Thursday, July 22, 2010

Identifying Areas in the U.S. Lacking Any Broadband Options

Despite previous proclamations of near ubiquitous broadband access in the United States, using smaller and more numerous counties instead of zip codes and considering broadband to require far greater than the previous 200 kilo bits per second floor, the FCC now acknowledges that significant numbers of Americans residing in many largely rural areas with low incomes lack any access at all. [1] The Commission now acknowledges “that broadband deployment to all Americans is not reasonable and timely. This conclusion departs from previous broadband deployment reports, which held that even though certain groups of Americans were not receiving timely access to broadband, broadband deployment ‘overall’ was reasonable and timely.” [2]

The Sixth Broadband Deployment Report confirms that a sizeable number of Americans have no broadband access whatsoever, or have access that do not meet the National Broadband Plan goal of affordable service with download speeds of at least 4 megabits per second (“Mbps”) and upload speeds of at least 1 Mbps. [3] The FCC recognized the prior 200 kilobit per second rate, in either direction, “simply is not enough bandwidth to enable a user, using current technology, ‘to originate and receive high-quality voice, data, graphics, and video telecommunications,’ as section 706 [of the Telecommunication Act of 1996] requires of such services.” [4]

Using the higher bit rate threshold the FCC estimates that 1,024 out of 3,230 counties in the United States and its territories are unserved by broadband, [5] and between approximately 14 to 24 million Americans do not have access to broadband today. [6] The Commission makes a number of candid acknowledgements:

The . . . [unserved] group appears to be disproportionately lower-income Americans and Americans who live in rural areas. The goal of the statute, and the standard against which we measure our progress, is universal broadband availability. We have not achieved this goal today, nor does it appear that we will achieve success without changes to present policies. The evidence further indicates that market forces alone are unlikely to ensure that the unserved minority of Americans will be able to obtain the benefits of broadband anytime in the near future. Therefore, if we remain on our current course, a large number of Americans likely will remain excluded from the significant benefits of broadband that most other Americans can access today. Given the ever-growing importance of broadband to our society, we are unable to conclude that broadband is being reasonably and timely deployed to all Americans in this situation. [7]

As evidenced by the ambitious goals in the National Broadband Plan, the Commission aspires to do a better job of promoting affordable and ubiquitous access going forward.

[1] Inquiry Concerning the Deployment of Advanced Telecommunications Capability to All Americans in a Reasonable and Timely Fashion, and Possible Steps to Accelerate Such Deployment Pursuant to Section 706 of the Telecommunications Act of 1996, as Amended by the Broadband Data Improvement Act, GN Docket No. 09-137, Sixth Broadband Deployment Report, (rel. July 20, 2010); available at:[hereinafter cited as Sixth Broadband Deployment Report].

[2] Id. at ¶2.

[3] See FCC, OMNIBUS BROADBAND INITIATIVE (OBI), CONNECTING AMERICA: THE NATIONAL BROADBAND PLAN, GN Docket No. 09-51 (2010) (NATIONAL BROADBAND PLAN); Inquiry Concerning the Deployment of Advanced Telecommunications Capability to All Americans in a Reasonable and Timely Fashion, and Possible Steps to Accelerate Such Deployment Pursuant to Section 706 of the Telecommunications Act of 1996, as Amended by the Broadband Data Improvement Act; A National Broadband Plan for Our Future, GN Docket Nos. 09-51, 09-137, 2010 W.L. 972375 (rel. March 16, 2010). See also, National Broadband Plan, World Wide Web Site,

[4] Sixth Broadband Deployment Report at ¶10.

[5] Id. at ¶22.

[6] Id. at ¶28. The Commission previously reported that about 80 million Americans either do not have access, or do not subscriber to an available broadband service.

[7] Id.

Wednesday, July 21, 2010

Comcast Violates an Unwritten Law

When a venture has petitioned the FCC to approve an acquisition, or to provide greater regulatory relief an unwritten law requires the petitioner to lay low. Comcast has violated this law by imposing, for the second time this year in Pennsylvania, a significant rate hike well in excess of the rate of inflation at the very same time it wants the FCC to approve the company’s acquition of NBC. Not smart.

