UPDATE

May 20, 2013

FCC Proposes Fine against Tower Owner for Violations of Tower Lighting Rules

Last week, the FCC issued a Notice of Apparent Liability (“NAL”) against a tower owner for failing to timely repair lighting on a tower.  The proposed fine was set at $15,000.

FCC rules require towers exceeding 200 feet above ground level or requiring “special aeronautical study” to be painted and lit according to FAA standards. Tower owners must also monitor and periodically inspect tower lighting systems, report lighting outages to the FAA immediately, and repair lighting outages “as soon as practicable.”

In this case, an FCC field agent inspected a tower in November 2012 and found that all of the tower’s lights were unlit.  A representative of the tower owner reported that the company had noticed the lighting outage in August 2010 and reported it to the FAA.  The company did not repair the outage, but re-reported it to the FAA every two weeks.

The FCC agent issued a Notice of Violation for failing to repair the tower’s lighting as soon as practicable.  In response, the tower owner did not deny that the tower’s lights had been out for over two years, but claimed repairs were complicated.  The company repaired the lighting in December 2012.

Nonetheless, the FCC proposed a $15,000 fine for the lighting violations.  The base fine for violation of the FCC’s tower painting and lighting rules is $10,000.  Here, the FCC increased the fine to $15,000 because, in its view, the company’s failure to repair the outage for over two years “demonstrates a deliberate disregard for the Commission’s rules….”

With the release of the NAL, the tower owner has 30 days to pay the proposed fine or file a written statement seeking to reduce or cancel the proposed fine.

This violation continues a trend we saw last year of increased antenna structure rules enforcement by the FCC and their field inspectors.  Cable operators with registered towers should make sure their towers are painted and lighted in accordance with their FCC registrations.  If you have any questions about the FCC’s antenna structure rules, please contact Scott Friedman or Jake Baldwin at (312) 372-3930 or sfriedman@cinnamonmueller.com or jbaldwin@cinnamonmueller.com.

Recent Increase in Copyright Infringement Claims

The DMCA and Statutory Immunity for ISPs

As Internet service providers (“ISPs”), cable operators often receive online infringement notices and subpoena requests from local law enforcement agencies.  Recently, we have seen an increase in the number of notices received by cable operators, and highlight an important law that cable operators, as ISPs, must comply with – the Digital Millennium Copyright Act (“DMCA”).

The DMCA includes the Online Copyright Infringement Liability Limitation Act, which offers ISPs significant protection from copyright infringement claims.  By virtue of the service they provide as ISPs, cable operators are exposed to infringement claims arising from copyrighted material illegally placed on the operator’s network by a user.  The DMCA establishes procedures through which the cable operator can obtain immunity from these damage claims.

To obtain the protection provided by the DMCA, cable operators must fulfill several compliance obligations, including registering an agent to receive infringement complaints, adopting and posting a repeat infringer policy, and responding to infringement complaints appropriately.

By following these steps, cable operators can benefit from statutory immunity from monetary liability.  If you have any questions about the DMCA, or copyright infringement in general, please contact Heidi Schmid at (312) 372-3930 or hschmid@cinnamonmueller.com.

UPDATE

May 3, 2013

FCC Grants Charter Two-Year Waiver of the Integrated Set-top Box Ban;

Acknowledges Court Invalidation of Certain CableCARD Rules

The FCC’s Media Bureau recently granted Charter’s request for a waiver of the FCC’s ban on set-top boxes with integrated security.  Significantly, the Bureau’s order acknowledged that a recent D.C. Circuit Court of Appeals decision vacated some of the FCC’s CableCARD rules adopted in 2003, and suggested that the validity of related rules adopted in 2010 may have been undermined.

Background

As part of the Telecommunications Act of 1996, Congress directed the FCC to adopt regulations to assure the commercial availability of “navigation devices” (e.g., set-top boxes).  One aim of the law was to help develop a consumer market for set-top boxes.  This would allow consumers to have a choice of where they obtained set-top boxes – their cable operator or an electronics retailer.

Through a series of orders, the FCC determined that commercial availability of set-top boxes required separating the “conditional access” functions of the box from other functions.  “Conditional access” means the signal security codes in the box that block or enable access to encrypted programming.  The FCC encouraged development of “CableCARDs,” removable devices that contain conditional access functions.  In 2003, through two orders – a Second Report and Order, and Order on Reconsideration – the FCC adopted several rules (“collectively known as the “plug and play” technical and encoding rules”) based on a cable and consumer electronics industry memorandum of understanding (MOU) related to navigation devices and CableCARDs.  Beginning in July 2004, operators of digital cable systems were required to support CableCARDs, and make them available to customers upon request, as well as support additional technical and encoding rules for set-top boxes that would be phased in between 2004 and 2007.  On July 1, 2007, the FCC’s “Integration Ban” went into effect, prohibiting deployment of digital set-top boxes with integrated conditional access functions.

Finally, in 2010, the FCC modified some of the plug and play rules and adopted additional rules related to navigation devices and CableCARDs, including technical requirements for home networking output, self-installation, uniform CableCARD fees, and discounts for customer provided boxes.

EchoStar, which was not a party to the MOU, challenged the rules adopted in the FCC’s 2003 Orders on grounds that the rules exceeded the FCC’s statutory authority and should not apply to all MVPDs; the D.C. Circuit Court of Appeals agreed and vacated the Orders in January 2013.

Charter’s Waiver Request

Charter filed a two-year Integration Ban waiver request in November 2012 while the EchoStar decision was pending.  The purpose of the Integration Ban is to assure reliance by both cable operators and consumer electronics manufacturers on a common, separated-security solution. Charter argued that its downloadable security system would achieve this purpose.  Charter, however, requested a temporary waiver to implement its “open-standard, downloadable security solution that supports third party retail devices.”  Charter explained that it needed two years to roll out downloadable security set-top boxes to customers before its cable systems would be fully ready to support downloadable security.  During this interim period, Charter would deploy boxes that include two security systems – one that includes a hardware chip that would eventually be used for downloadable security and a second that includes integrated security to be used for the two-year transitional period.  Eventually, the downloadable security system would combine software-based security with conditional access codes on the hardware chip.  The access codes would then be made available on an open royalty-free basis to encourage device manufacturers to offer devices that consumers could purchase for use on Charter’s cable systems.  Charter argued that its downloadable security system was comparable to one deployed by Cablevision under a waiver request granted by the Media Bureau in 2009.

The Waiver

The Media Bureau granted Charter’s request, with conditions, in part to address a problem created by the EchoStar decision.  The Bureau noted that prior to the EchoStar decision, the FCC’s CableCARD technical rules furthered Congressional intent by ensuring that consumers could purchase CableCARD retail devices with the knowledge that such devices would work on their cable operators’ digital cable system.  The Bureau recognized that after the EchoStar decision there was the potential for a fractured cable set-top box market should different cable operators adopt differing non-CableCARD separated-security standards.

Since the concept of downloadable security is fully consistent with the Integration Ban, the Media Bureau viewed Charter’s waiver as an opportunity to encourage the deployment of a technology that could provide many of the same benefits as the CableCARD.  The Bureau reasoned that its action would promote an industry-wide downloadable security standard, helping provide certainty for third-party manufactures and for consumers purchasing third-party devices.  The Bureau emphasized Charter’s commitment to adopt the same downloadable security system used by Cablevision and that this would make it more likely that other operators considering moving to a downloadable system would adopt the same established technology.  In summary, the Bureau found that its action was consistent with the Congressional mandate insofar that granting Charter’s waiver request would help assure the commercial availability of navigation devices.

Further, the Bureau acknowledged that some of the vacated “plug and play” technical and encoding rules, as adopted by the FCC’s 2003 Orders, were subsequently modified by the FCC’s 2010 Order.  However, it declined to address the continued effectiveness of these rules.  Nonetheless, the Bureau conditioned Charter’s waiver on the cable operator continuing to indefinitely support CableCARDs and comply with the FCC’s 2010 technical rules, expressly taking this action irrespective of the EchoStar decision.  The Bureau suggested these conditions were appropriate given that Charter voluntarily agreed to continue compliance with these rules and that it could also comply with any rule changes that the FCC may enact in the future.

What This Means for You

Cable operators should consider whether downloadable security offers an effective solution for their systems.  The Media Bureau has now twice endorsed downloadable security systems as compliant with the Integration Ban.  Specifically, the Bureau endorsed the system used by both Charter and Cablevision, which combines software-based security with a hardware chip that houses conditional access codes.

Further developments could be forthcoming about the validity of the rules contained in the FCC’s 2010 Order.  The Media Bureau’s statements in defense of its 2010 Order-based waiver conditions signal that FCC staff are aware that the EchoStar decision undermined the validity of those rules and that the FCC may take action to address this uncertainty in the future.

The Integration Ban remains in effect.

If you have questions about the integration ban, the remaining CableCARD rules, or Charter’s waiver, please contact Scott Friedman at (312) 372-3930 or at sfriedman@cinnamonmueller.com, or Elvis Stumbergs at (202) 872-6881 or estumbergs@cinnamonmueller.com.

FCC Adopts Consent Decree with Cable Operator for Delaying Access to Public Inspection File

Operator to Make $8,000 Voluntary Contribution to U.S. Treasury

On April 23, 2012, the FCC adopted a Consent Decree that settled an investigation and Notice of Apparent Liability (“NAL”) for a cable operator’s failure to make its public inspection file available upon request during regular business hours.  While the NAL, released in February 2012, set the potential fine at $10,000, under the terms of the consent decree, the cable operator will make an $8,000 voluntary contribution to the U.S. Treasury.

This serves as a cautionary tale that when FCC field inspectors visit a cable system, public file compliance is on their checklist.  The best practice is to put the public files in order, and proper procedures in place, before the inspector calls.  A cable operator risks fines if it fails to do so.

