[Federal Register Volume 87, Number 129 (Thursday, July 7, 2022)]
[Proposed Rules]
[Pages 40464-40476]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-14470]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Parts 73 and 74
[GN Docket No. 16-142; FCC 22-47; FR ID 93764]
Authorizing Permissive Use of the ``Next Generation'' Broadcast
Television Standard
AGENCY: Federal Communications Commission.
ACTION: Proposed rule.
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SUMMARY: In this document, the Commission seeks comment on the state
[[Page 40465]]
of the Next Generation Television (``Next Gen TV'' or ``ATSC 3.0'')
transition and on the scheduled sunsets of two rules adopted in the
First Next Gen TV Report and Order. First, the Commission reviews and
seeks comment on the progress of Next Gen TV broadcasters' voluntary,
market-driven deployment of ATSC 3.0 service and the current state of
the ATSC 3.0 marketplace, including whether holders of essential
patents for the ATSC 3.0 standards are licensing such patents on
reasonable and non-discriminatory (RAND) terms. Second, the Commission
seeks comment on the scheduled 2023 sunset of the rule requiring that a
Next Gen TV station's ATSC 1.0 simulcast primary video programming
stream be ``substantially similar'' to its 3.0 primary programming
stream. Third, the Commission seeks comment on the scheduled 2023
sunset of the requirement that a Next Gen TV station comply with the
ATSC A/322 standard.
DATES: Comments are due on or before August 8, 2022; reply comments are
due on or before September 6, 2022.
ADDRESSES: You may submit comments, identified by GN Docket No. 16-142,
by any of the following methods:
Electronic Filers: Comments may be filed electronically
using the internet by accessing the ECFS: http://apps.fcc.gov/ecfs/.
Paper Filers: Parties who choose to file by paper must
file an original and one copy of each filing.
Filings can be sent 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.
Commercial overnight mail (other than U.S. Postal Service
Express Mail and Priority Mail) must be sent to 9050 Junction Drive,
Annapolis Junction, MD 20701.
U.S. Postal Service first-class, Express, and Priority
mail must be addressed to 45 L Street NE, Washington, DC 20554.
Effective March 19, 2020, and until further notice, the
Commission no longer accepts any hand or messenger delivered filings.
This is a temporary measure taken to help protect the health and safety
of individuals, and to mitigate the transmission of COVID-19.\1\
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\1\ FCC Announces Closure of FCC Headquarters Open Window and
Change in Hand-Delivery Policy, Public Notice, 35 FCC Rcd 2788 (OMD
2020). See https://www.fcc.gov/document/fcc-closes-headquarters-open-window-and-changes-hand-delivery-policy.
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During the time the Commission's building is closed to the
general public and until further notice, if more than one docket or
rulemaking number appears in the caption of a proceeding, paper filers
need not submit two additional copies for each additional docket or
rulemaking number; an original and one copy are sufficient.
People with Disabilities. To request materials in accessible
formats for people with disabilities (braille, large print, electronic
files, audio format), send an email to [email protected] or call the
Consumer & Governmental Affairs Bureau at 202-418-0530 (voice), 202-
418-0432 (TTY).
FOR FURTHER INFORMATION CONTACT: For additional information on this
proceeding, contact Evan Baranoff, [email protected], of the Media
Bureau, Policy Division, (202) 418-2120. Direct press inquiries to
Janice Wise at (202) 418-8165.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Third
Further Notice of Proposed Rulemaking (FNPRM), FCC 22-47, adopted on
June 21, 2022 and released on June 22, 2022. The full text of this
document is available electronically via the FCC's Electronic Document
Management System (EDOCS) website at https://www.fcc.gov/edocs or via
the FCC's Electronic Comment Filing System (ECFS) website at https://www.fcc.gov/ecfs. (Documents will be available electronically in ASCII,
Microsoft Word, and/or Adobe Acrobat.) Alternative formats are
available for people with disabilities (Braille, large print,
electronic files, audio format), by sending an email to [email protected]
or calling the Commission's Consumer and Governmental Affairs Bureau at
(202) 418-0530 (voice), (202) 418-0432 (TTY).
Synopsis
I. Introduction
1. In this Third Further Notice of Proposed Rulemaking (FNPRM), we
seek comment on the state of the Next Generation Television (``Next Gen
TV'' or ``ATSC 3.0'') transition and on the scheduled sunsets of two
rules adopted in the First Next Gen TV Report and Order, 83 FR 4998. As
part of our assessment, we review and seek comment on the progress of
Next Gen TV broadcasters' voluntary, market-driven deployment of ATSC
3.0 service and the current state of the ATSC 3.0 marketplace,
including whether holders of essential patents for the ATSC 3.0
standards are licensing such patents on reasonable and non-
discriminatory (RAND) terms. Next, we seek comment on the scheduled
2023 sunset of the rule requiring that a Next Gen TV station's ATSC 1.0
simulcast primary video programming stream be ``substantially similar''
to its 3.0 primary programming stream. Finally, we seek comment on the
scheduled 2023 sunset of the requirement that a Next Gen TV station
comply with the ATSC A/322 standard.
II. Background
2. Next Gen TV is the newest broadcast TV transmission standard,
developed by the Advanced Television Systems Committee (ATSC), which
promises to enable broadcasters to deliver an array of new video and
non-video services and enhanced content features to consumers. Also
called ``ATSC 3.0'' or ``3.0'', this new standard merges the
capabilities of over-the-air (OTA) broadcasting with the broadband
viewing and information delivery methods of the internet, using the
same 6 MHz channels presently allocated for DTV service. As 3.0
proponents have previously explained to the Commission, the greater
spectral capacity of the new standard and its internet-Protocol (IP)
delivery component will allow broadcasters to provide consumers with a
higher quality television viewing experience, such as ultra-high-
definition (UHD) picture resolutions and immersive audio. It also has
the potential to enable broadcasters to reach viewers on both home and
mobile screens. In addition, ATSC 3.0 will allow broadcasters to offer
enhanced public safety capabilities, such as geo-targeting of emergency
alerts to tailor information to particular communities and emergency
alerting capable of waking up sleeping devices to warn consumers of
imminent emergencies, as well as greater accessibility options,
localized content, and interactive educational children's content. And
as an IP-based standard, ATSC 3.0 could enable advanced one-way
datacasting services to help support the proliferation of new, IP-based
consumer applications.
3. In November 2017, the Commission authorized television
broadcasters to use the Next Gen TV transmission standard on a
voluntary, market-driven basis.\2\ The Commission required that
broadcasters voluntarily deploying ATSC 3.0 service must, with very
limited exceptions, continue to air at least their primary stream using
the current-generation digital television
[[Page 40466]]
(DTV) transmission standard,\3\ also called ``ATSC 1.0'' or ``1.0,'' to
their viewers through ``local simulcasting'' arrangements with other
stations in their local market.\4\
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\2\ In June 2020, the Commission adopted a Second Report and
Order and Order on Reconsideration, resolving the remaining issues
raised in the Next Gen TV Further Notice, as well as dismissing (or
alternatively denying) the two petitions for reconsideration filed
in response to the First Next Gen TV Report and Order.
\3\ LPTV and TV translator stations may deploy ATSC 3.0 service
without providing an ATSC 1.0 simulcast signal. In addition, full
power and Class A stations may request a waiver of the simulcast
requirements.
\4\ Under the Commission's rules, a Next Gen TV station is
encouraged, but not required, to simulcast its existing non-primary
video programming streams (multicast streams) in a 1.0 format. In
November 2021, the Commission initiated a proceeding to allow Next
Gen TV stations to include within their license certain of their
multicast streams that are aired in a different service on ``host''
stations during a transitional period, using the same licensing
framework, and to a large extent the same regulatory regime,
established for the simulcast of primary video programming streams
on ``host'' station facilities.
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4. The Commission found that a local simulcasting requirement is
crucial to deploying Next Gen TV service in order to minimize viewer
disruption. The Next Gen TV standard is not backward-compatible with
pre-existing TV sets or receivers, which have only ATSC 1.0 and, in
many cases, now-obsolete analog tuners.\5\ Accordingly, viewers will be
unable to watch ATSC 3.0 transmissions on such televisions without
additional equipment. Thus, it is critical that Next Gen TV
broadcasters continue to provide service using the current ATSC 1.0
standard while the marketplace creates and disseminates devices
compatible with the new 3.0 transmission standard, in order to avoid
forcing viewers to acquire expensive new equipment immediately or
depriving them of their local television service during the transition.
