[Federal Register Volume 76, Number 107 (Friday, June 3, 2011)]
[Proposed Rules]
[Pages 32116-32133]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-13822]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Parts 73 and 76
[MB Docket No. 11-93; FCC 11-84]
Implementation of the Commercial Advertisement Loudness
Mitigation (CALM) Act
AGENCY: Federal Communications Commission.
ACTION: Proposed rule.
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SUMMARY: In this document, the Commission proposes rules to implement
the Commercial Advertisement Loudness Mitigation (``CALM'') Act. Among
other things, the CALM Act directs the Commission to incorporate into
its rules by reference and make mandatory a technical standard
developed by an industry standard-setting body that is designed to
prevent television commercial advertisements from being transmitted at
louder volumes than the program material they accompany. Specifically,
the CALM Act requires the Commission to incorporate by reference the
ATSC A/85 Recommended Practice (``ATSC A/85 RP'') and make it mandatory
``insofar as such recommended practice concerns the transmission of
commercial advertisements by a television broadcast station, cable
operator, or other multichannel video programming distributor.'' As
mandated by the statute, the proposed rules will apply to TV
broadcasters, cable operators and other multichannel video programming
distributors (``MVPDs''). The new law requires the Commission to adopt
the required regulation on or before December 15, 2011, and it will
take effect one year after adoption. The document seeks comment below
on proposals regarding compliance, waivers, and other implementation
issues.
DATES: Comments are due on or before July 5, 2011; reply comments are
due on or before July 18, 2011.
ADDRESSES: You may submit comments, identified by MB Docket No. 11-93,
by any of the following methods:
Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
Federal Communications Commission's Electronic Comment
Filing System (ECFS) Web Site: http://fjallfoss.fcc.gov/ecfs/. Follow
the instructions for submitting comments.
Mail: All filings must be addressed to the Commission's
Secretary, Office of the Secretary, Federal Communications Commission,
445 12th Street, SW., Washington, DC 20554.
[[Page 32117]]
People with Disabilities: Contact the FCC to request
reasonable accommodations (accessible format 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 section V. ``PROCEDURAL
MATTERS'' heading of the SUPPLEMENTARY INFORMATION section of this
document.
FOR FURTHER INFORMATION CONTACT: For additional information on this
proceeding, contact Evan Baranoff, [email protected], of the Media
Bureau, Policy Division, (202) 418-2120 or Shabnam Javid,
[email protected], of the Engineering Division, Media Bureau at
(202) 418-7000.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Notice
of Proposed Rulemaking (NPRM), FCC 11-84, adopted and released on May
27, 2011. The full text of this document is available electronically
via ECFS at http://fjallfoss.fcc.gov/ecfs/ or may be downloaded at
http://www.fcc.gov/document/implementation-commercial-advertisement-loudness-mitigation-calm-act or http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-11-84A1.doc. (Documents will be available
electronically in ASCII, Word 97, and/or Adobe Acrobat.) This document
is also 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. The
complete text may be purchased from the Commission's copy contractor,
445 12th Street, SW., Room CY-B402, Washington, DC 20554. Alternative
formats are available for people with disabilities (Braille, large
print, electronic files, audio format), by sending an e-mail to
[email protected] or calling the Commission's Consumer and Governmental
Affairs Bureau at (202) 418-0530 (voice), (202) 418-0432 (TTY).
Summary of the Notice of Proposed Rulemaking
I. Introduction
1. In this Notice of Proposed Rulemaking (``NPRM''), we propose
rules to implement the Commercial Advertisement Loudness Mitigation
(``CALM'') Act.\1\ Among other things, the CALM Act directs the
Commission to incorporate into its rules by reference and make
mandatory a technical standard developed by an industry standard-
setting body that is designed to prevent television commercial
advertisements from being transmitted at louder volumes than the
program material they accompany.\2\ As mandated by the statute, the
proposed rules will apply to TV broadcasters, cable operators and other
multichannel video programming distributors (``MVPDs'').\3\ The new law
requires the Commission to adopt the required regulation on or before
December 15, 2011,\4\ and it will take effect one year after
adoption.\5\ We seek comment below on proposals regarding compliance,
waivers, and other implementation issues.
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\1\ The Commercial Advertisement Loudness Mitigation (``CALM'')
Act, Pub. L. 111-311, 124 Stat. 3294 (2010) (codified at 47 U.S.C.
621). The CALM Act was enacted on December 15, 2010 (S. 2847, 111th
Cong.). The relevant legislative history includes the Senate and
House Committee Reports to bills S. 2847 and H.R. 1084,
respectively, as well as the Senate and House Floor Consideration of
these bills. See Senate Commerce, Science, and Transportation
Committee Report dated Sept. 29, 2010, accompanying Senate Bill, S.
2847, 111th Cong. (2010), S. REP. 111-340 (``Senate Committee Report
to S. 2847''); House Energy and Commerce Committee Report dated Dec.
14, 2009, accompanying House Bill, H.R. 1084, 111th Cong. (2009),
H.R. REP. 111-374 (``House Committee Report to H.R. 1084''); Senate
Floor Consideration of S. 2847, 156 Cong. Rec. S7763 (daily ed.
Sept. 29, 2010) (bill passed) (``Senate Floor Debate''); House Floor
Consideration of S. 2847, 156 Cong. Rec. H7720 (daily ed. Nov. 30,
2010) (``House Floor Debate of S. 2847'') and H7899 (daily ed. Dec.
2, 2010) (bill passed); House Floor Consideration of H.R. 1084, 155
Cong. Rec. H14907 (daily ed. Dec. 15, 2009). Note that the Senate
and House Committee Reports were prepared before the bill was
amended to add Section 2(c) of the CALM Act (the compliance
provision). See Senate Floor Debate at S7763- S7764 (approving
``amendment No. 4687'').
\2\ See ATSC A/85: ``ATSC Recommended Practice: Techniques for
Establishing and Maintaining Audio Loudness for Digital
Television,'' (May 25, 2011) (``ATSC A/85 RP''). To obtain a copy of
the ATSC A/85 RP, visit the ATSC website: http://www.atsc.org/cms/standards/a_85-2009.pdf. See also 47 U.S.C. 621(a); Senate
Committee Report to S. 2847 at 1; House Committee Report to H.R.
1084 at 1.
\3\ We refer herein to covered entities collectively as
``stations/MVPDs'' or ``regulated entities.''
\4\ See 47 U.S.C. 621(a).
\5\ See 47 U.S.C. 621(b)(1).
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II. Background
2. The CALM Act was enacted into law on December 15, 2010 in
response to consumer complaints about loud commercials.\6\ The
Commission has received complaints about ``loud commercials'' virtually
since the inception of commercial television, more than 50 years
ago.\7\ Indeed, loud commercials have been a leading source of
complaints to the Commission since the FCC Consumer Call Center began
reporting the top consumer complaints in 2002.\8\ One common complaint
is that a commercial is abruptly louder than the adjacent
programming.\9\ The problem occurs in over-the-air broadcast television
programming, as well as in cable, Direct Broadcast Satellite (``DBS'')
and other video programming.
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\6\ See also House Floor Debate of S. 2847 at H. 7721 (Rep.
Eshoo stating that the law is in response to ``the complaints that
the American people have registered with the FCC over the last 50
years'').
\7\ See 1984 Order, FCC 84-300, 49 FR 28077, July 10, 1984
(``1984 Order'') (observing in 1984 that ``the Commission has
received complaints of loud commercials for at least the last 30
years''). See also 47 CFR 73.4075; Public Notice, ``Statement of
Policy Concerning Loud Commercials,'' 1 FCC 2d 10, para. 20(a)
(1965) (unpublished) (``1965 Policy Statement'') (concluding that
``complaints of loud commercials are numerous enough to require
corrective action by the industry and regulatory measures by the
Commission'').
\8\ To view the FCC's Quarterly Inquiries and Complaints
Reports, visit http://www.fcc.gov/cgb/quarter/. According to the FCC
Consumer Call Center, since January 2008, the Commission has
received 819 complaints and 4,582 inquiries from consumers about
``loud commercials.''
\9\ See Senate Committee Report to S. 2847 at 1-2. See also
Public Notice, ``Statement of Policy Concerning Loud Commercials,''
1 FCC 2d 10, para. 15 (1965) (``1965 Policy Statement'') (stating
that a ``common source of complaint is the contrast between loudness
of commercials as compared to the volume of preceding program
material--e.g., soft music or dialogue immediately followed by a
rapid-fire, strident commercial'').
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3. The Commission has not regulated the ``loudness'' of
commercials, primarily because of the difficulty of crafting effective
rules ``due to the subjective nature'' of loudness.\10\ The Commission
has incorporated by reference into its rules various industry standards
on digital television, but these standards do not describe a consistent
method for industry to measure and control audio loudness.\11\ The loud
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commercial problem seems to have been exacerbated by the transition to
digital television. DTV's expanded aural dynamic range allows for
greater variations in loudness for cinema-like sound quality. As a
result, when content providers and/or stations/MVPDs do not properly
manage DTV loudness, the resulting wide variations in loudness are more
noticeable to consumers.\12\ However, DTV technology also offers
industry the opportunity to more easily manage loudness.
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\10\ See 1984 Order at para. 14.
\11\ 47 CFR 73.682(d) incorporates by reference and requires
compliance with most of the Advanced Television Systems Committee
(``ATSC'') A/53 Digital Television Standard (2007 version) relating
to digital broadcast television and 47 CFR 76.640(b)(1)(iii)
incorporates by reference the American National Standards Institute/
Society of Cable Telecommunications Engineers (``ANSI/SCTE'')
Standard 54 (2003 version) relating to digital cable television. The
rules do not currently incorporate by reference a standard that
applies to satellite TV (``DBS'') providers. Part 5 of the ATSC
Standard A/53, which includes the Dolby AC-3 DTV audio standard, has
recently been updated by ATSC. In our Video Description NPRM, we
propose to update our DTV transmission standard in Section 73.682(d)
of our rules to incorporate by reference the 2010 version of Part 5
of the ATSC A/53 Digital Television Standard (relating to audio
systems). See Video Description NPRM, FCC 11-36, 76 FR 14856, March
18, 2011 (``Video Description NPRM''). See also ATSC A/53, Part 5:
2010 ``ATSC Digital Television Standard, Part 5--AC-3 Audio System
Characteristics'' (July 6, 2010) (``2010 ATSC A/53 Standard, Part
5''). We note that this proposal is consistent with our proposed
rules herein because the ATSC A/85 RP references and requires
compliance with the same testing methodology adopted in the 2010
ATSC A/53 Standard, Part 5. See, e.g., ATSC A/85 RP Sec. Sec. 2.1
at 9 (referencing A/53) and 7.1 at 17 (stating that the ATSC A/85 RP
``identifies methods to ensure consistent digital television
loudness through the proper use of dialnorm metadata for all
content, and thus comply with A/53''). The previous version of the
ATSC A/53 Standard, Part 5, which is incorporated by reference in
Section 73.682(d), includes an outdated audio loudness measurement
method. See ATSC A/53, Part 5: 2007 ``ATSC Digital Television
Standard, Part 5--AC-3 Audio System Characteristics'' Sec. 5.5 at 9
(Dialogue Level) (Jan. 3, 2007) (``2007 ATSC A/53 Standard, Part
5''). The 2010 ATSC A/53 Standard, Part 5, contains the new methods
to measure and control audio loudness, reflected in the ATSC A/85
RP. See 2010 ATSC A/53 Standard, Part 5 at Sec. 2.1 at 5
(referencing A/85) and Sec. 5.5 at 9 (Dialogue Level). We
anticipate that the Video Description proceeding, MB Docket No. 11-
43, will be completed before we adopt the regulation required by the
CALM Act. See Video Description NPRM, para. 5, n.14 (the
Communications and Video Accessibility Act requires reinstatement of
the video description rules one year after the date of its
enactment, which occurred on October 8, 2010).
\12\ See ATSC Letter by Mark Richer, ATSC President, and
attached ``Executive Summary of the ATSC DTV Loudness Tutorial
Presented on February 1, 2011'' (dated Apr. 8, 2011) (``ATSC Letter
and DTV Loudness Tutorial Summary'') (stating ``[t]he ATSC AC-3
Digital Television Audio System has 32 times the perceived dynamic
range (ratio of soft to loud sounds) than the previous NTSC analog
audio system. Although this increase in dynamic range makes cinema-
like sound a reality for DTV, greater loudness variation is now an
unintentional consequence when loudness is not managed correctly'').
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4. The television broadcast industry has recognized the importance
of measuring and controlling volume in television programming,
particularly in the context of the transition to digital television. In
November 2009, the Advanced Television Systems Committee (``ATSC'')
\13\ completed and published its A/85 Recommended Practice (``ATSC A/85
RP''),\14\ which was developed to offer guidance to the TV industry--
from content creators to distributors to consumers--about DTV audio
loudness management.\15\ On May 25, 2011, the ATSC approved a successor
document to the A/85 RP, which, among other things, adds an Annex J
concerning ``the courses of action necessary to perform effective
loudness control of digital television commercial advertising.'' \16\
Although the ATSC A/85 RP, like most ATSC documents, was primarily
intended for over-the-air TV broadcasters, the ATSC A/85 RP also offers
guidance to cable and DBS operators, and other MVPDs to the extent that
they use the AC-3 digital audio system \17\ when they transmit digital
programming content, including commercial advertisements, to
consumers.\18\ The ATSC A/85 RP adopts the International
Telecommunication Union \19\ Radiocommunication Sector (``ITU-R'') \20\
Recommendation BS.1770 measurement algorithm as the loudness
measurement standard \21\ and sets forth various techniques for
industry to manage and control the audio loudness of digital
programming content as it flows down the production stream.\22\ The
ITU-R BS.1770 measurement algorithm provides a numerical value that
indicates the perceived loudness of the content.\23\ That numerical
value is encoded in the audio content by the content provider or
station/MVPD as a metadata parameter called ``dialnorm.'' \24\
Stations/MVPDs transmit the ``dialnorm'' to the consumer's reception
equipment along with the programming to direct the consumer's equipment
to manage and control the loudness of the programming.\25\ The ``golden
rule'' of the ATSC A/85 RP is that the dialnorm value must correctly
identify the perceived loudness of the content it accompanies in order
to prevent loudness variation during content transitions on a channel
(e.g., TV program to commercial) or when changing channels.\26\ If the
``dialnorm''
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parameter is present and set correctly, the AC-3 audio decoder in the
consumer's home receiver will automatically adjust the volume to
eliminate spikes in loudness at these transitions. The ATSC A/85 RP
also clarifies that the ATSC A/53 DTV Transmission Standard requires
that the dialnorm value be encoded accurately and carried with the
audio content and assumes compliance with this technical
requirement.\27\ If all stations/MVPDs measure content with the ITU-R
BS.1770 measurement algorithm and transmit dialnorm metadata that
correctly identifies the loudness of the content it accompanies, then
consumers will be able to set their volume controls to their preferred
listening (loudness) level and will not have to adjust the volume
between programs and commercials.\28\
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\13\ ATSC is an international, non-profit organization
developing voluntary standards for digital television. The ATSC
member organizations represent the broadcast, broadcast equipment,
motion picture, consumer electronics, computer, cable, satellite,
and semiconductor industries. ATSC creates and fosters
implementation of voluntary Standards and Recommended Practices to
advance digital television broadcasting and to facilitate
interoperability with other media. See http://www.atsc.org/aboutatsc.html.