According to the NAL, an FCC enforcement agent visited the cable operator’s office on October 26, 2011, and requested to inspect the public inspection file.  The operator’s customer service representative refused.  The enforcement agent then telephoned the operator’s CEO, who stated that customer service representatives are not allowed access to the public inspection file unless a manager is present.

FCC rules require cable operators to maintain certain files and records for public inspection during regular business hours.  Authorized FCC representatives may also request to view the file at any reasonable hour.  While the FCC recognizes that brief, security-related delays to access a public file are reasonable, the FCC issued the NAL even though enforcement agents returned on October 27, 2011, when a manager was present, and observed that the operator’s public inspection file was complete.

Cable public file and recordkeeping requirements vary with the size of the system.  Systems with fewer than 1,000 subscribers have the fewest obligations, while obligations for systems with more than 5,000 subscribers are more extensive.

If you have questions about the FCC’s public file obligations, please contact Scott Friedman or Heidi Schmid at (312) 372-3930 or sfriedman@cinnamonmueller.com or hschmid@cinnamonmueller.com.

CM News:  Elvis Stumbergs, Certified Information Privacy Professional

Congratulations to Washington, D.C.-based CM associate Elvis Stumbergs, who recently earned recognition as a Certified Information Privacy Professional/US (CIPP/US) by the International Association of Privacy Professionals.

Elvis earned the certification after passing an exam about common aspects of privacy and data protection across national borders, regions and industries, as well as an exam demonstrating a strong foundation in US privacy laws and regulations.

Through Elvis’ expertise and CM’s long-standing experience providing advice about cable, VoIP and broadband privacy regulations, CM stands ready to assist your company about a broad range of privacy and data protection issues.  You can reach Elvis Stumbergs at (202) 872-6881 or estumbergs@cinnamonmueller.com.

UPDATE

April 19, 2013

FCC Implements Emergency Information Accessibility Mandates

On April 9, 2013, the FCC released an Order that requires video programming distributors (“VPDs”), including multichannel video programming distributors (“MVPDs”), to pass through an audio translation of on-screen emergency information text crawls on a secondary audio stream.  These rules will become effective two years after publication of the Order in the Federal Register.

Note: The emergency information pass-through requirement does not have a technical capability exception.  ACA will petition the FCC to waive secondary audio pass-through requirements for operators of all-analog and smaller hybrid analog/digital cable systems not technically capable of providing a secondary audio program stream.

The Order also imposes accessibility requirements on manufacturers of most consumer devices (referred to as “apparatus”) that allow the viewing, playback and/or recording of video programming. The rules require that apparatus, such as a set-top box or DVR, be capable of processing and passing through emergency information and video description secondary audio streams.  The apparatus rules, which do contain technical feasibility or achievability exceptions, will also become effective two years from publication of the Order in the Federal Register.

Finally, while the emergency information rules do not yet apply to TV-Everywhere delivery of video content, the FCC concurrently issued a Notice of Further Proposed Rulemaking (“FNPRM”) asking whether they should.

Background

Section 202(a) of The Twenty-First Century Communications and Video Accessibility Act of 2010 (“CVAA”) directs the FCC to promulgate regulations that would require video programming providers (“VPPs”), VPDs, and program owners to convey emergency information in a manner accessible to individuals who are blind or visually impaired.  The FCC’s Order implements this directive by specifying how this emergency information should be conveyed by “covered entities,” interpreted by the FCC to mean VPPs (which include “program owners”) and VPDs.  Section 203 of the CVAA directs the FCC to impose certain emergency information and video description requirements on apparatus designed to receive, play back, or record video programming transmitted simultaneously with sound.  The FCC’s Order implements this directive by providing specifics on the apparatus to which these rules apply and how compliance can be achieved.

Emergency Information Secondary Audio Rules

General Rule. The Order requires VPPs and VPDs to use a secondary audio stream (also known as secondary audio programming or “SAP”) to aurally convey emergency information that appears visually in on-screen crawls during programming other than newscasts.

The Emergency Information rules also provide that:

• Broadcasters and other programmers are responsible for putting emergency information in a secondary audio stream.
• VPDs are responsible for passing through the emergency information on an existing secondary audio stream.
• Emergency information must supersede all other programming on the secondary audio stream, including video description, foreign language translation, or duplication of the main audio stream.
• VPDs or VPPs are not required to offer specific customer support services to assist blind or visually impaired subscribers in navigating between the main and secondary audio streams to access video description and accessible emergency information.
• Consumers may file complaints with the FCC’s Consumer and Governmental Affairs Bureau.

Apparatus Requirements

General Rule. The Order requires that set-top boxes, DVRs and other affected apparatus, with a few limited exceptions, have the capability to decode, make available, present or pass through a secondary audio stream to facilitate the transmission and delivery of video description services and emergency information.  Manufacturers of these devices are primarily responsible for compliance.  Although the Order is not entirely clear on this point, the FCC will likely hold VPDs responsible for providing their subscribers with compliant apparatus as well.

The apparatus requirements only apply to devices that can be used to access television broadcast or MVPD services.  The rules do not apply to devices, for example, that solely allow viewing of videos on Internet websites.

The Apparatus rules also provide that:

• Apparatus designed to receive or play back video programming must comply with the requirements only to the extent it is “technically feasible.”
• Apparatus designed to record video programming transmitted simultaneously with sound, or that uses a picture screen less than 13 inches in size, must meet the requirements only if “achievable.”
• Consumers may file complaints with the FCC’s Consumer and Governmental Affairs Bureau.

FNPRM Concerning Implications for TV-Everywhere and Other IP-Based Offerings

The FCC issued an FNPRM requesting comment on whether the emergency information and video description rules should apply to an MVPD that permits its subscribers to access linear video programming via tablets, laptops, personal computers, smartphones, or similar devices, or by means of an application or plug-in.  The FCC’s resolution of this issue will determine if an MVPD’s TV-Everywhere and similar IP-based offerings must comply with the rules requiring emergency information to be provided through a secondary audio stream.

If you have questions regarding the FCC’s emergency information order, please contact Elvis Stumbergs at (202) 872-6881 or estumbergs@cinnamonmueller.com.

FCC Releases Small Entity Compliance Guide for Basic Tier Encryption

This week, the FCC released a Compliance Guide intended to help small entities comply with the FCC’s basic tier encryption rules.  Under the FCC’s amended rules – which became effective December 10, 2012 – all-digital cable systems may voluntarily encrypt the basic service tier so long as they meet certain customer service protection measures.

As highlighted in the Compliance Guide, “all-digital systems” mean systems in which “no television signals are provided using the NTSC system,” and instead all signals are sent using QAM.  Moreover, before opting to encrypt their basic service tier, cable operators must fulfill express customer service protection measures related to equipment offers and subscriber notifications described below.

Required Equipment Offers. Operators must for a limited, “transitional” period provide existing customers with their choice of equipment to receive the encrypted basic service tier, as detailed below, all at no charge (including no service charges related to the equipment):

(i)            For customers receiving only the basic service tier without a set-top box or CableCARD, either a set-top box or CableCARD on up to two televisions sets for two years from the date of encryption;

(ii)           For customers receiving a level of service above basic on one television set, but receiving only basic on other sets without a set-top box or CableCARD, either a set-top box or CableCARD on one television set for one year from the date of encryption; and

(iii)          For Medicaid recipient customers receiving only the basic service tier without a set-top box or CableCARD, either a set-top box or CableCARD on up to two televisions sets for five years from the date of encryption.

Operators must keep these offers open for a period lasting from at least 30 days prior to encrypting the first basic tier channel through at least 120 days after that.

Subscriber Notice Requirements. Cable operators which choose to encrypt their basic service tier are required to provide notice to existing customers about:

(i)            the planned encryption and free equipment offers at least 30 days before beginning encryption of the basic service tier; and

(ii)           the end of the free equipment transitional period 30-60 days before its end, including the date that the subscriber will be charged for the continued use of the cable operator’s equipment, and the name and address of the local franchising authority.

These notices must contain certain specific language detailed in the Compliance Guide.

In addition, the Compliance Guide notes that cable operators that do not have all-digital systems may continue to seek a waiver of the FCC’s rule prohibiting scrambling of channels on the basic service tier in cases of extreme service theft.

If you have questions about basic service tier encryption, please contact Jake Baldwin or Scott Friedman at (312) 372-3930, or at jbaldwin@cinnamonmueller.com or sfriedman@cinnamonmueller.com.

FCC Cites Hotel for Signal Leakage and Aeronautical Frequency Violations

The FCC Enforcement Bureau’s New Orleans Office recently cited the Airport Inn & Suites, located in Kenner, LA, for failing to notify the FCC of its non-cable MVPD system’s operation in the aeronautical band and for exceeding the FCC’s cable signal leakage limits.

Under the FCC’s signal leakage rules, cable and non-cable MVPDs operating within frequency bands 108-137 MHz and 225-400 MHz must comply with specific reporting and technical requirements.  In this case, agents from the New Orleans Field Office found that the Airport Inn & Suites MVPD system was using aeronautical frequencies, but had not filed FCC Form 321 (Aeronautical Frequency Notification) to notify the FCC of its operation in the aeronautical band.

In addition, the agents conducted field strength measurements from the MVPD equipment room at the Airport Inn & Suites and determined that the signal leakage emitted violated the FCC’s allowable limits.

The citation requires the Airport Inn & Suites to take immediate steps to come into compliance and to provide to the FCC, within 20 days, descriptions of specific actions taken to correct the violations and preclude recurrence, and a time line for completion of pending corrective actions.  Future violations may result in monetary forfeitures, seizure of equipment, or criminal sanctions.

If you have questions regarding the FCC’s signal leakage rules, please contact Scott Friedman at (312) 372-3930 or sfriedman@cinnamonmueller.com.