Comcast surely must know that the optics of buying NBC do not look great no matter how much Comcast says such a transaction will promote competition. Raising both cable and Internet access rates reinforces the notion that the company has market power and faces limited competitive constraints. Of course this is the very company that does not want to pay anything for retransmission consent to carry broadcast television stations even as it charges subscribers $14.50 for the privilege. This company has fought a decade long battle to stymie alternatives to lucrative set top box rentals and now wants the FCC to abandon any efforts to promote CableCards and other alternatives.

It seems as though Comcast cannot lay low even during a time it wants a big gift from the FCC. The least the company could do is throw a gold-plated crumb to subscribers.

Monday, July 19, 2010

Content Deregulation and the Second Circuit Court Opinion on Fleeting Expletives

Acting on a remand from the Supreme Court, which had upheld on procedural grounds the FCC’s increasingly stringent rules limiting broadcast indecency, [1] the Second Circuit Court of Appeals considered First Amendment arguments and concluded that the FCC’s new rules are unconstitutionally vague. [2] Unlike the Supreme Court, which had deferred to the FCC’s decision to tighten its rules, including sanctioning broadcast stations for failing to bleep out spontaneously uttered, “fleeting” expletives, the Second Circuit held that the FCC created a chilling effect [3] that goes far beyond whether broadcasters can let slip the occasional profane word.

The Second Circuit held that the FCC owes broadcasters the same degree of clarity about the Commission’s rules regardless of whether content regulations trigger a lower level of scrutiny by courts [4] as the Supreme Court had deemed appropriate in F.C.C. v Pacifica Foundation, 438 U.S. 726 (1978), where the Court approved an FCC fine for the 2 p.m broadcast of a George

Carlin monologue containing several expletives based on the uniquely pervasiveness of broadcasting and its accessibility by children.

The Second Circuit documented how the FCC shifted its enforcement without clear guidance and with inconsistent application. With an emphasis on context, the FCC found no violation when profane words were used in the film Saving Private Ryan yet the very same words were considered actionable when uttered in a documentary about the Blues music genre. Such inconsistency “raises grave concerns under the First Amendment” [5]  because “nothing would prevent the FCC from applying its indecency policy in a discriminatory manner in the future.” [6]

With such a clear endorsement of media First Amendment freedom, some observers have speculated or hoped that the judiciary, including the Supreme Court, will be inclined to reject more limitations on expression and medium-based analysis of the First Amendment. [7] While acknowledging that it must apply Supreme Court precedent, the Second Circuit strongly implied that “today’s realities” [8] do not support a dichotomy in the degree of permissible government regulation and nature of judicial scrutiny between broadcasting and other media such as the Internet and cable television. [9] Asserting that broadcast television no longer has a uniquely pervasive presence, the court emphasized the substantial changes in the media landscape since the Supreme Court decided the Pacifica case:

The past thirty years has seen an explosion of media sources, and broadcast television has become only one voice in the chorus. Cable television is almost as pervasive as broadcast-almost 87 percent of households subscribe to a cable or satellite service-and most viewers can alternate between broadcast and non-broadcast channels with a click of their remote control. . . . The internet, too, has become omnipresent, offering access to everything from viral videos to feature films and, yes, even broadcast television programs.. . . As the FCC itself acknowledges, “[c]hildren today live in a media environment that is dramatically different from the one in which their parents and grandparents grew up decades ago.” [10]

The Second Circuit argues that broadcasters should qualify for the same insulation from government content regulation as other media in light of enhanced consumer choice and the ability of parents to program their televisions, using the V-Chip, to block children’s’ access to harmful content. [11]

Notwithstanding the Second Circuit’s determination of changed circumstances and the diminution of broadcasters’ market power and influence, [12] the Supreme Court may not follow through with decisions resulting in diminished continuing government oversight and regulation of content potentially harmful to children. The FCC may not appeal the case and the Court may not grant certiorari on appeal. Despite significant changes in the media marketplace, the Court did not grant certiorari in Cablevision Systems Corp. v. F.C.C. [13] where a lower court affirmed the FCC’s must-carry rules that resulted in the carriage of an upstate New York television station by cable systems serving cities on Long Island.