\14\ See ATSC A/85: ``ATSC Recommended Practice: Techniques for
Establishing and Maintaining Audio Loudness for Digital
Television,'' (Nov. 4, 2009).
\15\ See ATSC A/85 RP Sec. 1 at 7. A key goal of the ATSC A/85
RP was to develop a system that would enable industry to control the
variations in loudness of digital programming, while retaining the
improved sound quality and dynamic range of such programming. Id.
\16\ ATSC A/85 RP Annex J.
\17\ AC-3 is one method of formatting and encoding digital
multi-channel audio, used by TV broadcast stations and many
traditional cable operators. The AC-3 audio system is defined in the
ATSC Digital Audio Compression Standard (A/52B), which is
incorporated into the ATSC Digital Television Standard (A/53). See
ATSC A/52B: ``Digital Audio Compression (AC-3, E-AC-3) Standard,
Revision B'' (June 14, 2005). The ATSC A/85 RP provides methods for
establishing and maintaining audio loudness using Dialog
Normalization (dialnorm) metadata, a parameter unique to the AC-3
audio system. See, e.g., ATSC A/85 RP Sec. 4 at 13.
\18\ See, e.g., ATSC A/85 RP Annex H at 61. As discussed infra,
the ATSC A/85 RP provides some guidance for handling content without
metadata, including non-AC-3 audio content; but the A/85 RP
contemplates encoding all content into AC-3 and setting dialnorm
appropriately.
\19\ The International Telecommunication Union (``ITU'') is a
specialized agency of the United Nations whose goal is to promote
international cooperation in the efficient use of
telecommunications, including the use of the radio frequency
spectrum. The ITU publishes technical recommendations concerning
various aspects of radiocommunication technology. These
recommendations are subject to an international peer review and
approval process in which the Commission participates.
\20\ The ITU Radiocommunication Sector (``ITU-R'') plays a vital
role in the global management of the radio-frequency spectrum and
satellite orbits--limited natural resources which are increasingly
in demand from a large and growing number of services such as fixed,
mobile, broadcasting, amateur, space research, emergency
telecommunications, meteorology, global positioning systems,
environmental monitoring and communication services--that ensure
safety of life on land, at sea and in the skies.
\21\ The internationally accepted ITU-R BS.1770 measurement
algorithm, presented in units of loudness K-weighted, relative to
full scale (``LKFS''), was developed to give industry professionals
a contemporary and accurate tool to measure loudness by modeling the
human hearing system. ITU is currently considering improvements to
its recommendation. See ITU Press Release, titled ``Sound advice
from ITU to keep TV volume in check; ITU Recommendation to control
volume variations in TV programming'' at http://www.itu.int/newsroom/press_releases/2010/03.html (dated Jan. 18, 2010).
\22\ See ATSC A/85 RP Sec. 7.1 at 17 (the ATSC A/85 RP
``identifies methods to ensure consistent digital television
loudness through the proper use of dialnorm metadata for all
content'').
\23\ See ATSC A/85 RP Sec. 3.4 at 12 (defining ITU-R BS.1770).
``Loudness'' is a subjective measure based on human perception of
sound waves that can be difficult to quantify and thus to measure.
The ITU utilized very extensive human testing to produce an
algorithm which provides a good approximation of human loudness
perception of program audio to measure the loudness of programs.
``Volume,'' in contrast to loudness, is an objective measure based
on the amplitude of sound waves. See ATSC A/85 RP Sec. 3.4 at 13
(defining loudness as ``[a] perceptual quantity; the magnitude of
the physiological effect produced when a sound stimulates the
ear'').
\24\ Metadata or ``data about the (audio) data'' is
instructional information that is transmitted to the home
(separately, but in the same bit stream) along with the digital
audio content it describes. See ATSC A/85 RP Sec. 1.1 at 7. The
dialnorm and other metadata parameters are integral to the AC-3
audio bit stream. Id. at 8. The dialnorm value identifies the
average measured loudness of the content.
\25\ From the consumer's perspective, the dialnorm metadata
parameter defines the volume level the sound needs to be reproduced
so that the consumer will end up with a uniform volume level across
programs and commercials without a need to adjust it again. See ATSC
A/85 RP at 7. See also ATSC DTV Loudness Tutorial Summary at 1
(``When content is measured with the ITU-R BS.1770 measurement
algorithm and dialnorm metadata is transmitted that correctly
identifies the loudness of the content it accompanies, the ATSC AC-
audio system presents DTV sound capable of cinema's range but
without loudness variations that a viewer may find annoying.'').
\26\ See ATSC DTV Loudness Tutorial Summary at 1 (``An essential
requirement (the golden rule) for management of loudness in an ATSC
audio system is to ensure that the average content loudness in units
of LKFS matches the metadata's dialnorm value in the AC-3 bit
stream. If these two values do not match, the metadata cannot
correctly ensure that the consumer's DTV sound level is consistently
reproduced''). See also ATSC A/85 RP Sec. 5.2 at 15.
\27\ See ATSC A/85 RP Sec. 7.1 at 17 (``Carriage of and correct
setting of the value of dialnorm is mandatory''); ATSC A/85 RP Annex
J at Sec. J.3.
\28\ See ATSC A/85 RP Sec. 4 at 13. If the ATSC A/85 RP is
applied to all channels, the loudness will also be consistent across
channels. Id. We note that the AC-3 audio system does not intend to
eliminate all loudness variations, but only prevent loudness
variations during content transitions. Indeed, the AC-3 audio system
increases the dynamic range to provide consumers with cinema-like
sound quality. See ATSC DTV Loudness Tutorial Summary at 1.
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5. Following Congress's adoption of the CALM Act, Commission staff
held informal meetings with industry representatives for preliminary
information gathering purposes and to obtain technical guidance on how
the various industry segments currently manage audio loudness and how
they intend to comply with the required regulation.\29\ In these
meetings, industry representatives described certain challenges they
may face with complying with the required regulation. For example,
industry representatives explained that some MVPDs do not exclusively
use the AC-3 audio system on which the ATSC RP A/85 is based. Also,
industry representatives explained that some stations/MVPDs may face
challenges with respect to the content which they do not create or
insert into the program stream. We address these issues in the
discussion section that follows.
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\29\ See Appendix: List of Participants. These informal meetings
occurred prior to commencement of this proceeding and are not
subject to the ex parte requirements. These meetings do not supplant
official comments in this proceeding.
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6. The statutory text of the CALM Act provides in relevant part as
follows: \30\
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\30\ See 47 U.S.C. 621 (2010). See also 47 U.S.C. 609 (2010).
(2) (a) Rulemaking required. Within 1 year after the date of
enactment of this Act, the Federal Communications Commission shall
prescribe pursuant to the Communications Act of 1934 (47 U.S.C. 151
et seq.) a regulation that is limited to incorporating by reference
and making mandatory (subject to any waivers the Commission may
grant) the ``Recommended Practice: Techniques for Establishing and
Maintaining Audio Loudness for Digital Television'' (A/85), and any
successor thereto, approved by the Advanced Television Systems
Committee, only insofar as such recommended practice concerns the
transmission of commercial advertisements by a television broadcast
station, cable operator, or other multichannel video programming
distributor.\31\
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\31\ Id. 621(a).
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(b) Implementation
(1) Effective Date. The Federal Communications Commission shall
prescribe that the regulation adopted pursuant to subsection (a)
shall become effective 1 year after the date of its adoption.\32\
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\32\ Id. 621(b)(1).
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(2) Waiver. For any television broadcast station, cable
operator, or other multichannel video programming distributor that
demonstrates that obtaining the equipment to comply with the
regulation adopted pursuant to subsection (a) would result in
financial hardship, the Federal Communications Commission may grant
a waiver of the effective date set forth in paragraph (1) for 1 year
and may renew such waiver for 1 additional year.\33\
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\33\ Id. 621(b)(2).
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(3) Waiver Authority. Nothing in this section affects the
Commission's authority under section 1.3 of its rules (47 CFR 1.3)
to waive any rule required by this Act, or the application of any
such rule, for good cause shown to a television broadcast station,
cable operator, or other multichannel video programming distributor,
or to a class of such stations, operators, or distributors.\34\
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\34\ Id. 621(b)(3).
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(c) Compliance. Any broadcast television operator, cable
operator, or other multichannel video programming distributor that
installs, utilizes, and maintains in a commercially reasonable
manner the equipment and associated software in compliance with the
regulations issued by the Federal Communications Commission in
accordance with subsection (a) shall be deemed to be in compliance
with such regulations.\35\
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\35\ Id. 621(c).
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(d) Definitions. For purposes of this section--
(1) The term ``television broadcast station'' has the meaning
given such term in section 325 of the Communications Act of 1934 (47
U.S.C. 325); \36\ and
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\36\ Id. 621(d)(1). Section 325 of the Communications Act
defines the term ``television broadcast station'' as ``an over-the-
air commercial or noncommercial television broadcast station
licensed by the Commission under subpart E of part 73 of title 47,
Code of Federal Regulations, except that such term does not include
a low-power or translator television station.'' 47 U.S.C.
325(b)(7)(B).
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(2) The terms ``cable operator'' and ``multi-channel video
programming distributor'' have the meanings given such terms in
section 602 of Communications Act of 1934 (47 U.S.C. 522).\37\
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\37\ Id. 621(d)(2). Section 602 of Communications Act defines
the term ``cable operator'' as ``any person or group of persons (A)
who provides cable service over a cable system and directly or
through one or more affiliates owns a significant interest in such
cable system, or (B) who otherwise controls or is responsible for,
through any arrangement, the management and operation of such a
cable system.'' 47 U.S.C. 522(5). Section 602 of Communications Act
defines the term ``multichannel video programming distributor'' as
``a person such as, but not limited to, a cable operator, a
multichannel multipoint distribution service, a direct broadcast
satellite service, or a television receive-only satellite program
distributor, who makes available for purchase, by subscribers or
customers, multiple channels of video programming.'' 47 U.S.C.
522(13).
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III. Discussion
7. In this discussion, we consider the scope of the CALM Act and
identify the entities responsible under the law for preventing the
transmission of loud commercials. Next, we address how stations/MVPDs
can demonstrate compliance with the ATSC A/85 RP pursuant to the
provisions of the CALM Act and propose a consumer-driven complaint
process to enforce regulations mandated by the Act. We also seek
information and comment on challenges for stations/MVPDs in complying
with the statute and approaches that will enable them to comply
consistent with their statutory responsibilities. Finally, we consider
how to implement the waiver provisions in the statute.
A. Section 2(a) and Scope
8. We begin by addressing Section 2(a) and the scope of the CALM
Act. As indicated above, Section 2(a) directs the Commission to
``prescribe * * * a regulation that is limited to incorporating by
reference and making mandatory'' the ATSC A/85 RP.\38\ This language
not only requires us to incorporate by reference and make mandatory the
ATSC A/85 RP, but it expressly limits our authority in that regard.
Therefore, we tentatively conclude that the Commission may not modify
the technical standard or adopt other actions inconsistent with the
statute's express limitations. Accordingly, we propose to incorporate
by reference the ATSC A/85 RP into our rules.\39\
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\38\ See 47 U.S.C. 621(a).
\39\ See proposed rules 47 CFR 73.682(e) and 76.607. As required
by the Office of the Federal Register (``OFR''), we will obtain
approval from the Director of the Federal Register to incorporate by
reference the ATSC A/85 RP into our rules. See 5 U.S.C. 552(a); 1
CFR 51.3; and generally 1 CFR part 51 (Incorporation by Reference).
We note that the ATSC A/85 RP will be incorporated into our rules as
it exists on the date it is approved by the OFR for incorporation by
reference. We will incorporate future versions of the ATSC A/85 RP
as they become available and will publish notice of updates to this
incorporation by reference in the Federal Register.
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[[Page 32120]]
9. Section 2(a) further mandates that the Commission incorporate by
reference and make mandatory the ATSC A/85 RP ``only insofar as [it]
concerns the transmission of commercial advertisements. * * *'' \40\ We
seek comment on whether and how to identify the portions of the ATSC A/
85 RP ``concern[ing] the transmission of commercial advertisements''
for purposes of the statute.\41\ We note that the ATSC recently
approved a successor document to the A/85 RP which, among other things,
adds an Annex J, titled ``Requirements for Establishing and Maintaining
Audio Loudness of Commercial Advertising in Digital Television,''
addressing ``the courses of action necessary to perform effective
loudness control of digital television commercial advertising.'' \42\
We invite comment on the successor document and on the significance of
Annex J.
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\40\ See 47 U.S.C. 621(a).
\41\ We note that, under the CALM Act, each regulated entity is
responsible for determining how to use the ATSC A/85 RP to ensure
that its viewers receive commercials and programming at a consistent
loudness. See, e.g., ATSC A/85 RP Sec. 8 (describing effective
solutions for managing variations in loudness during program-to-
interstitial transitions); ATSC A/85 RP Annex J Sec. J.2.
\42\ ATSC A/85 RP Annex J Sec. J.1.
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10. We also interpret the statutory language ``the transmission of
commercial advertisements'' to apply to all such transmissions by
stations/MVPDs. In our informal meetings, some industry representatives
noted that in some circumstances stations/MVPDs do not create or insert
all the commercials that they ultimately transmit to consumers. They
further asserted that the rules the Commission will adopt to implement
the CALM Act should limit a station/MVPD's responsibility to
commercials that the station/MVPD itself ``inserts'' into the
programming stream and not apply to all commercials a station/MVPD
transmits to the consumer. We believe such an approach and limitation
would be inconsistent with the statutory language, the purpose of the
CALM Act, the legislative history, and ATSC A/85 RP. The statute
expressly applies to commercials transmitted by a station/MVPD and
makes no exception for commercials not inserted by the station/MVPD.
