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Memorandum to Clients June 2014

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Memorandum to Clients June 2014 MemorandumMemorandum toto ClientsClients June 2014 News and Analysis of Recent Developments in Communications Law No. 14-06 The Supremes have spoken . now it’s the Swami’s turn. The Supreme Court’s Aereo Decision: What It Says, What It Means By Kevin M. Goldberg [email protected] 703-812-0462 [Editor’s Note: As we have reported on CommLaw- eas with which it is familiar. And it also tried hard to make Blog.com, the Supreme Court has reversed the Second Cir- sure that its decision will not disrupt what it believes it cuit in the Aereo case, giving the TV broadcasting industry knows about new media, such as cloud computing. a major victory. Yes, that’s the result that the Swami, Kevin Goldberg, had predicted. So we asked him to review Let’s take a look at Breyer’s majority opinion (which was the two opinions out of the Supremes – Justice Breyer’s joined in by Chief Justice Roberts and Associate Justices majority opinion and Justice Scalia’s dissent – and let us Kennedy, Ginsburg, Sotomayor and Kagan), and then the know what he found. Here’s his report – but note that we dissent by Scalia (writing for himself and Justices Thomas are dispensing with our routine summary of what Aereo is and Alito). Then I’ll field some questions that I’ve been fre- and how the case got to the Supremes. If you’re just getting quently asked. to the Aereo party now and don’t know the background, check out our blog’s extensive Aereo-related coverage at The Majority Opinion this link. And if you want to see Kevin talking about Aereo, Breyer’s opinion is methodical. It focuses (as it should) on check out his appearance on LXBN TV.] the narrow question of whether Aereo infringes the right to “publicly perform” copyrighted programs when it sells its s I observed following the April 22 oral argument in subscribers “a technologically complex service that allows Aereo, for the most part the Justices on the Supreme A them to watch television programs over the Internet at Court can’t really be described as “tech savvy”. Nothing in about the same time as the programs are broadcast over the either the majority or the “dissenting” opinion changes that. air”. Under the Copyright Act, of course, the public per- (Why the quotes around “dissenting”? We’ll look at that formance right is held exclusively by the copyright holder – below.) and everybody agreed that Aereo was not the copyright holder of any of the over-the-air programming it provided But the Justices’ seeming unfamiliarity and general discom- to subscribers. fort with New Technology may be a good thing. The Court appears to have taken care to limit its Aereo decision to ar- He broke the issue into two questions: does Aereo “perform” the programs at all and, if it does, does it do so “publicly”? Inside this issue . With respect to the first question, it’s clear that Aereo’s sys- tem results in the “performance” – i.e., the display – of Wireless Microphone Users Face copyrighted works. But who is doing the “performing”, Ae- reo or its subscriber? Aereo’s view is that it is merely an Worsening Spectrum Shortage ....................... 2 equipment supplier and that the subscriber, by individually DOJ Opens Review of Music Licensing deciding to avail herself of the equipment provided by Ae- Consent Decrees ............................................. 3 reo, is the one who does all the “performing”. New Technologies Once Again Blurring the Lines of Copyright Law ............................. 4 Needless to say, the language of the Copyright Act does not 2014 Reg Fees Proposed ................................... 6 resolve the question. But in Breyer’s view, a close look at the The Freeze is On for LPTV/Class A/TV Act’s legislative history does. Translator Displacement Applications ............ 9 Sixth White Space Coordinator The 1976 Copyright Act was Congress’s response to two Su- Completes Tests ............................................ 12 preme Court decisions – Fortnightly and Teleprompter, D.C. Circuit Rules Against from 1968 and 1974, respectively. In those cases the Court “John Doe” Lawsuits ..................................... 13 had held that cable television systems were not engaged in Revised CALM Act Rules Adopted .................... 15 the “public performance” of broadcast programming: as it Deadlines ......................................................... 