[House Report 106-79]
[From the U.S. Government Publishing Office]
106th Congress Rept. 106-79
HOUSE OF REPRESENTATIVES
1st Session Part 1
_______________________________________________________________________
SATELLITE COMPETITION AND CONSUMER PROTECTION ACT
_______________________________________________________________________
April 7, 1999.--Ordered to be printed
_______
Mr. Bliley, from the Committee on Commerce, submitted the following
R E P O R T
together with
ADDITIONAL VIEWS
[To accompany H.R. 851]
[Including cost estimate of the Congressional Budget Office]
The Committee on Commerce, to whom was referred the bill
(H.R. 851) to require the Federal Communications Commission to
establish improved predictive models for determining the
availability of television broadcast signals, having considered
the same, report favorably thereon with an amendment and
recommend that the bill as amended do pass.
CONTENTS
Page
Amendment........................................................ 2
Purpose and Summary.............................................. 11
Background and Need for Legislation.............................. 11
Hearings......................................................... 15
Committee Consideration.......................................... 15
Rollcall Votes................................................... 15
Committee Oversight Findings..................................... 16
Committee on Government Reform Oversight Findings................ 16
New Budget Authority, Entitlement Authority, and Tax Expenditures 16
Committee Cost Estimate.......................................... 16
Congressional Budget Office Estimate............................. 16
Federal Mandates Statement....................................... 21
Advisory Committee Statement..................................... 21
Constitutional Authority Statement............................... 21
Applicability to Legislative Branch.............................. 21
Section-by-Section Analysis of the Legislation................... 21
Changes in Existing Law Made by the Bill, as Reported............ 27
Additional Views................................................. 57
Amendment
The amendment is as follows:
Strike out all after the enacting clause and insert in lieu
thereof the following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Satellite Competition and Consumer
Protection Act''.
TITLE I--AMENDMENTS TO THE COMMUNICATIONS ACT OF 1934
SEC. 101. RETRANSMISSION CONSENT.
Section 325(b) of the Communications Act of 1934 (47 U.S.C. 325(b))
is amended--
(1) by amending paragraphs (1) and (2) to read as follows:
``(b)(1) No cable system or other multichannel video programming
distributor shall retransmit the signal of a television broadcast
station, or any part thereof, except--
``(A) with the express authority of the originating station;
``(B) pursuant to section 614, in the case of a station
electing, in accordance with this subsection, to assert the
right to carriage under such section; or
``(C) pursuant to section 338, in the case of a station
electing, in accordance with this subsection, to assert the
right to carriage under such section.
``(2) The provisions of this subsection shall not apply--
``(A) to retransmission of the signal of a noncommercial
television broadcast station;
``(B) to retransmission of the signal of a television
broadcast station outside the station's local market by a
satellite carrier directly to its subscribers, if--
``(i) such station was a superstation on May 1, 1991;
``(ii) as of July 1, 1998, such station was
retransmitted by a satellite carrier under the
compulsory license of section 119 of title 17, United
States Code; and
``(iii) the satellite carrier complies with all
network nonduplication, syndicated exclusivity, and
sports blackout rules adopted by the Commission
pursuant to section 712 of this Act;
``(C) until 7 months after the date of enactment of the
Satellite Competition and Consumer Protection Act, to
retransmission of the signal of a television network station
directly to a satellite antenna, if the subscriber receiving
the signal is located in an area outside the local market of
such station; or
``(D) to retransmission by a cable operator or other
multichannel video provider, other than a satellite carrier, of
the signal of a television broadcast station outside the
station's local market if such signal was obtained from a
satellite carrier and--
``(i) the originating station was a superstation on
May 1, 1991; and
``(ii) as of July 1, 1998, such station was
retransmitted by a satellite carrier under the
compulsory license of section 119 of title 17, United
States Code.'';
(2) by adding at the end of paragraph (3) the following new
subparagraph:
``(C) Within 45 days after the date of enactment of the Satellite
Competition and Consumer Protection Act, the Commission shall commence
a rulemaking proceeding to revise the regulations governing the
exercise by television broadcast stations of the right to grant
retransmission consent under this subsection, and such other
regulations as are necessary to administer the limitations contained in
paragraph (2). The Commission shall complete all actions necessary to
prescribe such regulations within one year after such date of
enactment. Such regulations shall--
``(i) establish election time periods that correspond with
those regulations adopted under subparagraph (B) of this
paragraph; and
``(ii) prohibit television broadcast stations that provide
retransmission consent from engaging in discriminatory
practices, understandings, arrangements, and activities,
including exclusive contracts for carriage, that prevent a
satellite carrier from obtaining retransmission consent from
such stations.'';
(3) in paragraph (4), by adding at the end the following new
sentence: ``If an originating television station elects under
paragraph (3)(C) to exercise its right to grant retransmission
consent under this subsection with respect to a satellite
carrier, the provisions of section 338 shall not apply to the
carriage of the signal of such station by such satellite
carrier.'';
(4) in paragraph (5), by striking ``614 or 615'' and
inserting ``338, 614, or 615''; and
(5) by adding at the end the following new paragraph:
``(7) For purposes of this subsection, the term `television broadcast
station' means an over-the-air commercial or noncommercial television
broadcast station licensed by the Commission under subpart E of part 73
of title 47, Code of Federal Regulations, except that such term does
not include a low-power or translator television station.''.