Nothing in the statutory language or legislative history distinguishes
between different sources of commercial content or suggests any intent
to limit a station/MVPD's responsibility only to those commercials
``inserted'' by it. Nor does the ATSC A/85 RP make such a
distinction.\43\ To the contrary, the legislative history underscores
that the purpose of the statute is to address consumers' experiences
with loud commercials, and the statute imposes responsibility for
addressing the problem on the station/MVPD.\44\ Limiting regulations to
only certain commercials would undermine the statute's purpose. As a
practical matter, consumers neither know nor care which entity inserts
commercials into the programming stream. Therefore, we tentatively
conclude that ``transmission of commercial advertisements'' means
transmission of all commercials, and therefore that stations/MVPDs are
responsible for all commercials ``transmitted'' by them, including
commercials inserted by stations/MVPDs, as well as those commercials
that are in the programming that stations/MVPDs receive from content
providers and transmit (or retransmit) to viewers. We believe this
interpretation is required by the express language of the statute, but
we invite commenters to address this analysis. We also seek specific
information from stations and MVPDs on the percentage of the
commercials they transmit to consumers that is inserted by the station/
MVPD itself, as compared to the percentage of commercials that is part
of programming from a content provider (e.g., from a network or cable
programmer).
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\43\ See ATSC A/85 RP Sec. 8 at 23. (``Methods to effectively
control program-to-interstitial loudness''). See also ATSC A/85 RP
Sec. 8.4 at 24-25 (``TV Station and MVPD local ad insertion'').
\44\ See House Floor Debate of S. 2847 at H7720 (Rep. Eshoo
stating that the bill would ``eliminate the earsplitting levels of
television advertisements and return control of television sound
modulation to the American consumer''); Senate Committee Report to
S. 2847 at 1 (stating purpose of law).
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11. Section 2(a) applies to ``commercial advertisements,'' but does
not define this term for purposes of the statute.\45\ Nor does the
legislative history address the definition of ``commercial
advertisements.'' We seek comment on how to define this term for
purposes of the CALM Act.\46\ For example, does the term ``commercial
advertisements'' include political advertising, including uses by
legally qualified candidates? \47\ Does the term ``commercial
advertisements'' apply to promotions of television or cable/MVPD
programs? We anticipate that noncommercial broadcast stations will
largely not be affected by this proceeding, because Section 399B of the
Communications Act, as amended, prohibits them from broadcasting
``advertisements.'' \48\ In 2001, however, the Commission concluded
that the prohibition in Section 399B does not apply to nonbroadcast
services provided by noncommercial stations, such as subscription
services provided on their DTV channels.\49\ We seek comment on whether
the CALM Act applies to noncommercial stations to the extent they
transmit advertisements on nonbroadcast streams and, if so, whether
this raises any issues unique to the noncommercial service. We note
that the definition of a ``television broadcast station'' used by the
CALM Act includes both a commercial and noncommercial television
broadcast station.
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\45\ We note that Section 399B of the Communications Act defines
the term ``advertisement'' as ``any message or other programming
material which is broadcast or otherwise transmitted in exchange for
any remuneration, and which is intended--(1) to promote any service,
facility, or product offered by any person who is engaged in such
offering for profit; (2) to express the views of any person with
respect to any matter of public importance or interest; or (3) to
support or oppose any candidate for political office.'' See 47
U.S.C. 399b(a).
\46\ We note that, in the context of commercial limits during
children's programming, the Commission defines ``commercial matter''
as ``airtime sold for purposes of selling a product or service and
promotions of television programs or video programming services
other than children's or other age-appropriate programming appearing
on the same channel or promotions for children's educational and
informational programming on any channel.'' See 47 CFR 73.670 Note
1; 47 CFR 76.225 Note 1.
\47\ See 47 U.S.C. 315.
\48\ 47 U.S.C. 399b.
\49\ See Report and Order, FCC 01-306, 66 FR 58973, November 26,
2001.
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12. Section 2(a) expressly applies to each ``television broadcast
station, cable operator, or other multichannel video programming
distributor.'' The CALM Act incorporates definitions of these terms
contained in the Communications Act.\50\ In our informal meetings, some
industry representatives explained that not all MVPDs use the AC-3
audio systems on which the ATSC A/85 RP is based for all content.\51\
Therefore, they asserted that, to the extent that an MVPD does not use
AC-3 audio technology, the statute should not apply to them. The
statute, however, expressly applies to all stations/MVPDs regardless of
the audio system they currently use. Nothing in the statutory language
or legislative history suggests an intent to make an exception for
MVPDs that do not use AC-3 audio systems. The purpose of the statute is
to address the problem of loud commercials for all TV consumers, not
just those served by stations/MVPDs that use a particular audio system.
Not only would limiting the statute's scope to stations/MVPDs
[[Page 32121]]
that use AC-3 audio systems be inconsistent with the express language
of the statute, we think such a reading would undermine the statute's
purpose. Therefore, we tentatively conclude that the CALM Act defines
the scope and application of the new technical loudness standard as
mandatory for all stations/MVPDs and not only those using AC-3 audio
systems. We believe this interpretation is required by the express
language of the statute, but we invite commenters to address this
analysis. In addition, we seek comment below on whether and how MVPDs
that do not use AC-3 audio systems can comply with the CALM Act.\52\ We
note that ATSC is considering amending the ATSC A/85 RP to address how
an MVPD that does not exclusively use an AC-3 audio system can follow
the ATSC A/85 RP.\53\
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\50\ 47 U.S.C. 621(d).
\51\ We note that broadcast TV stations are required to use AC-3
audio systems by Section 73.682 of our rules, which incorporates by
reference the ATSC A/53 Standard.
\52\ See infra discussion considering compliance by stations/
MVPDs that face practical challenges, such as the use of non-AC-3
audio systems.
\53\ See ATSC Letter (``ATSC has also started work on the
development of a new ``Annex K'' that addresses loudness management
for commercial advertising when using non-AC-3 audio systems.'').
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13. Finally, Section 2(a) mandates that the required regulation be
prescribed ``[w]ithin 1 year after the date of the enactment of this
Act'' and incorporate by reference and make mandatory ``any successor''
to the ATSC A/85 RP.\54\ Because the statute requires the Commission to
incorporate successors to the ATSC A/85 RP, and affords the Commission
no discretion in this regard, we tentatively conclude that no notice
and comment will be necessary to incorporate successor documents into
our rules.\55\ In accordance with this statutory directive and
consistent with the requirements of the Office of the Federal Register,
we tentatively conclude that any successors to the ATSC A/85 RP will
take effect when the Commission has obtained approval from the Director
of the Federal Register to incorporate by reference such successors
into our rules and publishes a technical amendment in the Federal
Register to codify the successors into the Commission's rules.\56\ If
the ATSC adopts a successor to the ATSC A/85 RP before we issue a
Report and Order in this proceeding, we tentatively conclude that we
will incorporate by reference into our rules the successor standard
adopted by ATSC. We ask that the ATSC notify us whenever it approves a
successor to the ATSC A/85 RP, and submit a copy of it into the record
of this proceeding.\57\ We direct the Media Bureau to issue a public
notice announcing the ATSC's approval of any successor to the ATSC A/85
RP. We seek comment on our tentative conclusions.
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\54\ 47 U.S.C. 621(a).
\55\ See 5 U.S.C. 552(b)(B) (providing that Administrate
Procedure Act's notice and comment requirements do not apply when
the agency for good cause finds, and incorporates the finding and a
brief statement of reasons therefor in the rules issued, that notice
and public procedure thereon are unnecessary).
\56\ See 5 U.S.C. 552(a); 1 CFR 51.3; and generally 1 CFR part
51.
\57\ We request that the ATSC also send a courtesy copy of the
notice to the Chief Engineer of the Media Bureau.
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B. Compliance and Enforcement
14. As established above, each station/MVPD is responsible for
complying with the CALM Act. In this section, we address how stations/
MVPDs can demonstrate compliance with the statute. Specifically, we
believe that a station/MVPD can demonstrate compliance with the statute
by showing that it has satisfied the safe harbor requirements set out
in Section 2(c) of the CALM Act, as described in detail below, or by
proving through other means that any commercials that are the subject
of a complaint meet the standards of the statute. We also address
stations/MVPDs that seek to ensure that the commercials they transmit
to viewers comply with the ATSC A/85 RP through contracts with their
content providers. We recognize that there may be alternative means of
complying and demonstrating compliance with the regulations required by
the CALM Act, and we intend to take into consideration challenges that
stations/MVPDs may face in complying with the ATSC A/85 RP, and how
those challenges may vary depending upon the technology the entity
uses, as well as its size and market power.
15. We note that the ATSC A/85 RP identifies several options for
actions that stations/MVPDs may take to control and manage
loudness.\58\ Under the ATSC A/85 RP, stations/MVPDs can control and
manage loudness either by (1) using one or more types of equipment,
such as a loudness measurement device and/or software, a file based
scaling device, or a real time loudness processing device; or (2)
ensuring that their content suppliers deliver the content to them in
accordance with their loudness specification (e.g., a fixed ``target''
loudness value or the correct dialnorm value).\59\ In the latter case,
a station/MVPD may be able to comply with the ATSC A/85 RP without
having equipment capable of managing audio loudness on its premises
because the ATSC A/85 RP recognizes that the adjustments and/or
loudness calculations for setting the correct dialnorm value may be
performed during production or post-production or otherwise upstream of
the station/MVPD. The statute, however, makes the station/MVPD
responsible for ensuring that such adjustments and/or calculations have
been performed on the content transmitted to its viewers/subscribers,
particularly because the ATSC A/85 requires the station/MVPD to ensure
the dialnorm is set correctly.\60\ We seek to adopt rules that achieve
the goals of the statute, are easy to enforce and, at the same time,
pose minimal administrative burdens. Therefore, as explained below, we
also propose a consumer complaint procedure that enables consumers to
file complaints with the Commission and permits stations/MVPDs to
demonstrate compliance in response to those complaints in a
straightforward manner.
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\58\ See ATSC A/85 RP Sec. 8.1. See also ATSC DTV Loudness
Tutorial Summary at 2-3.
\59\ See id.
\60\ As noted, supra, ``Section 2(a) expressly applies to each
`television broadcast station, cable operator, or other multichannel
video programming distributor.' '' See also ATSC A/85 RP Sec. 8.1
at 23.
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1. Section 2(c) ``Safe Harbor''
16. Section 2(c) expressly provides that a station/MVPD will be
``deemed to be in compliance'' with our rules implementing the CALM Act
\61\ if such entity ``installs, utilizes, and maintains in a
commercially reasonable manner the equipment and associated software''
necessary to comply with the ATSC A/85 RP.\62\ The legislative history
indicates an intent for this provision to be construed as a ``safe
harbor'' for stations/MVPDs that obtain and use the necessary
equipment.\63\ Consistent with Section 2(c)'s language and history, we
propose to interpret this provision to require the Commission to accept
showings that a regulated entity has satisfied Section 2(c)'s
requirements as demonstrating compliance, but not to restrict regulated
entities to such showings as the only means of demonstrating
compliance. We tentatively conclude that the Section 2(c) safe harbor
provision requires that a station/MVPD must, itself, install, utilize,
and maintain the necessary equipment, based on our reading of the
statutory language and associated
[[Page 32122]]
definitions.\64\ That is, we believe that Section 2(c) contemplates
action by the television broadcast station \65\ and the MVPD itself,
and not action by a third party, such as a network with which the
station is affiliated or a programmer providing content to the MVPD. We
seek comment on this tentative conclusion and on whether there are any
circumstances in which a station/MVPD could satisfy the safe harbor
parameters by utilizing a third party that has the necessary equipment,
rather than installing the equipment itself. For example, would it be
consistent with the statutory language for a station to demonstrate
Section 2(c) safe harbor compliance by showing that the network with
which it is affiliated installed, utilized, and maintained the
necessary equipment in a commercially reasonable manner? Is there any
relevant distinction in this regard between a network providing content
to an affiliate and a programmer providing content to an MVPD?
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\61\ See 47 U.S.C. 621(c) and proposed rules 47 CFR 73.682(e)
and 76.607.
\62\ See 47 U.S.C. 621(c) (which describes when a station
``shall be deemed in compliance with [our rules]'').
\63\ See House Floor Debate of S. 2847 at H7720 (Rep. Terry
describing this provision as ``a kind of `safe harbor' by deeming an
operator that installs, utilizes and maintains the appropriate
equipment and software in compliance with the [CALM Act]'').
\64\ We also consider, infra, use of contractual arrangements
through which a station/MVPD would require that content be delivered
to it by a content provider in conformance with the ATSC A/85 RP.
See, e.g., ATSC A/85 RP Sec. 7.3.2 at 18 (stating that ``[a]
content delivery specification should specify the Target Loudness
for all content'').
\65\ We note that Section 2(a) refers to a ``television
broadcast station'' and Section 2(c) refers to a ``broadcast
television operator.'' See 47 U.S.C. 621(a) and (c). We seek comment
on the significance, if any, of the use of these different terms.
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17. In our informal meetings with industry, MVPD representatives
indicated that they can use equipment to ensure compliance with A/85
for a commercial they insert into a channel, but not for a commercial
contained in a block of programming they receive from a content
provider. We believe, in this situation, the MVPD may be able to rely
on the safe harbor with respect to the commercial it inserts into the
programming stream, but not with respect to the commercials for which
it does not utilize the equipment. In this situation, the MVPD would be
required to use an alternative method of loudness control,\66\ and
could not rely on the safe harbor in response to a complaint. We seek
comment on the situations in which a station/MVPD would be able to
satisfy the safe harbor provision with respect to some, but not all, of
the commercials it transmits to consumers.
---------------------------------------------------------------------------
\66\ See infra discussion of Other Ways to Demonstrate
Compliance.
---------------------------------------------------------------------------
18. Below, we propose the interpretations for each of the statutory
terms in Section 2(c) and seek comment on these interpretations. We
also seek comment on what ``commercially reasonable'' means in this
context. Does the term ``commercially reasonable'' mean consistent with
industry practice? Does it imply consideration of individual
circumstances?
19. Installation. We propose to interpret installation of equipment
in a commercially reasonable manner to mean that a station/MVPD has
obtained and readied for use in its video distribution system equipment
that conforms with the ATSC A/85 RP to control loudness of commercials
transmitted to consumers.\67\ The solutions set out in ATSC A/85 RP may
rely on loudness measurement devices and/or software, file based
scaling devices, or real time loudness processing devices depending on
the method chosen to control loudness.\68\ Loudness measurement devices
and/or software must be able to measure loudness using the ITU-R
BS.1770 measurement algorithm and support the use of dialnorm
metadata.\69\ We seek comment on our proposed interpretation and on how
to determine whether particular equipment conforms to ITU-R BS.1770 as
required in the ATSC A/85 RP. We recognize that stations/MVPDs may want
regulatory certainty that the equipment they may purchase (or have
already purchased) will enable them to comply with the ATSC A/85 RP
(and, thus, the statute).\70\ However, we do not propose to require
equipment authorization through an equipment performance verification
procedure or to establish an administratively burdensome or time-
consuming process for determining compliance based on satisfying the
installation requirement.\71\ We invite comment on what measures we
should require stations/MVPDs to take to ensure that they have
installed the correct equipment to enable them to take advantage of the
safe harbor provided for in Section 2(c) of the CALM Act.
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\67\ See ATSC A/85 RP Sec. 8 at 23.