Because a TV station cannot, as a technical matter, simultaneously
broadcast in both 1.0 and 3.0 format from the same facility on the same
physical channel, local simulcasting must be effectuated through
voluntary partnerships between local market broadcasters that seek to
provide Next Gen TV service.\6\ The Commission established certain
requirements in the First Next Gen TV Report and Order for the
provision of simulcast signals to ensure that local simulcasting is
effective in protecting viewers. (By the time the transition is
complete, any temporary authority granted for local simulcasting will
expire, and a station will once again be required to air all of its
licensed programming on its own single channel.)
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\5\ As of August 31, 2017, new television receivers may, but are
no longer required to, contain analog tuners.
\6\ A Next Gen TV station must partner with another television
station (``host'') in its local market to either: (1) air an ATSC
3.0 channel at the host's facility, while using its original
facility to continue to provide an ATSC 1.0 simulcast channel, or
(2) air an ATSC 1.0 simulcast channel at the host's facility, while
converting its original facility to the ATSC 3.0 standard in order
to provide a 3.0 channel. In either case, a Next Gen TV broadcaster
must simulcast the primary video programming stream of its ATSC 3.0
channel in an ATSC 1.0 format, so that viewers will continue to
receive ATSC 1.0 service.
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5. The Commission also required that Next Gen TV broadcasters
comply with all of its broadcast rules, including, but not limited to,
our rules regarding foreign ownership, political broadcasting,
children's programming, equal employment opportunities, public
inspection file, indecency, sponsorship identification, contests, the
CALM Act, the Emergency Alert System (EAS), and accessibility for
people with disabilities. The Commission emphasized that broadcasters,
equipment manufacturers, and MVPDs must comply with the Commission's
Part 79 captioning rules including closed captioning decoder
requirements, video description and emergency information accessibility
requirements, and requirements for user interfaces, programming guides,
and menus.
6. ``Substantially Similar'' Rule. In the 2017 First Next Gen TV
Report and Order, the Commission adopted a requirement that the
programming aired on a Next Gen TV station's ATSC 1.0 simulcast channel
be ``substantially similar'' to that of the primary video programming
stream on the ATSC 3.0 channel.\7\ This means that the programming must
be the same, except for programming features that are based on the
enhanced capabilities of ATSC 3.0 and promotions for upcoming
programs.\8\ In adopting this approach, the Commission found it ``will
help ensure that viewers do not lose access to the broadcast
programming they receive today, while still providing flexibility for
broadcasters to innovate and experiment with new, innovative
programming features using Next Gen TV technology.'' The Commission
decided, however, that the substantially similar requirement would
expire on July 17, 2023, unless the Commission takes action to extend
it.\9\ In this regard, the Commission concluded that, while ``this
[substantially similar] requirement is necessary in the early stages of
ATSC 3.0 deployment, it could unnecessarily impede Next Gen TV
programming innovations as the deployment of ATSC 3.0 progresses.'' The
Commission further stated that it ``intend[ed] to monitor the ATSC 3.0
marketplace,'' and would ``extend the substantially similar requirement
if necessary.'' The substantially similar rule took effect on July 17,
2018, and is set to expire on July 17, 2023, unless extended by the
Commission.\10\ The Commission affirmed this decision in 2020, but
stated that, approximately one year before the requirement is set to
expire, it would seek comment on whether the rule should be extended
based on marketplace conditions at that time.
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\7\ We refer to this as the substantially similar rule. The
substantially similar rule is independent of the requirement for
Next Gen TV broadcasters to simulcast in 1.0 format.
\8\ Such enhanced content or features that cannot reasonably be
provided in ATSC 1.0 format include: targeted advertisements,
``hyper-localized'' content (e.g., geo-targeted weather, targeted
emergency alerts, and hyper-local news), programming features or
improvements created for the 3.0 service (e.g., emergency alert
``wake up'' ability and interactive programming features), enhanced
formats made possible by 3.0 technology (e.g., 4K or HDR), and any
personalization of programming performed by the viewer and at the
viewer's discretion.
\9\ We emphasize that the underlying requirement that a Next Gen
TV station must simulcast in 1.0 format does not have a sunset date.
In addition, none of the other aspects of the local simulcasting
rules are set to expire, including those governing: simulcast
arrangements and agreements; designated market area (DMA), and
community of license coverage; and multichannel video programming
distributor (MVPD) notices and consumer education.
\10\ The local simulcasting rules took effect on July 17, 2018.
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7. Requirement to comply with the ATSC A/322 standard. In
authorizing use of the Next Gen TV broadcast transmission standard, the
Commission in the First Next Gen TV Report and Order required
compliance with only two parts of the ATSC 3.0 suite of standards: (1)
ATSC A/321:2016 ``System Discovery & Signaling'' (A/321), which is the
standard used to communicate the RF signal type that the ATSC 3.0
signal will use; and (2) A/322:2016 ``Physical Layer Protocol'' (A/
322), which is the standard that defines the waveforms that ATSC 3.0
signals may take.\11\ In requiring compliance with A/322, the
Commission observed that ``device manufacturers and MVPDs may not be
able to reliably predict what signal modulation a broadcaster is using
unless broadcasters are required to follow A/322,'' at least with
respect to their required primary programming stream. The Commission
explained that ``[t]his uncertainty could cause manufacturers to
inadvertently build equipment that cannot receive Next Gen TV
broadcasts or could render MVPDs unable to receive and retransmit the
signals of Next Gen TV stations. These outcomes would harm consumers.''
The Commission, however, decided that it was not appropriate at the
time ``to require broadcasters to adhere to A/322
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indefinitely,'' explaining that ``the ATSC 3.0 standard could evolve,
and stagnant Commission rules could prevent broadcasters from taking
advantage of that evolution.'' The Commission thus determined that the
requirement to comply with the A/322 standard would expire on March 6,
2023, absent Commission action to extend it. In establishing a sunset
for A/322 compliance, the Commission sought to ``balance [its] goals of
protecting consumers while promoting innovation.'' The Commission
affirmed this decision in 2020, but stated that, approximately one year
before the requirement is set to expire, it would seek comment on
whether the rule should be extended based on marketplace conditions at
that time.
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\11\ These two standards were incorporated by reference into the
Commission's rules. The Commission applied the A/322 standard only
to a Next Gen TV station's primary, free, OTA video programming
stream.
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8. Patent Licensing. In the First Next Gen TV Report and Order, the
Commission observed that the ATSC, which developed the ATSC 3.0
standard, requires patent owners to disclose that they hold relevant
patents and to commit to licensing them on reasonable and non-
discriminatory (RAND) terms. Courts have found that a patentee's
agreement with a standard-setting organization to provide RAND
licensing created a contract enforceable by a third-party beneficiary.
The Commission decided in 2017 that ``[w]ith no evidence of patent
licensing issues, . . . it [was] premature to impose regulations on the
private licensing marketplace.'' We note that in the context of the
original DTV transition, the Commission similarly stated its
expectation that the licensing of patents in DTV technology would be on
RAND terms. The Commission also emphasized that if a problem with
patent licensing arose and was brought to the Commission's attention,
it would ``consider it and take appropriate action.'' Ultimately,
however, the Commission never adopted any specific licensing terms or
otherwise took action on these issues in the context of the DTV
transition. In the case of ATSC 3.0 the Commission stated that it would
``monitor how the marketplace handles patent royalties for essential
patents.'' \12\
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\12\ The Commission affirmed this decision in the Second Next
Gen TV Report and Order, 85 FR 43478.
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III. Discussion
9. As an initial matter, we seek comment on the state of the ATSC
3.0 marketplace, including specifically information and data on
broadcasters' present deployment of ATSC 3.0 service; current
availability and pricing of ATSC 3.0 consumer television equipment; the
number of over-the-air (OTA) television viewers currently watching ATSC
3.0 broadcasts; whether any MVPDs are currently carrying or have plans
to carry 3.0 signals; and how the 3.0 marketplace is handling patent
royalties for essential patents in ATSC 3.0 technology. Next, we seek
comment on whether we should retain the substantially similar
requirement, which is set to expire in July 2023. Finally, we seek
comment on whether we should retain the requirement that Next Gen TV
broadcasters' primary video programming stream must comply with the
ATSC A/322 standard, which is set to expire in March 2023, and, if so,
for how long.
