July 26, 2006

Some important FCC developments concerning the future of the broadcast band

By J.H. Snider
Truth, Justice, and Telecom Policy

http://quixote.blogs.com/telecompolicy/2006/07/some_important_.html


While media reform activists have been preoccupied with telecom legislation 
on the Hill and the media ownership proceeding at the FCC, the NAB has been 
quietly moving ahead with critical initiatives at the FCC, especially in 
the radio bands. Here are some of the highlights:

     1) The NAB has asked the FCC to drastically restrict the use of FM 
modulators in the FM band (See Report to National Association of 
Broadcasters Regarding Study and Measurements of Part 15 Devices Operating 
in the FM Broadcast Band by MSW, dated June 2, 2006 and later submitted to 
the FCC). FM modulators are unlicensed devices that use the white spaces 
between licensed channels in the FM band. Tens of millions are used by 
portable music players such as the iPod and satellite radio services such 
as XM Satellite. The NAB tested 17 FM modulators and found that 14 of the 
17 were operating illegally. The NAB claims they use too much power and 
have out-of-band emissions and that this cause severe problems for the 
broadcasters' new digital radio (IBOC) service. Let's assume for the moment 
that these devices are indeed operating at higher than allowed power 
limits. Why would manufacturers do this and, if this has been a problem, 
why haven't more consumer complained about interference on current radio 
channels? In large markets with crowded radio dials such as in Washington, 
DC and New York, FM modulators tend not to work as well because of the 
strong nearby channels. So perhaps there is an incentive to provide FM 
modulators with higher power to deal with such situations. If so, why is 
this harmful? Why shouldn't I be able to listen to the music I want in my 
own car? Why not flip the question and ask whether the power levels the FCC 
granted for unlicensed devices operating in the FM white space are too low? 
If my use of an FM modulator harms the reception of an incumbent 
terrestrial radio broadcaster's channel in my own car, what potential harm 
does that do to anyone but myself? Why would I possibly care if the whole 
purpose of the FM modulator is to provide myself with more listening 
options by bypassing the radio programming of incumbent terrestrial radio 
broadcasters? Note that FM modulators only use empty radio channels within 
a given radio market, so even if two cars pass immediately adjacent to each 
other, there is no effect on an incumbent radio broadcaster. The only 
interference could be between the two FM modulators using the same channel. 
If the problem is out-of-band emissions, it's probably reasonable to throw 
the book at the manufacturers. But, if the real problem is slightly higher 
power levels, I think the broadcasters public interest argument is much harder.

     2) The NAB has petitioned the FCC to allow AM radio broadcasters to 
acquire available FM frequencies for FM translator service within their own 
protected coverage areas (see Petition for Rulemaking of the National 
Association of Broadcasters to Permit AM Radio Stations' Use of FM 
Translators, July 17, 2006). The argument is that there are lots of gaps in 
AM coverage, especially at night when many stations are required to operate 
at lower power. The FM translators would thus allow the AM radio 
broadcasters to provide better broadcast service to the public. One of the 
most interesting features of the petition is the broadcasters' claims about 
all the wonderful public service they provide: more than $5 billion worth. 
The question is: why should the AM broadcasters be the recipient of such a 
huge spectrum giveaway? Might that spectrum be put to better alternative 
use? Note that each AM channel is 20 kHz wide (40 kHz after the digital 
radio transition) whereas each FM channel is 200 kHz wide (400 kHz after 
the digital radio transition).