\68\ See ATSC A/85 RP Sec. 8 at 23.
\69\ See ATSC A/85 RP Sec. 3.3 at 13 (defining ``measured
loudness'') and ATSC A/85 RP Sec. 5.1 at 14.
\70\ Based on industry sources, Congress estimated that the cost
of equipment that controls the volume of programming ranges from a
few thousand dollars to about $20,000 per device, depending on the
method used to comply with the mandate. Senate Committee Report to
S. 2847 at 3.
\71\ We note that our existing equipment authorization
procedures would be inappropriate here because they are generally
used to ensure compliance with RF safety or interference issues,
neither of which is relevant to demonstrating compliance with the
CALM Act. See, e.g., 47 CFR 2.902 (verification) and Sec. 2.907
(certification).
---------------------------------------------------------------------------
20. Utilization. We propose to interpret utilization of equipment
in a commercially reasonable manner to mean that a station/MVPD
operates the equipment in conformance with the ATSC A/85 RP to ensure
that commercials are transmitted to consumers at a loudness level that
is consistent with the programming the commercials accompany.\72\ As
discussed, the key goal of the ATSC A/85 RP and the statute is to
prevent the transmission of loud commercials to consumers.\73\
Consistent with that goal, we propose to interpret the term utilization
in Section 2(c) to mean that, in order to satisfy the safe harbor
provision, mechanisms must be in place to properly measure the loudness
of the content for which the safe harbor is claimed and ensure that
dialnorm metadata is encoded correctly before transmitting the content
to the consumer. We seek comment on this interpretation and on the
utilization that is necessary to perform these functions. We also seek
comment on how stations/MVPDs that seek to rely on the safe harbor in
response to a complaint may demonstrate utilization of the required
equipment with regard to the programming in question.
---------------------------------------------------------------------------
\72\ See, e.g., ATSC A/85 RP Annex H at 61 (stating ``[g]oal is
to present to the viewer consistent audio loudness across
commercials, programs, and channel changes''). See also, e.g., House
Floor Debate of S. 2847 at H7720 (Rep. Eshoo stating that the bill
would ``make the volume of commercials and regular programming
uniform so consumers can control sound levels.''); Senate Committee
Report to S. 2847 at 1 (stating Congress' expectation that the ATSC
A/85 RP will ``moderat[e] the loudness of commercials in comparison
to accompanying video programming''); House Committee Report to H.R.
1084 at 1 (stating goal of statute is ``to preclude commercials from
being broadcast at louder volumes than the program material they
accompany'').
\73\ Id.
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21. Maintenance. We propose to interpret maintenance of equipment
in a commercially reasonable manner to mean that a station/MVPD
performs routine maintenance on the equipment at issue to ensure that
it continues to function in a manner that prevents the transmission of
loud commercials to consumers and timely repairs equipment when it
malfunctions.\74\ Accordingly, we believe maintenance in a
``commercially reasonable manner'' requires a station/MVPD to routinely
perform quality control tests, such as spot checks to ensure that their
equipment is properly detecting inappropriate loudness and to take
swift corrective action to the extent problems are detected. We seek
comment on this interpretation. We also invite comment on what, if any,
other quality control measures should be required in order for
stations/MVPDs to take advantage of
[[Page 32123]]
the CALM Act's safe harbor provision. Do stations/MVPDs, in the
ordinary course of doing business, maintain records about the routine
maintenance of equipment on which they should be able to rely to be
deemed in compliance with this element of the statute? Also, how much
time is commercially reasonable for repairing malfunctioning equipment?
---------------------------------------------------------------------------
\74\ See Senate Committee Report to S. 2847 at 4 (``the
Committee expects that stations and MVPDs will use commercially
reasonable efforts to maintain equipment and to repair or replace
malfunctioning equipment'').
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2. Other Ways To Demonstrate Compliance
22. While stations/MVPDs shall be ``deemed'' in compliance if they
show that they have installed, utilized and maintained equipment in a
commercially reasonable manner pursuant to Section 2(c), we do not
believe that the CALM Act limits entities to just this one means of
demonstrating compliance. As described below, we propose that
demonstrations of compliance would be required in response to a
consumer complaint alleging a loud commercial.\75\ Thus, for example,
in response to a consumer complaint, a station/MVPD may demonstrate
that the dialnorm value of the complained of commercial actually
matches the perceived loudness of the content, following the ``golden
rule.'' In this manner, the station/MVPD would thereby show that the
transmission of the commercial complied with the requirements of the
ATSC A/85 RP, rather than showing it installed, utilized and maintained
equipment, pursuant to the provisions of Section 2(c). We believe that
the ability to make such a showing would be useful for stations/MVPDs
that have other means of meeting the goal of the statute and do not
choose to rely on the safe harbor to demonstrate compliance. We seek
comment on this and other means of complying and demonstrating
compliance.
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\75\ See infra discussion of complaint process.
---------------------------------------------------------------------------
23. We also recognize that stations/MVPDs may take a contractual
approach to compliance with the ATSC A/85 RP. Specifically, they may
contract with their content providers to ensure that the content
delivered to them complies with the ATSC A/85 RP.\76\ As noted above,
we tentatively conclude that the statute requires that commercials and
adjacent programming be transmitted to consumers in compliance with the
ATSC A/85 RP and holds stations/MVPDs responsible for preventing the
transmission of loud commercials to consumers.\77\ However, the ATSC A/
85 RP recognizes that it may be more efficient for content providers to
measure and encode dialnorm values at the production stage and states
that content providers may play a significant role in the process.\78\
The ATSC A/85 RP describes several effective solutions for controlling
relative loudness of programs and commercials, including that a
distributor ``ensure'' that content is labeled with the correct
dialnorm value.\79\ Therefore, we believe it is consistent with the
ATSC A/85 RP for a station/MVPD to ``ensure'' that the dialnorm matches
the loudness of the content by incorporating the ATSC A/85 RP
requirements into its contracts with content providers.\80\
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\76\ As discussed below, we emphasize that such agreements will
not alter the station's/MVPD's obligation to ensure that it is
complying with our rules, and any failure to comply may subject the
station/MVPD to enforcement action.
\77\ See 47 U.S.C. 621(a).
\78\ See ATSC DTV Loudness Tutorial Summary at 2 (stating that,
under both fixed and agile dialnorm systems, controlling loudness
can be achieved by ensuring that content is delivered properly to
the station/MVPD operator). See also, e.g., ATSC A/85 RP Sec. 7.3.2
at 18 and Annex I at 67.
\79\ See ATSC A/85 RP Sec. 8.1 at 23. See also ATSC A/85 RP
Sec. 7.3.2 at 18.
\80\ A contractual approach to compliance with the ATSC A/85 RP
seems consistent with the requirements associated with commercial
limits on children's programming. See 1991 Children's TV Order, FCC
91-113, 56 FR 19611, April 29, 1991. (``1991 Children's TV Order'')
(stating an MVPD remains liable for violations of the commercial
limits on cable network children's programs they carry). In
contrast, we believe the rules pertaining to closed captioning are
inapposite. See 1997 Closed Captioning Order, FCC 97-279, 62 FR
48487, September 16, 1997. (``1997 Closed Captioning Order''); and
47 CFR 79.1(g)(6) (stating an MVPD may rely on the accuracy of
certifications and is not held responsible for situations where a
program source falsely certifies that programming delivered to the
MVPD meets the Commission's captioning requirements if the MVPD is
unaware that the certification is false). Unlike the CALM Act and
the Children's Television Act of 1990 (47 U.S.C. 303a and 303b),
Section 713 of the Communications Act, 47 U.S.C. 613, refers to the
closed captioning of programming by providers and ``owners'' of
video programming and allocates to owners some responsibility for
compliance. 1997 Closed Captioning Order, at paragraphs 28-29
(noting that ``[t]he references to program ``owners'' in Section 713
reflect Congress' recognition that it is most efficient to caption
programming at the production stage, and the assumption that owners
and producers will be involved in the captioning process'').
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24. Importantly, however, the station/MVPD would remain responsible
for noncompliance with the regulations required by the CALM Act where
the program source fails to deliver content in compliance with the ATSC
A/85 RP, the station/MVPD transmits the nonconforming content to
viewers, and the content is the subject of consumer complaints. In this
regard, stations/MVPDs may choose to negotiate for indemnification
clauses in their content contracts in the event the content provider
fails to follow the A/85 RP and the Commission takes enforcement action
against the station/MVPD. We seek comment on whether and how regulated
entities that use contracts to ensure compliance with ATSC A/85 RP may
demonstrate compliance with the regulations required by the CALM Act in
response to consumer complaints, and what, if any, quality control
measures they should take to monitor the content delivered to them for
transmission to consumers. We also welcome comment from content
providers and, in particular, from the advertising industry to gauge
industry's ability to provide stations/MVPDs with content in compliance
with the ATSC A/85 RP. Moreover, should regulated entities pursue the
contractual option for ensuring compliance, what amount of time might
be necessary for negotiation of new indemnification provisions? Should
the Commission factor this contract negotiation timeframe into its
approach to enforcement?
25. We specifically invite comment on compliance methods that would
be well-suited for small stations/MVPDs. Would a contractual approach
be beneficial and workable for small stations/MVPDs? To what extent do
large and small stations/MVPDs receive the same content streams,
including metadata, from programmers? What other factors that affect
stations/MVPDs' compliance as a result of their size should we
consider? \81\
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\81\ See also infra discussion of financial hardship and general
waiver provisions.
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3. Station/MVPD Practical Challenges
26. As noted above, in our informal meetings with industry, we
heard that MVPDs face specific challenges in complying with the new
law. We describe two of these concerns below. We seek comment from
industry about these and other practical challenges to compliance. We
also seek comment on whether broadcast stations face similar or other
challenges. We request that commenters offer solutions as well as
describing challenges, and specify how stations/MVPDs can meet their
statutory responsibilities.
27. First, as indicated above, several MVPD representatives
indicated that they use audio systems that differ from the AC-3 audio
system on which the ATSC A/85 RP is based.\82\ Furthermore, the ATSC A/
85 RP, which the statute directs the Commission to make mandatory, was
originally intended for TV broadcast stations and other operators of an
ATSC AC-3 audio system and may not be suitable for use
[[Page 32124]]
by MVPDs to the extent they use other audio systems.\83\ Although the
ITU-R BS.1770 audio loudness measurement algorithm can be applied to
all audio systems, the specific methods for establishing and
maintaining the audio loudness mentioned in the ATSC A/85 RP are not
applicable to the non-AC-3 audio systems. Because the statute makes the
ATSC A/85 RP mandatory for every station/MVPD, we seek comment on
whether and how MVPDs that do not use AC-3 audio system can comply.\84\
From our informal discussions with MVPD representatives, we understand
that some MVPDs which do not use AC-3 in the transmission of audio
content to consumers nevertheless use AC-3 within their distribution
networks and transcode content to a non-AC-3 format after commercials
are inserted.\85\ We also understand that if the dialnorm was set
properly while the content was encoded in the AC-3 format, the loudness
adjustments will be made when the content is transcoded to another
format as if such transcoding occurred in the consumer's own equipment.
We seek comment on whether the CALM Act should be interpreted to permit
non-AC-3 transmission of commercials if the loudness of commercials is
effectively controlled using the techniques described within the ATSC
A/85 RP prior to such transmission occurring. Would such an
interpretation be consistent with the statutory language mandating that
we incorporate ATSC A/85 RP ``only insofar as such recommended practice
concerns the transmission of commercial advertisements''? Again, we
note that ATSC may revise the A/85 RP to account for users of other
audio systems. If it does not do so, we also seek comment, as discussed
further below, on whether exercise of our waiver authority, conditioned
upon use of other effective technology, would be appropriate to address
this issue.
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\82\ In addition to the AC-3 audio system, MVPDs may use MPEG-1
Layer 2 (MP2), advanced audio coding (AAC) or other systems.
\83\ See ATSC A/85 RP Sec. 1 at 7. The ATSC A/85 RP's scope
includes MVPDs that use AC-3 audio systems as being ``a specific
community of interest.'' Id. The A/85 RP also provides guidance
regarding how to manage loudness of content without metadata,
including non-AC-3 audio content. Id. 6 at 16 (discussing delivery
or exchange of content without metadata). See also id. Annex H.7 at
63-64, Annex I.7 at 69.
\84\ The legislative history does not expressly consider the use
of non-AC-3 technologies, whether other audio technologies can be
effective at addressing the loud commercials problem, whether there
would be significant costs associated with changing to exclusively
AC-3 systems, or whether the waiver provision in Section 2(b)(3) is
intended to address use of other technologies. See infra discussion
of general waiver.
\85\ Transcoding ``is a procedure for modifying a stream of data
carried'' (in this context, the AC-3 audio stream) ``so that it may
be carried via a different type of network'' (in this context, the
non-AC-3 audio system). See Newton's Telecom Dictionary (definition
of ``transcoding'') at 846 (20th ed. 2004).
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28. Second, some MVPDs pointed out that they generally do not
create most of the content they transmit to consumers and often receive
programs and commercials together in programming blocks from the
broadcast station or content provider and pass through these
programming blocks to consumers. In addition, they reported that they
transmit (or retransmit) channels to consumers on a real time basis and
do not have the technical capability to prescreen and correct audio
content before transmitting to the consumer. We seek specific comment
from MVPDs about how they receive the content from programmers and
their technical ability to prescreen and correct audio content that
they do not create or insert. To what extent does the contractual
approach to compliance discussed above address any such practical
challenges faced by MVPDs?
29. Although broadcast industry representatives did not express
these same concerns, we seek comment on whether broadcast stations
generally have an opportunity to prescreen and correct audio content
before transmitting to the consumer.\86\ For example, would stations
have this ability with respect to their local content, but not for
network programming? To what extent can network/affiliate agreements be
expected to require that the networks deliver content in compliance
with the ATSC A/85 RP?
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\86\ As explained supra, broadcast TV stations are required to
use AC-3 audio systems by Section 73.682 of our rules, which
incorporates by reference the ATSC A/53 Standard.
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30. We also seek comment on whether special considerations apply to
MVPD carriage of broadcast stations. If a station complies with the
ATSC A/85 RP, and the MVPD carries the station without altering the
audio content, will the MVPD's retransmission of the station to the
consumer likewise comply with the A/85 RP? \87\ If broadcast content
carried by an MVPD contains loud commercials that are the subject of a
complaint, how can we determine which party to hold responsible? We
seek comment on these issues.
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\87\ We note the Commission exempts MVPDs from liability under
the closed captioning and children's television commercial limits
for broadcast content they passively carry, because the Copyright
Act of 1976 bars MVPDs from altering the content (including
commercials) of retransmitted broadcast channels. See 47 CFR
76.225(e) and 25.701(e)(2); see 47 CFR 79.1(e)(9). See also 17
U.S.C. 111(c)(3), 119(a)(5) and 122(e).