UPDATE

April 5, 2013

CALM Act Compliance Update:

SCTE issues Recommended Practices for Spot Check Loudness Measurements

Yesterday, the Society of Cable Telecommunications Engineers (“SCTE”) announced the publication of a new standards document, SCTE 197 2013, designed to help MVPDs and programmers comply with the Commercial Advertisement Loudness Mitigation (“CALM”) Act obligations.

Titled “Recommendations for Spot Check Loudness,” SCTE 197 provides best practices for measuring the audio content carried in a single programming channel of a program network, aligned with techniques discussed in ATSC standard A/85, “Recommended Practice: Techniques for Establishing and Maintaining Audio Loudness for Digital Television.” SCTE 197, available for download at www.scte.org/standards, further provides guidelines for recording measured loudness and loudness metadata value, as well as approaches for interpretation of the collected data and for actions to be taken in the case of discrepancies.

Below, we provide a brief summary of the CALM Act and the requirements for MVPDs.

Background. The FCC’s rules on loud television commercials, adopted in response to the 2010 CALM Act, took effect on December 13, 2012.  Broadcast stations and MVPDs must ensure that all commercials are transmitted to consumers at the appropriate loudness level.  The rules cover digital advertisements locally inserted by MVPDs and those that come embedded from a content provider.  The rules do not apply to analog broadcasts or analog MVPD service.

CALM Act Requirements. For MVPDs that locally insert commercials, the FCC will assume compliance if the MVPD:

• Has installed the required equipment (under the A/85 Recommended Practice, a standard adopted by the ATSC);
• Uses the equipment in connection with the insertions; and
• Keeps the equipment in good working order (with records showing the equipment’s use and that the equipment has undergone periodic maintenance and testing).

If an MVPD does not itself install, utilize and maintain the equipment used to encode the loudness of a commercial before or at the time of its transmission, the MVPD may acquire a certification from the 3^rd party that the local advertisements inserted comply with the recommended practices.

For embedded commercials, MVPDs may rely on a “safe harbor” to prove compliance:

• For certified programming, the MVPD may rely on a programmer’s certification if the MVPD has no reason to believe the certification is false.
• For non-certified programming, MVPDs with over 10 million subscribers must annually spot check 100% of non-certified programming, and MVPDs with between 400,000 and 10 million subscribers must annually spot check 50% of non-certified programming.  MVPDs with less than 400,000 subscribers are exempt from these annual spot check obligations.

Pattern or Trend of Complaints:  Spot Checks. If the FCC becomes aware of a “pattern or trend of sufficiently specific complaints,” it may open an enforcement inquiry.  Upon receiving an inquiry notice from the FCC, the MVPD must verify compliance by performing a spot check.  After performing a spot check, follow-up spot checks are required only if the initial spot check indicates noncompliance.

If you have any questions about the CALM Act rules, please contact Scott Friedman at (312) 372-3930 or sfriedman@cm-chi.com.

Live or “Near Live” Video Programming Aired on TV with Captions Must Now be Captioned When Distributed Online via IP

As of March 30, 2013, distributors of video programming (“VPDs”) online using Internet Protocol (“IP”) must pass through closed captions for programming which previously aired live or “near-live” on television with closed captions.  These newly effective captioning rules represent the second of three primary IP closed captioning compliance deadlines adopted as part of the FCC’s 2012 IP Closed Captioning Report and Order (“Order”), pursuant to the Twenty-First Century Video Accessibility Act.

Below, we briefly summarize some of the key obligations and captioning deadlines under the IP closed captioning rules.

VPD Obligations. VPDs must comply with the new rules to the extent that they provide IP-delivered video programming (for example, through a TV Everywhere-type of offering or other over-the-top video service) when such a streaming video service is not distributed as part of their traditional managed MVPD service.  This means that VPDs must ensure the receipt and necessary processing of caption files accompanying programming from the video programming owners (“VPOs”) when distributing the programming online.  This includes an obligation to ensure that plug-ins, applications, and devices are capable of rendering or passing through the closed captioning as well.

Exceptions. An MVPD that also provides broadband Internet access service and acts only as a means for its Internet subscribers to access IP video programming distributed by an online video distributor (e.g., Hulu, Netflix, Amazon) would not be responsible for ensuring compliance with captioning rules for video received by one of their subscribers from such online entities.  The new rules also do not change the existing television closed captioning rules currently applicable to programming distributed by MVPDs over their traditional managed video services platform (e.g., linear cable channels, video-on-demand), even if delivered by IP.

Covered Programming. The new IP closed captioning rules apply to full length video programming previously published or exhibited on broadcast television or on a cable television channel with captions that is redistributed using IP by a VPD.  The Order established three primary categories of covered video programming and adopted separate captioning deadlines for each:

• Programming not edited for Internet distribution:  rules went into effect on September 30, 2012.
• Live and “near-live” programming:  rules went into effect on March 30, 2013.
• Prerecorded programming that is edited for Internet distribution:  rules will go into effect on September 30, 2013.

Contact Information. VPDs must make contact information available to consumers for receipt and handling of complaints.  The FCC declined to specify how VPDs must provide this contact information, but expects that VPDs will prominently display their contact information in a way that it is accessible to all end users of their services.  A general notice on the VPDs website would be sufficient.

The contact information must be kept current, updated within 10 business days of any change, and include:

• The name of a person with primary responsibility for Internet protocol captioning issues and who can ensure compliance with these rules; and
• The person’s title or office, telephone number, fax number, postal mailing address, and e-mail address.

Compliance Deadlines for Devices. Effective January 1, 2014, many manufacturers of digital apparatus designed to receive or play back video programming (such as smartphones, tablets, personal computers, TV set-top boxes, removable media players) must make them capable of rendering of passing through closed captions.  Professional and commercial equipment and display-only monitors are excluded.

For more information about IP closed captioning, please contact Elvis Stumbergs at (202) 872-6881 or estumbergs@cm-chi.com, or Scott Friedman at (312) 372-3930 or sfriedman@cm-chi.com.

UPDATE

March 8, 2013

FCC Form 499-A Due April 1

All providers of telecommunications, including resellers and those offering interconnected VoIP service, with very limited exceptions, must file their annual telecommunications revenue report (Form 499-A) on or before April 1, 2013.  This includes any entity that relies on the de minimis exception for contributions to the federal Universal Service Fund (“USF”).

Information reported in FCC Form 499-A is used to calculate the support contribution an entity must pay into the USF as well as the Telecommunications Relay Service (“TRS”), North America Numbering Plan (“NANP”), and Local Number Portability Administration (“LNPA”) funds.  Providers owing less than $10,000 in USF support are considered de minimis and do not have to contribute to USF, but must still file the form and pay any TRS and NANP contributions due.

All covered providers must complete the Form 499-A Worksheet (also available as an online form) using 2012 revenue data.  The FCC revised the form this year and issued updated instructions.  The instructions and filing procedures are complicated, so be sure to start early.

Note:  Each USF-related violation carries its own forfeiture amount.  Failure to file Form 499-A, or failure to file the form on time can result in hefty financial penalties.  Additional forfeitures can be assessed for failure to contribute to USF, TRS, and NANP.

If you have any questions regarding these filings, please contact Bruce Beard at (314) 394-1535 or bbeard@cm-chi.com.

New Accessibility Recordkeeping Compliance Certificate due April 1, 2013

In accordance with the 21^st Century Communications and Video Accessibility Act of 2010, the FCC adopted new accessibility, recordkeeping, certification, and consumer complaint rules to ensure that people with disabilities can access various communication services.  All covered providers, except those subject to a small entity exemption for certain services, must file an annual compliance certificate with the FCC by April 1, 2013 certifying that they have operating procedures in place to ensure compliance with the recordkeeping requirements.

Who must file by April 1? Telecommunications, interconnected VoIP, and advanced communication services (“ACS”) providers must file.  ACS providers include companies offering:

• New VoIP services not available before October 8, 2010;
• Non-interconnected VoIP services;
• Electronic messaging services (services that provide real time or near real time messages in text format, such as instant messaging); and
• Interoperable video conferencing services.

What must the certification contain? All covered providers must submit an annual certification through the FCC’s Recordkeeping Compliance Certification and Contact Registry that:

• Designates a contact person authorized to resolve accessibility-related complaints;
• Designates an agent to accept service of complaints; and
• Certifies that the company has established operating procedures adequate to ensure compliance with the recordkeeping rules and that the records are being kept accordingly.

Are any exemptions available? Yes.  The rules provide a temporary exemption from the accessibility and recordkeeping requirements for providers of ACS that are small entities as determined by the Small Business Administration (“SBA”).  Based on the SBA’s size standards, providers that have fewer than 1,500 employees, including affiliates, are automatically exempt from the accessibility and recordkeeping requirements.  The exemption expires October 8, 2013.

Note:  The small entity exemption applies only to providers as to their ACS offerings; it does not apply to telecommunications or interconnected VoIP offerings.  Providers of telecommunication services or interconnected VoIP services must file their compliance certificates by April 1, 2013 regardless of size.

The FCC has provided additional information about the rules in a recent Public Notice.

If you have any questions about the new rules, developing operating procedures, or filing certifications, please contact Bruce Beard at (314) 394-1535 or bbeard@cm-chi.com, Elvis Stumbergs at (202) 872-6881 or estumbergs@cm-chi.com, or Jake Baldwin at (312) 372-3930 or jbaldwin@cm-chi.com.

FCC Denies Waiver Request, Dismisses Late-Filed Radio License Renewal Applications

This week, the FCC denied a waiver request to accept late-filed applications for the renewals of eight radio licenses, and dismissed the late-filed renewal applications.

Section 1.949(a) of the FCC’s rules requires radio licensees to file renewal applications no later than the expiration dates of the licenses.  Additionally, FCC policy allows radio license  renewal applications to be retroactively granted if filed up to 30 days after the license’s expiration, although the licensee may be subject to enforcement action for untimely filing and for unauthorized operation during the unlicensed period.   Here, the company’s licenses expired on October 29, 2012, November 1, 2012, and November 5, 2012, but the company did not file its renewal applications until December 24, 2012.

