NAB Ceases Challenge of FCC Online Public File Requirement

NAB withdrew its lawsuit Thursday because the FCC proposed expanding the requirement to broadcast competitors, Wharton said. “Originally the rule only applied to broadcasters,” he said. “We thought that was an unfairness of not making the rule apply to cable, satellite and radio providers, who are also selling political ads. If this is all about transparency and good government, why would you exempt the cable industry?” NAB won’t protest the rule or fight its implementation “as long as our competitors are also going to be required to face the additional regulation.” Complying with the rule is challenging for broadcasters since ads are sometimes bought on an hourly basis during election cycles, Wharton said. “The amount of buying political ads in the final days of a campaign is enormous in markets where there are razor thin margins. Both third party and candidates are buying last-minute spots.”

“I see this as a victory,” said Meredith McGehee, policy director of the Campaign Legal Center. “It’s pretty hard to argue against Internet availability in the 21st century.” Before the online disclosure requirement, people had to go to stations to access paper records, she said. NAB held the case in abeyance to see what would happen, said Andrew Schwartzman, senior counselor at Georgetown University's Institute for Public Representation. “What happened was that the rules went into effect without any significant problems. TV people say it’s a much easier system to upload stuff to the FCC website. It made things significantly easier for them.” Requiring broadcasters to post files online “actually made better sense for broadcasters,” McGehee said. “They keep all these records digitally anyway. It was more burdensome for them to continue to use the paper system.”

“We all know how easy it is to upload something to the Internet,” said Lauren Wilson, Free Press policy counsel. “Making political files more accessible on a platform that we all use every day is important. The Internet is the best place to look for public files.” Wharton said some broadcasters faced computer glitches when trying to upload files: “I’ve heard less comments related to the glitches in the midterms than in the general [election] two years ago. The system is running smoother.”

Broadcasters were concerned that competitors could see the rates they charged, McGehee said. “Broadcasters feel like they have a business advantage when that information is not easily accessible,” she said. The Campaign Legal Center is pushing the commission to spell out requirements to reveal the identity of a sponsor of an ad, she said. “The viewer doesn’t know by watching or if they were to take the other step and go online” to look up an advertiser, she said. “A lot of these groups just have a P.O. Box and you have no clue where the money’s coming from. An innocuous sounding name doesn’t reveal the true ID of the sponsor.”

Sometimes the ad buyer is responsible for providing information, Wharton said. “We’ve reached out to some of the advertising agencies and ad buyers for the campaigns to make sure they understand what this rule is about and how they can comply.” Section 317 has required this for decades, but “post-Citizens United this has been a critical challenge for the FCC,” McGehee said The commission needs to initiate a new rulemaking proceeding or policy to explain the requirements, she said.

The FCC should expand the public files requirement, McGehee said. “I actually think cable and satellite are light-years ahead in terms of facilities,” she said “They won’t face a technological barrier” for uploading public files. Small “mom and pop” radio stations could find it difficult to immediately upload files, but McGehee said the FCC could offer a leeway period for them. The commission will need to define what constitutes smaller radio stations and what compliance is, she said. “Years ago you might’ve had a situation where small operators wouldn’t have Internet access,” Schwartzman said. “But everybody has Internet access at this point.” Some radio stations filed comments complaining about similar issues that TV stations brought up, he said. “Experience has suggested that’s not the case.” The FCC sought comment on expanding the online public file requirement in 2014 in docket 14-127. The Federal Register hasn’t yet published a notice about expanding the requirements to other industries, said an FCC spokeswoman.

The FCC should enforce standardization of the PDFs broadcasters upload, McGehee said. “People upload information in a non-standard format,” she said, saying broadcasters have left out basic information. “We assume, but don’t know, that the media bureau will take some enforcement action against stations that weren’t in full compliance,” Schwartzman said. “No one at the agency is looking," McGehee said. "You could upload your grandma’s recipe.” The Campaign Legal Center and Sunlight Foundation found blanks and other issues with uploaded files, she said. “We had to do that from the outside. It’s troubling.” Schwartzman agreed that the commission should develop a standard methodology. “A number of broadcasters use the NAB’s forms. The NAB’s forms aren’t perfect,” he said. A standardized database is necessary to help the public make sense of the files, McGehee said. “There are so many places, particularly in government, where databases exist. I could even set it up on an Excel sheet. It should be a simple thing.”