A. Review of ATSC 3.0 Marketplace
10. First, we seek comment regarding the ATSC 3.0 marketplace. It
has been more than four years since the Commission authorized Next Gen
TV broadcasters to provide OTA broadcast ATSC 3.0 service on a
voluntary, market-driven basis.\13\ During this time, dozens of
broadcasters have voluntarily deployed ATSC 3.0 service to test its
technical and economic viability as a DTV broadcast service. In the
First Next Gen TV Report and Order, the Commission stated that it would
``monitor the pace of the voluntary deployment of ATSC 3.0 both
nationally and market-by-market, including the rollout of 3.0 service
by television broadcasters, the penetration of ATSC 3.0-ready TV sets
and other converter equipment, and the extent to which MVPDs have
deployed 3.0 equipment.'' The Commission also stated that it would
``monitor how the marketplace handles patent royalties for essential
patents.'' Accordingly, we seek specific comment on five aspects of the
deployment: (1) voluntary deployment of ATSC 3.0 service by
broadcasters and the continued availability of ATSC 1.0 programming;
(2) availability of ATSC 3.0 consumer TV sets and equipment; (3)
consumer viewership of ATSC 3.0 signals; (4) MVPD carriage of ATSC 3.0
signals; and (5) status of ATSC 3.0 patent licensing.
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\13\ The Media Bureau completed revisions to the FCC Form 2100
and began accepting ATSC 3.0 license applications through the
Commission's Licensing and Management System (LMS) on May 28, 2019.
Prior to this date, the Bureau continued to process requests to
commence ATSC 3.0 market trials and product development under the
experimental licensing rules.
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11. As part of this review, we seek comment on whether broadcasters
still consider ATSC 3.0 to be a trial technology and the extent to
which broadcasters intend to fully transition to 3.0 at some point. Is
the expectation still a uniform transition by all broadcasters at some
future point? The Commission intended for broadcasters to operate in
both 1.0 and 3.0 only for a ``temporary'' period of time. We seek
comment on the appropriate length of time broadcasters should be
required or allowed to operate in both 1.0 and 3.0. What is the impact
on OTA viewers and MVPDs of not having a date certain 3.0 transition
deadline? For example, without a certain transition date, are viewers
and MVPDs able to prepare for their own transitions? We also seek
comment on the ways in which broadcasters are educating consumers about
the continued progress of the transition.
1. Broadcaster Deployment of ATSC 3.0 Service
12. We seek comment and data on broadcasters' current and future
deployment of ATSC 3.0 service. According to our licensing records, as
of June 21, 2022, the Commission has licensed 306 broadcast television
stations to provide ATSC 3.0 service. Based on our records, ATSC 3.0
stations have been licensed to operate in 68 markets, though in some
cases it may be a single low power television station. Furthermore,
most markets with 3.0 deployments have a single 3.0 ``lighthouse''
facility licensed to provide ATSC 3.0 service. According to S&P Global,
Next Gen TV now reaches nearly 66.3 million unique households, or about
51.1% of total U.S. households. Given current deployments, is this an
accurate estimate of the percentage of the U.S. population that could
have access to at least one ATSC 3.0 broadcast signal if they had 3.0
TV equipment? We seek comment on these data points, as well as
additional data. In how many DMAs has ATSC 3.0 service actually been
launched, and what percentage of viewers could receive ATSC 3.0
programming if they had 3.0 equipment? In how many markets are
broadcasters providing access to all of the ``Big-4'' networks (NBC,
CBS, ABC, FOX) and what percentage of 3.0 viewers have access to such
programming? In how many markets are broadcasters providing access to
all of the ``Big-4'' networks and PBS programming and what percentage
of 3.0 viewers can receive such programming? What other programming
networks are available in 3.0 and in which markets? What other data
should the Commission be tracking in order to monitor the state of the
ATSC 3.0 transition, and how should it collect such information? Are
existing Commission databases sufficient to track such information?
13. We seek further information on the ATSC 3.0 broadcast rollout.
Just
[[Page 40468]]
prior to the pandemic, the broadcast industry expected that ATSC 3.0
service would be available in 61 markets by the end of 2020. To date,
however, full-power broadcasters are licensed to provide ATSC 3.0
service in only 54 markets. How, and to what extent, has the pandemic
impacted overall ATSC 3.0 deployment? Early in the pandemic, some
expected that the delays would not be significant. Given the length of
the pandemic and its impact on supply chains, have those early
estimates held? Have the related supply-chain disruptions had an impact
on broadcasters' ability to secure necessary equipment? What other
challenges have Next Gen TV broadcasters faced?\14\ What future
challenges do they anticipate, if any? Has ATSC 3.0 met broadcasters',
and the Commission's original expectations from a technical
perspective? (For example, has ATSC 3.0 service met the Commission's
original expectations of technical performance outlined in the First
Next Gen TV Report and Order?) What have broadcasters learned so far in
terms of the economic viability of ATSC 3.0 service, and how are they
evaluating viability? What else have broadcasters learned from over
four years of real-world experience with ATSC 3.0?
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\14\ We note that the Commission recently issued an FNPRM in
response to broadcasters' concerns about airing multicast streams on
host stations.
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14. What are broadcasters' plans for future voluntary ATSC 3.0
deployment? For example, by what date do broadcasters expect that there
will be some ATSC 3.0 service in all 210 markets, and when do they
expect to be ready to transition entire markets to ATSC 3.0? To what
extent are enhanced datacasting capabilities expected to help promote
the transition to ATSC 3.0 and what, if any, services are already being
offered? We also specifically seek comment from any broadcasters that
do not currently have plans to voluntarily deploy ATSC 3.0 service. Do
they have plans to transition at a later date? Why have they decided
not to undertake ATSC 3.0 service, and what factors are most important
to these stations as they plan for future services (be it in 1.0 or
3.0)?
15. Continuing Availability of Programming to Existing Viewers. We
seek comment on the effectiveness of local simulcasting in ensuring
continuity of OTA television service. Has local simulcasting worked as
expected? To what extent, if any, have consumers experienced disruption
or confusion as a result of the transition and simulcasting
arrangements? Have any OTA viewers complained about problems related to
1.0 simulcast service such as loss of access to service or quality of a
station's signal? Have any viewers purchased 3.0 TV equipment because
they stopped receiving a 1.0 simulcast signal? Are Next Gen TV
stations' 1.0 simulcasts aired in HD format? Have any Next Gen TV
stations that were previously broadcasting 1.0 service in HD changed to
an SD format for their 1.0 simulcast service upon or after the
deployment of 3.0 service? If so, why? To what extent and in what ways
has the programming on Next Gen TV stations' 3.0 primary stream
differed from that on their 1.0 primary stream?
16. 3.0 Enhanced Content and Features. We seek comment on what
types of enhanced content and features are currently being broadcast to
3.0 viewers (both with and without internet service). The record
established in the 2017 First Next Gen TV Report and Order reflected
ATSC 3.0's potential to allow for ``a wide range of potential services
now and in the future.'' ATSC 3.0 proponents said that ATSC 3.0 will
enable delivery of Ultra High Definition (UHD) television, including
images with high spatial resolution, wide color gamut, high dynamic
range and high frame rate as well as advanced audio systems to provide
consumers with more vivid pictures and sound. In addition, ATSC 3.0
proponents said the new standard would ```allow broadcasters to offer
exciting and innovative services,' including superior reception, mobile
viewing capabilities, enhanced public safety capabilities, such as
advanced emergency alerting capable of waking up sleeping devices to
warn consumers of imminent emergencies, enhanced accessibility
features, localized and/or personalized content, interactive
educational children's content, and other enhanced features.'' To what
extent are any of these enhanced content or features, such as enhanced
accessibility features, currently being offered to viewers? If they are
not currently available, when can viewers expect them to become
available? What types of specific enhanced content and features are
currently being provided? What types of enhanced content and features
are expected to be launched in the near future, and what is the timing
for such offerings? What offerings can be accessed by viewers who do
not have wired or wireless broadband internet access?
17. We seek comment in particular on the types of viewer data that
broadcasters deploying ATSC 3.0 may collect and on the expected uses of
such data. Will all 3.0 viewers be potentially subject to ATSC 3.0-
enabled viewer data collection, or does that capability apply only to
those 3.0 viewers whose television receivers have an internet
connection? What efforts are broadcasters taking to inform 3.0 viewers
about the data that is being collected? Will 3.0 viewers have the
ability to opt out of undesired 3.0 features, such as data collection
and targeted advertising? Would limitations or regulations on the
collection of user data by ATSC 3.0 broadcasters be in the public
interest? Commenters should identify the authority on which the
Commission might rely to impose such limitations or regulations.
