by any of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     Federal Communications Commission's Web site: http://www.fcc.gov/cgb/ecfs/. Follow the instructions for submitting comments.
     People With Disabilities: Contact the FCC to request 
reasonable accommodations (accessible format

[[Page 45713]]

documents, sign language interpreters, CART, etc.) by e-mail: 
[email protected] or phone: 202-418-0530 or TTY: 202-418-0432.

For detailed instructions for submitting comments and additional 
information on the rulemaking process, see the SUPPLEMENTARY 
INFORMATION section of this document.

FOR FURTHER INFORMATION CONTACT: For additional information on this 
proceeding, contact Ann Gallagher, [email protected] of the Media 
Bureau, Audio Division, (202) 418-2716, or Brendan Murray, 
[email protected] of the Media Bureau, Policy Division, (202) 418-
2120.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Second 
Report and Order, First Order on Reconsideration, and Second Further 
Notice of Proposed Rulemaking, FCC 07-33, adopted on March 22, 2007, 
and released on May 31, 2007. The full text of this document is 
available for public inspection and copying during regular business 
hours in the FCC Reference Center, Federal Communications Commission, 
445 12th Street, SW., CY-A257, Washington, DC 20554. These documents 
will also be available via ECFS (http://www.fcc.gov/cgb/ecfs/). 
(Documents will be available electronically in ASCII, Word 97, and/or 
Adobe Acrobat.) The complete text may be purchased from the 
Commission's copy contractor, 445 12th Street, SW., Room CY-B402, 
Washington, DC 20554. To request this document in accessible formats 
(computer diskettes, large print, audio recording, and Braille), send 
an e-mail to [email protected] or call the Commission's Consumer and 
Governmental Affairs Bureau at (202) 418-0530 (voice), (202) 418-0432 
(TTY).

Initial Paperwork Reduction Act of 1995 Analysis

    This document does not contain proposed information collection(s) 
subject to the Paperwork Reduction Act of 1995 (PRA), Public Law 104-
13. In addition, therefore, it does not contain any new or modified 
``information collection burden for small business concerns with fewer 
than 25 employees,'' pursuant to the Small Business Paperwork Relief 
Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4).

Summary of the Notice of Proposed Rulemaking

    1. Preserving the existing system of free over-the-air terrestrial 
radio service as radio stations convert to digital broadcasting remains 
important. In order to accomplish this goal, we seek comment on how to 
ensure that the amount of subscription-based radio services is limited. 
For example, should we implement a requirement which states that no 
more than 20 to 25 percent of a station's digital capacity be devoted 
to subscription services? In the digital television context, we have 
not imposed a specific cap on the amount of subscription services that 
could be offered. Rather, we have permitted television stations to use 
their digital capacity for any purpose as long as they transmit at 
least one over-the-air video program signal at no direct charge to 
viewers. This estimate is based on current analog FM SCA usage and the 
scalability of the digital stream in 1 kbps or smaller increments. How 
should any limitation on digital subscription services be specified--in 
terms of occupied bandwidth, or in terms of total digital capacity? 
Would limiting digital subscription services to 20 to 25 percent be 
sufficient to ensure that the free over-the-air radio service is not 
compromised? Should there be different rules for NCE radio stations? 
What kinds of subscription services do radio stations, both NCE and 
commercial, plan to offer once they commence digital broadcasting? For 
example, iBiquity states that it will continue to develop new 
applications for DAB including store and replay, on-demand services, 
and a ``buy button.'' iBiquity has not made it clear whether these 
services would be offered on a subscription basis. Would any 
subscription services be broadcast services? With regard to DTV, 
Congress explicitly authorized the Commission to permit digital 
television stations to offer ancillary and supplementary subscription-
based services. Given that there is no similar statutory provision for 
DAB, we will proceed cautiously to ensure that free over-the-air 
service is preserved. We note that radio stations are permitted to 
offer subscription services during the pendency of this Second Further 
Notice of Proposed Rulemaking, but are put on notice that we will adopt 
new rules in this area that may affect such offerings.
    2. In the DAB FNPRM, we sought comment on whether we can and should 
impose spectrum fees for that portion of digital bandwidth used by 
broadcasters to provide subscription services. Given that we are 
further considering the issues surrounding the provision of 
subscription services, we now seek additional input from the public on 
the fee issue. With regard to DTV, Congress authorized the Commission 
to impose a fee on certain ancillary or supplementary services. The 
Commission subsequently adopted a rule requiring DTV licensees to pay a 
fee of five percent of the gross revenues derived from all ancillary or 
supplemental services that are feeable, as defined by the rules. Given 
that no express statutory authority exists in the DAB context, do we 
have the authority to impose a five percent or other fee based on the 
Commission's jurisdiction ancillary to its regulation of broadcasting? 
Can we, therefore, impose a similar fee for subscription digital radio? 
What limits should we place on subscription services, particularly if 
we are unable to impose a fee? Should broadcasters have to provide a 
free digital stream at least equal in quality to the best subscription 
service if they decide to provide a subscription service?
    3. In the Second Report and Order (published elsewhere in this 
issue), we rule that several statutory requirements and Commission 
regulations would apply to all free over-the-air digital programming 
streams. Here, we seek comment on whether those same requirements, as 
outlined in Section D.1, above, should apply to subscription services. 
We note that the Commission has applied certain public interest 
obligations to other subscription services, including cable television 
and satellite radio, pursuant to our authority to regulate subscription 
services ancillary to the regulation of broadcasting. We tentatively 
conclude that we should apply the requirements outlined above to 
subscription services offered by terrestrial radio stations, and that 
we have the statutory authority to do so. We seek comment on this 
tentative conclusion.
    4. As stated above, the Commission must ensure that broadcast radio 
and television stations serve the ``public interest, convenience and 
necessity.'' To ensure that broadcasters serve the public interest, 
convenience and necessity, the Commission requires licensees to comply 
with various program-related and operational duties. Broadcasters, for 
example, are required to air programming responsive to community needs 
and interests and have other service obligations. We will continue to 
enforce our statutory mandate to ensure that broadcasters serve the 
public interest, and remind broadcasters of the importance of meeting 
their existing public interest obligations. As stated above, IBOC 
provides broadcasters the potential for a more flexible and dynamic use 
of the radio spectrum and raises questions