This release provides an important reminder to monitor your FCC licenses, and be prepared to timely file renewal applications.  Licensees that fail to timely file renewal applications risk enforcement action, and may need to seek special temporary authority to continue operating the license post-expiration.  If you have any questions about FCC license renewals, please contact Scott Friedman at (312) 372-3930 or sfriedman@cm-chi.com.

Cinnamon Mueller Goes to Washington

Cinnamon Mueller attorneys will attend the American Cable Association’s 20^th Annual Summit in Washington D.C. next week.  D.C. Office Managing Partner Barbara Esbin will participate in ACA’s Issues Briefing for cable operators next Wednesday afternoon.  The Briefing will cover ACA’s advocacy efforts before the FCC and Congress on current issues of importance and help member companies prepare for their Thursday lobbying appointments on Capitol Hill.  If you’re attending the Summit, we’d love to catch up.  Be sure to say hello to one of our attorneys.

UPDATE

February 15, 2013

CPNI Officer’s Certification Due On or Before March 1, 2013

On January 16, 2013, the FCC released an Enforcement Advisory reminding telecommunications carriers and interconnected VoIP providers that their annual reports certifying compliance with the FCC’s Customer Proprietary Network Information (“CPNI”) rules are due on or before March 1, 2013. Failure to submit a timely and complete certification may lead to FCC enforcement action.  In past years, the FCC has issued Notices of Apparent Liability proposing fines of up to $20,000 against companies that failed to comply with the certification requirement, filed their certifications late, or filed their certifications incorrectly.

FCC rules require an annual compliance certificate, signed by a corporate officer, stating with personal knowledge that the provider has established and followed operating procedures adequate to ensure compliance with the FCC’s CPNI rules.  The filing must include a statement explaining how the operating procedures ensure compliance with the FCC’s CPNI rules.

The provider must also include, if applicable, an explanation of any actions taken against data brokers and a summary of all customer complaints concerning any unauthorized release of CPNI received in the past year.  The Enforcement Advisory contains a suggested filing template intended to help companies ensure that their certifications contain all required information.  The certificate must be filed in EB Docket No. 06-36 or through the FCC’s CPNI Certification Template.

If you have any questions regarding CPNI or the filing of the officer’s certificate, please contact Scott Friedman at (312) 580-8557 or sfriedman@cm-chi.com.

Copyright Forms and Fees Due March 1, 2013

Cable operators must file with the U.S. Copyright Office their Statements of Account (Form SA1-2 or SA3) and pay any royalty fees due for the July 2012 – December 2012 accounting period by March 1, 2013.  The following forms apply:

• SA1-2 Short Form. For use by cable systems with semiannual gross receipts of less than $527,600.
• SA3 Long Form. For use by cable systems with semiannual gross receipts of $527,600 or more.

Copyright royalty fees must be remitted by electronic payment.  If you have any questions about copyright forms or fees, please contact Heidi Schmid at (312) 372-3930 or hschmid@cm-chi.com.

FCC Form 477 Due March 1, 2013

The next Form 477 filing is due March 1, 2013 (reporting data as of December 31, 2012).  Further information about the Form 477 and 2010 Census tracts is available online.  For more information about filing Form 477, please contact Scott Friedman at (312) 372-3930 or via email at sfriedman@cm-chi.com.

New Accessibility Recordkeeping Compliance Certificate due April 1, 2013

In accordance with the Twenty-First Century Communications and Video Accessibility Act of 2010, the FCC adopted new accessibility, recordkeeping, certification, and consumer complaint rules to ensure that people with disabilities can access various communication services.  All covered providers, except those subject to a small entity exemption for certain services, must file an annual compliance certificate with the FCC by April 1, 2013 certifying that they have operating procedures in place to ensure compliance with the recordkeeping requirements.

Who must file? Telecommunications, interconnected VoIP, and advanced communication services (“ACS”) providers must file an annual certification by April 1, 2013.  ACS providers include:

• New VoIP services not available before October 8, 2010;
• Non-interconnected VoIP services;
• Electronic messaging services (services that provide real time or near real time messages in text format, such as instant messaging); and
• Interoperable video conferencing services.

What must the certification contain? All covered providers are required to submit an annual certification through the FCC’s web-based Recordkeeping Compliance Certification and Contact Registry available here.  The certification must:

• Designate a contact person authorized to resolve accessibility-related complaints;
• Designate an agent to accept service of complaints; and
• Certify that the company has established operating procedures adequate to ensure compliance with the recordkeeping rules and that the records are being kept accordingly.

Are any exemptions available? Yes.  The rules provide a temporary exemption from the accessibility and recordkeeping requirements for providers of ACS that are small entities as determined by the Small Business Administration (“SBA”).  Based on the SBA’s size standards, providers that have fewer than 1,500 employees, including affiliates, are automatically exempt from the accessibility and recordkeeping requirements.  The exemption expires October 8, 2013.

Note:  The small entity exemption applies only to providers as to their ACS offerings; it does not apply to telecommunications or interconnected VoIP offerings.  Providers of telecommunication services or interconnected VoIP services must file their compliance certificates by April 1, 2013 regardless of size.

The FCC has provided additional information about the rules in a recent Public Notice.

If you have any questions about the new rules, developing operating procedures, or filing certifications, please contact Bruce Beard at (314) 394-1535 or bbeard@cm-chi.com, Elvis Stumbergs at (202) 872-6881 or estumbergs@cm-chi.com, or Jake Baldwin at (312) 372-3930 or jbaldwin@cm-chi.com.

UPDATE

February 1, 2013

New Accessibility Record Keeping Requirements for VoIP, Telecom and Advanced Communications Services Begin January 30, 2013—Compliance Certificate due April 1, 2013

In 2011, the FCC adopted rules that include new accessibility, recordkeeping, certification, and consumer complaint procedures to help ensure that people with disabilities can access various communication services.  The new recordkeeping requirements are effective January 30, 2013.  Also, beginning this year, all covered providers, other than those subject to a small entity exemption for certain services, must file a compliance certificate with the FCC each April 1 certifying that they have operating procedures in place to ensure compliance with the recordkeeping requirements.

Background. Congress enacted the Twenty-First Century Communications and Video Accessibility Act of 2010 to ensure that people with disabilities, such as the visually and hearing-impaired, would have access to new advanced communications services.  Accessibility obligations already existed for telecommunications services and interconnected VoIP services under Section 255 of the Communications Act.  The new recordkeeping and certification requirements, which were enacted to help ensure accessibility, now apply to all covered providers.

Who is covered by the new record keeping requirements? The new recordkeeping requirements apply to:

• Telecommunications providers
• Interconnected VoIP providers
• Providers of advanced communication services (“ACS”), which are:
  • New VoIP services not available before October 8, 2010;
  • Non-interconnected VoIP services;
  • Electronic messaging services (services that provide real time or near real time messages in text format, such as instant messaging); and
  • Interoperable video conferencing services.

What records must be kept? All covered providers are required to maintain the following records of their compliance with accessibility rules:

• Information about efforts to consult with individuals with disabilities;
• Descriptions of accessibility features of products and services;
• Information about compatibility with peripheral devices used to achieve access; and
• Records supporting any determination that accessibility is “not achievable.”

What are the annual certification requirements? All covered providers are required to submit an annual certification each April 1, beginning this year, through the FCC’s web-based Recordkeeping Compliance Certification and Contact Registry available here.  The certifications must include:

• Certification that the company has established operating procedures that are adequate to ensure compliance with the recordkeeping rules and that the records are being kept accordingly;
• Designation of a contact person authorized to resolve accessibility-related complaints; and
• Designation of an agent to accept service of complaints.

Are any exemptions available? Yes.  The rules provide a temporary exemption from the accessibility and recordkeeping requirements for providers of ACS that are small entities as determined by the Small Business Administration (“SBA”).  Based on the SBA’s size standards, cable operators, broadband Internet service providers, and VoIP providers that have fewer than 1,500 employees, including affiliates, are automatically exempt from the accessibility and recordkeeping requirements.  The exemption expires October 8, 2013.

Note:  The exemption applies only to providers as to their ACS offerings; it does not apply to telecommunications or interconnected VoIP offerings.  Providers of telecommunication services or interconnected VoIP services must file their compliance certificates by April 1, 2013 regardless of their size.

What do the rules require regarding accessibility for ACS? The new rules require that providers of ACS make the services accessible to and usable by people with disabilities unless doing so is “not achievable.”

Accessibility. Accessible means that input, control, and mechanical functions must be locatable, identifiable, and operable to people with vision, hearing, physical, and cognitive disabilities.

Supplemental documentation must be accessible.  The rules also require that the information and documentation given to customers, including bills, installation guides, and software, be made available in alternate formats as needed.  The requirement to provide access to information also involves ensuring that individuals with disabilities can access, at no extra cost, call centers and customer support regarding the product and its accessibility features.

Achievability. Achievable means “with reasonable effort or expense.”  Service providers may determine for themselves whether accessibility is achievable for any given new product.  To help guide that determination, the FCC identified four factors it will consider:

• The nature and cost of steps needed to meet the accessibility requirements for a given product;
• The technical and economic impact on the provider’s operations and on the equipment or service;
• The type of operations; and
• The extent of accessible services or equipment the provider offers with various functions and features, and at different prices.

Covered entities are allowed to meet their accessibility requirements by relying on built-in and third-party solutions, as well as external peripheral devices commonly used by the disabled and available at a nominal cost.

The FCC has provided additional information about the rules in a recent Public Notice.

If you have any questions about the rules, developing operating procedures or filing the certifications, please contact Bruce Beard at (314) 394-1535 or bbeard@cm-chi.com or Jake Baldwin at (312) 372-3930 or jbaldwin@cm-chi.com.