2. Availability of ATSC 3.0 Consumer TV Equipment
18. We seek comment on the current availability and pricing of TV
sets with ATSC 3.0 tuners and other ATSC 3.0 consumer TV equipment
(e.g., gateway devices, set-top boxes, and 3.0 to 1.0 converter devices
such as dongles). According to recent press reports, the industry
believes there is still ``a lot of work to be done'' to get 3.0
equipment on the shelves and into the hands of consumers. This is
unsurprising, since no television purchased before 2020 is capable of
tuning ATSC 3.0 programming, and the first mass produced consumer
converter device was not available until 2021. Even in 2022, analyst
forecasts of TV sales suggest that only 11% of new televisions sold
will have ATSC 3.0 tuners. We understand that about 70 models of TV
sets with ATSC 3.0 tuners are now available from three manufacturers--
LG Electronics, Samsung, and Sony. Press reports suggest that the least
expensive 3.0-compatible set is a mid-size TV that is consistently
listed for more than $400. A fourth manufacturer, Hisense, recently
announced that it will be releasing three 3.0-compatible sets this
year, with the least expensive retailing for approximately $800. How
many 3.0 TV sets have been sold in the U.S. to date? How does the
pricing of currently available 3.0 TV sets compare to the overall
market? To what extent are 3.0 tuners available, or expected to be
available, in the lowest-cost models of TV sets? What other companies
are manufacturing or are planning to manufacture 3.0 TV sets and other
3.0 TV equipment? What challenges or impediments exist, if any, for
manufacturers seeking to develop and manufacture 3.0 TV sets and other
3.0 TV equipment? To what extent, if any, is patent licensing
inhibiting the development of 3.0 TV sets or other 3.0 equipment by
non-patent holders?
[[Page 40469]]
19. We seek specific comment on the availability of low-cost
consumer 3.0 to 1.0 set-top boxes or other converter devices, such as
external tuners or dongles, that can make a legacy 1.0 TV set capable
of receiving 3.0 signals. How many 3.0 converter devices have been sold
in the U.S. to date? Where are such devices available for sale? Do all
currently available converter devices require an internet connection,
and if so are there plans to create devices that do not require
internet access? What manufacturers are developing or have plans to
develop ATSC 3.0 converter devices, particularly low-cost devices, and
where will such devices be sold? When might such devices become
available and at what prices? We believe the availability of low-cost
3.0 converter devices will be critical for consumers who are not ready
to replace their 1.0 TV sets. What is the price range that should be
considered ``low-cost,'' and what is that range based on? The cheapest
3.0 gateway device currently available for purchase, of which we are
aware, is the ``HDHomeRun 4K'' device that can be purchased over the
internet and retails for $199. We are not aware of any low-cost set-top
boxes or converters (e.g., external tuners or dongles), or any
converter devices that can be purchased offline in a ``brick and
mortar'' location. What (if anything) can the Commission do to foster
the development of such low-cost 3.0 converter devices? Do broadcasters
have any plans to distribute or subsidize such devices as a means of
facilitating the deployment of ATSC 3.0?
3. OTA TV Viewers Watching 3.0 Broadcasts
20. We seek comment and data on how many OTA TV viewers are
currently watching 3.0 broadcasts. Are there any current sources for
this information? Are any companies able or planning to track this data
as the transition progresses? If so, how? How many OTA TV households
have a TV set with (or attached to) a 3.0 tuner? Is the number of 3.0
TV sets or other 3.0 TV equipment sold with ATSC 3.0 tuners a good
indicator of consumer viewing trends for ATSC 3.0 service? Is there
evidence that consumers are currently using the ATSC 3.0 tuner featured
in these sets? Are OTA TV viewers and other consumers aware of the
broadcasters' voluntary transition to 3.0 and how it may affect them
now and in the future?
21. We seek comment on how broadcasters are educating OTA TV
viewers and other consumers about the broadcasters' voluntary
transition to 3.0 and how it may affect them now and in the future. How
effective have the required on-air notices been in informing OTA
viewers about the 3.0 transition? Following the transitions of
individual stations, have broadcasters received any complaints or
questions? What (if any) additional, voluntary education efforts are
currently being employed by broadcasters, manufacturers and/or
retailers? Other than the ``NEXTGEN TV'' branding noted above, are
manufacturers and retailers providing information about the 3.0
transition to consumers before they buy new TV equipment?
4. MVPD Carriage of 3.0 Signals
22. We seek comment and data on whether any MVPDs are currently
carrying or have plans to carry 3.0 signals. We note that MVPDs are not
required to carry 3.0 signals but may do so voluntarily if they obtain
retransmission consent from the Next Gen TV broadcast station. We seek
comment about the technical challenges, if any, that MVPDs face in
carrying 3.0 signals. Is there equipment available that will allow
MVPDs to receive 3.0 signals and redistribute them to their
subscribers? We seek comment on the coordination efforts between Next
Gen TV broadcasters and MVPDs to resolve any existing technical issues,
including the status of any relevant ATSC 3.0 working groups.\15\ We
observe that ATSC has issued a recommended practice, ATSC A/370:
``Conversion of ATSC 3.0 Services for Redistribution.'' Does this
document resolve the question of how MVPDs can receive 3.0 broadcast
signals and convert them to 1.0 or some other format for redistribution
to their subscribers? Is ATSC still working on the issue of how
broadcasters can deliver 3.0 services to MVPDs for direct
redistribution? Which enhanced features available to OTA 3.0 viewers do
MVPDs expect to be able to pass through to their subscribers now or in
the future? We also seek comment on any other issues related to MVPDs'
ability to carry and transmit ATSC 3.0 signals.
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\15\ In the 2017 First Next Gen TV Report and Order, the
Commission observed that an ATSC working group called TG3/S37, the
``Specialist Group on Conversion and Redistribution of ATSC 3.0
Service,'' was still working to resolve technical issues in this
regard. What is the status of this working group and the resolution
of these issues?
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5. RAND Licensing of 3.0 Patents
23. We seek comment on how the 3.0 marketplace is handling patent
royalties for essential patents in ATSC 3.0 technology. As noted above,
ATSC requires patentees to make essential patents available on RAND
terms. Are holders of essential patents in ATSC 3.0 technologies
licensing such patents on RAND terms? How have the available licensing
terms impacted current and potential participants in the 3.0
marketplace, the deployment of 3.0 services, and the availability of
consumer devices? The Commission previously found that it would be
premature to impose regulations on 3.0 patent licensing in the absence
of any issues. Have there been any developments that would warrant such
Commission action at this time and how should the Commission continue
to monitor this issue in the future? If so, what precisely should such
a rule require and upon what authority would the rule be based? What
are the advantages, disadvantages, and legal limitations of such a
requirement? Finally, we observe that a ``ATSC 3.0 Patent Portfolio
License'' is being offered by MPEG LA, LLC. We seek more information
and comment about this portfolio license. Is this portfolio license
being made available on RAND terms? What essential patents, if any, are
not included in this portfolio license?
B. Substantially Similar Rule
24. We seek comment on whether we should retain the substantially
similar rule or permit it to sunset in 2023.\16\ As the Commission
stated when adopting the requirement, the purpose of the rule, in
conjunction with the underlying requirement to simulcast in 1.0, is to
protect 1.0 viewers from losing access to a Next Gen TV station's
programming when that station transitions its facility to 3.0. While
the underlying requirement that a Next Gen TV broadcaster must air a
1.0 signal (when deploying 3.0) ensures 1.0 viewers continue to receive
some free OTA TV service during the transition, the substantially
similar rule ensures that 1.0 viewers actually receive the same primary
video programming as that aired on the 3.0 channel. As the Commission
explained in the 2017 First Next Gen TV Report and Order, ``[t]o ensure
that viewers are protected, it is important not only to require that
television broadcasters continue to broadcast in the current ATSC 1.0
standard while ATSC 3.0 is being deployed, but also that they continue
to air in ATSC 1.0 format the programming that viewers most want and
expect to receive. We seek to ensure that
[[Page 40470]]
broadcasters air their most popular, widely-viewed programming on their
1.0 simulcast channels so that viewers are not forced to purchase 3.0
capable equipment simply to continue to receive this programming rather
than because they find the ATSC 3.0 technology particularly
attractive.''
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\16\ We note that, even without an expiration date, the
substantially similar rule, which is tied to the underlying
requirement to simulcast in 1.0, is intended to be temporary and
would in any event be eliminated when the transition to 3.0 is
complete.
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25. To what extent would allowing the sunset of the substantially
similar rule undermine the 1.0 simulcast rule? For example, without the
substantially similar rule, how can the Commission ensure that 1.0
viewers are able to keep watching the same programming they watch
today, as well as any new programming offerings on a broadcaster's
primary channel that can be offered in 1.0 format? The voluntary
transition to 3.0 is intended to ``minimize[e] the impact on, and costs
to, consumers and other industry stakeholders.'' Yet many consumers may
not want or be financially able to purchase new TV equipment with 3.0
tuners in the current market. Would eliminating the rule make the
underlying requirement to simulcast in 1.0 less effective or
ineffective? In the absence of the substantially similar rule, how
would the Commission determine whether a 1.0 stream was a ``simulcast''
of a specific 3.0 stream when enforcing the underlying requirement to
simulcast in 1.0?