[[Page 45714]]

about the nature of program-related and operating obligations in 
digital broadcasting because the scope of those responsibilities has 
not been defined. Certain parties have proposed new public interest 
requirements for DAB, while others have argued that there is no reason 
to change our existing rules. We seek comment on whether we should 
adopt any new public interest requirements for digital audio 
broadcasters.
    5. In the context of examining possible changes to television 
station public interest obligations in the digital environment, the 
Commission is considering whether the current requirements pertaining 
to television stations' public inspection files are sufficient to 
ensure that the public has adequate access to information on how the 
stations are serving their communities. As we undertake an examination 
of possible changes to radio station public interest obligations in the 
digital environment, we believe it is also appropriate to consider 
whether the current requirements for radio stations' public inspection 
files are sufficient to ensure that the public has adequate access to 
information on how these stations are serving their communities. In the 
Enhanced Disclosure NPRM, we proposed that television broadcast station 
licensees should use a standardized form to provide information on how 
the station serves the public interest in a variety of areas, and that 
the form should be provided on a quarterly basis and maintained in the 
station's public inspection file in place of the currently required 
issues/programs lists. We also proposed to enhance the public's ability 
to access public interest information by requiring licensees to make 
the contents of their public inspection files, including the form, 
available on the station's or a state broadcasters association's 
Internet Web site. We seek comment on whether we should consider 
applying such rules to radio stations, whether operating in analog or 
digital. Would the benefits or burdens of requiring the public 
inspection file to also be placed on the Internet be the same, lesser, 
or greater for radio stations than for television stations? In what 
specific ways, if any, should the rules differ for radio? Are there 
ways we can reduce the burden on small radio stations?