Copyright Forms and Fees Due March 1, 2013

Cable operators must file with the U.S. Copyright Office their Statements of Account (Form SA1-2 or SA3) and pay any royalty fees due for the July 2012 – December 2012 accounting period by March 1, 2013.  The following forms apply:

• SA1-2 Short Form. For use by cable systems with semiannual gross receipts of less than $527,600.
• SA3 Long Form. For use by cable systems with semiannual gross receipts of $527,600 or more.

Copyright royalty fees must be remitted by electronic payment.  If you have any questions about copyright forms or fees, please contact Heidi Schmid at (312) 372-3930 or via email at hschmid@cm-chi.com.

FCC Form 477 Due March 1, 2013

The next Form 477 filing is due March 1, 2013 (reporting data as of December 31, 2012).  For this filing, the FCC’s electronic system will only recognize 2010 Census tract codes.  Further information about the Form 477 and 2010 Census tracts is available online.

For more information about filing Form 477, please contact Scott Friedman at (312) 372-3930 or via email at sfriedman@cm-chi.com.

UPDATE

January 18, 2013

FCC Issues CPNI Enforcement Advisory for CPNI Officer’s Certification

Due On or Before March 1, 2013

On January 16, 2013, the FCC released an Enforcement Advisory reminding telecommunications carriers and interconnected VoIP providers that their annual reports certifying compliance with the FCC’s Customer Proprietary Network Information (“CPNI”) rules are due on or before March 1, 2013. Failure to submit a timely and complete certification may lead to FCC enforcement action.  In past years, the FCC has issued Notices of Apparent Liability proposing fines of up to $20,000 against companies that failed to comply with the certification requirement, filed their certifications late, or filed their certifications incorrectly.

FCC rules require an annual compliance certificate, signed by a corporate officer, stating with personal knowledge that the provider has established and followed operating procedures adequate to ensure compliance with the FCC’s CPNI rules.  The filing must include a statement explaining how the operating procedures ensure compliance with the FCC’s CPNI rules.

The provider must also include, if applicable, an explanation of any actions taken against data brokers and a summary of all customer complaints concerning any unauthorized release of CPNI received in the past year.  The FCC Enforcement Advisory contains a suggested template for filing intended to help companies ensure that their certifications contain all of the required information.  The certificate, as well as the information noted above, must be filed in EB Docket No. 06-36, or through the FCC’s CPNI Certification Template (http://apps.fcc.gov/eb/CPNI/).

If you have any questions regarding CPNI or the filing of the officer’s certificate, please contact please contact Bruce Beard at (636) 778-0646 or bbeard@cm-chi.com.

FCC’s Broadcast Exclusivity Rules

How Network Non-Duplication and Syndicated Exclusivity Can Affect You

Cable operators often receive notices from local broadcasters claiming exclusive territorial rights for network or syndicated programming.  Below, we briefly cover the FCC’s broadcast exclusivity regulations – network non-duplication and syndicated exclusivity.

Television broadcast station licensees affiliated with broadcast networks often receive, through their affiliation agreement, exclusive rights to distribute certain network programming within a specified geographic area.  Television station licensees may also exercise exclusivity rights in accordance with the contractual provisions of their syndicated program license agreements.

In short, when a broadcaster receives exclusive rights by contract, the station can use the FCC’s rules to prevent cable systems from carrying duplicate programming.

Notice Requirements.  The network non-duplication and syndicated exclusivity rules require that, following proper notice from a station, a cable operator must delete duplicating programming in a community that falls within a station’s protected zone.  A broadcaster’s failure to meet the FCC’s notice requirements can lead to forfeiture of its network non-duplication or syndicated exclusivity rights.

Extent of Protection.  In general, a broadcast station’s protected zone extends 35 miles from the station’s community of license reference point.  For network non-duplication purposes, smaller market stations receive an extra 20 mile secondary zone, for a total of 55 miles from the reference point.

Exceptions.  Several exceptions may trump a broadcaster’s assertion of network non-duplication or syndicated exclusivity, including:

• Small systems.  The network non-duplication and syndicated exclusivity rules do not apply to cable systems with fewer than 1,000 subscribers.

Significantly viewed stations.  A cable system need not delete the duplicate network or syndicated programming of any television station “significantly viewed.”

If you have questions about the FCC’s broadcast exclusivity rules, please contact Scott Friedman at (312) 372-3930 or sfriedman@cm-chi.com.

Cinnamon Mueller News

Elvis Stumbergs joins the firm. We would like to extend a warm welcome to Elvis Stumbergs.  Elvis comes to Cinnamon Mueller with experience in communications, antitrust, marketing, and privacy regulatory matters.  Elvis began his legal career as an honors attorney at the FCC in the Media Bureau, and also served in the Wireless Telecommunications Bureau and as counsel for the National Broadband Plan team.  Immediately prior to joining Cinnamon Mueller, Elvis was an associate at a leading international law firm.  Elvis is both an undergraduate and law school graduate of UCLA, and is admitted to practice law in California and the District of Columbia.  Based in Cinnamon Mueller’s Washington DC office, Elvis will, among other things, assist our team in representing the ACA and its members.  Welcome, Elvis!

UPDATE

December 14, 2012

HAPPY HOLIDAYS FROM CINNAMON MUELLER!

Basic Tier Encryption Now Permitted – Amended Rules Effective December 10, 2012

On October 12, 2012, the FCC released an Order amending its rules and lifting its ban on basic tier encryption for all-digital cable systems, provided that the all-digital systems comply with specific consumer protection measures.  These rules became effective December 10, 2012.

Under the amended rules, “all-digital systems” mean systems in which “no television signals are provided using the NTSC system.”  This covers systems that offer unencrypted analog “barker channels,” but does not include hybrid analog/digital systems.

Before opting to encrypt their basic service tier, all-digital cable operators must fulfill the express customer service protection measures related to equipment offers and subscriber notifications described below.

Required Equipment Offers. Operators must for a limited, “transitional” period provide existing customers with their choice of equipment to receive the encrypted basic service tier, as detailed below, all at no charge (including no service charges related to the equipment):

(i)            For customers receiving only the basic service tier without a set-top box or CableCARD, either a set-top box or CableCARD on up to two televisions sets for two years from the date of encryption;

(ii)           For customers receiving a level of service above basic on one television set, but receiving only basic on other sets without a set-top box or CableCARD, either a set-top box or CableCARD on one television set for one year from the date of encryption; and

(iii)          For Medicaid recipient customers receiving only the basic service tier without a set-top box or CableCARD, either a set-top box or CableCARD on up to two televisions sets for five years from the date of encryption.

Operators must keep these offers open for a period lasting from at least 30 days prior to encrypting the first basic tier channel through at least 120 days after that.

Subscriber Notice Requirements. Related to these required equipment offers, the FCC requires operators to provide notice to existing customers about:

(i)            the planned encryption and free equipment offers at least 30 days before beginning encryption of the basic service tier; and

(ii)           the end of the free equipment transitional period 30-60 days before its end.

These notices must contain certain specific language detailed in the Order and FCC regulations.

If you have questions about basic service tier encryption, please contact Jake Baldwin or Scott Friedman at (312) 372-3930, or at jbaldwin@cm-chi.com or sfriedman@cm-chi.com.

CALM Act Rules Effective as of December 13, 2012

The FCC’s rules on loud television commercials took effect on December 13, 2012, one year after the FCC adopted an Order implementing the rules in response to the 2010 Commercial Advertisement Loudness Mitigation Act (the “CALM Act”).  Broadcast stations and MVPDs must ensure that all commercials are transmitted to consumers at the appropriate loudness level.  The rules cover digital advertisements locally inserted by MVPDs and those that come embedded from a content provider.

For MVPDs that locally insert commercials, the FCC will assume compliance if the MVPD:

• Has installed the required equipment (under the A/85 Recommended Practice, a standard adopted by the ATSC) ;
• Uses the equipment in connection with the insertions; and
• Keeps the equipment in good working order (with records showing the equipment’s use and that the equipment has undergone periodic maintenance and testing).

For embedded commercials, MVPDs can rely on a “safe harbor” to prove compliance:

• For certified programming, the MVPD may rely on a programmer’s certification if the MVPD has no reason to believe the certification is false.
• For non-certified programming, MVPDs with over 10 million subscribers must annually spot check 100% of non-certified programming, and MVPDs with between 400,000 and 10 million subscribers must annually spot check 50% of non-certified programming.  MVPDs with less than 400,000 subscribers are exempt from these spot check obligations.

If you have any questions about the CALM Act rules, please contact Scott Friedman at (312) 372-3930 or at sfriedman@cm-chi.com.

Interconnected VoIP Outage Reporting Requirements Effective December 16, 2012

The FCC’s new outage reporting requirements for interconnected VoIP providers go into effect December 16, 2012.

The new rules extend outage-reporting requirements to facilities-based and non-facilities-based interconnected VoIP providers.  Reporting requirements are limited to situations where there is a complete loss of interconnected VoIP service on the provider’s network.

Beginning December 16, 2012, interconnected VoIP providers must submit an electronic notification (through the NORS web-based filing system) to the FCC:

• Within 24 hours of discovering an outage of at least 30 minutes duration that (i) potentially affects at least 900,000 user minutes of interconnected VoIP service and results in complete loss of service; or (ii) potentially affects any special offices and facilities (e.g., major military installations, key government facilities, nuclear power plants, or airports).

• Within four hours of discovering an outage of at least 30 minutes duration that potentially affects a 911 special facility.  In addition, the VoIP provider also must notify by telephone or other electronic means the designated contact at the affected 911 facility and convey all relevant information.

In addition, VoIP providers must submit a Final Communications Outage Report to the Commission within 30 days after discovering the outage.  Unlike current outage rules, there is no requirement to submit an initial report.

For more information about outage reporting obligations, please contact Bruce Beard at (314) 394-1535 or bbeard@cm-chi.com.