26. While broadcasters have incentives to provide the programming
their viewers want, after making significant investments in ATSC 3.0
technology they may also have incentives to favor their ATSC 3.0
offerings. For example, without a requirement to make programming
substantially similar, Next Gen TV broadcasters would be free to
provide the most desirable programming only to those viewers with 3.0
TV equipment. This could create two different tiers of free, OTA
television service.\17\ Advertising dollars, and thus spending on
programming, could flow primarily to the 3.0 ``tier'' in such a
scenario, potentially widening the quality gap between the two tiers.
Given these concerns, are Next Gen TV broadcasters' financial
incentives sufficient to ensure that all 1.0 viewers retain access to
all primary video programming that can be offered in 1.0 format? How
might broadcasters' financial incentives change as the 3.0 transition
progresses? How could the development of ``tiered'' programming
disproportionately impact consumers with limited means and other
vulnerable consumers (such as seniors)? In a voluntary, market-based
transition, what are Next Gen TV broadcasters' obligations to 1.0
viewers that choose not to transition to 3.0? We seek comment on these
questions and issues.
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\17\ We recognize that two tiers of OTA TV service may already
occur to a lesser extent. Due to inevitable 1.0 capacity constraints
as the transition progresses, the Commission has afforded Next Gen
TV stations with the flexibility to air 1.0 primary programming in
SD, even if the station was previously broadcasting it in HD.
Similarly, the Commission did not require that Next Gen TV stations
air multicast streams in 1.0 format. In contrast to these
situations, 1.0 capacity constraints would not seem to be hindering
the provision of substantially similar programming. Next Gen TV
broadcasters are not required to simulcast programming that cannot
be aired in 1.0 format.
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27. Have marketplace developments to date in any way reduced or
eliminated the need for the substantially similar rule? What
marketplace conditions are relevant to this question, independent of
the underlying requirement to simulcast in 1.0? \18\ While we are
seeking detailed information about the state of the ATSC 3.0
marketplace in this proceeding, the information we have already shows
that ATSC 3.0 deployment and consumer adoption remain in the early
stages. When 3.0 viewership increases (reducing reliance on 1.0
service) and more affordable 3.0 TV equipment become available in the
marketplace, will the need for the substantially similar rule remain?
How, if at all, will any such need be affected by the potential for
shifting financial incentives as the transition progresses? We seek
comment on these questions and issues.
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\18\ We observe that certain marketplace conditions will factor
into our analysis about how long the underlying requirement to
simulcast in 1.0 is needed.
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28. We also seek comment on whether the substantially similar rule
is currently impeding innovations in broadcast programming and, if so,
how? Is it likely that the rule will hinder 3.0 programming innovations
in the near future? If so, how? Should any such innovations outweigh
the protections afforded to 1.0 viewers by the rule? We observe that
the substantially similar rule already affords significant flexibility
for broadcasters to innovate and experiment with new, innovative
programming features using Next Gen TV technology in that it does not
require Next Gen TV broadcasters to duplicate enhanced content or
features that cannot reasonably be provided in the 1.0 format, and does
not require any degree of simulcasting on any stream other than the
primary stream.\19\ Does the requirement nonetheless pose any
impediment to innovation in broadcast programming and, if so, how? Are
such impediments imminent or currently theoretical? What innovations
that are currently being aired or are in development would be hindered
by the rule, if any? We seek specific comment on what types of
programming Next Gen TV broadcasters would like to provide only in 3.0
and, to the extent such programming can (as a technical matter) be
provided in 1.0 format, why such programming should not have to be
provided in 1.0 format? To the extent an individual Next Gen TV
broadcaster may need more flexibility than the rule allows, would
targeted waivers be more appropriate than sunsetting the substantially
similar requirement? \20\ We seek comment on these questions and
issues.
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\19\ Next Gen TV broadcasters do not have to duplicate enhanced
content or features that cannot reasonably be provided in the 1.0
format. This includes: ``hyper-localized'' content (e.g., geo-
targeted weather, targeted emergency alerts, and hyper-local news),
programming features or improvements created for the 3.0 service
(e.g., emergency alert ``wake up'' ability and interactive
programming features), enhanced formats made possible by 3.0
technology (e.g., 4K or HDR), and any personalization of programming
performed by the viewer and at the viewer's discretion.
\20\ Notably, the Commission has stated with respect to requests
for waiver of the requirement to simulcast that ``[it would] look
favorably on a waiver applicant choosing to provide ATSC 3.0
converter devices at no cost or low cost to over-the-air households
located within its community of license which will no longer receive
the station's ATSC 1.0 signal as a means to minimize the impact of
not simulcasting on viewers.''
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29. Finally, we seek comment about any other advantages or
disadvantages associated with the sunset of the substantially similar
rule, and if we do decide to retain it, for how long? How would the
sunset of the rule impact MVPDs, including small MVPDs, particularly
given that the 1.0 simulcast signal remains the relevant signal for
carriage purposes? \21\ What is the impact on small broadcasters of
requiring continued compliance with the substantially similar rule?
Finally, we note that because the substantially similar rule, like the
underlying requirement to simulcast in 1.0, will be eliminated when the
transition to 3.0 is complete, the timing of the ultimate ``sunset'' of
this requirement is very much in the hands of the broadcast industry.
If the rule is retained, should we consider extending the substantially
similar requirement for a particular term, or retain it for as long as
the underlying requirement to simulcast in
[[Page 40471]]
1.0 remains? If for a term, what would be an appropriate benchmark? We
seek comment on these questions and issues.
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\21\ We note that small or rural MVPDs are more likely to rely
exclusively on OTA delivery of TV signals. While MVPDs that rely on
OTA delivery could mitigate signal quality issues by obtaining
delivery through alternate means, such as fiber, DBS transport, or
reception and transcoding/down conversion of the ATSC 3.0 signal,
such methods may require significant expenditures that small MVPDs
in particular are less able to afford.
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C. Requirement To Comply With the ATSC A/322 Standard
30. We seek comment on whether we should retain the requirement
that Next Gen TV broadcasters' primary video programming stream must
comply with the ATSC A/322 standard and, if so, for how long. If we
retain the requirement, should we apply a different sunset date or is
it needed on an ongoing basis? The purpose of this requirement is to
provide certainty to consumers, television receiver manufacturers, and
MVPDs that 3.0 TV sets or other 3.0 TV equipment will be able to
receive all 3.0 primary broadcast signals. What would be the impact on
consumers, television receiver manufacturers, and MVPDs if this
requirement were to sunset? If we do not require compliance with the
ATSC A/322 standard, how can we ensure that 3.0 TV sets and other 3.0
TV equipment will be able to receive all 3.0 primary broadcast signals?
What would be the potential impact, if any, of eliminating the
requirement on consumers, television manufacturers, and MVPDs? Would
the sunset of this requirement jeopardize the provision of ATSC 3.0
service as a free and universally available digital broadcast
television service? Have marketplace developments since 2017 reduced or
eliminated the need for mandatory compliance with the ATSC A/322
standard? What marketplace conditions are relevant to this question?
31. In 2017, broadcasters acknowledged that ``adopting the full
physical layer of the Next Gen standard, including A/322'' may ``ensure
that consumer electronics manufacturers can build television receivers
with confidence.'' Is this no longer the case? Is A/322 no longer
necessary to provide such certainty? Is the A/322 standard currently
impeding broadcast innovations? If so, how? Does the need to facilitate
any such innovations outweigh the protections the rule affords to
consumers, television receiver manufacturers and MVPDs? Might retention
of the A/322 standard--which applies only to the primary broadcast
stream--hinder broadcast innovation in the future? If so, how? Do
broadcasters merely hope to use methods that are likely to be adopted
in future versions of A/322, or do they contemplate the use of a
physical layer standard that ATSC would never incorporate into A/322?
What is the impact on small broadcasters of requiring continued
compliance with the A/322 standard? What could be the impact on small
television receiver manufacturers and small MVPDs if the requirement is
allowed to sunset? We seek comment on these questions.
32. Finally, we observe that ATSC has updated the A/322 standard
since we mandated its use in 2017. It appears, however, that the most
recent 2021 version of the A/322 standard makes only ministerial
changes to the standard and contains no substantive changes. We seek
comment on this observation as well as whether it is necessary or
advisable to incorporate into our rules the 2021 version of the A/322
standard to the extent that the requirement is retained.