I. Procedural Matters

A. Filing Requirements

    6. Ex Parte Rules. The Second Further Notice of Proposed Rulemaking 
in this proceeding will be treated as a ``permit-but-disclose'' subject 
to the ``permit-but-disclose'' requirements under Section 1.1206(b) of 
the Commission's rules. Ex parte presentations are permissible if 
disclosed in accordance with Commission rules, except during the 
Sunshine Agenda period when presentations, ex parte or otherwise, are 
generally prohibited. Persons making oral ex parte presentations are 
reminded that a memorandum summarizing a presentation must contain a 
summary of the substance of the presentation and not merely a listing 
of the subjects discussed. More than a one-or two-sentence description 
of the views and arguments presented is generally required. Additional 
rules pertaining to oral and written presentations are set forth in 
Section 1.1206(b).
    7. Comments and Reply Comments. Pursuant to Sec. Sec.  1.415 and 
1.419 of the Commission's rules, 47 CFR 1.415, 1.419, interested 
parties may file comments and reply comments on or before the dates 
indicated on the first page of this document. Comments may be filed 
using: (1) the Commission's Electronic Comment Filing System (ECFS), 
(2) the Federal Government's eRulemaking Portal, or (3) by filing paper 
copies.
     Electronic Filers: Comments may be filed electronically 
using the Internet by accessing the ECFS: http://www.fcc.gov/cgb/ecfs/ 
or the Federal eRulemaking Portal: http://www.regulations.gov. Filers 
should follow the instructions provided on the Web site for submitting 
comments.
     For ECFS filers, if multiple docket or rulemaking numbers 
appear in the caption of this proceeding, filers must transmit one 
electronic copy of the comments for each docket or rulemaking number 
referenced in the caption. In completing the transmittal screen, filers 
should include their full name, U.S. Postal Service mailing address, 
and the applicable docket or rulemaking number. Parties may also submit 
an electronic comment by Internet e-mail. To get filing instructions, 
filers should send an e-mail to [email protected], and include the following 
words in the body of the message, ``get form.'' A sample form and 
directions will be sent in response.
     Paper Filers: Parties who choose to file by paper must 
file an original and four copies of each filing. If more than one 
docket or rulemaking number appears in the caption of this proceeding, 
filers must submit two additional copies for each additional docket or 
rulemaking number.
    Filings can be sent by hand or messenger delivery, by commercial 
overnight courier, or by first-class or overnight U.S. Postal Service 
mail (although we continue to experience delays in receiving U.S. 
Postal Service mail). All filings must be addressed to the Commission's 
Secretary, Office of the Secretary, Federal Communications Commission.
     The Commission's contractor will receive hand-delivered or 
messenger-delivered paper filings for the Commission's Secretary at 236 
Massachusetts Avenue, NE., Suite 110, Washington, DC 20002. The filing 
hours at this location are 8 a.m. to 7 p.m. All hand deliveries must be 
held together with rubber bands or fasteners. Any envelopes must be 
disposed of before entering the building.
     Commercial overnight mail (other than U.S. Postal Service 
Express Mail and Priority Mail) must be sent to 9300 East Hampton 
Drive, Capitol Heights, MD 20743.
     U.S. Postal Service first-class, Express, and Priority 
mail must be addressed to 445 12th Street, SW., Washington, DC 20554.
    People with Disabilities: To request materials in accessible 
formats for people with disabilities (braille, large print, electronic 
files, audio format), send an e-mail to [email protected] or call the 
Consumer & Governmental Affairs Bureau at 202-418-0530 (voice), 202-
418-0432 (TTY).
    8. Availability of Documents. Comments, reply comments, and ex 
parte submissions will be available for public inspection during 
regular business hours in the FCC Reference Center, Federal 
Communications Commission, 445 12th Street, SW., CY-A257, Washington, 
DC 20554. Persons with disabilities who need assistance in the FCC 
Reference Center may contact Bill Cline at (202) 418-0267 (voice), 
(202) 418-7365 (TTY), or [email protected]. These documents also will 
be available from the Commission's Electronic Comment Filing System. 
Documents are available electronically in ASCII, Word 97, and Adobe 
Acrobat. Copies of filings in this proceeding may be obtained from Best 
Copy and Printing, Inc., Portals II, 445 12th Street, SW., Room CY-
B402, Washington, DC 20554; they can also be reached by telephone, at 
(202) 488-5300 or (800) 378-3160; by e-mail at [email protected]; or via 
their Web site at http://www.bcpiweb.com. To request materials in 
accessible formats for people with disabilities (Braille, large print, 
electronic files, audio format), send an e-mail to [email protected] or 
call the Consumer and Governmental Affairs Bureau at (202) 418-0531 
(voice), (202) 418-7365 (TTY).

[[Page 45715]]

    9. Additional Information. For additional information on this 
proceeding, contact Ann Gallagher, [email protected], of the Media 
Bureau, Audio Division, (202) 418-2716 or Brendan Murray, 
[email protected], of the Media Bureau, Policy Division, (202) 
418-2120.