UPDATE

November 30, 2012

FCC Extends Home Networking Set-Top Deadline

Small Cable Operators Now Have Until September 2, 2014 to Comply

On Wednesday, November 28, 2012, the FCC released an Order granting cable operators more time, until June 2, 2014, to implement the requirement that all new HD set-top boxes include an IP-output port that complies with an open industry standard for home networking.  Cable companies serving 400,000 or fewer subscribers over one or more cable systems received an additional three months’ time – until September 2, 2014 – to come into compliance.  In addition, the FCC clarified what qualifies as an “open industry standard” for purposes of complying with the IP-output requirement.

Background. In its October 14, 2010 Third Report and Order in the Commercial Availability of Navigation Devices proceeding, the FCC eliminated the 1394 interface mandate.  In its place, the FCC specified that, by December 1, 2012, operator-supplied two-way HD boxes must meet certain functional requirements to enable the networking of content to connected devices in the home (i.e., “an open industry standard that provides for audiovisual communications including service discovery, video transport, and remote control command pass-through standards for home networking”).

In adopting the IP-output mandate, the FCC did not specify any particular technology that would presumptively satisfy these functional requirements (e.g. through Ethernet, Wi-Fi, MoCA, IEEE 1394).  Nor did it specify a standard by which the functionalities (service discovery, video transport, and remote control command pass-through standards for home networking) are to be provided.  Instead, the Order left these issues for the industry to work out.

While the Digital Living Network Alliance (“DLNA”) has been hard at work developing an IP-output standard, it has not yet completed this work.  Consequently, ACA, NCTA, TiVo, and others suggested to the FCC that the Media Bureau extend the compliance deadline.

Open Industry Standard. In its Order released Wednesday, the FCC concluded that it would not change its policy of not mandating a single standard that all cable set-top boxes must use.  Nonetheless, the FCC agreed with TiVo that it would be useful to clarify the meaning of the phrase “open industry standard.”

The FCC explained that it “will analyze whether a set of specifications is an open industry standard based on the elements established in OMB Circular A-119.”  These elements are:

(i)            Openness;

(ii)          Balance of interest;

(iii)         Due process;

(iv)         An appeals process; and

(v)          Consensus.

Moreover, the FCC found that the industry is working to develop a future version of the DLNA Premium Video profile that will serve as a home-networking solution compliant with the home networking requirement, and further concluded that the process DLNA uses to develop and adopt standards satisfies the elements of an “open industry standard.”  Accordingly, the FCC stated that any cable operator that includes a DLNA output on its set-top boxes that supports the IP-output requirements will be in compliance with its home networking rule.

Extension of December 1, 2012 Deadline. Because finalized standards have not yet materialized, and because the cable industry does not expect the DNLA standard to be settled until 2013, the FCC granted cable operators an 18-month extension of the December 1, 2012 deadline – to June 2, 2014.

Moreover, in response to ACA’s argument that small cable companies are often unable to obtain equipment and related software until after the needs of larger cable operators are satisfied, the FCC granted small cable companies an additional three-month extension beyond that provided for larger cable operators.  Small cable companies that serve 400,000 or fewer subscribers over one or more cable systems have until September 2, 2014 to comply.

For more information about outage reporting obligations, please contact Barbara Esbin at (202) 872-6811 or besbin@cm-chi.com or Scott Friedman at (312) 372-3930 or sfriedman@cm-chi.com.

First Quarter 2013 Filing Deadlines

Form 477 Due March 1, 2013

FCC Form 477 is due on March 1, 2013.  Operators are required to include information about broadband connections and local telephone service as of December 31, 2012.   Filing instructions and a link to the electronic filing system are available at http://www.fcc.gov/form477/.

As a reminder, broadband providers must provide the following information:

• The number of broadband connections in individual census tracts, broken down by technology type and upload and download speed.
• The percentage of broadband connections that is residential.

Moreover, interconnected VoIP providers must report the following information:

• The number of subscribers served (both end-user and resale).
• The percentage of subscribers that is residential.
• Whether the service is provided over a broadband connection provided by the filer or the filer’s affiliate.
• A list of the 5-digit zip codes in which the filer has at least one subscriber.
• Whether the service is fixed or nomadic.

For more information about filing Form 477, please contact Scott Friedman at (312) 372-3930 or via email at sfriedman@cm-chi.com.

Copyright Forms and Fees Due March 1, 2013

Cable operators must file with the U.S. Copyright Office their Statement of Account (Form SA1-2 or SA3) and pay any royalty fees due for the July 2012 – December 2012 accounting period by March 1, 2013.  The following forms apply:

• SA1-2 Short Form. For use by cable television systems with semiannual gross receipts of less than $527,600.
• SA3 Long Form. For use by cable television systems with semiannual gross receipts of $527,600 or more.

Copyright royalty fees must be remitted by electronic payment.

If you have any questions about copyright forms or fees, please contact Jake Baldwin at (312) 372-3930 or via email at jbaldwin@cm-chi.com.

CPNI Officer’s Certificate Due On or Before March 1, 2013

The FCC’s CPNI rules require that an officer of an interconnected VoIP provider file an annual certificate with the FCC stating that the officer has personal knowledge that the provider has established operating procedures adequate to ensure compliance with the FCC’s CPNI rules.  The carrier must also provide a statement explaining how its operating procedures ensure that it is in compliance with the FCC’s CPNI rules.  The annual certificate for 2012 must be filed on or before March 1, 2013.

The provider must also include, if applicable, an explanation of any actions taken against data brokers and a summary of all customer complaints concerning the unauthorized release of CPNI received in the past year.  The officer’s certificate, as well as the information noted above, must be filed in EB Docket No. 06-36.

In past years, the FCC has issued Public Notices in January and February offering further guidance regarding the filing of the officer’s certificate, including an acceptable sample form.  Use of the sample form is not mandatory provided all required information is included.

If you have any questions regarding CPNI or the filing of the officer’s certificate, please contact Bruce Beard at (636) 778-0646 or via email at bbeard@cm-chi.com.

________________________________________________________________________

Please visit our website at www.cinnamonmueller.com www.cinnamonmueller.com to learn more about our lawyers and practice. You can reach Cinnamon Mueller at (312) 372-3930. This update is provided by the law firm of Cinnamon Mueller. The document is intended for informational purposes only as a service to clients of Cinnamon Mueller.  It is not intended to provide specific legal advice or to substitute obtaining appropriate legal counsel. We encourage you to consult with counsel to address special compliance issues and for assistance in negotiating or handling any such matter referred to in the update.

UPDATE

November 9, 2012

Interconnected VoIP Outage Reporting Requirements Effective December 16, 2012

The FCC’s new outage reporting requirements for interconnected VoIP providers go into effect December 16, 2012. 

The new rules extend outage-reporting requirements to facilities-based and non-facilities-based interconnected VoIP providers.  Reporting requirements are limited to situations where there is a complete loss of interconnected VoIP service on the provider’s network. 

Beginning December 16, 2012, interconnected VoIP providers must submit an electronic notification (through the NORS web-based filing system) to the FCC:

• Within 24 hours of discovering an outage of at least 30 minutes duration that (i) potentially affects at least 900,000 user minutes of interconnected VoIP service and results in complete loss of service; or (ii) potentially affects any special offices and facilities (e.g., major military installations, key government facilities, nuclear power plants, or airports). 
• Within four hours of discovering an outage of at least 30 minutes duration that potentially affects a 911 special facility.  In addition, the VoIP provider also must notify by telephone or other electronic means the designated contact at the affected 911 facility and convey all relevant information. 

In addition, VoIP providers must submit a Final Communications Outage Report to the Commission within 30 days after discovering the outage.  Unlike current outage rules, there is no requirement to submit an initial report.

For more information about outage reporting obligations, please contact Bruce Beard at (314) 394-1535 or bbeard@cm-chi.com or Scott Friedman at (312) 372-3930 or sfriedman@cm-chi.com.

End-of-Year Compliance Check

With the end of the year rapidly approaching, now is a good time to take care of any ongoing or annual compliance obligations and prepare for next year. Some items you may want to check include:

FCC Form 320. FCC rules require cable operators who provide service in aeronautical frequencies (108-137 and 225-400 MHz) to perform an annual signal leakage test and submit the results to the FCC on Form 320. Form 320s are due annually for each system using aeronautical frequencies.

Licenses. Operators with FCC licenses or authorizations (e.g., CARS or radio licenses, or earth station registrations) should review the licenses for expiration dates in 2013. Now is a good time to calendar upcoming renewals.

Subscriber Notices. FCC rules and the Cable Act require cable operators to provide annual notices to subscribers covering:

• Service offerings
• Prices, options, and conditions of service
• Installation, service, and maintenance policies
• Instructions on how to use the cable service
• Channel lineups
• Billing and complaint procedures, including contact information for the local franchise authority
• Prices for rental of navigation devices and CableCARDs
• Equipment compatibility, including notices that:
  • Some models of TVs and other consumer devices (e.g., DVD players, TiVo devices) may not be able to receive all channels on the system
  • Some features of TVs and other consumer devices may not be available if the service is received through a set-top box
  • Retail remote controls may be compatible with the system’s set-top boxes
• Information about the system’s collection of personally identifiable information (PII):
  • The nature of the PII collected and the nature of the use of PII
  • The period the operator retains PII
  • The time and place the subscriber may access the PII
  • Limitations on the collection and disclosure of PII and the subscriber’s rights to enforce those limitations

Additional items are required if the operator: (i) allows subscribers to install additional connections but does not provide the equipment to do so; or (ii) uses encryption technology with customer devices that may require special equipment to enable reception of multiple signals.

Net Neutrality Disclosures. The FCC’s Net Neutrality rules, effective last November, require providers of broadband internet service to disclose information regarding network management practices, network performance, and commercial terms of service. Broadband providers should review their Net Neutrality disclosures periodically to ensure they are accurate, especially if any changes have been made to network management practices (e.g., adoption of usage-based billing).