33. Digital Equity and Inclusion. The Commission, as part of its
continuing effort to advance digital equity for all,\22\ including
people of color, persons with disabilities, persons who live in rural
or Tribal areas, and others who are or have been historically
underserved, marginalized, or adversely affected by persistent poverty
or inequality, invites comment on any equity-related considerations
\23\ and benefits (if any) that may be associated with the proposals
and issues discussed herein. Specifically, we seek comment on how our
proposals may promote or inhibit advances in diversity, equity,
inclusion, and accessibility, as well the scope of the Commission's
relevant legal authority.
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\22\ Section 1 of the Communications Act of 1934 as amended
provides that the FCC ``regulat[es] interstate and foreign commerce
in communication by wire and radio so as to make [such service]
available, so far as possible, to all the people of the United
States, without discrimination on the basis of race, color,
religion, national origin, or sex.'' 47 U.S.C. 151.
\23\ The term ``equity'' is used here consistent with Executive
Order 13985 as the consistent and systematic fair, just, and
impartial treatment of all individuals, including individuals who
belong to underserved communities that have been denied such
treatment, such as Black, Latino, and Indigenous and Native American
persons, Asian Americans and Pacific Islanders and other persons of
color; members of religious minorities; lesbian, gay, bisexual,
transgender, and queer (LGBTQ+) persons; persons with disabilities;
persons who live in rural areas; and persons otherwise adversely
affected by persistent poverty or inequality. See Exec. Order No.
13985, 86 FR 7009, Executive Order on Advancing Racial Equity and
Support for Underserved Communities Through the Federal Government
(January 20, 2021).
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IV. Procedural Matters
A. Initial RFA Analysis
34. As required by the Regulatory Flexibility Act of 1980, as
amended (RFA),\24\ the Commission has prepared this Initial Regulatory
Flexibility Analysis (IRFA) of the possible significant economic impact
on a substantial number of small entities by the policies proposed in
this Third Further Notice of Proposed Rulemaking (NPRM). Written public
comments are requested on this IRFA. Comments must be identified as
responses to the IRFA and must be filed by the deadlines for comments
on the FNPRM provided on the first page of the FNPRM. The Commission
will send a copy of this entire FNPRM, including this IRFA, to the
Chief Counsel for Advocacy of the Small Business Administration
(SBA).\25\
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\24\ 5 U.S.C. 603. The RFA, see 5 U.S.C. 601-612, was amended by
the Small Business Regulatory Enforcement Fairness Act of 1996
(SBREFA), Public Law 104-121, Title II, 110 Stat. 857 (1996).
\25\ 5 U.S.C. 603(a).
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1. Need for, and Objectives of, the Proposed Rule Changes
35. In this Third Further Notice of Proposed Rulemaking (FNPRM),
the Commission considers and seeks comment on the state of the Next Gen
TV transition and on the scheduled sunsets of two rules adopted in the
First Next Gen TV Report and Order. In that decision, the Commission
authorized broadcasters to use the ATSC 3.0 standard and adopted rules
governing the deployment of 3.0 service, including two which are
scheduled to sunset absent further action. The Commission noted that it
would monitor the 3.0 transition and approximately one year before the
scheduled sunsets, it would seek comment on whether marketplace
conditions warranted extending these requirements. As part of our
assessment, we review and seek comment on the progress of Next Gen TV
broadcasters' voluntary, market-driven deployment of ATSC 3.0 service
and the current state of the ATSC 3.0 marketplace, including whether
holders of essential patents for the ATSC 3.0 standards are licensing
such patents on reasonable and non-discriminatory (RAND) terms and if a
Commission rule requiring 3.0 patent licensing on RAND terms would
provide benefits to consumers and potential participants in the 3.0
marketplace. Next, the Commission considers whether to retain the rule
requiring that a Next Gen TV station's ATSC 1.0 simulcast primary video
programming stream be substantially similar to its 3.0 primary
programming stream. This rule is scheduled to sunset in July 2023.
Finally, the Commission considers whether to retain the requirement
that a Next Gen TV station comply with the ATSC A/322. This rule is
also scheduled to sunset in March 2023.
2. Legal Basis
36. The proposed action is authorized pursuant to sections 1, 4, 7,
301, 303, 307, 308, 309, 316, 319, 325(b), 336,
[[Page 40472]]
338, 399b, 403, 534, and 535 of the Communications Act of 1934, as
amended, 47 U.S.C. 151, 154, 157, 301, 303, 307, 308, 309, 316, 325(b),
336, 338, 399b, 403, 534, and 535.
3. Description and Estimate of the Number of Small Entities To Which
the Proposed Rules Will Apply
37. 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. The RFA generally defines
the term ``small entity'' as having the same meaning as the terms
``small business,'' ``small organization,'' and ``small governmental
jurisdiction.'' In addition, the term ``small business'' has the same
meaning as the term ``small business concern'' under the Small Business
Act. A small business concern is one which: (1) is independently owned
and operated; (2) is not dominant in its field of operation; and (3)
satisfies any additional criteria established by the SBA. The rules
proposed herein will directly affect small television and radio
broadcast stations. Below, we provide a description of these small
entities, as well as an estimate of the number of such small entities,
where feasible.
38. Wired Telecommunications Carriers. The U.S. Census Bureau
defines this industry as 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 communications 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.
Wired Telecommunications Carriers are also referred to as wireline
carriers or fixed local service providers.
39. The SBA small business size standard for Wired
Telecommunications Carriers classifies firms having 1,500 or fewer
employees as small. U.S. Census Bureau data for 2017 show that there
were 3,054 firms that operated in this industry for the entire year. Of
this number, 2,964 firms operated with fewer than 250 employees.
Additionally, based on Commission data in the 2021 Universal Service
Monitoring Report, as of December 31, 2020, there were 5,183 providers
that reported they were engaged in the provision of fixed local
services. Of these providers, the Commission estimates that 4,737
providers have 1,500 or fewer employees. Consequently, using the SBA's
small business size standard, most of these providers can be considered
small entities.
40. Cable Companies and Systems (Rate Regulation). The Commission
has developed its own small business size standard 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. Based
on industry data, there are about 420 cable companies in the U.S. Of
these, only seven have more than 400,000 subscribers. In addition,
under the Commission's rules, a ``small system'' is a cable system
serving 15,000 or fewer subscribers. Based on industry data, there are
about 4,139 cable systems (headends) in the U.S. Of these, about 639
have more than 15,000 subscribers. Accordingly, the Commission
estimates that the majority of cable companies and cable systems are
small.
41. Cable System Operators (Telecom Act Standard). The
Communications Act of 1934, as amended, contains a size standard for a
``small cable operator,'' which is ``a cable operator that, directly or
through an affiliate, serves in the aggregate fewer than one 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.'' For purposes of the Telecom Act Standard, the
Commission determined that a cable system operator that serves fewer
than 677,000 subscribers, either directly or through affiliates, will
meet the definition of a small cable operator based on the cable
subscriber count established in a 2001 Public Notice. Based on industry
data, only six cable system operators have more than 677,000
subscribers. Accordingly, the Commission estimates that the majority of
cable system operators are small under this size standard. We note
however, that the Commission neither requests nor collects information
on whether cable system operators are affiliated with entities whose
gross annual revenues exceed $250 million. Therefore, 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.
42. 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 is included in the Wired
Telecommunications Carriers industry which 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 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.
43. The SBA small business size standard for Wired
Telecommunications Carriers classifies firms having 1,500 or fewer
employees as small. U.S. Census Bureau data for 2017 show that 3,054
firms operated in this industry for the entire year. Of this number,
2,964 firms operated with fewer than 250 employees. Based on this data,
the majority of firms in this industry can be considered small under
the SBA small business size standard. According to Commission data
however, only two entities provide DBS service--DIRECTV (owned by AT&T)
and DISH Network, which require a great deal of capital for operation.
DIRECTV and DISH Network both exceed the SBA size standard for
classification as a small business. Therefore, we must conclude based
on internally developed Commission data, in general DBS service is
provided only by large firms.
44. 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 included in the Wired Telecommunications Carriers'
industry which includes wireline
[[Page 40473]]
telecommunications businesses. The SBA small business size standard for
Wired Telecommunications Carriers classifies firms having 1,500 or
fewer employees as small. U.S. Census Bureau data for 2017 show that
there were 3,054 firms in this industry that operated for the entire
year. Of this total, 2,964 firms operated with fewer than 250
employees. Thus under the SBA size standard, the majority of firms in
this industry can be considered small.