SEC. 102. MUST-CARRY FOR SATELLITE CARRIERS RETRANSMITTING TELEVISION
BROADCAST SIGNALS.
Title III of the Communications Act of 1934 is amended by inserting
after section 337 (47 U.S.C. 337) the following new section:
``SEC. 338. CARRIAGE OF LOCAL TELEVISION SIGNALS BY SATELLITE CARRIERS.
``(a) Carriage Obligations.--
``(1) In general.--Subject to the limitations of subparagraph
(2), each satellite carrier providing secondary transmissions
to subscribers located within the local market of a television
broadcast station of a primary transmission made by that
station shall carry upon request all television broadcast
stations located within that local market, subject to section
325(b), by retransmitting thesignal or signals of such stations
that are identified by Commission regulations for purposes of this
section.
``(2) Effective date.--No satellite carrier shall be required
to carry local television broadcast stations under paragraph
(1) until January 1, 2002.
``(b) Good Signal Required.--
``(1) Costs.--A television broadcast station asserting its
right to carriage under subsection (a) shall be required to
bear the costs associated with delivering a good quality signal
to the designated local receive facility of the satellite
carrier or to another facility that is acceptable to at least
one-half the stations asserting the right to carriage in the
local market.
``(2) Regulations.--The regulations issued under subsection
(g) shall set forth the obligations necessary to carry out this
subsection.
``(c) Duplication Not Required.--
``(1) Commercial stations.--Notwithstanding subsection (a), a
satellite carrier shall not be required to carry upon request
the signal of any local commercial television broadcast station
that substantially duplicates the signal of another local
commercial television broadcast station which is secondarily
transmitted by the satellite carrier within the same local
market, or to carry upon request the signals of more than 1
local commercial television broadcast station in a single local
market that is affiliated with a particular television network.
``(2) Noncommercial stations.--The Commission shall prescribe
regulations limiting the carriage requirements under subsection
(a) of satellite carriers with respect to the carriage of
multiple local noncommercial television broadcast stations. To
the extent possible, such regulations shall provide the same
degree of carriage by satellite carriers of such multiple
stations as is provided by cable systems under section 615.
``(d) Channel Positioning.--No satellite carrier shall be required to
provide the signal of a local television broadcast station to
subscribers in that station's local market on any particular channel
number or to provide the signals in any particular order, except that
the satellite carrier shall retransmit the signal of the local
television broadcast stations to subscribers in the stations' local
market on contiguous channels and provide access to such station's
signals at a nondiscriminatory price and in a nondiscriminatory manner
on any navigational device, on-screen program guide, or menu.
``(e) Compensation for Carriage.--A satellite carrier shall not
accept or request monetary payment or other valuable consideration in
exchange either for carriage of local television broadcast stations in
fulfillment of the requirements of this section or for channel
positioning rights provided to such stations under this section, except
that any such station may be required to bear the costs associated with
delivering a good quality signal to the local receive facility of the
satellite carrier.
``(f) Remedies.--
``(1) Complaints by broadcast stations.--Whenever a local
television broadcast station believes that a satellite carrier
has failed to meet its obligations under this section, such
station shall notify the carrier, in writing, of the alleged
failure and identify its reasons for believing that the
satellite carrier is obligated to carry upon request the signal
of such station or has otherwise failed to comply with other
requirements of this section. The satellite carrier shall,
within 30 days of such written notification, respond in writing
to such notification and either begin carrying the signal of
such station in accordance with the terms requested or state
its reasons for believing that it is not obligated to carry
such signal or is in compliance with other requirements of this
section, as the case may be. A local television broadcast
station that is denied carriage in accordance with this section
by a satellite carrier or is otherwise harmed by a response by
a satellite carrier that it is in compliance with other
requirements of this section may obtain review of such denial
or response by filing a compliant with the Commission. Such
complaint shall allege the manner in which such satellite
carrier has failed to meet its obligations and the basis for
such allegations.
``(2) Opportunity to respond.--The Commission shall afford
the satellite carrier against which a complaint is filed under
subparagraph (A) an opportunity to present data and arguments
to establish that there has been no failure to meet its
obligations under this section.
``(3) Remedial actions; dismissal.--Within 120 days after the
date a complaint is filed under subparagraph (A), the
Commission shall determine whether the satellite carrier has
met its obligations under this chapter. If the Commission
determines that the satellite carrier has failed to meet such
obligations, the Commission shall order the satellite carrier,
in the case of an obligation to carry a station, to begin
carriage of the station and to continue such carriage for
atleast 12 months, or, in the case of the failure to meet other
obligations under this section, shall take other appropriate remedial
action. If the Commission determines that the satellite carrier has
fully met the requirements of this chapter, the Commission shall
dismiss the complaint.
``(g) Regulations by Commission.--Within 180 days after the date of
enactment of this section, the Commission shall, following a rulemaking
proceeding, issue regulations implementing this section.