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31. Finally, we also invite comment on other challenges that
stations/MVPDs may face and how they can solve these challenges
consistent with their responsibilities under the CALM Act. For example,
will there be challenges in conforming legacy or inventory content?
Also, will MVPDs face particular practical challenges associated with
carriage of public, educational and governmental (``PEG'') or leased
access programming? \88\ Are there any legal impediments to MVPD
adjustment of audio content to meet the RP A/85 requirements and the
goals of the CALM Act? Does Section 315's prohibition on ``censorship''
of political advertisements pose any legal obstacles? \89\ Do small
market broadcast stations or small cable/MVPD system operators face
particular practical challenges related to their size?
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\88\ See 47 U.S.C. 531(e) and 532(c)(2). See also 47 CFR
76.901(a).
\89\ 47 U.S.C. 315.
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32. Is the contractual approach to compliance discussed above
sufficient to address the challenges that stations/MVPDs may face? Or,
are there other means of addressing some of these challenges. For
example, can retransmission consent agreements be used to clarify
responsibilities between stations and MVPDs? Can a similar approach be
used for commercial stations that elect mandatory carriage? What, if
any, are the implications under copyright licenses? Would the waiver
provision in the CALM Act, as discussed below, be an appropriate tool
to address certain challenges or special circumstances that stations/
MVPDs encounter? Would such a waiver conditioned on compliance by use
of a different audio technology that will prevent the transmission of
loud commercials to consumers be consistent with the goal of the
statute?
4. Complaint Process
33. The overall focus and intent of the CALM Act is to address the
problem of loud commercials as consumers experience them. Therefore, we
propose to enforce compliance with the statute by focusing on consumer
complaints after the rules take effect. If stations/MVPDs take the
actions necessary to eliminate or significantly reduce valid loud
commercial complaints, then we believe the CALM Act will achieve its
purpose. We believe that a consumer complaint driven procedure is the
most practical means to monitor industry compliance with our proposed
rules. In addition to investigating individual consumer complaints
alleging transmission of a loud commercial, we
[[Page 32125]]
intend to monitor consumer complaints and follow trends to determine
where enforcement action is warranted. We invite comment on whether we
should supplement the complaint-driven approach with occasional
equipment audits, and under what circumstances such audits would be
appropriate. We seek comment on our proposed consumer complaint-driven
approach and the proposed consumer complaint procedure, as described
below.
34. Filing a Complaint. We propose that consumers may file their
complaints electronically using the Commission's online complaint form
(the Form 2000 series) found at http://esupport.fcc.gov/complaints.htm.
We propose to modify the online complaint form to specifically
accommodate complaints about loud commercials.\90\ Consumers may also
file their complaint by fax to 1-866-418-0232 or by letter mailed to
Federal Communications Commission, Consumer & Governmental Affairs
Bureau, Consumer Inquiries & Complaints Division, 445 12th Street, SW.,
Washington, DC 20554. Consumers that want assistance filing their
complaint may contact the Commission's Consumer Call Center by calling
1-888-CALL-FCC (1-888-225-5322) (voice) or 1-888-TELL-FCC (1-888-835-
5322) (tty).\91\ There is no fee for filing a consumer complaint.
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\90\ We intend to add ``loud commercials'' as a complaint
category under the complaint type menu for ``Broadcast (TV and
Radio), Cable, and Satellite Issues.'' We will also add specific
questions which relate to the filing of a loud commercial complaint.
See, infra, discussion of complaint details.
\91\ We also encourage consumers to visit the Consumer &
Governmental Affairs Bureau website at http://www.fcc.gov/cgb/or to
visit our online Consumer Help Center at http://reboot.fcc.gov/consumers/.
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35. Complaint Details. To ensure that the Commission is able to
take appropriate action on a complaint, the consumer should complete
fully the online complaint form. For consumers that choose not to use
the online complaint form, they can submit a written complaint. The
complaint should clearly indicate that it is a loud commercial
complaint and include the following information: (1) The complainant's
contact information, including name, mailing address, daytime phone
number, and e-mail address if available; (2) the name and call sign of
the broadcast station or the name and type of MVPD against whom the
complaint is directed; (3) the date and time the loud commercial
problem occurred; (4) the channel and/or network involved; (5) the name
of the television program during which the commercial was viewed; (6)
the name of the commercial's advertiser/sponsor or product involved;
and (7) a description of the loud commercial problem.
36. We will evaluate the individual complaints we receive to
determine which complaints indicate a possible violation of our rules.
In addition, we will track these consumer complaints, as well as
stations/MVPDs' responses to them, to determine if there are trends
that suggest a need for enforcement action. We will generally forward
individual complaints to the appropriate broadcast station or MVPD so
that stations/MVPDs can both be aware of a potential problem and take
action to address it and to respond to their viewers/subscribers
appropriately. When appropriate, we will investigate the station/MVPD
and require it to respond to the alleged violation(s) with a detailed
explanation of its actions. If the station/MVPD asserts in its response
to us that it did not violate the rules, we would expect it to provide
us with sufficient records and documentation to demonstrate compliance.
We seek comment on what records and documentation stations/MVPDs should
be required to retain to demonstrate compliance, including but not
limited to records and documentation to demonstrate compliance with the
Section 2(c) safe harbor provision.\92\ If the station/MVPD
acknowledges in its response to us that it violated the rules, we
intend to require an explanation of why the violation occurred and what
corrective actions it will take to prevent future violations. We seek
comment on whether to require stations/MVPDs to designate a contact
person to receive loud commercial complaints, or if we can use existing
contact information from our various databases (e.g., CDBS, COALS,
etc.) for this purpose.\93\ We note that a television broadcast station
would be required to retain in its local public inspection file a copy
of a complaint filed with the Commission about a loud commercial under
the Commission's existing rules.\94\ We seek comment on whether to
require MVPDs to do the same in their local public inspection files or,
to the extent some MVPDs are not obligated to maintain a public
inspection file, to retain such complaints for a comparable period of
time in an accessible location.\95\ We also seek comment on what, if
any, requirements should be imposed on stations/MVPDs to retain copies
of loud commercial complaints that they receive directly from
consumers.\96\
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\92\ See, supra, discussion of demonstrating safe harbor
compliance and of other ways to demonstrate compliance.
\93\ The Commission's Consolidated Database System (``CDBS'')
Electronic Filing System is publicly available online via the Media
Bureau's Electronic Filing and Public Access website at: http://www.fcc.gov/mb/cdbs.html or CDBS website at: http://fjallfoss.fcc.gov/prod/cdbs/forms/prod/cdbs_ef.htm. The Media
Bureau's Cable Operations and Licensing System (COALS) database is
publicly available online at http://fjallfoss.fcc.gov/csb/coals/index.html.
\94\ See 47 CFR 73.3526(e)(10) (requiring commercial TV stations
to retain in its local public inspection file material relating to a
Commission investigation or complaint to the Commission). The rule
requires a station to retain the complaint in its public file until
it is notified in writing that the complaint may be discarded. Id.
See also 47 CFR 73.3527(e)(11) (relating to noncommercial TV
stations).
\95\ See, e.g., 47 CFR 76.1700 et seq. and 25.701.
\96\ We note that, if we require stations/MVPDs to retain in
their public file copies of loud commercial complaints which they
receive directly from consumers, our trends analysis may include
consideration of consumer complaints filed directly with the
station/MVPD.
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5. Enforcement
37. Under the general forfeiture provisions of the Communications
Act, stations/MVPDs are subject to forfeitures for violations of the
Communications Act and Commission's rules.\97\ We will apply these
provisions to enforce compliance with the CALM Act and our rules
implementing it. This approach is consistent with the legislative
history of the CALM Act.\98\ Accordingly, we will use the full range of
enforcement tools available to us.\99\ We seek comment on whether there
are any general situations that may warrant special consideration in
enforcing the Act. We also invite comment on whether we should
establish a base forfeiture amount for violations of our rules
implementing the CALM Act, and if so, on the appropriate base
forfeiture amount.\100\
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\97\ 47 U.S.C. 503.
\98\ See, e.g., Senate Committee Report to S. 2847 at 4.
\99\ See 47 U.S.C. 503(b)(1)(B) and 47 CFR 1.80(a)(2) (stating
that any person who willfully or repeatedly fails to comply with the
provisions of the Communications Act or the Commission's rules shall
be liable for a forfeiture penalty).
\100\ See 47 CFR 1.80.
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C. Financial Hardship and General Waivers
38. Section 2(b)(2) of the CALM Act provides that the Commission
may grant a one-year waiver of the effective date of the rules
implementing the statute to any station/MVPD that shows it would be a
``financial hardship'' to obtain the necessary equipment to comply with
the rules, and may renew such waiver for one additional year.\101\ The
legislative history indicates congressional intent for us to interpret
``financial hardship'' broadly and, in particular, recognizes ``that
television broadcast stations in smaller markets and smaller cable
[[Page 32126]]
systems may face greater challenges budgeting for the purchase of
equipment to comply with the bill than television broadcast stations in
larger markets or larger cable systems.'' \102\ In addition, Section
2(b)(3) of the CALM Act provides that the statute does not affect the
Commission's authority to waive any rule required by the CALM Act, or
the application of any such rule, for good cause shown with regard to
any station/MVPD or class of stations/MVPDs.\103\ We intend to delegate
authority to the Media Bureau to consider waiver requests filed
pursuant to Sections 2(b)(2) and 2(b)(3) of the CALM Act.
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\101\ See 47 U.S.C. 621(b)(2).
\102\ See Senate Committee Report to S. 2847 at 4. The
legislative history, in particular, states that the Commission
``should not require stations or MVPDs to demonstrate that they have
negative cash flow or are in receivership for bankruptcy to be
eligible for a waiver based on financial hardship.'' This appears to
be a reference to the strict financial hardship standard established
in 2008 for DTV station build-out extensions given the short time
remaining before the DTV transition deadline. See Third DTV Periodic
Report and Order, FCC 07-228, 73 FR 5634, January 30, 2008. (``Third
DTV Periodic Report and Order'') (requiring a station to either (1)
submit proof that they have filed for bankruptcy or that a receiver
has been appointed, or (2) submit an audited financial statement for
the previous three years showing negative cash flow).
\103\ See 47 U.S.C. 621(b)(3).
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39. Financial Hardship. We propose a financial hardship waiver
standard for evaluating requests for one-year extensions of the
effective date. To request a financial hardship waiver pursuant to
Section 2(b)(2), we propose to require a station/MVPD to provide: (1)
Evidence of its financial condition, such as financial statements;
\104\ (2) a cost estimate for obtaining the necessary equipment to
comply with the required regulation; (3) a detailed statement
explaining why its financial condition justifies postponing compliance;
and (4) an estimate of how long it will take to comply, along with
supporting information. Consistent with the statements in the
legislative history that we should interpret ``financial hardship''
broadly, we do not propose to require waiver applicants to show
negative cash flow, as we have done in other contexts.\105\ Instead, we
propose to require only that the station/MVPD's assertion of financial
hardship be reasonable under the circumstances.\106\ As part of the
showing set forth above, we propose to require a station/MVPD that
requests a financial hardship waiver to describe the equipment it
intends to obtain to comply with the CALM Act and the expense
associated with that equipment.\107\ We seek comment on our proposals.
Should we allow a station/MVPD to provide federal tax returns in lieu
of financial statements? We also seek comment on how to address the
situation in which an MVPD is carrying a broadcast station that has
been granted a financial hardship waiver. We also invite comment on
whether the financial hardship waiver provisions of the statute should
be interpreted to apply to any successors to ATSC A/85 RP.
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\104\ Financial statements should be compiled according to
generally accepted accounting practices (``GAAP''). Stations/MVPDs
may request confidential treatment for this financial information
pursuant to 47 CFR 0.459.
\105\ See, e.g., Third DTV Periodic Report and Order, at para.
74 (generally requiring three years showing negative cash flow for
DTV station build-out extensions); 2002 Broadcast Ownership Review
Order, FCC 03-127, 68 FR 46286, August 5, 2003 (generally requiring
three years of negative cash flow to show that a station is a
``failed station'' for purposes of a waiver of the local TV
ownership rules); Great Plains Cable Television, Inc. et al.
Requests for Waiver of Section 76.1204(a)(1) of the Commission's
Rules, 22 FCC Rcd 13414, 13426-7, paragraphs 39-40 (2007)
(unpublished) (granting waiver for extraordinary financial hardships
upon evidence of negative cash flow).
\106\ This approach is consistent with the more liberal process
for DTV build-out extensions prior to 2008. See 2001 DTV Recon
Order, FCC 01-330, 66 FR 65122, December 18, 2001 (establishing
four-part test for financial hardship to obtain a DTV build-out
extension: (1) An itemized estimate of the cost of meeting the
build-out requirements; (2) a detailed statement explaining why its
financial condition precludes such an expenditure; (3) a detailed
accounting of the applicant's good faith efforts to meet the
deadline, including its good faith efforts to obtain the requisite
financing and an explanation why those efforts were unsuccessful;
and (4) an indication when the applicant reasonably expects to
complete construction).
\107\ If, for example, an MVPD does not intend to install,
utilize and maintain equipment to demonstrate compliance with the
CALM Act, but rather intends to rely primarily on contractual
arrangements with content providers, and more limited monitoring
equipment, then it would not qualify for a financial waiver based
upon the cost of equipment it never intends to obtain.
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40. Small Stations/MVPD Systems. We seek specific comment on
whether to create a streamlined financial hardship waiver approach for
small market broadcast stations and operators of small MVPD systems.
One way of streamlining the hardship waivers would be to reduce the
amount of information stations/MVPDs that meet an appropriate
definition of ``small'' would be required to submit to justify the
waiver postponing the effective date for one year. We seek comment on
whether such additional relief for small stations/systems would be
appropriate; how to streamline the process for requesting waivers; and
how to define ``small'' for this purpose. For example, would it be
appropriate to define a ``small market television broadcast station''
as a station that is in television markets 101-210 and is not
affiliated with a top-four network (i.e., ABC, CBS, Fox and NBC)? \108\
Would it be appropriate to define a ``small MVPD system'' as one with
fewer than 15,000 subscribers (on the effective date of the rules)
\109\ and that is not affiliated with a larger operator? \110\
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\108\ See, e.g., Third DTV Periodic Report and Order, 23 FCC Rcd
at 3041, para. 97, n.292 (defining a small market broadcast station
in the DTV context).
\109\ See, e.g., 47 CFR 76.901(c) (defining a ``small system''
as a cable system serving 15,000 or fewer subscribers in the context
of cable rate regulation).
\110\ See, e.g., DTV Broadcast Carriage Signals Order, FCC 08-
193, 73 FR 61742, October 17, 2008 (defining a ``small cable
operator'' in the context of broadcast carriage requirements and
excluding cable systems affiliated with a cable operator serving
more than 10 percent of all MVPD subscribers).