     3) Lastly, there is the big enchilada: FM multicasting rights, which 
are expected to come up for a vote at the FCC in the next few weeks. I have 
already written extensively about this proceeding on my blog and do not 
want to repeat myself here. But the key point is that this is pretty much 
the last time to point out to the FCC that it has given radio broadcasters 
double their licensed spectrum and the capacity to provide up to 20 times 
their current service levels (e.g., up to 20 FM programming streams per 
license) without asking for anything in return. Little noticed in the 
upcoming vote is that in addition to the report and order on multicasting 
(and other IBOC) issues, there is a further notice of proposed rulemaking 
that will cover such issues as the future of free radio and other public 
service obligations. I'd like the FCC to ask some of the following 
questions in this NPRM: should FM broadcasters be allowed to transition 95% 
or more of their spectrum to fee only services? If so, should they pay a 
tax/fee on those services? If not, why is there such a different taxing 
philosophy for fee-based TV and other telecommunications services? In other 
words, why should radio broadcasting be exempt from the principle of 
technological neutrality and regulatory convergence? Another issue concerns 
royalty fees for use of new digital FM radio devices. Unlike the current 
generation of analog FM radios, the largest incumbent radio broadcasters 
control patents on the digital radio standard and get a significant royalty 
fee whenever a digital radio is purchased. In the new world of digital 
radio services, this could pose a big problem. For example, let's suppose 
that the FCC ultimately decides that indoor GPS is a vital public service. 
America already has a free satellite delivered GPS service (thanks to the 
military), but it only works outdoors. Mobile telephone companies also 
provide a terrestrial GPS service that works indoors, but users have to 
subscribe to a mobile telephone service to receive this service and it 
doesn't work with unlicensed devices. I've been told that FM broadcasters 
intend to provide an indoor GPS service (the FM band is considered the gold 
standard for indoor GPS because of its ability to penetrate walls, even the 
concrete cinder blocks in my child's elementary school). The question is 
whether they will be able to charge for indoor GPS service or whether it 
should be provided as a free service, perhaps linked to America's new 
emergency alert system for location based alerts. And if it should be 
provided as a free service, should it be available inexpensively for 
unlicensed devices and other devices not primarily using the broadcast 
band? If, to pick up a "free" indoor GPS signal, an unlicensed device has 
to add $10 in royalties for a chip that costs only 10 cents to produce, is 
this in the public interest?

In the TV band, I want to report on only one item. On July 18, 2006 the FCC 
released a notice granting digital licenses to translators and low power TV 
stations. This puts the final touches on one of the greatest FCC scams 
since the enactment of the Communications Act of 1934. In September 2004 
the FCC granted TV translators and low power stations the digital rights it 
so controversially granted high power TV stations in 1997. But it actually 
went far beyond the grant of rights given to high power broadcasters in 
1997. In the name of preserving and enhancing broadcast service, it has 
essentially allowed TV translators and low power TV the option to exit the 
broadcasting business, something it didn't dare to do for high power TV in 
1997. Giving away all the rights in the name of providing more broadcast 
service is especially outrageous in the year 2006 because rural broadcast 
service can now be provided much more efficiently via local-into-local 
satellite TV and rural communities and Congress are crying out for more 
spectrum for rural broadband service. The FCC should use its new DBS 
proceeding to create a free local-into-local satellite TV service (see my 
comments on Docket 06-123), and be done with rural TV translators once and 
for all so that spectrum can be reallocated for broadband service. In 
December 2004 NAF and MAP filed a petition for reconsideration to prevent 
the FCC from continuing with this extraordinary giveaway of spectrum assets 
to incumbent licensees. The FCC did nothing for close to a year and then 
chose to simply ignore our petition. This public notice is the fruit of 
that outcome. Any petition to deny these free spectrum rights must be 
submitted to the FCC by August 17, 2006.

So, in conclusion, I don't want to in any way dispute the importance of the 
high profile telecom debates currently raging in Washington, DC. But it's 
dangerous for us to ignore the low profile but still vital 
telecommunications policy issues that have been put into play.

Of all the issues I've raised above, I believe that the future of FM 
modulators (unlicensed service in the FM band) may have the most political 
salience and be the best news story. Millions of iPod and satellite radio 
users could be quite interested to learn that the FCC says they are doing 
something illegal when using an unused radio channel within their own car 
or home.


================================
George Antunes, Political Science Dept
University of Houston; Houston, TX 77204
Voice: 713-743-3923  Fax: 713-743-3927
antunes at uh dot edu



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