45. Home Satellite Dish (HSD) Service. HSD or the large dish
segment of the satellite industry is the original satellite-to-home
service offered to consumers and involves the home reception of signals
transmitted by satellites operating generally in the C-band frequency.
Unlike DBS, which uses small dishes, HSD antennas are between four and
eight feet in diameter and can receive a wide range of unscrambled
(free) programming and scrambled programming purchased from program
packagers that are licensed to facilitate subscribers' receipt of video
programming. Because HSD provides subscription services, HSD falls
within the industry category of Wired Telecommunications Carriers. The
SBA small business size standard for Wired Telecommunications Carriers
classifies firms having 1,500 or fewer employees as small. U.S. Census
Bureau data for 2017 show that there were 3,054 firms that operated for
the entire year. Of this total, 2,964 firms operated with fewer than
250 employees. Thus, under the SBA size standard, the majority of firms
in this industry can be considered small.
46. Open Video Services (OVS). 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. The OVS framework provides opportunities for
the distribution of video programming other than through cable systems.
OVS operators provide subscription services and therefore fall within
the SBA small business size standard for the cable services industry,
which is ``Wired Telecommunications Carriers.'' The SBA small business
size standard for this industry classifies firms having 1,500 or fewer
employees as small. U.S. Census Bureau data for 2017 show that there
were 3,054 firms in this industry that operated for the entire year. Of
this total, 2,964 firms operated with fewer than 250 employees. Thus,
under the SBA size standard the majority of firms in this industry can
be considered small. Additionally, we note that the Commission has
certified some OVS operators who are now providing service and
broadband service providers (BSPs) are currently the only significant
holders of OVS certifications or local OVS franchises. The Commission
does not have financial or employment information for the entities
authorized to provide OVS however, the Commission believes some of the
OVS operators may qualify as small entities.
47. Wireless Cable Systems--Broadband Radio Service and Educational
Broadband Service. Broadband Radio Service systems, previously referred
to as Multipoint Distribution Service (MDS) and Multichannel Multipoint
Distribution Service (MMDS) systems, and ``wireless cable,'' transmit
video programming to subscribers and provide two-way high speed data
operations using the microwave frequencies of the Broadband Radio
Service (BRS) and Educational Broadband Service (EBS) (previously
referred to as the Instructional Television Fixed Service (ITFS)).
Wireless cable operators that use spectrum in the BRS often
supplemented with leased channels from the EBS, provide a competitive
alternative to wired cable and other multichannel video programming
distributors. Wireless cable programming to subscribers resembles cable
television, but instead of coaxial cable, wireless cable uses microwave
channels.
48. In light of the use of wireless frequencies by BRS and EBS
services, the closest industry with a SBA small business size standard
applicable to these services is Wireless Telecommunications Carriers
(except Satellite). The SBA small business size standard for this
industry classifies a business as small if it has 1,500 or fewer
employees. U.S. Census Bureau data for 2017 show that there were 2,893
firms that operated in this industry for the entire year. Of this
number, 2,837 firms employed fewer than 250 employees. Thus under the
SBA size standard, the Commission estimates that a majority of
licensees in this industry can be considered small.
49. According to Commission data as December 2021, there were
approximately 5,869 active BRS and EBS licenses. The Commission's small
business size standards with respect to BRS involves eligibility for
bidding credits and installment payments in the auction of licenses for
these services. For the auction of BRS licenses, the Commission adopted
criteria for three groups of small businesses. A very small business is
an entity that, together with its affiliates and controlling interests,
has average annual gross revenues exceed $3 million and did not exceed
$15 million for the preceding three years, a small business is an
entity that, together with its affiliates and controlling interests,
has average gross revenues exceed $15 million and did not exceed $40
million for the preceding three years, and an entrepreneur is an entity
that, together with its affiliates and controlling interests, has
average gross revenues not exceeding $3 million for the preceding three
years. Of the ten winning bidders for BRS licenses, two bidders
claiming the small business status won 4 licenses, one bidder claiming
the very small business status won three licenses and two bidders
claiming entrepreneur status won six licenses. One of the winning
bidders claiming a small business status classification in the BRS
license auction has an active licenses as of December 2021.
50. The Commission's small business size standards for EBS define a
small business as an entity that, together with its affiliates, its
controlling interests and the affiliates of its controlling interests,
has average gross revenues that are not more than $55 million for the
preceding five (5) years, and a very small business is an entity that,
together with its affiliates, its controlling interests and the
affiliates of its controlling interests, has average gross revenues
that are not more than $20 million for the preceding five (5) years. In
frequency bands where licenses were subject to auction, the Commission
notes that as a general matter, the number of winning bidders that
qualify as small businesses at the close of an auction does not
necessarily represent the number of small businesses currently in
service. Further, the Commission does not generally track subsequent
business size unless, in the context of assignments or transfers,
unjust enrichment issues are implicated. Additionally, since the
Commission does not collect data on the number of employees for
licensees providing these services, at this time we are not able to
estimate the number of licensees with active licenses that would
qualify as small under the SBA's small business size standard.
51. Incumbent Local Exchange Carriers (ILECs). Neither the
Commission nor the SBA has developed a small business size standard
specifically for incumbent local exchange carriers. Wired
Telecommunications Carriers is the closest industry with a SBA small
business size standard. The SBA small business size standard for Wired
Telecommunications Carriers classifies firms having 1,500 or fewer
employees as small. U.S. Census Bureau data for
[[Page 40474]]
2017 show that there were 3,054 firms in this industry that operated
for the entire year. Of this number, 2,964 firms operated with fewer
than 250 employees. Additionally, based on Commission data in the 2021
Universal Service Monitoring Report, as of December 31, 2020, there
were 1,227 providers that reported they were incumbent local exchange
service providers. Of these providers, the Commission estimates that
929 providers have 1,500 or fewer employees. Consequently, using the
SBA's small business size standard, the Commission estimates that the
majority of incumbent local exchange carriers can be considered small
entities.
52. Competitive Local Exchange Carriers (CLECs). Neither the
Commission nor the SBA has developed a size standard for small
businesses specifically applicable to local exchange services.
Providers of these services include several types of competitive local
exchange service providers. Wired Telecommunications Carriers is the
closest industry with a SBA small business size standard. The SBA small
business size standard for Wired Telecommunications Carriers classifies
firms having 1,500 or fewer employees as small. U.S. Census Bureau data
for 2017 show that there were 3,054 firms that operated in this
industry for the entire year. Of this number, 2,964 firms operated with
fewer than 250 employees. Additionally, based on Commission data in the
2021 Universal Service Monitoring Report, as of December 31, 2020,
there were 3,956 providers that reported they were competitive local
exchange service providers. Of these providers, the Commission
estimates that 3,808 providers have 1,500 or fewer employees.
Consequently, using the SBA's small business size standard, most of
these providers can be considered small entities.
53. Radio and Television Broadcasting and Wireless Communications
Equipment Manufacturing. This industry comprises establishments
primarily engaged in manufacturing radio and television broadcast and
wireless communications equipment. Examples of products made by these
establishments are: transmitting and receiving antennas, cable
television equipment, GPS equipment, pagers, cellular phones, mobile
communications equipment, and radio and television studio and
broadcasting equipment. The SBA small business size standard for this
industry classifies businesses having 1,250 employees or less as small.
U.S. Census Bureau data for 2017 show that there were 656 firms in this
industry that operated for the entire year. Of this number, 624 firms
had fewer than 250 employees. Thus, under the SBA size standard, the
majority of firms in this industry can be considered small.
54. Audio and Video Equipment Manufacturing. This industry
comprises establishments primarily engaged in manufacturing electronic
audio and video equipment for home entertainment, motor vehicles, and
public address and musical instrument amplification. Examples of
products made by these establishments are video cassette recorders,
televisions, stereo equipment, speaker systems, household-type video
cameras, jukeboxes, and amplifiers for musical instruments and public
address systems. The SBA small business size standard for this industry
classifies firms with 750 employees or less as small. According to 2017
U.S. Census Bureau data, 464 firms in this industry operated that year.
Of this number, 399 firms operated with less than 250 employees. Based
on this data and the associated SBA size standard, we conclude that the
majority of firms in this industry are small.
55. Television Broadcasting. This industry is comprised of
``establishments primarily engaged in broadcasting images together with
sound.'' These establishments operate television broadcast 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 studio, from an affiliated
network, or from external sources. The SBA small business size standard
for this industry classifies businesses having $41.5 million or less in
annual receipts as small. 2017 U.S. Census Bureau data indicate that
744 firms in this industry operated for the entire year. Of that
number, 657 firms had revenue of less than $25,000,000. Based on this
data we estimate that the majority of television broadcasters are small
entities under the SBA small business size standard.