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41. General Waiver Authority. Section 2(b)(3) of the CALM Act
provides that the Commission may waive any rule required by the CALM
Act, or the application of any such rule, to any station/MVPD for good
cause shown under Section 1.3 of the Commission's rules.\111\ In
addition to any requests for waiver necessitated by unforeseen
circumstances, we believe this provision preserves our inherent
authority to grant waivers to MVPDs that cannot implement the ATSC A/85
RP because of the technology they use. Grant of a waiver under such
circumstances would be more likely to be in the public interest if the
waiver recipient can demonstrate that it, by some other means, will be
able to prevent the transmission of loud commercials, as intended by
the CALM Act. We seek comment on the appropriate exercise of our waiver
authority under such circumstances, and on whether non-AC-3 audio
systems can effectively prevent loud commercials.
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\111\ See 47 U.S.C. 621(b)(3). See 47 CFR 1.3 (the Commission's
rules ``may be suspended, revoked, amended, or waived for good cause
shown, in whole or in part, at any time by the Commission'' and that
``[a]ny provision of the rules may be waived by the Commission on
its own motion or on petition if good cause therefor is shown'').
---------------------------------------------------------------------------
42. We also invite comment on whether and how waivers should be
used to address challenges that stations/MVPDs foresee in complying
with the regulations required by the CALM Act. For example, would it be
appropriate and consistent with the provisions of the CALM Act to grant
a blanket one-year extension of the effective date of our rules to
small market stations or smaller MVPD operators because such entities
are generally likely to face financial hardships and/or because of the
administrative burdens associated with requesting financial hardship
waivers for such entities? \112\ Are small
[[Page 32127]]
stations/systems as a class likely to need more time to obtain the
necessary equipment to comply with the CALM Act? We also invite comment
on the potential impact on consumers of a blanket one-year extension
for small stations/MVPDs, including whether it would engender confusion
and frustration if the effective date for the CALM Act were delayed for
some stations/MVPDs but not others. What impact might a blanket waiver
approach have on consumers?
---------------------------------------------------------------------------
\112\ We also note that a blanket one-year extension for small
stations/MVPDs would eliminate a significant administrative burden
on the Commission of processing hardship waiver requests.
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43. Filing Deadline. We propose that, absent extraordinary
circumstances, the deadline for filing a waiver request pursuant to
either Section 2(b)(2) or 2(b)(3) of the CALM Act will be 180 days
before the effective date of our rules. This will afford the Bureau
time to consider these requests before our rules take effect. Requests
for waiver renewals must be filed at least 180 days before the waiver
expires. Requests for waiver based on unforeseen circumstances, of
course, can be filed at any time. We seek comment on these proposed
filing deadlines.
44. Filing Requirements. We propose to require a station/MVPD to
file its financial hardship or general waiver request electronically
into this docket through the Commission's Electronic Comment Filing
System (``ECFS'') using the Internet by accessing the ECFS: http://www.fcc.gov/cgb/ecfs/. The filing must be clearly designated as a
``financial hardship'' or ``general'' waiver request. Such requests
must also comply with Section 1.3 of our rules.\113\ We believe this
process will ensure that all interested parties receive notice and an
opportunity to comment on such waiver requests. We propose that we will
not impose a filing fee for waiver requests pursuant to the waiver
provisions of the CALM Act. We seek comment on our proposed filing
requirements.
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\113\ See 47 CFR 1.3.
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IV. Conclusion
45. Congress' directive to us in the CALM Act is clear: Incorporate
by reference into our rules and make mandatory the ATSC A/85 RP to
prevent TV broadcast stations, cable and DBS operators, and other MVPDs
from transmitting ``loud commercials'' to consumers. To achieve this
directive, we propose a consumer complaint-driven process to evaluate
and ensure compliance with our rules, similar to what we have done in
other contexts. We believe our proposed implementation of the CALM Act
appropriately focuses on benefits for consumers, while limiting costs
to stations and MVPDs to the extent possible.
V. Procedural Matters
A. Initial Regulatory Flexibility Act Analysis
46. As required by the Regulatory Flexibility Act of 1980, as
amended (``RFA'') \114\ the Commission has prepared this present
Initial Regulatory Flexibility Analysis (``IRFA'') concerning the
possible significant economic impact on small entities by the policies
and rules proposed in this Notice of Proposed Rulemaking (``NPRM'').
Written public comments are requested on this IRFA. These comments must
be filed in accordance with the same filing deadlines for comments on
the NPRM \115\ and they must have a separate and distinct heading
designating them as responses to the IRFA. The Commission will send a
copy of the NPRM, including this IRFA, to the Chief Counsel for
Advocacy of the Small Business Administration (``SBA'').\116\ In
addition, the NPRM and IRFA (or summaries thereof) will be published in
the Federal Register.\117\
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\114\ See 5 U.S.C. 603. The RFA, see 5 U.S.C. 601 et. seq., has
been amended by the Contract With America Advancement Act of 1996,
Pub. L. 104-121, 110 Stat. 847 (1996) (CWAAA). Title II of the CWAAA
is the Small Business Regulatory Enforcement Fairness Act of 1996
(SBREFA).
\115\ See Section IV.D. of the NPRM.
\116\ See 5 U.S.C. 603(a).
\117\ See id.
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1. Need for, and Objectives of, the Proposed Rule Changes
47. This document proposes rules to implement the Commercial
Advertisement Loudness Mitigation (CALM) Act.\118\ Among other things,
the CALM Act directs the Commission to incorporate into its rules by
reference and make mandatory a technical standard developed by an
industry standard-setting body that is designed to prevent television
commercial advertisements from being transmitted at louder volumes than
the program material they accompany.\119\ Specifically, the CALM Act
requires the Commission to incorporate by reference the ATSC A/85
Recommended Practice (``ATSC A/85 RP'') \120\ and make it mandatory
``insofar as such recommended practice concerns the transmission of
commercial advertisements by a television broadcast station, cable
operator, or other multichannel video programming distributor.'' \121\
The NPRM considers proposals for implementing the statute and applying
the required regulation. Some of these proposals are contained in
Sections A.4. and A.5. of this IRFA, and we invite comment on these
proposals. As mandated by the statute, the proposed rules will apply to
TV broadcasters, cable operators and other multichannel video
programming distributors (``MVPDs'').\122\ The new law requires the
Commission to adopt the required regulation on or before December 15,
2011,\123\ and it will take effect one year after adoption.\124\
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\118\ The Commercial Advertisement Loudness Mitigation
(``CALM'') Act, Pub. L. 111-311, 124 Stat. 3294 (2010) (codified at
47 U.S.C. 621).
\119\ See 47 U.S.C. 621(a); Senate Committee Report to S. 2847
at 1; House Committee Report to H.R. 1084 at 1.
\120\ See ATSC A/85: ``ATSC Recommended Practice: Techniques for
Establishing and Maintaining Audio Loudness for Digital
Television,'' (May 25, 2011) (``ATSC A/85 RP''). To obtain a copy of
the ATSC A/85 RP, visit the ATSC Web site: http://www.atsc.org/cms/standards/a_85-2009.pdf.
\121\ See 47 U.S.C. 621(a).
\122\ We refer herein to covered entities collectively as
``stations/MVPDs'' or ``regulated entities.''
\123\ See 47 U.S.C. 621(a).
\124\ See 47 U.S.C. 621(b)(1).
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2. Legal Basis
48. The proposed action is authorized pursuant to the Commercial
Advertisement Loudness Mitigation Act of 2010, Public Law 111-311, 124
Stat. 3294, and Sections 1, 2(a), 4(i) and (j), and 303 of the
Communications Act of 1934, as amended, 47 U.S.C. 151, 152, 154(i) and
(j), 303 and 621.
3. Description and Estimate of the Number of Small Entities to Which
the Proposed Rules Will Apply
49. The RFA directs agencies to provide a description of and, where
feasible, an estimate of the number of small entities that may be
affected by the proposed rules, if adopted.\125\ The RFA generally
defines the term ``small entity'' as having the same meaning as the
terms ``small business,'' ``small organization,'' and ``small
governmental jurisdiction.'' \126\ In addition, the term ``small
business'' has the same meaning as the term ``small business concern''
under the Small Business Act.\127\ A small business concern is one
which: (1) Is independently owned and operated; (2) is not dominant in
its field of
[[Page 32128]]
operation; and (3) satisfies any additional criteria established by the
SBA.\128\ Below, we provide a description of such small entities, as
well as an estimate of the number of such small entities, where
feasible.
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\125\ 5 U.S.C. 603(b)(3).
\126\ 5 U.S.C. 601(6).
\127\ 5 U.S.C. 601(3) (incorporating by reference the definition
of ``small business concern'' in 15 U.S.C. 632). Pursuant to 5
U.S.C. 601(3), the statutory definition of a small business applies
``unless an agency, after consultation with the Office of Advocacy
of the Small Business Administration and after opportunity for
public comment, establishes one or more definitions of such term
which are appropriate to the activities of the agency and publishes
such definition(s) in the Federal Register.'' 5 U.S.C. 601(3).
\128\ 15 U.S.C. 632. Application of the statutory criteria of
dominance in its field of operation and independence are sometimes
difficult to apply in the context of broadcast television.
Accordingly, the Commission's statistical account of television
stations may be over-inclusive.
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50. Television Broadcasting. The SBA defines a television
broadcasting station as a small business if such station has no more
than $14.0 million in annual receipts.\129\ Business concerns included
in this industry are those ``primarily engaged in broadcasting images
together with sound.'' \130\ The Commission has estimated the number of
licensed commercial television stations to be 1,390.\131\ According to
Commission staff review of the BIA Kelsey Inc. Media Access Pro
Television Database (BIA) as of January 31, 2011, 1,006 (or about 78
percent) of an estimated 1,298 commercial television stations \132\ in
the United States have revenues of $14 million or less and, thus,
qualify as small entities under the SBA definition. The Commission has
estimated the number of licensed noncommercial educational (NCE)
television stations to be 391.\133\ We note, however, that, in
assessing whether a business concern qualifies as small under the above
definition, business (control) affiliations \134\ must be included. Our
estimate, therefore, likely overstates the number of small entities
that might be affected by our action, because the revenue figure on
which it is based does not include or aggregate revenues from
affiliated companies. The Commission does not compile and otherwise
does not have access to information on the revenue of NCE stations that
would permit it to determine how many such stations would qualify as
small entities.
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\129\ See 13 CFR 121.201, NAICS Code 515120 (2007).
\130\ Id. This category description continues, ``These
establishments operate television broadcasting studios and
facilities for the programming and transmission of programs to the
public. These establishments also produce or transmit visual
programming to affiliated broadcast television stations, which in
turn broadcast the programs to the public on a predetermined
schedule. Programming may originate in their own studios, from an
affiliated network, or from external sources.'' Separate census
categories pertain to businesses primarily engaged in producing
programming. See Motion Picture and Video Production, NAICS code
512110; Motion Picture and Video Distribution, NAICS Code 512120;
Teleproduction and Other Post-Production Services, NAICS Code
512191; and Other Motion Picture and Video Industries, NAICS Code
512199.
\131\ See News Release, ``Broadcast Station Totals as of
December 31, 2010,'' 2011 WL 484756 (F.C.C.) (dated Feb. 11, 2011)
(``Broadcast Station Totals''); also available at http://www.fcc.gov/Daily_Releases/Daily_Business/2011/db0211/DOC-304594A1.pdf.
\132\ We recognize that this total differs slightly from that
contained in Broadcast Station Totals, however, we are using BIA's
estimate for purposes of this revenue comparison.
\133\ See Broadcast Station Totals.
\134\ ``[Business concerns] are affiliates of each other when
one concern controls or has the power to control the other or a
third party or parties controls or has the power to control both.''
13 CFR 121.103(a)(1).
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51. In addition, an element of the definition of ``small business''
is that the entity not be dominant in its field of operation. We are
unable at this time to define or quantify the criteria that would
establish whether a specific television station is dominant in its
field of operation. Accordingly, the estimate of small businesses to
which rules may apply does not exclude any television station from the
definition of a small business on this basis and is therefore over-
inclusive to that extent. Also, as noted, an additional element of the
definition of ``small business'' is that the entity must be
independently owned and operated. We note that it is difficult at times
to assess these criteria in the context of media entities and our
estimates of small businesses to which they apply may be over-inclusive
to this extent.
52. Cable and Other Program Distribution. Since 2007, these
services have been defined within the broad economic census category of
Wired Telecommunications Carriers; that category is defined as follows:
``This industry comprises establishments primarily engaged in operating
and/or providing access to transmission facilities and infrastructure
that they own and/or lease for the transmission of voice, data, text,
sound, and video using wired telecommunications networks. Transmission
facilities may be based on a single technology or a combination of
technologies.'' \135\ The SBA has developed a small business size
standard for this category, which is: all such firms having 1,500 or
fewer employees.\136\ According to Census Bureau data for 2007, there
were a total of 955 firms in this previous category that operated for
the entire year.\137\ Of this total, 939 firms had employment of 999 or
fewer employees, and 16 firms had employment of 1000 employees or
more.\138\ Thus, under this size standard, the majority of firms can be
considered small and may be affected by rules adopted pursuant to the
NPRM.
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\135\ U.S. Census Bureau, 2007 NAICS Definitions, ``517110 Wired
Telecommunications Carriers'' (partial definition), http://www.census.gov/naics/2007/def/ND517110.HTM#N517110.
\136\ 13 CFR 121.201, NAICS code 517110 (2007).
\137\ U.S. Census Bureau, 2007 Economic Census, Subject Series:
Information, Table 5, Employment Size of Firms for the United
States: 2007, NAICS code 5171102 (issued Nov. 2010).
\138\ See id.
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53. Cable Companies and Systems (Rate Regulation Standard). The
Commission has also developed its own small business size standards for
the purpose of cable rate regulation. Under the Commission's rules, a
``small cable company'' is one serving 400,000 or fewer subscribers
nationwide.\139\ As of 2008, out of 814 cable operators,\140\ all but
10 (that is, 804) qualify as small cable companies under this
standard.\141\ In addition, under the Commission's rules, a ``small
system'' is a cable system serving 15,000 or fewer subscribers.\142\
Current Commission records show 6,000 cable systems. Of these, 726 have
20,000 subscribers or more, based on the same records. We estimate that
there are 5,000 small systems based upon this standard.
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\139\ 47 CFR 76.901(e). The Commission determined that this size
standard equates approximately to a size standard of $100 million or
less in annual revenues. Implementation of Sections of the 1992
Cable Act: Rate Regulation, Sixth Report and Order and Eleventh
Order on Reconsideration, 10 FCC Rcd 7393, 7408 (1995).
\140\ Cable MSO Ownership, A Geographical Analysis, 2009
Edition, 14-31, SNL Kagan (June 2009).
\141\ Id. at 12.
\142\ 47 CFR 76.901(c).
