Draft Channel Sharing Rules Welcomed But May Not Widely Apply
A draft item on new channel sharing rules could present some new opportunities for TV broadcasters, but may be limited in its practical application, numerous attorneys representing both full-power and low-power broadcasters told us. FCC Chairman Ajit Pai distributed the draft item last week (see 1703020076), and it's scheduled for a vote at the March 23 commissioners’ meeting. The draft would allow limited sharing for LPTV and translators with each other and with full powers, and sharing outside the context of the incentive auction. It's good for the FCC to be giving broadcasters these options, but opportunities for them to be applied are likely to be “rare,” said Fletcher Heald broadcast attorney Peter Tannenwald. “There are several restrictions that could reduce the viability of channel sharing under the draft order,” said Wiley Rein broadcast attorney Ari Meltzer in a blog post.
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The draft item would allow full-power stations to be part of channel sharing agreements where they host other stations, and LPTV and translator stations could be either host stations or hosted ones. Full powers and Class A’s that sold their spectrum and entered into channel sharing agreements as part of the incentive auction could enter into new such agreements if the original ones end, under the draft. Those proposed rules could mean a full power could end up hosting a low-power station, and the draft item would then allow the secondary service to broadcast at the higher power level of their host’s facilities. “The biggest beneficiaries of the new rules may be LPTV and TV translator stations, which can use channel sharing to avoid displacement.” said Meltzer.
Boosting the power of an LP station or a translator would be attractive to a secondary service broadcaster, but there’s little incentive for a full power to make such a deal, Tannenwald said. Full-power broadcasters sometimes acquire LPTV stations to get access to additional channels and increase their leverage in retrans negotiations, but sharing with an LPTV station won’t confer the same benefits he said. There could be situations created by geography or market conditions where deals between LPTV stations and full powers make good business sense, but they're unlikely to be very common, said Fletcher Heald broadcast attorney Dan Kirkpatrick.
The draft sharing order also restricts stations’ auction-related sharing to the windows in the incentive auction rules, Meltzer said. Under those rules, a station that doesn’t implement channel sharing within six months of receiving auction winnings “must surrender its license and will be unable to channel share in the future.” Meltzer said. The draft rules also would require sharing agreements unrelated to the auction to follow community of licensee rules, so a host station would need to be capable of providing a signal over a hosted station's entire community of license, Meltzer said. Some provisions in the draft also raise additional questions, Kirkpatrick told us. If a situation were to arise where a low-power station hosts a full power, the host's lower signal could create carriage issues, he said.
Tannenwald conceded it’s not clear how the provisions of the order will be used post-incentive auction, when many displaced LPTV and translator stations will be looking for new homes. “It’s an unknown world,” he said.