B. Initial and Final Regulatory Flexibility Analysis

    10. The Regulatory Flexibility Act of 1980, as amended (``RFA''), 
requires that a regulatory flexibility analysis be prepared for notice 
and comment rule making proceedings, unless the agency certifies that 
``the rule will not, if promulgated, have a significant economic impact 
on a substantial number of small entities.'' The RFA generally defines 
the term ``small entity'' as having the same meaning as the terms 
``small business,'' ``small organization,'' and ``small governmental 
jurisdiction.'' In addition, the term ``small business'' has the same 
meaning as the term ``small business concern'' under the Small Business 
Act. A ``small business concern'' is one which: (1) Is independently 
owned and operated; (2) is not dominant in its field of operation; and 
(3) satisfies any additional criteria established by the Small Business 
Administration (SBA). By the issuance of this Second Further Notice of 
Proposed Rulemaking, we seek comment on the impact our suggested 
proposals would have on small business entities.
    11. Act. As required by the Regulatory Flexibility Act, the 
Commission has prepared a Final Regulatory Flexibility Analysis 
(``FRFA'') relating to this Second Report and Order and First Order on 
Reconsideration.

C. Paperwork Reduction Act Analysis

    This document does not contain proposed information collection(s) 
subject to the Paperwork Reduction Act of 1995 (PRA), Public Law 104-
13. In addition, therefore, it does not contain any new or modified 
``information collection burden for small business concerns with fewer 
than 25 employees,'' pursuant to the Small Business Paperwork Relief 
Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4).

Initial Regulatory Flexibility Analysis

    12. As required by the Regulatory Flexibility Act of 1980, as 
amended, the Commission has prepared this Initial Regulatory 
Flexibility Analysis of the possible significant economic impact on a 
substantial number of small entities by the policies and rules proposed 
in the Second Further Notice of Proposed Rulemaking. Written public 
comments are requested on this IRFA. Comments must be identified as 
responses to the IRFA and must be filed by the deadlines for comments 
on the Second Further Notice of Proposed Rulemaking. The Commission 
will send a copy of this entire Second Further Notice of Proposed 
Rulemaking (``FNPRM''), including this IRFA, to the Chief Counsel for 
Advocacy of the Small Business Administration (``SBA''). In addition, 
the Second Further Notice of Proposed Rulemaking and the IRFA (or 
summaries thereof) will be published in the Federal Register.
    13. Need for, and Objectives of, the Proposed Rules. The Second 
FNPRM has been initiated to obtain further comments concerning the 
development and implementation of terrestrial digital audio 
broadcasting. Because free over-the-air terrestrial broadcasting is in 
the public interest, and because spectrum is a limited resource, in the 
Second FNPRM the Commission seeks comment on how to limit ancillary 
subscription services provided by radio stations converting to the IBOC 
DAB format so that terrestrial radio broadcasting remains an 
essentially free over-the-air service. The Commission also seeks 
comment on, inter alia, the application of several statutory and 
regulatory public interest requirements to subscription services.
    14. Legal Basis. The authority for this Second Further Notice of 
Proposed Rulemaking is contained in Sections 1, 2, 4(i), 303, 307, 
312(a)(7), 315, 317, 507, and 508 of the Communications Act of 1934, 47 
U.S.C 151, 152, 154(i), 303, 307, 312(a)(7), 315, 317, 508, and 509.
    15. Description and Estimate of the Number of Small Entities to 
Which the Proposed Rules Will Apply. The RFA directs the Commission to 
provide a description of and, where feasible, an estimate of the number 
of small entities that will be affected by the proposed rules. The RFA 
generally defines the term ``small entity'' as encompassing the terms 
``small business,'' ``small organization,'' and ``small governmental 
entity.'' In addition, the term ``small business'' has the same meaning 
as the term ``small business concern'' under the Small Business Act. A 
small business concern is one which: (1) Is independently owned and 
operated; (2) is not dominant in its field of operation; and (3) 
satisfies any additional criteria established by the Small Business 
Administration (``SBA'').
    16. Radio Stations. The proposed rules and policies potentially 
will apply to all AM and commercial FM radio broadcasting licensees and 
potential licensees. The SBA defines a radio broadcasting station that 
has $6.5 million or less in annual receipts as a small business. A 
radio broadcasting station is an establishment primarily engaged in 
broadcasting aural programs by radio to the public. Included in this 
industry are commercial, religious, educational, and other radio 
stations. Radio broadcasting stations which primarily are engaged in 
radio broadcasting and which produce radio program materials are 
similarly included. However, radio stations that are separate 
establishments and are primarily engaged in producing radio program 
material are classified under another NAICS number. According to 
Commission staff review of BIA Publications, Inc. Master Access Radio 
Analyzer Database on March 31, 2005, about 10,840 (95%) of 11,410 
commercial radio stations have revenue of $6.5 million or less. We 
note, however, that many radio stations are affiliated with much larger 
corporations having much higher revenue. Our estimate, therefore, 
likely overstates the number of small entities that might be affected 
by our action.
    17. Electronics Equipment Manufacturers. The rules adopted in this 
proceeding will apply to manufacturers of DAB receiving equipment and 
other types of consumer electronics equipment. The appropriate small 
business size standard is that which the SBA has established for radio 
and television broadcasting and wireless communications equipment 
manufacturing. This category encompasses entities that primarily 
manufacture radio, television, and wireless communications equipment. 
Under this standard, firms are considered small if they have 1000 or 
fewer employees. Census Bureau data for 2002 indicate that, for that 
year, there were a total of 1,041 establishments in this category. Of 
those, 1,023 had employment under 1,000. Given the above, the 
Commission estimates that the great majority of equipment manufacturers 
affected by these rules are small businesses.
    18. Description of Projected Reporting, Recordkeeping and Other 
Compliance Requirements. The proposed rules on subscription services 
may impose additional reporting or recordkeeping requirements on 
existing radio stations, depending upon how the Commission decides to 
limit subscription services. We seek comment on the possible burden 
these requirements would place on small entities. Also, we seek comment 
on whether a special approach toward any