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54. Cable System Operators (Telecom Act Standard). The
Communications Act of 1934, as amended, also contains a size standard
for small cable system operators, which is ``a cable operator that,
directly or through an affiliate, serves in the aggregate fewer than 1
percent of all subscribers in the United States and is not affiliated
with any entity or entities whose gross annual revenues in the
aggregate exceed $250,000,000.'' \143\ There are approximately 63.7
million cable subscribers in the United States today.\144\ Accordingly,
an operator serving fewer than 637,000 subscribers shall be deemed a
small operator, if its annual revenues, when combined with the total
annual revenues of all its affiliates, do not exceed $250 million in
the aggregate.\145\ Based on available data, we find that the number of
cable operators serving 637,000 subscribers or less is also 804.\146\
We note that the Commission neither requests nor collects information
on whether cable system operators are affiliated with entities whose
gross annual revenues
[[Page 32129]]
exceed $250 million.\147\ Although it seems certain that some of these
cable system operators are affiliated with entities whose gross annual
revenues exceed $250,000,000, we are unable at this time to estimate
with greater precision the number of cable system operators that would
qualify as small cable operators under the definition in the
Communications Act.
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\143\ 47 U.S.C. 543(m)(2); see 47 CFR 76.901(f) & nn. 1-3.
\144\ See Cable TV Investor: Deals & Finance, No. 655, SNL
Kagan, March 31, 2009, at 6.
\145\ 47 CFR 76.901(f); see Public Notice, FCC Announces New
Subscriber Count for the Definition of Small Cable Operator, DA 01-
158 (Cable Services Bureau, Jan. 24, 2001).
\146\ Cable MSO Ownership at 12.
\147\ The Commission does receive such information on a case-by-
case basis if a cable operator appeals a local franchise authority's
finding that the operator does not qualify as a small cable operator
pursuant to Sec. 76.901(f) of the Commission's rules. See 47 CFR
76.901(f).
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55. Direct Broadcast Satellite (``DBS'') Service. DBS service is a
nationally distributed subscription service that delivers video and
audio programming via satellite to a small parabolic ``dish'' antenna
at the subscriber's location. DBS, by exception, is now included in the
SBA's broad economic census category, ``Wired Telecommunications
Carriers,'' \148\ which was developed for small wireline firms. Under
this category, the SBA deems a wireline business to be small if it has
1,500 or fewer employees.\149\ However, the data we have available as a
basis for estimating the number of such small entities were gathered
under a superseded SBA small business size standard formerly titled
``Cable and Other Program Distribution.'' The definition of Cable and
Other Program Distribution provided that a small entity is one with
$12.5 million or less in annual receipts.\150\ Currently, only two
entities provide DBS service, which requires a great investment of
capital for operation: DIRECTV and EchoStar Communications Corporation
(``EchoStar'') (marketed as the DISH Network).\151\ Each currently
offers subscription services. DIRECTV \152\ and EchoStar \153\ each
report annual revenues that are in excess of the threshold for a small
business. Because DBS service requires significant capital, we believe
it is unlikely that a small entity as defined by the SBA would have the
financial wherewithal to become a DBS service provider. We seek
comments that have data on the annual revenues and number of employees
of DBS service providers.
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\148\ See 13 CFR 121.201, NAICS code 517110 (2007). The 2007
North American Industry Classification System (``NAICS'') defines
the category of ``Wired Telecommunications Carriers'' as follows:
``This industry comprises establishments primarily engaged in
operating and/or providing access to transmission facilities and
infrastructure that they own and/or lease for the transmission of
voice, data, text, sound, and video using wired telecommunications
networks. Transmission facilities may be based on a single
technology or a combination of technologies. Establishments in this
industry use the wired telecommunications network facilities that
they operate to provide a variety of services, such as wired
telephony services, including VoIP services; wired (cable) audio and
video programming distribution; and wired broadband Internet
services. By exception, establishments providing satellite
television distribution services using facilities and infrastructure
that they operate are included in this industry.'' (Emphasis added
to text relevant to satellite services.) U.S. Census Bureau, 2007
NAICS Definitions, ``517110 Wired Telecommunications Carriers'';
http://www.census.gov/naics/2007/def/ND517110.HTM.
\149\ 13 CFR 121.201, NAICS code 517110 (2007).
\150\ 13 CFR 121.201, NAICS code 517510 (2002).
\151\ See Annual Assessment of the Status of Competition in the
Market for the Delivery of Video Programming, Thirteenth Annual
Report, 24 FCC Rcd 542, 580, para. 74 (2009) (``13th Annual
Report''). We note that, in 2007, EchoStar purchased the licenses of
Dominion Video Satellite, Inc. (``Dominion'') (marketed as Sky
Angel). See Public Notice, ``Policy Branch Information; Actions
Taken,'' Report No. SAT-00474, 22 FCC Rcd 17776 (IB 2007).
\152\ As of June 2006, DIRECTV is the largest DBS operator and
the second largest MVPD, serving an estimated 16.20% of MVPD
subscribers nationwide. See id. at 687, Table B-3.
\153\ As of June 2006, DISH Network is the second largest DBS
operator and the third largest MVPD, serving an estimated 13.01% of
MVPD subscribers nationwide. Id. As of June 2006, Dominion served
fewer than 500,000 subscribers, which may now be receiving ``Sky
Angel'' service from DISH Network. See id. at 581, para. 76.
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56. Satellite Master Antenna Television (SMATV) Systems, also known
as Private Cable Operators (PCOs). SMATV systems or PCOs are video
distribution facilities that use closed transmission paths without
using any public right-of-way. They acquire video programming and
distribute it via terrestrial wiring in urban and suburban multiple
dwelling units such as apartments and condominiums, and commercial
multiple tenant units such as hotels and office buildings. SMATV
systems or PCOs are now included in the SBA's broad economic census
category, ``Wired Telecommunications Carriers,'' \154\ which was
developed for small wireline firms.\155\ Under this category, the SBA
deems a wireline business to be small if it has 1,500 or fewer
employees.\156\ However, the data we have available as a basis for
estimating the number of such small entities were gathered under a
superseded SBA small business size standard formerly titled ``Cable and
Other Program Distribution.'' The definition of Cable and Other Program
Distribution provided that a small entity is one with $12.5 million or
less in annual receipts.\157\ As of June 2004, there were approximately
135 members in the Independent Multi-Family Communications Council
(IMCC), the trade association that represents PCOs.\158\ The IMCC
indicates that, as of June 2006, PCOs serve about 1 to 2 percent of the
multichannel video programming distributors (MVPD) marketplace.\159\
Individual PCOs often serve approximately 3,000-4,000 subscribers, but
the larger operations serve as many as 15,000-55,000 subscribers. In
total, as of June 2006, PCOs serve approximately 900,000
subscribers.\160\ Because these operators are not rate regulated, they
are not required to file financial data with the Commission.
Furthermore, we are not aware of any privately published financial
information regarding these operators. Based on the estimated number of
operators and the estimated number of units served by the largest 10
PCOs, we believe that a substantial number of PCOs may have been
categorized as small entities under the now superseded SBA small
business size standard for Cable and Other Program Distribution.\161\
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\154\ See 13 CFR 121.201, NAICS code 517110 (2007).
\155\ Although SMATV systems often use DBS video programming as
part of their service package to subscribers, they are not included
in Section 340's definition of ``satellite carrier.'' See 47 U.S.C.
340(i)(1) and 338(k)(3); 17 U.S.C. 119(d)(6).
\156\ 13 CFR 121.201, NAICS code 517110 (2007).
\157\ 13 CFR 121.201, NAICS code 517510 (2002).
\158\ See Annual Assessment of the Status of Competition in the
Market for the Delivery of Video Programming, Eleventh Annual
Report, FCC 05-13, para. 110 (rel. Feb. 4, 2005) (``2005 Cable
Competition Report'').
\159\ See 13th Annual Report, 24 FCC Rcd at 684, Table B-1.
\160\ Id.
\161\ 13 CFR 121.201, NAICS code 517510 (2002).
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57. Open Video Services. The open video system (``OVS'') framework
was established in 1996, and is one of four statutorily recognized
options for the provision of video programming services by local
exchange carriers.\162\ The OVS framework provides opportunities for
the distribution of video programming other than through cable systems.
Because OVS operators provide subscription services,\163\ OVS falls
within the SBA small business size standard covering cable services,
which is ``Wired Telecommunications Carriers.'' \164\ The SBA has
developed a small business size standard for this category, which is:
all such firms having 1,500 or fewer employees. According to Census
Bureau data for 2007, there were a total of 3,188 firms in this
previous
[[Page 32130]]
category that operated for the entire year.\165\ Of this total, 3,144
firms had employment of 999 or fewer employees, and 44 firms had
employment of 1,000 employees or more.\166\ Thus, under this size
standard, most cable systems are small and may be affected by rules
adopted pursuant to the NPRM. In addition, we note that the Commission
has certified some OVS operators, with some now providing service.\167\
Broadband service providers (``BSPs'') are currently the only
significant holders of OVS certifications or local OVS franchises.\168\
The Commission does not have financial or employment information
regarding the entities authorized to provide OVS, some of which may not
yet be operational. Thus, again, at least some of the OVS operators may
qualify as small entities.
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\162\ 47 U.S.C. 571(a)(3)-(4). See Annual Assessment of the
Status of Competition in the Market for the Delivery of Video
Programming, MB Docket No. 06-189, Thirteenth Annual Report, 24 FCC
Rcd 542, 606, para. 135 (2009) (``Thirteenth Annual Cable
Competition Report'').
\163\ See 47 U.S.C. 573.
\164\ U.S. Census Bureau, 2007 NAICS Definitions, ``517110 Wired
Telecommunications Carriers''; http://www.census.gov/naics/2007/def/ND517110.HTM#N517110.
\165\ U.S. Census Bureau, 2007 Economic Census, Subject Series:
Information, Table 5, Employment Size of Firms for the United
States: 2007, NAICS code 5171102 (issued Nov. 2010).
\166\ See id.
\167\ A list of OVS certifications may be found at http://www.fcc.gov/mb/ovs/csovscer.html.
\168\ See Thirteenth Annual Cable Competition Report, 24 FCC Rcd
at 606-07, para. 135. BSPs are newer firms that are building state-
of-the-art, facilities-based networks to provide video, voice, and
data services over a single network.
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4. Description of Projected Reporting, Recordkeeping, and Other
Compliance Requirements
58. The NPRM contains proposals that, if adopted, would impose new
reporting, recordkeeping and/or other compliance requirements,
including the following. First, the NPRM considers what showing is
required to satisfy the Section 2(c) safe harbor compliance
provision.\169\ Second, the NPRM considers what types of showings are
required for a station/MVPD that chooses not to demonstrate Section
2(c) safe harbor compliance, but instead chooses to demonstrate
compliance with the rules implementing the CALM Act by some other
means.\170\ This includes, for example, whether and how regulated
entities could use contracts to ensure compliance and what quality
control measures they can take to monitor the content delivered to them
for transmission to consumers.\171\ Third, the NPRM considers whether
to require stations/MVPDs to designate a contact person to receive loud
commercial complaints.\172\ Fourth, the NPRM notes that television
broadcast stations will be required to retain in their local public
inspection file material a copy of a complaint filed with the
Commission about a loud commercial, and considers whether to require
MVPDs to do the same in their local public inspection file.\173\ The
NPRM also considers what, if any, requirements should be imposed on
stations/MVPDs to retain a copy of a loud commercial complaint that it
receives directly from consumers? \174\ Finally, the NPRM considers
what showing is required to respond to a consumer complaint alleging a
loud commercial that is forwarded to it by the Commission.\175\ The
NPRM proposes to require the station/MVPD to investigate the alleged
violation and provide a detailed explanation of its findings. In
addition, if the station/MVPD asserts in its response that it did not
violate the rules, it must provide the Commission with sufficient
records and documentation to demonstrate compliance. The NPRM considers
what records and documentation should be required to demonstrate
compliance. If the station/MVPD acknowledges in its response that it
violated the rules, it must provide the Commission with an explanation
of why the violation occurred and what corrective actions it will take
to prevent future violations.
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\169\ See NPRM paragraphs 16-21. Section 2(c) requires a
station/MVPD seeking ``safe harbor'' compliance to demonstrate that
it has installed, utilized and maintained the necessary equipment in
a commercially reasonable manner.
\170\ See id. paragraphs 22-23.
\171\ See id. para. 23.
\172\ See id. para. 36.
\173\ See id.
\174\ See id.
\175\ See id.
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5. Steps Taken To Minimize Significant Economic Impact on Small
Entities, and Significant Alternatives Considered
59. 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.\176\
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\176\ 5 U.S.C. 603(c)(1)-(c)(4)
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60. The express language of the statute requires that the new
technical loudness standard (i.e., the ATSC A/85 RP) be made mandatory
for all stations/MVPDs, regardless of size.\177\ However, the statute
also provides for a one-year waiver of the effective date of the rules
implementing the statute to any station/MVPD that shows it would be a
``financial hardship'' to obtain the necessary equipment to comply with
the rules and allows renewal of such waiver for one additional
year.\178\ The NPRM proposes a broad financial hardship waiver standard
for approving such waivers. In particular, this waiver provision should
benefit television broadcast stations in smaller markets and smaller
MVPD systems, which may face greater challenges in budgeting for the
purchase of equipment to comply with the law than television broadcast
stations in larger markets or larger MVPD systems. The NPRM also
specifically considers whether to create a streamlined financial
hardship waiver process for small market broadcast stations and
operators of small MVPD systems.\179\ Finally, the statute also
provides that the Commission may waive any rule required by the CALM
Act, or the application of any such rule, for good cause shown to any
station/MVPD.\180\ This provision allows us to consider legitimate
requests for waiver of specific compliance with the ATSC A/85 RP,
provided the station/MVPD can prevent the transmission of loud
commercials to consumers and, thus, comply with the overarching goal of
the statute and the ATSC A/85 RP. The NPRM considers alternative
approaches to implementing the waiver provisions of the statute and
specifically considers if an alternative approach would facilitate
small businesses' compliance with the ATSC A/85 RP (and thus our
rules).
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\177\ See 47 U.S.C. 621(a).
\178\ See Id. 621(b)(2).
\179\ See NPRM paras. 40 and 42.
\180\ See 47 U.S.C. 621(b)(3).
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6. Federal Rules That May Duplicate, Overlap, or Conflict With the
Proposed Rule
61. None.
B. Initial Paperwork Reduction Act of 1995 Analysis
62. This NPRM has been analyzed with respect to the Paperwork
Reduction Act of 1995 (``PRA'') \181\ and contains proposed new and
modified information collection requirements.\182\ It will be submitted
to the Office of Management and Budget (OMB) for review under Section
3507(d) of the
[[Page 32131]]
PRA.\183\ The Commission, as part of its continuing effort to reduce
paperwork burdens, invites OMB, the general public, and other
interested parties to comment on the information collection
requirements contained in this document, as required by the PRA.