Cable Public File. FCC rules require cable operators to maintain certain files and records for inspection by the FCC, local franchise authorities, and the public. The requirements vary depending on the size of the system. Systems with fewer than 1,000 subscribers have the fewest obligations, while systems with 5,000 or more subscribers have the most extensive obligations. Operators should review their public files to ensure they are up-to-date.

If you have questions about annual compliance obligations, please contact Jake Baldwin or Scott Friedman at (312) 372-3930, or at jbaldwin@cm-chi.com or sfriedman@cm-chi.com.

________________________________________________________________________

Please visit our website at www.cinnamonmueller.com www.cinnamonmueller.com to learn more about our lawyers and practice. You can reach Cinnamon Mueller at (312) 372-3930. This update is provided by the law firm of Cinnamon Mueller. The document is intended for informational purposes only as a service to clients of Cinnamon Mueller.  It is not intended to provide specific legal advice or to substitute obtaining appropriate legal counsel. We encourage you to consult with counsel to address special compliance issues and for assistance in negotiating or handling any such matter referred to in the update. 

UPDATE

October 19, 2012

Interconnected VoIP Outage Reporting Requirements Effective December 16, 2012 

This week, the Office of Management and Budget (“OMB”) approved the information collection associated with the FCC’s February 2012 Order extending outage reporting requirements to Interconnected VoIP providers.  With OMB approval, the new rules go into effect December 16, 2012.  

The new rules extend Part 4 outage-reporting requirements to facilities-based and non-facilities-based interconnected VoIP providers.  Reporting requirements are limited to situations where there is a complete loss of interconnected VoIP service on the provider’s network.  

Beginning December 16, 2012, interconnected VoIP providers must submit an electronic notification (through the NORS web-based filing system) to the FCC: 

• Within four hours of discovering an outage of at least 30 minutes duration that potentially affects a 911 special facility.  In addition, the VoIP provider also must notify by telephone or other electronic means the designated contact at the affected 911 facility and convey all relevant information. 
• Within 24 hours of discovering an outage of at least 30 minutes duration that (i) potentially affects at least 900,000 user minutes of interconnected VoIP service and results in complete loss of service; or (ii) potentially affects any special offices and facilities (includes major military installations, key government facilities, nuclear power plants or airports). 

In addition, VoIP providers must submit a Final Communications Outage Report to the Commission within 30 days after discovering the outage.  Unlike current outage rules, there is no obligation to submit an initial report. 

For more information about outage reporting obligations, please contact Bruce Beard at (314) 394-1535 or bbeard@cm-chi.com or Scott Friedman at (312) 372-3930 or sfriedman@cm-chi.com. 

November 8, 2012 Deadline to File National EAS Test Results for Companies Who Have Not Complied With National EAS Test Reporting Requirements 

The American Cable Association (“ACA”) recently reached out to cable operators that have yet to comply with the FCC’s national emergency alert system (“EAS”) test reporting requirements.  Per ACA’s conversations with FCC staff, the FCC will accept late-filed reports through November 8, 2012.  

The national EAS test was conducted on November 9, 2011.  All EAS providers, including cable operators, were required to complete three forms – one before the national test, one the day of the test, and a final form by December 27, 2011. 

Cable operators who fail to file the required forms face fines up to $37,500 per day ($375,000).  The FCC’s base fine for failure to file a required form is $3,000. 

If you have questions about whether your company filed its required EAS National Test results, please contact Bruce Beard at (314) 394-1535 or bbeard@cm-chi.com. 

FCC Releases Order Permitting All-Digital Cable Systems to Encrypt the Basic Service Tier

On October 12, 2012, the FCC released an Order lifting its ban on basic tier encryption for all-digital cable systems, provided that the all-digital systems comply with specific consumer protection measures.  To the FCC, “all-digital systems” means systems in which “no television signals are provided using the NTSC system.”  This covers systems that offer unencrypted analog “barker channels,” but does not include hybrid analog/digital systems.  

Before opting to encrypt their basic service tier, all-digital cable operators must fulfill the express customer service protection measures related to equipment offers and subscriber notifications described below. 

Required Equipment Offers.  Operators must for a limited, “transitional” period provide existing customers with their choice of equipment to receive the encrypted basic service tier, as detailed below, all at no charge (including no service charges related to the equipment): 

(i)               For customers receiving only the basic service tier without a set-top box or CableCARD, either a set-top box or CableCARD on up to two televisions sets for two years from the date of encryption;

(ii)              For customers receiving a level of service above basic on one television set, but receiving only basic on other sets without a set-top box or CableCARD, either a set-top box or CableCARD on one television set for one year from the date of encryption; and

(iii)            For Medicaid recipient customers receiving only the basic service tier without a set-top box or CableCARD, either a set-top box or CableCARD on up to two televisions sets for five years from the date of encryption. 

Operators must keep these offers open for a period lasting from at least 30 days prior to encrypting the first basic tier channel through at least 120 days after that. 

Subscriber Notice Requirements.  Related to these required equipment offers, the FCC requires operators to provide notice to existing customers about: 

(i)               the planned encryption and free equipment offers at least 30 days before beginning encryption of the basic service tier; and

(ii)              the end of the free equipment transitional period 30-60 days before its end. 

These notices must contain certain specific language detailed in the Order and FCC regulations.   

If you have questions about basic service tier encryption, please contact Adriana Kissel or Scott Friedman at (312) 372-3930, or at akissel@cm-chi.com or sfriedman@cm-chi.com.

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Please visit our website at www.cinnamonmueller.com www.cinnamonmueller.com to learn more about our lawyers and practice. You can reach Cinnamon Mueller at (312) 372-3930. This update is provided by the law firm of Cinnamon Mueller. The document is intended for informational purposes only as a service to clients of Cinnamon Mueller.  It is not intended to provide specific legal advice or to substitute obtaining appropriate legal counsel. We encourage you to consult with counsel to address special compliance issues and for assistance in negotiating or handling any such matter referred to in the update. 

SPECIAL CLIENT ALERT

October 8, 2012

Requests for Waiver of CALM Act Rules Due October 14, 2012

If your cable system inserts commercials on digital channels, you may be required to install equipment by December 13, 2012 to comply with the FCC’s CALM Act ru. The regulations require cable operators inserting commercials on digital channels to comply with certain volume standards, detailed in a publication called ATSC A/85, by the December 13 deadline. 

If your system uses a third party to insert commercials, you can rely on a certification from the third party that it is in compliance. If you insert commercials on your own, your system must install equipment and software necessary to assure compliance with ATSC A/85. If your system inserts commercials and cannot meet the December 13 deadline, you should seek a waiver. The waiver request must be filed by October 14, 2012. 

Operators who do not insert commercials, and merely pass through commercials embedded by programmers, may generally rely on certifications from programmers to show compliance with ATSC A/85. Again, the regulations apply to digital channels only. 

Two types of waiver are available for operators unable to comply with the rules by December 13. 

Financial Hardship Waiver. The FCC can grant a one-year waiver of the rules’ effective date if an operator shows that it would face a financial hardship to get the equipment necessary to comply. 

To obtain a financial hardship waiver, an operator must show: (i) evidence of its financial condition; (ii) a cost estimate for obtaining the necessary equipment; (iii) an explanation of why its financial condition justifies postponing compliance; and (iv) an estimate of how long it will take to comply. 

Alternatively, a small system (one with fewer than 15,000 subscribers and not affiliated with a large operator) may use a streamlined hardship waiver process, certifying that it: (i) meets the definition of small system; and (ii) needs a one-year delay to obtain the equipment to avoid a financial hardship. 

General Waiver. Under its general waiver standard, the FCC can waive the rules on a showing of “good cause.” General waivers may be appropriate where, for example, a system uses an alternative technology that would make it difficult to comply with ATSC A/85. 

If you have any questions about waivers of the CALM Act rules, please contact Bruce Beard at (314) 394-1535 or bbeard@cm-chi.com or Jake Baldwin at (312) 372-3930 or jbaldwin@cm-chi.com.  

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Please visit our website at www.cinnamonmueller.com www.cinnamonmueller.com to learn more about our lawyers and practice. You can reach Cinnamon Mueller at (312) 372-3930. This update is provided by the law firm of Cinnamon Mueller. The document is intended for informational purposes only as a service to clients of Cinnamon Mueller.  It is not intended to provide specific legal advice or to substitute obtaining appropriate legal counsel. We encourage you to consult with counsel to address special compliance issues and for assistance in negotiating or handling any such matter referred to in the update. 

UPDATE

October 5, 2012

FCC Steps Up Enforcement of Tower Rules 

The FCC has stepped up enforcement of its antenna structure rules, issuing nearly 50 proposed forfeitures in the last year. Alleged violations include, among others, failure to repaint towers to assure visibility.  With FCC field inspectors on the lookout for tower violations, tower owners should make sure their towers comply with the FCC’s rules. Here is a brief overview of the tower rules: 

All towers must display the antenna structure registration number “in a conspicuous place so that it is readily visible” near the base. Owners of towers exceeding 200 feet above ground level or requiring “special aeronautical study” must meet additional requirements, including: 

• Paint and light the tower per FAA standards, and clean or repaint the tower “as often as necessary to maintain good visibility.” 
• Monitor the tower lights daily or use an automatic alarm system to detect light failures.  
• Inspect quarterly all alarm systems and indicators associated with the lighting. 
• Report “immediately by telephone” to the nearest Flight Service Station or FAA office any “known extinguishment or improper functioning” of any top steady burning light or flashing obstruction light not corrected within 30 minutes.  
• Exhibit red obstruction lighting from sunset to sunrise and exhibit all high intensity and medium intensity obstruction lighting continuously. 

            Note: A tower owner is ultimately responsible for compliance even if it has a maintenance agreement with another company.