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possible compliance burdens on small entities might be appropriate.
    19. Steps Taken To Minimize Significant Impact on Small Entities, 
and Significant Alternatives Considered. The RFA requires an agency to 
describe any significant alternatives that it has considered in 
reaching its proposed approach, which may include the following four 
alternatives (among others): (1) The establishment of differing 
compliance or reporting requirements or timetables that take into 
account the resources available to small entities; (2) the 
clarification, consolidation, or simplification of compliance or 
reporting requirements under the rule for small entities; (3) the use 
of performance, rather than design, standards; and (4) an exemption 
from coverage of the rule, or any part thereof, for small entities.
    20. In the Second Report and Order, the Commission permits radio 
stations to offer high quality digital radio signals, multicast digital 
audio programming streams, and datacasting. In the Second Further 
Notice of Proposed Rulemaking, the Commission seeks comment on what 
limitations on ancillary subscription services are necessary and 
appropriate to ensure the viability of free over-the-air radio 
broadcasting. This is an issue of first impression for the Commission; 
there is no history that indicates whether limits on ancillary 
subscription services will be adverse or beneficial to small 
businesses. Therefore, we make no judgment on whether limits on 
ancillary subscription services will adversely affect small business. 
We welcome commenters to address whether limits on ancillary 
subscription services will have any adverse effects on small 
businesses.
    21. Federal Rules Which Duplicate, Overlap, or Conflict With, the 
Commission's Proposals. None.
    22. The Commission will send a copy of the Second Report and Order, 
First Order on Reconsideration, and Second Further Notice of Proposed 
Rulemaking, including this FRFA, to the Chief Counsel for Advocacy of 
the SBA. A copy of the Second Report and Order, First Order on 
Reconsideration, and Second Further Notice of Proposed Rulemaking and 
FRFA (or summaries thereof) will also be published in the Federal 
Register.

II. Ordering Clauses

    23. Accordingly, it is ordered, pursuant to the authority contained 
in Sections 1, 2, 4(i), 303, 307, 312, 315, 317, 507, and 508 of the 
Communications Act of 1934, 47 U.S.C. 151, 152, 154(i), 303, 307, 312, 
315, 508, and 509, this Second Report and Order First Order on 
Reconsideration and Second Further Notice of Proposed Rulemaking is 
adopted.
    24. It is further ordered that the Commission's Consumer and 
Governmental Affairs Bureau, Reference Information Center, shall send a 
copy of this Second Report and Order First Order on Reconsideration and 
Second Further Notice of Proposed Rulemaking including the Initial and 
Final Regulatory Flexibility Analysis, to the Chief Counsel for 
Advocacy of the Small Business Administration.

List of Subjects in 47 CFR Part 73

    Digital television, Radio.

Federal Communications Commission.
Marlene H. Dortch,
Secretary.
[FR Doc. 07-3958 Filed 8-14-07; 8:45 am]
BILLING CODE 6712-01-P