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\181\ The Paperwork Reduction Act of 1995 (``PRA''), Public Law
104-13, 109 Stat 163 (1995) (codified in Chapter 35 of title 44
U.S.C.).
\182\ We propose to modify existing information collection
requirements relating to the Commission's online complaint form (the
Form 2000 series). See OMB Control No. 3060-0874. We also propose to
create a new information collection requirement to cover the filing
of financial hardship and general waiver requests pursuant to
Sections 2(b)(2) and 2(b)(3) of the CALM Act.
\183\ See 44 U.S.C. 3507(d).
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63. Written PRA comments on the proposed information collection
requirements contained herein must be submitted on or before 60 days
after the date of publication in the Federal Register. Comments should
address: (a) Whether the proposed collection of information is
necessary for the proper performance of the functions of the
Commission, including whether the information shall have practical
utility; (b) the accuracy of the Commission's burden estimates; (c)
ways to enhance the quality, utility, and clarity of the information
collected; and (d) ways to minimize the burden of the collection of
information on the respondents, including the use of automated
collection techniques or other forms of information technology.\184\ In
addition, we seek specific comment on how we might ``further reduce the
information collection burden for small business concerns with fewer
than 25 employees,'' pursuant to the Small Business Paperwork Relief
Act of 2002.\185\
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\184\ See 44 U.S.C. 3506(c)(2).
\185\ The Small Business Paperwork Relief Act of 2002
(``SBPRA''), Public Law 107-198, 116 Stat. 729 (2002) (codified in
Chapter 35 of title 44 U.S.C.); see 44 U.S.C. 3506(c)(4).
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64. In addition to filing comments with the Office of the
Secretary, a copy of any PRA comments on the proposed information
collection requirements contained herein should be submitted to the
Federal Communications Commission (FCC) via e-mail to [email protected] and
to Nicholas A. Fraser, Office of Management and Budget, via e-mail to
[email protected] or via fax at 202-395-5167. For
additional information concerning the information collection
requirements contained in this NPRM, send an e-mail to [email protected] or
contact Cathy Williams, [email protected], of the Office of
Managing Director, Performance Evaluation and Records Management, (202)
418-2918.
65. To view a copy of the information collection requests (ICRs)
submitted to OMB: (1) Go to the OMB Information Collection Review Data
on Reginfo.gov web page http://www.reginfo.gov/public/do/PRAMain, (2)
look for the section of the Web page called ``Currently Under Review,''
(3) click on the downward-pointing arrow in the ``Select Agency'' box
below the ``Currently Under Review'' heading, (4) select ``Federal
Communications Commission'' from the list of agencies presented in the
Select Agency box, (5) click the ``Submit'' button to the right of the
``Select Agency'' box, (6) when the list of FCC ICRs currently under
review appears, look for the title of the ICR and then click on the ICR
Reference Number. A copy of the FCC submission to OMB will be
displayed.
OMB Control Number: 3060-0874
Title: FCC Form 2000 A through F, FCC Form 475-B, FCC Form 1088 A
through H, and FCC Form 501--Consumer Complaint Forms: General
Complaints, Obscenity or Indecency Complaints, Complaints under the
Telephone Consumer Protection Act, and Slamming Complaints.
Form Number: FCC Form 2000 A through F, FCC Form 475-B, FCC Form
1088 A through H, and FCC Form 501.
Type of Review: Revision of a currently approved collection.
Respondents: Business or other for-profit entities; individuals or
household; not-for profit institutions; State, local or tribal
government.
Number of Respondents and Responses: 523,193 respondents and
523,193 responses.
Frequency of Response: On occasion reporting requirement.
Estimated Time per Response: 0.25 to 0.5 hours.
Total Annual Burden: 198,204 hours.
Total Annual Cost to Respondents: None.
Obligation to Respond: Voluntary. The statutory authority for this
collection of information is contained in 47 U.S.C 151, 152, 154(i) and
(j), 303(r) and 621.
Nature and Extent of Confidentiality: Confidentiality is an issue
to the extent that individuals and households provide personally
identifiable information, which is covered under the FCC's updated
system of records notice (``SORN''), FCC/CGB-1, ``Informal Complaints
and Inquiries,'' which became effective on January 25, 2010.
Privacy Impact Assessment: The Privacy Impact Assessment (``PIA'')
for Informal Complaints and Inquiries was completed on June 28, 2007.
It may be reviewed at http://www.fcc.gov/omd/privacyact/Privacy-Impact-Assessment.html.
Needs and Uses: Consumers may file complaints about loud
commercials using the Commission's online complaint form (specifically,
the Form 2000E). Consumers may also file their complaint by fax or by
letter. The information obtained by consumer complaints will be used by
Commission staff to evaluate and ensure that TV stations and MVPDs are
in compliance with the rules implementing the Commercial Advertisement
Loudness Mitigation (``CALM'') Act. FCC Form 2000E is the only form
that is contained in this collection that has proposed form revisions
to it. All of the other forms contained in this collection would remain
unchanged.
OMB Control Number: 3060-xxxx.
Title: Commercial Advertisement Loudness Mitigation (``CALM'') Act;
Financial Hardship and General Waiver Requests.
Form Number: Not applicable.
Type of Review: New collection.
Respondents: Business or other for-profit entities.
Number of Respondents and Responses: 4,500 respondents and 4,500
responses.
Frequency of Response: On occasion reporting requirement.
Estimated Time per Response: 20 hours.
Total Annual Burden: 90,000 hours.
Total Annual Cost to Respondents: $2,700,000.
Obligation to Respond: Required to obtain benefits. The statutory
authority for this collection of information is contained in 47 U.S.C
151, 152, 154(i) and (j), 303(r) and 621.
Nature and Extent of Confidentiality: There is no assurance of
confidentiality provided to respondents, but, in accordance with the
Commission's rules, 47 CFR 0.459, a station/MVPD may request
confidential treatment for financial information supplied with its
waiver request.
Privacy Impact Assessment: No impact(s).
Needs and Uses: TV stations and MVPDs may file financial hardship
waiver requests to seek a one-year waiver of the effective date of the
rules implementing the CALM Act or to request a one-year renewal of
such waiver. A TV station or MVPD must demonstrate in its waiver
request that it would be a ``financial hardship'' to obtain the
necessary equipment to comply with the rules. TV stations and MVPDs may
file general waiver requests to request waiver of the rules
implementing the CALM Act for good cause. The information obtained by
financial hardship and general waiver requests will be used by
Commission staff to evaluate whether grant of a waiver would be in the
public interest.
C. Ex Parte Rules
66. Permit-But-Disclose. This proceeding will be treated as a
``permit-but-disclose'' proceeding in accordance
[[Page 32132]]
with the Commission's ex parte rules.\186\ 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.\187\ More than a one- or
two-sentence description of the views and arguments presented is
generally required.\188\ Additional rules pertaining to oral and
written presentations in ``permit-but-disclose'' proceedings are set
forth in section 1.1206(b) of the rules.\189\
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\186\ See 47 CFR 1.1206 (rule for permit-but-disclose''
proceedings); see also id. 1.1200-1.1216.
\187\ See 1.1206(b)(2).
\188\ See id.
\189\ See id. 1.1206(b). See also Commission Emphasizes the
Public's Responsibilities in Permit-But-Disclose Proceedings, Public
Notice, 15 FCC Rcd 19945 (2000). We note that the Commission
recently amended the rules governing the content of ex parte
notices. See Amendment of the Commission's Ex Parte Rules and Other
Procedural Rules, Report and Order and Further Notice of Proposed
Rulemaking, GC Docket No. 10-43, FCC 11-11, paragraphs 35-36 (rel.
Feb. 2, 2011).
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D. Filing Requirements
67. Comments and Replies. Pursuant to Sections 1.415 and 1.419 of
the Commission's rules,\190\ 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.\191\
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\190\ See id. 1.415, 1419.
\191\ See Electronic Filing of Documents in Rulemaking
Proceedings, Report and Order, 63 FR 24121, May 1, 1998.
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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.
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. All filings must be addressed to the Commission's Secretary,
Office of the Secretary, Federal Communications Commission.
[cir] All hand-delivered or messenger-delivered paper filings for
the Commission's Secretary must be delivered to Room TW-A325 at FCC
Headquarters, 445 12th Street, SW., Washington, DC 20554. All hand
deliveries must be held together with rubber bands or fasteners. Any
envelopes must be disposed of before entering the building. The filing
hours are 8 a.m. to 7 p.m.
[cir] 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.
[cir] U.S. Postal Service first-class, Express, and Priority mail
must be addressed to FCC Headquarters, 445 12th Street, SW.,
Washington, DC 20554.
68. Availability of Documents. Comments, reply comments, and ex
parte submissions will be publically available online via ECFS.\192\
These documents will also be available for public inspection during
regular business hours in the FCC Reference Information Center, which
is located in Room CY-A257 at FCC Headquarters, 445 12th Street, SW.,
Washington, DC 20554. The Reference Information Center is open to the
public Monday through Thursday from 8 a.m. to 4:30 p.m. and Friday from
8 a.m. to 11:30 a.m.
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\192\ Documents will generally be available electronically in
ASCII, Microsoft Word, and/or Adobe Acrobat.
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69. 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
FCC's Consumer and Governmental Affairs Bureau at 202-418-0530 (voice),
202-418-0432 (tty).
70. Additional Information. For additional information on this
proceeding, contact Evan Baranoff, [email protected], of the Media
Bureau, Policy Division, (202) 418-2120 or Shabnam Javid,
[email protected], of the Engineering Division, Media Bureau at
(202) 418-7000.
VI. Ordering Clauses
71. Accordingly, it is ordered that pursuant to the Commercial
Advertisement Loudness Mitigation Act of 2010, Public Law 111-311, 124
Stat. 3294, and Sections 1, 2(a), 4(i), and 303(r) of the
Communications Act of 1934, as amended, 47 U.S.C. 151, 152, 154(i) and
(j), 303(r), and 621, notice is hereby given of the proposals and
tentative conclusions described in this Notice of Proposed Rulemaking.
72. It is further ordered that the Reference Information Center,
Consumer Information Bureau, shall send a copy of this Notice of
Proposed Rulemaking, including the Initial Regulatory Flexibility
Analysis, to the Chief Counsel for Advocacy of the Small Business
Administration.
List of Subjects in 47 CFR Parts 73 and 76
Cable television, Digital television, Incorporation by reference,
Satellite television, Television.
Federal Communications Commission.
Avis Mitchell,
Federal Register Liaison.
For the reasons discussed in the preamble, the Federal
Communications Commission proposes to amend 47 CFR parts 73 and 76 as
follows:
PART 73--RADIO BROADCAST SERVICES
1. The authority citation for part 73 continues to read as follows:
Authority: 47 U.S.C. 154, 303, 334 and 336.
2. Section 73.682 is amended by adding paragraph (e) to read as
follows:
Sec. 73.682 TV transmission standards.
* * * * *
(e)(1) Transmission of commercial advertisements by television
broadcast station. Effective [one year after date of FCC adoption],
television broadcast stations must comply with the ATSC A/85: ``ATSC
Recommended Practice: Techniques for Establishing and Maintaining Audio
Loudness for Digital Television,'' (May 25, 2011) (``ATSC A/85 RP''),
and any successor thereto, approved by the ATSC (incorporated by
reference, see Sec. 73.8000), insofar as it concerns the transmission
of commercial advertisements. ATSC A/85 RP is available from Advanced
Television Systems Committee (ATSC), 1750 K Street, NW., Suite 1200,
Washington, DC 20006, or at the ATSC Web site: http://www.atsc.org/standards.html.
(2) A television broadcast station that installs, utilizes, and
maintains in a commercially reasonable manner the equipment and
associated software to comply with ATSC A/85 shall be deemed in
compliance with this section.
3. Section 73.8000 is amended by adding paragraph (b)(5) to read as
follows:
[[Page 32133]]
Sec. 73.8000 Incorporation by reference.
* * * * *
(b) * * *
(5) ATSC A/85: ``ATSC Recommended Practice: Techniques for
Establishing and Maintaining Audio Loudness for Digital Television''
(May 25, 2011), IBR approved for Sec. 73.682.
* * * * *
PART 76--MULTICHANNEL VIDEO AND CABLE TELEVISION SERVICE
4. The authority citation for part 76 continues to read as follows:
Authority: 47 U.S.C. 151, 152, 153, 154, 301, 302, 302a, 303,
303a, 307, 308, 309, 312, 315, 317, 325, 339, 340, 341, 503, 521,
522, 531, 532, 534, 535, 536, 537, 543, 544, 544a, 545, 548, 549,
552, 554, 556, 558, 560, 561, 571, 572, 573.
5. Section 76.607 is added to read as follows:
Sec. 76.607 Transmission of commercial advertisements.
(a) Effective [one year after date of FCC adoption], cable
operators and other multichannel video programming distributors must
comply with the ATSC A/85: ``ATSC Recommended Practice: Techniques for
Establishing and Maintaining Audio Loudness for Digital Television''
(May 25, 2011) (``ATSC A/85 RP''), and any successor thereto, approved
by the ATSC (incorporated by reference, see Sec. 76.602), insofar as
it concerns the transmission of commercial advertisements. ATSC A/85 RP
is available from Advanced Television Systems Committee (ATSC), 1750 K
Street, NW., Suite 1200, Washington, DC 20006, or at the ATSC Web site:
http://www.atsc.org/standards.html.
(b) A cable operator or other multichannel video programming
distributor that installs, utilizes, and maintains in a commercially
reasonable manner the equipment and associated software to comply with
ATSC A/85 shall be deemed in compliance with this section.
6. Section 76.602 is amended by adding paragraph (b)(10) to read as
follows:
Sec. 76.602 Incorporation by reference.
* * * * *
(b) * * *
(10) ATSC A/85: ``ATSC Recommended Practice: Techniques for
Establishing and Maintaining Audio Loudness for Digital Television''
(May 25, 2011), IBR approved for Sec. 76.602.
Note: The following Appendix will not be included in the Code
of Federal Regulations.
Appendix: List of Participants in Informal Meetings
ABC
American Cable Association (``ACA'')
AT&T
Advanced Television Systems Committee, Inc. (``ATSC'')
CBS
Consumer Electronics Association (``CEA'')
Consumers Union (``CU'')
DIRECTV, Inc. (``DIRECTV'')
DISH Network L.L.C. (``DISH'')
Dolby Laboratories, Inc. (``Dolby'')
FOX
Free press
Massillon Cable TV
Association for Maximum Service Television, Inc. (``MSTV'')
National Association of Broadcasters (``NAB'')
National Cable & Telecommunications Association (``NCTA'')
NBC Universal
Public Broadcasting Service (``PBS'')
Verizon
Wide Open West
[FR Doc. 2011-13822 Filed 6-2-11; 8:45 am]
BILLING CODE 6712-01-P