16 said in Fortnightly, “Broadcasters perform. Viewers do not perform. [And a cable provider] falls on the viewer’s side (Continued on page 10) Page 2 Memorandum to Clients June 2014 The spectrum squeeze is on Wireless Microphone Users Face Worsening Spectrum Shortage By Mitchell Lazarus [email protected] 703-812-0440 ireless microphone users are fighting for spectrum. Here is why – and what the FCC is doing about it. W Anyone who watches TV or attends live shows knows about wireless microphones: those black or silver things the per- former holds, plus a lot more equipment backstage. Until recently, few people gave these devices much thought – not even the FCC. Not until the 2009 digital TV transition that transferred 108 MHz of TV spectrum to other uses. Most wireless microphones operate in vacant TV channels. The old analog TV rules required certain TV stations to be spaced far apart – not just those on the same or adjacent channels, but also some that operated many channels apart. That left plenty of room for microphones. But digital TV stations can safely be squeezed more closely together. That made possible the 2009 TV spectrum repacking, which cut the numbers of empty channels and left microphone users scrambling for spectrum, especially in microphone-dense areas like the Broadway theater district, while manufacturers struggled to squeeze more microphones into less spectrum. FLETCHER, HEALD & The FCC added a complication by allowing unlicensed “TV white space” (TVWS) data devices into most of the same vacant TV channels that wireless microphones HILDRETH use. Until the digital repacking there would have been room for both, but the sub- P.L.C. sequent shortage set off acrimonious disputes at the FCC. 1300 N. 17th Street - 11th Floor There was another complication. Back then many wireless microphones operated Arlington, Virginia 22209 illegally. FCC rules required a license, but limited license eligibility to certain nar- Tel: (703) 812-0400 row classes of users: broadcast stations and networks, TV and film producers, Fax: (703) 812-0486 cable companies, and a very few others. Lots of other people used wireless micro- E-Mail: [email protected] phones anyway, including Broadway theaters, outdoor concerts, churches, high- Website: fhhlaw.com Blog site: www.commlawblog.com school performers, and – famously – the FCC’s own meeting room. Co-Editors Rather than enforce against the violators, the FCC instead took steps to make Howard M. Weiss most of the violations go away. A 2010 order granted a blanket waiver allowing Harry F. Cole unlicensed use of wireless microphones up to 50 milliwatts – plenty for most churches and high-school auditoriums (and the FCC meeting room). Later in Assitant Editor 2010, the FCC identified two vacant TV channels in each market for wireless mi- Steve Lovelady crophone use, closed these to TVWS devices, and clarified how both licensed and Contributing Writers unlicensed microphones users could temporarily lock out TVWS devices from other channels, if needed, to protect certain performances. Anne Goodwin Crump, Kevin M. Goldberg, An uneasy truce prevailed – until the FCC proposed a second TV spectrum re- Mitchell Lazarus, Frank Montero packing. and Davina Sashkin Memorandum to Clients is This repacking comes about because the same 6 MHz TV channel that used to published on a regular basis by carry one analog program can now carry multiple digital programs simultane- Fletcher, Heald & Hildreth, P.L.C. ously. The FCC plans an “incentive auction” that will invite broadcasters to accept This publication contains general cash for sharing a TV channel or, if they prefer, for leaving the business alto- legal information which is not gether. Spectrum thus freed up will be auctioned for wireless broadband use, intended to be deemed legal advice or solicitation of clients. with some of the proceeds earmarked to pay off cooperating broadcasters. The Readers should not act upon result: still fewer vacant channels for wireless microphones and TVWS devices. information presented herein without professional legal The FCC’s recent incentive auction order further divides up the ever-smaller pie: counseling addressing the facts and circumstances specific to them. w The two channels now reserved for wireless microphones will become one, shared between wireless microphones and TVWS devices. Distribution of this publication does not create or extend w The new wireless broadband spectrum will include a “duplex gap” 11 MHz an attorney-client relationship. wide between base and mobile frequencies. The FCC will set aside 6 MHz of Copyright © 2014 Fletcher, Heald & Hildreth, P.L.C. this for TVWS and 4 MHz for licensed wireless microphones, primarily for All rights reserved (Continued on page 8) Copying is permitted for internal distribution. June 2014 Memorandum to Clients Page 3 Throwing More Gas on the Music Licensing Fire DOJ Opens Review of Music Licensing Consent Decrees By Kevin M. Goldberg [email protected] 703-812-0462 n its never-ending push-and-pull relationship with what modifications are called for. Specifically, it seeks I the music industry over copyright royalties, the radio comment on several questions: industry currently faces assaults on multiple fronts. While the creation of a “performance right” (or, as Do the Consent Decrees continue to serve important broadcasters view it, a “performance tax”) appears to competitive purposes today? Are there provisions have been staved off for another year (according to the that are no longer necessary to protect competition? NAB), there are plenty of other threats headed the Are there provisions that are ineffective in protect- broadcasters’ way.
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