Bear in mind that when the Supreme Court first considered the fleeting expletives case, a majority of the Court endorsed the FCC’s actions, albeit on administrative law grounds. Justice Scalia, the author of the majority decision, made it clear that he believes broadcasters continue to have the ability to harm children. Justice Scalia believes that potential harm in subjecting this assumption to scientific inquiry obviates the need for the FCC to acquire empirical evidence:

There are some propositions for which scant empirical evidence can be marshaled, and the harmful effect of broadcast profanity on children is one of them. One cannot demand a multiyear controlled study, in which some children are intentionally exposed to indecent broadcasts (and insulated from all other indecency), and others are shielded from all indecency. . . . Here it suffices to know that children mimic the behavior they observe-or at least the behavior that is presented to them as normal and appropriate. Programming replete with one-word indecent expletives will tend to produce children who use (at least) one-word indecent expletives. Congress has made the determination that indecent material is harmful to children, and has left enforcement of the ban to the Commission. If enforcement had to be supported by empirical data, the ban would effectively be a nullity. [14]

Justice’s Scalia’s concern for children may have constituted one of the reasons the Court has agreed to consider whether states can restrict minors’ access to potentially harmful video games.

[1] F.C.C. v. Fox Television Stations, Inc., 129 S.Ct. 1800, 1813 (2009)(the FCC’s shift in rules deeming single, non-literal use of an expletive not actionably indecent to one where it is subject to possible exceptions for bona fide news coverage and artistic necessity considered no arbitrary or capricious).

[2] Fox Television Stations, Inc., v. F.C.C., __F.3d __, 2010 W.L. 2736937 (2d Cir. July 13, 2010).

[3] “Under the current policy, broadcasters must choose between not airing or censoring controversial programs and risking massive fines or possibly even loss of their licenses, and it is not surprising which option they choose. Indeed, there is ample evidence in the record that the FCC's indecency policy has chilled protected speech.” Id. at *14 (Westlaw pagination).

[4] “Broadcasters are entitled to the same degree of clarity as other speakers, even if restrictions on their speech are subject to a lower level of scrutiny. It is the language of the rule, not the medium in which it is applied, that determines whether a law or regulation is impermissibly vague.” Id. at *10.

[5] Id. at *14.

[6] Id.

[7] “The Supreme Court, if it takes up the case, should end all government regulations on the content of broadcasts. Technological change has undermined any justification for limiting the First Amendment rights of broadcast media outlets but not others.” Free Speech for Broadcasters, Too, THE NEW YORK TIMES, editorial (July 16, 2010); available at:

[8] Fox Television Stations, Inc. 2010 W.L. 2736937 at * 8.

[9] The court compared the assumptions made by courts when evaluating the degree of First Amendment protection applied to indecent speech transmitted by different media with Internet speakers entitled to full protection, citing Reno v. ACLU, 521 U.S. 844, 874-75 (1997), telephone companies not required to ban entirely “dial-a-porn” calling, citingSable Communications of California v. F.C.C., 492 U.S. 115, 131 (1989), and cable television companies free to transmit sexually oriented content at any hour. First Amendment infringing broadcast regulation is subject to a lower level of judicial scrutiny based on “the twin pillars of pervasiveness and accessibility to children.” Fox Television Stations, Inc. 2010 W.L. 2736937 at * 7 citing Pacifica, 438 U.S. at 748-49.

[10] Fox Television Stations, Inc. 2010 W.L. 2736937 at * 7 (citations omitted).

[11] We can think of no reason why this rationale for applying strict scrutiny in the case of cable television would not apply with equal force to broadcast television in light of the V-chip technology that is now available. Id. at *8.

[12] Other courts have undertaken a more nuanced assessment of media competition and market power. For example in Prometheus Radio Project v. FCC, 373 F. 3d 372 (3d Cir. 2004), the Third Circuit Court of Appeals, rejected the FCC’s methodology for determining media market competitiveness which counted the number of outlets regardless of size and impact. This court also noted that major incumbent media ventures had established a significant presence on the Internet thereby challenging the assumption that the Internet provides new content independent of other media.

[13] 570 F.3d 83 (2d Cir. 2009), cert. den. Cablevision Systems Corp. v. F.C.C., __ S.Ct.__, 2010 W.L. 322891, (U.S. May 17, 2010) (NO. 09-901).

[14] F.C.C. v. Fox Television Stations, Inc., 129 S.Ct. 1800, 1813 (2009).

[15] Video Software Dealers Ass’n v. Schwarzenegger, 556 F.3d 950 (9th Cir. 2009) , cert. granted sub nom., Schwarzenegger v. Entertainment Merchants Ass’n, 130 S.Ct. 2398, (U.S. Apr 26, 2010) (NO. 08-1448).