If you have any questions about the FCC’s antenna structure rules, please contact Scott Friedman or Jake Baldwin at (312) 372-3930 or sfriedman@cm-chi.com or jbaldwin@cm-chi.com. 

FCC Orders Time Warner Cable to Carry In-Market Station in HD 

The FCC recently granted a must-carry complaint filed by broadcast station KEYT against Time Warner Cable and ordered Time Warner to carry KEYT in high-definition (HD) in in-market communities. 

Background. Under the Cable Act, a broadcast station may assert must-carry rights on cable systems within its market. Further, under FCC rules, broadcast signals delivered to a cable system in HD must be carried on the system in HD, unless the “small system exemption” applies. 

Time Warner operates a system that straddles market boundaries in Ventura County, California. KEYT delivers its signal to Time Warner’s system in HD. Time Warner retransmits the signal in standard definition (SD) to both in-market and out-of-market communities in Ventura County. Citing the must-carry rules, KEYT demanded HD carriage for the in-market communities. Time Warner did not respond. 

Complaint. KEYT argued that, because it is a must-carry station delivering its signal to Time Warner in HD, Time Warner must retransmit the signal in HD to in-market communities. Time Warner challenged KEYT’s status as a must-carry station, countering that KEYT elected retransmission consent status for all in-market and out-of-market communities. 

The FCC agreed with KEYT, finding that (i) the station is a must-carry station in the in-market communities and (ii) the retransmission consent election applied only to out-of-market communities. Accordingly, the FCC granted KEYT’s complaint and ordered Time Warner to carry KEYT in HD in the in-market communities. 

Note: The small system exemption allows a system to carry a must-carry signal in SD digital or analog format, even if it is broadcast in HD, so long as all subscribers can view the signal. The exemption applies if a system either (i) serves fewer than 2,501 subscribers and is not affiliated with a large operator, or (ii) has an activated capacity of less than 553 MHz. The exemption sunsets June 12, 2015. 

If you have any questions about broadcast carriage rights or the small system exemption, please contact Bruce Beard at (314) 394-1535 or bbeard@cm-chi.com or Scott Friedman at (312) 372-3930 or sfriedman@cm-chi.com. 

FCC Proposes Forfeiture for Unauthorized Operation of Transmitting Earth Station 

Last week, the FCC issued a proposed forfeiture to Towerstream Corporation for unauthorized operation of a transmitting earth station. 

The Communications Act and FCC rules prohibit the “transmission of energy or communications or signals” by space or earth stations except with FCC authorization. Towerstream is authorized to operate two earth stations. Upon inspection, FCC agents determined that Towerstream was transmitting via a third, unauthorized, earth station. The FCC proposed a $15,000 forfeiture for the violation. 

Note: While FCC authorization is required to operate earth stations that transmit signals, no authorization is required to operate earth stations that only receive signals. Instead, receive-only earth stations may be registered with the FCC to help protect them from interference.           

If you have any questions about seeking authorization for transmit/receive earth stations or registering receive-only earth stations, please contact Scott Friedman or Jake Baldwin at (312) 372-3930 or sfriedman@cm-chi.com or jbaldwin@cm-chi.com. 

FCC DTV Viewability Rule to Sunset December 12, 2012 

The FCC’s dual must-carry, or “viewability,” rule will sunset December 12, 2012. The “viewability” rule requires cable operators with hybrid analog-digital systems to carry digital must-carry signals in both analog and digital format.  

Steps to Drop Analog Carriage. Operators of hybrid systems who want to phase out carriage of analog must-carry signals on December 12, 2012 can do so by: 

(i)               Offering analog subscribers conversion equipment for sale or lease, either for free or at an affordable cost (to the FCC, affordable means a monthly fee of $2 or less); 

(ii)              Providing 90 days prior written notice of the change to affected stations; and 

(iii)            Providing 30 days prior written notice to customers affected by a service change.  

Note: Hybrid systems must continue carrying must-carry stations in both analog and digital formats until December 12, 2012.  

 If you have any questions about the viewability rules, please contact Bruce Beard at (314) 394-1535 or bbeard@cm-chi.com or Scott Friedman at (312) 372-3930 or sfriedman@cm-chi.com.

________________________________________________________________________

Please visit our website at www.cinnamonmueller.com www.cinnamonmueller.com to learn more about our lawyers and practice. You can reach Cinnamon Mueller at (312) 372-3930. This update is provided by the law firm of Cinnamon Mueller. The document is intended for informational purposes only as a service to clients of Cinnamon Mueller.  It is not intended to provide specific legal advice or to substitute obtaining appropriate legal counsel. We encourage you to consult with counsel to address special compliance issues and for assistance in negotiating or handling any such matter referred to in the update. 

UPDATE

September 21, 2012

EEO Form 396-C Filing Deadline October 1, 2012

The FCC’s MVPD Equal Employment Opportunity (“EEO”) Program Annual Report, Form 396-C, must be submitted electronically by midnight on October 1, 2012.  To file Form 396-C, login to the Media Bureau’s CDBS Electronic Filing System.  In addition, the FCC randomly selected a number of cable operators to file a Supplemental Investigation Sheet along with their Form 396-C.  The list of operators required to submit the Supplemental Investigation Sheet is available at http://transition.fcc.gov/Daily_Releases/Daily_Business/2012/db0730/DA-12-1217A1.pdf. 

If you have any questions about EEO compliance, please contact Scott Friedman at (312) 372-3930 or sfriedman@cm-chi.com or Jacob Baldwin at (312) 372-3930 or jbaldwin@cm-chi.com.  

FCC DTV Viewability Rule to Sunset December 12, 2012 

Last June, the FCC released a Report and Order announcing that the FCC’s dual must-carry, or “viewability,” rule will sunset December 12, 2012.  The FCC’s 2007 “viewability” rule requires cable operators with hybrid analog-digital systems to carry digital must-carry signals in both analog and digital format.  

With the December 12, 2012 sunset date approaching, we cover below the steps cable operators can take to phase out carriage of analog must-carry signals on hybrid analog-digital systems. 

Background.  The Communications Act requires cable operators to make must-carry broadcast signals viewable by all of their subscribers. Operators of systems that carry both analog and digital signals, also known as “hybrid” systems, previously could comply with the viewability requirement for must-carry signals by carrying the must-carry signal in analog for all-analog subscribers, in addition to carrying a digital version or by transitioning to an all-digital system. 

New Rule.  After December 12, 2012, operators can make must-carry broadcast signals accessible to analog subscribers by “an effective means,” which may include offering conversion equipment for sale or lease, either for free or at an affordable cost.  

Note:  Hybrid systems must continue carrying must-carry stations in both analog and digital until December 12, 2012.  

Steps to Take Before Dropping Analog Carriage.  Hybrid operators that want to stop carrying must-carry stations in analog and provide the must-carry stations only in digital format can do so by: 

(i)               Offering analog subscribers conversion equipment for sale or lease, either for free or at an affordable cost that does not substantially deter use of the equipment.  To   the FCC, affordable means a monthly fee of no more than $2. 

(ii)              Providing 90 days prior written notice of the signal carriage change to affected broadcast stations; and 

(iii)            Providing 30 days prior written notice to customers affected by a service change.  

Note:  FCC rules prohibit the deletion or repositioning of broadcast stations during sweeps (generally February, May, July, and November). 

If you have any questions about the FCC’s viewability rules or small system HD carriage exemption, please contact Scott Friedman at (312) 372-3930 or sfriedman@cm-chi.com or James Moskowitz at (202) 872-6881 or jmoskowitz@cm-chi.com. 

FCC to Allow Cable Operator Acquisition of CLECs with Overlapping Service Territories 

This week, the FCC issued an Order that will permit cable operators to acquire a competitive local exchange carrier (“CLEC”) with a service territory that overlaps the cable operator’s.  This new ruling opens the door for cable operators to acquire CLECs that provide services in their markets. 

The Order came in response to an NCTA petition, filed last August, that argued that CLECs and cable operators should not be subject to the Communications Act’s cross-ownership prohibitions.  Under Section 652 of the Communications Act, buyouts and certain other transactions between cable operators and local exchange carriers (“LECs”), subject to certain exceptions, are prohibited.  Specifically, section 652(b), with limited exceptions, prohibits cable operators or their affiliates from acquiring more than a 10% financial interest, or management interest, in any LEC providing telephone exchange service within the cable operator’s franchise area (absent a waiver).           

In the Order, the FCC found that Section 652(b) “unambiguously prohibits” a cable operator from acquiring any LEC providing telephone exchange service within the cable operator’s franchise area (absent exception or waiver).  The FCC agreed, however, that it should exercise its general forbearance authority to forbear application of Section 652(b) as it applied to the acquisition of CLECs.  The FCC explained that these transactions pose little risk of competitive harm and often increase competition. 

While this Order opens the way for cable operators to acquire CLECs, the Commission emphasized that these transactions remain subject to several levels of regulatory review, including FCC review under Section 214 of the Communications Act, review by other federal government agencies, such as the Department of Justice and the Federal Trade Commission, as well as review under local franchises and state statutes. 

If you have any questions about the implications of the FCC’s Order allowing cable operator acquisition of CLECs, please contact Bruce Beard at (314) 394-1535 or bbeard@cm-chi.com or James Moskowitz at (202) 872-6881 or jmoskowitz@cm-chi.com.

________________________________________________________________________

Please visit our website at www.cinnamonmueller.com http://www.cinnamonmueller.com to learn more about our lawyers and practice. You can reach Cinnamon Mueller at (312) 372-3930. This update is provided by the law firm of Cinnamon Mueller. The document is intended for informational purposes only as a service to clients of Cinnamon Mueller.  It is not intended to provide specific legal advice or to substitute obtaining appropriate legal counsel. We encourage you to consult with counsel to address special compliance issues and for assistance in negotiating or handling any such matter referred to in the update.