56. The Commission estimates that as of March 2022, there were
1,373 licensed commercial television stations. Of this total, 1,280
stations (or 93.2 percent) had revenues of $41.5 million or less in
2021, according to Commission staff review of the BIA Kelsey Inc. Media
Access Pro Television Database (BIA) on June 1, 2022, and therefore
these licensees qualify as small entities under the SBA definition. In
addition, the Commission estimates as of March 2022, there were 384
licensed noncommercial educational (NCE) television stations, 383 Class
A TV stations, 1,840 LPTV stations and 3,231 TV translator stations.
The Commission however does not compile, and otherwise does not have
access to financial information for these television broadcast stations
that would permit it to determine how many of these stations qualify as
small entities under the SBA small business size standard.
Nevertheless, given the SBA's large annual receipts threshold for this
industry and the nature of these television station licensees, we
presume that all of these entities qualify as small entities under the
above SBA small business size standard.
4. Description of Projected Reporting, Recordkeeping, and Other
Compliance Requirements
57. The FNPRM considers whether to retain two existing compliance
requirements, both of which are scheduled to expire in 2023. The FNPRM
does not propose any new reporting or recordkeeping requirements.
58. Substantially Similar Rule. The FNPRM considers whether to
retain the ``substantially similar'' rule. This rule requires that the
programming aired on a Next Gen TV station's ATSC 1.0 simulcast channel
be ``substantially similar'' to that of the primary video programming
stream on the ATSC 3.0 channel. This means that the programming must be
the same, except for programming features that are based on the
enhanced capabilities of ATSC 3.0, including targeted advertisements,
and promotions for upcoming programs.
59. Requirement to comply with the ATSC A/322 standard. The FNPRM
considers whether to retain the requirement to comply with the ATSC A/
322 standard. In authorizing use of the Next Gen TV broadcast
transmission standard, the Commission in the First Next Gen TV Report
and Order required compliance with only two parts of the ATSC 3.0 suite
of standards: (1) ATSC A/321:2016 ``System Discovery & Signaling'' (A/
321), which is the standard used to communicate the RF signal type that
the ATSC 3.0 signal will use; and (2) A/322:2016 ``Physical Layer
Protocol'' (A/322), which is the standard that defines the waveforms
that ATSC 3.0 signals may take. The requirement to comply with A/321
does not have a sunset date but the requirement to comply with A/322
will expire in 2023 unless the Commission takes action to extend it.
[[Page 40475]]
5. Steps Taken To Minimize Significant Impact on Small Entities and
Significant Alternatives Considered
60. 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.
61. The Commission has authorized television broadcasters to use
the Next Gen TV (ATSC 3.0) standard on a voluntary, market-driven
basis. As observed in the Final Regulatory Flexibility Analysis of the
2017 First Next Gen TV Report and Order, this means that broadcasters
decide whether (and if so when) to deploy ATSC 3.0 service and bear the
costs associated with such deployment. The substantially similar
requirement and the requirement to comply with A/322 only apply to TV
broadcast stations that voluntarily choose to implement the Next Gen TV
(ATSC 3.0) standard. Because the decision to deploy ATSC 3.0 service is
voluntary, broadcasters, including small entities, do not need to
undertake any costs or burdens associated with ATSC 3.0 service unless
they choose to do so. Accordingly, we believe that should the
Commission decide to retain either or both of these requirements (i.e.,
the substantially similar rule and the A/322 standard) that they would
not impose a significant economic impact on small entities. We seek
comment on this tentative conclusion. We also seek comment on the
impact of these rules on small entities.
6. Federal Rules That May Duplicate, Overlap, or Conflict With the
Proposed Rule
62. None.
B. Initial Paperwork Reduction Act Analysis
63. This document does not contain proposed information collection
requirements subject to the Paperwork Reduction Act of 1995 (PRA).\26\
In addition, therefore, it does not contain any new or modified
information collection burden for small business concerns with fewer
than 25 employees, pursuant to the Small Business Paperwork Relief Act
of 2002.\27\
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\26\ 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.).
\27\ 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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C. Ex Parte Rules--Permit-But-Disclose
64. This proceeding shall be treated as a ``permit-but-disclose''
proceeding in accordance with the Commission's ex parte rules.\28\
Persons making ex parte presentations must file a copy of any written
presentation or a memorandum summarizing any oral presentation within
two business days after the presentation (unless a different deadline
applicable to the Sunshine period applies). Persons making oral ex
parte presentations are reminded that memoranda summarizing the
presentation must (1) list all persons attending or otherwise
participating in the meeting at which the ex parte presentation was
made, and (2) summarize all data presented and arguments made during
the presentation. If the presentation consisted in whole or in part of
the presentation of data or arguments already reflected in the
presenter's written comments, memoranda, or other filings in the
proceeding, the presenter may provide citations to such data or
arguments in his or her prior comments, memoranda, or other filings
(specifying the relevant page and/or paragraph numbers where such data
or arguments can be found) in lieu of summarizing them in the
memorandum. Documents shown or given to Commission staff during ex
parte meetings are deemed to be written ex parte presentations and must
be filed consistent with rule 1.1206(b). In proceedings governed by
rule 1.49(f) or for which the Commission has made available a method of
electronic filing, written ex parte presentations and memoranda
summarizing oral ex parte presentations, and all attachments thereto,
must be filed through the electronic comment filing system available
for that proceeding, and must be filed in their native format (e.g.,
.doc, .xml, .ppt, searchable .pdf). Participants in this proceeding
should familiarize themselves with the Commission's ex parte rules.
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\28\ 47 CFR 1.1200 et seq.
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D. Filing Requirements--Comments and Replies
65. Pursuant to sections 1.415 and 1.419 of the Commission's
rules,\29\ 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 the Commission's Electronic Comment Filing
System (ECFS).\30\
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\29\ 47 CFR 1.415, 1419.
\30\ Electronic Filing of Documents in Rulemaking Proceedings,
63 FR 24121 (1998).
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Electronic Filers: Comments may be filed electronically
using the internet by accessing the ECFS: http://apps.fcc.gov/ecfs/.
Paper Filers: Parties who choose to file by paper must
file an original and one copy of each filing.
Filings can be sent 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] Commercial overnight mail (other than U.S. Postal Service
Express Mail and Priority Mail) must be sent to 9050 Junction Drive,
Annapolis Junction, MD 20701.
[cir] U.S. Postal Service first-class, Express, and Priority mail
must be addressed to 45 L Street NE, Washington, DC 20554.
Effective March 19, 2020, and until further notice, the
Commission no longer accepts any hand or messenger delivered filings.
This is a temporary measure taken to help protect the health and safety
of individuals, and to mitigate the transmission of COVID-19.\31\
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\31\ FCC Announces Closure of FCC Headquarters Open Window and
Change in Hand-Delivery Policy, Public Notice, 35 FCC Rcd 2788 (OMD
2020). See https://www.fcc.gov/document/fcc-closes-headquarters-open-window-and-changes-hand-delivery-policy.
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During the time the Commission's building is closed to the
general public and until further notice, if more than one docket or
rulemaking number appears in the caption of a proceeding, paper filers
need not submit two additional copies for each additional docket or
rulemaking number; an original and one copy are sufficient.
66. People With Disabilities. To request materials in accessible
formats for people with disabilities (braille, large print, electronic
files, audio format), send an email to [email protected] or call the
Consumer & Governmental Affairs Bureau at 202-418-0530 (voice), 202-
418-0432 (TTY).
V. Ordering Clauses
67. It is ordered, pursuant to the authority found in sections 1,
4, 7, 301, 303, 307, 308, 309, 316, 319, 325(b), 336, 338, 399b, 403,
534, and 535 of the Communications Act of 1934, as
[[Page 40476]]
amended, 47 U.S.C. 151, 154, 157, 301, 303, 307, 308, 309, 316, 319,
325(b), 336, 338, 399b, 403, 534, and 535, this Third Further Notice of
Proposed Rulemaking is hereby adopted and notice is hereby given of the
proposals and tentative conclusions described in this Third Further
Notice of Proposed Rulemaking.
68. It is further ordered that the Commission's Consumer and
Governmental Affairs Bureau, Reference Information Center, shall send a
copy of this Third Further Notice of Proposed Rulemaking, including the
Initial Regulatory Flexibility Analysis, to the Chief Counsel for
Advocacy of the Small Business Administration.
Federal Communications Commission.
Marlene Dortch,
Secretary.
[FR Doc. 2022-14470 Filed 7-6-22; 8:45 am]
BILLING CODE 6712-01-P