``(h) Definitions.--As used in this section:
``(1) Subscriber.--The term `subscriber' means an entity that
receives a secondary transmission service by means of a
secondary transmission from a satellite and pays a fee for the
service, directly or indirectly, to the satellite carrier or to
a distributor.
``(2) Distributor.--The term `distributor' means an entity
which contracts to distribute secondary transmissions from a
satellite carrier and, either as a single channel or in a
package with other programming, provides the secondary
transmission either directly to individual subscribers or
indirectly through other program distribution entities.
``(3) Local receive facility.--The term `local receive
facility' means the reception point in each local market which
a satellite carrier designates for delivery of the signal of
the station for purposes of retransmission.
``(4) Television broadcast station.--The term `television
broadcast station' has the meaning given such term in section
325(b)(7).
``(5) Secondary transmission.--The term `secondary
transmission' has the meaning given such term in section 119(c)
of title 17, United States Code.''.
SEC. 103. NONDUPLICATION OF PROGRAMMING BROADCAST BY LOCAL STATIONS.
Section 712 of the Communications Act of 1934 (47 U.S.C. 612) is
amended to read as follows:
``SEC. 712. NONDUPLICATION OF PROGRAMMING BROADCAST BY LOCAL STATIONS.
``(a) Extension of Network Nonduplication, Syndicated Exclusivity,
and Sports Blackout to Satellite Retransmission.--Within 45 days after
the date of enactment of the Satellite Competition and Consumer
Protection Act, the Commission shall commence a single rulemaking
proceeding to establish regulations that apply network nonduplication
protection, syndicated exclusivity protection, and sports blackout
protection to the retransmission of broadcast signals by satellite
carriers to subscribers. To the extent possible consistent with
subsection (b), such regulations shall provide the same degree of
protection against retransmission of broadcast signals as is provided
by the network nonduplication (47 C.F.R. 76.92), syndicated exclusivity
(47 C.F.R. 151), and sports blackout (47 C.F.R. 76.67) rules applicable
to cable television systems. The Commission shall complete all actions
necessary to prescribe regulations required by this section so that the
regulations shall become effective within 1 year after such date of
enactment.
``(b) Establishment of Network Nonduplication Boundaries.--
``(1) Establishment of signal standard for network
nonduplication required.--The Commission shall establish a
signal intensity standard for purposes of determining the
network nonduplication rights of local television broadcast
stations. Until revised pursuant to subsection (c), such
standard shall be the Grade B field strength standard
prescribed by the Commission in section 73.683 of the
Commission's regulations (47 C.F.R. 73.683). For purposes of
this section, the standard established under this paragraph is
referred to as the `Network Nonduplication Signal Standard'.
``(2) Establishment of improved predictive model required.--
Within 180 days after the date of enactment of the Satellite
Competition and Consumer Protection Act, the Commission shall
take all actions necessary, including any reconsideration, to
develop and prescribe by rule a point-to-point predictive model
for reliably and presumptively determining the ability of
individual locations to receive signals in accordance with the
Network Nonduplication Signal Standard. In prescribing such
model, the Commission shall ensure that such model takes into
account terrain, building structures, and other land cover
variations. The Commission shall establish procedures for the
continued refinement in the application of the model by the use
of additional data as it becomes available. For purposes of
this section, such model is referred to as the `Network
Nonduplication Reception Model', and the area encompassing
locations that are predicted to have the ability to receive
such a signal of a particular broadcast station is referred to
as that station's `Reception Model Area'.
``(3) Network nonduplication.--The network nonduplication
regulations required under subsection (a) shall allow a
television network station to assert nonduplication rights as
follows:
``(A) If a satellite carrier is retransmitting that
station, or any other television broadcast stations
located in the same local market, to subscribers
located in that station's local market, the television
network station may assert nonduplication rights
against the satellite carrier throughout the area
within which that station may assert such rights under
the rules applicable to cable television systems (47
C.F.R. 76.92), except as provided in subparagraph (C).
``(B) If a satellite carrier is not retransmitting
any television broadcast stations located in the
television network station's local market to
subscribers located in such market, the television
network station may assert nonduplication rights
against the satellite carrier in the geographic area
that is within such station's Reception Model Area, but
such geographic area shall not extend beyond the local
market of such station.
``(C) If there are 2 or more television network
stations that are each affiliates of a single
television network within the same local market,
neither such station may assert under subparagraph (A)
nonduplication rights against a satellite carrier in an
area that is outside the Reception Model Area of that
station.
``(4) Waivers.--The network nonduplication protection
described in paragraph (3) shall not apply to a subscriber who
files with the satellite carrier a written waiver with respect
to that subscriber obtained from a television network station
allowing the subscriber to receive satellite retransmission of
another network station affiliated with that same network. The
television network station shall accept or reject a
subscriber's request for a waiver within 30 days after receipt
of the request. The television network station and the
satellite carrier shall maintain a file available to the public
that contains such waiver requests and the acceptances and
rejections thereof.
``(5) Objective verification.--If a subscriber submits a
petition to the Commission or an entity designated by the
Commission by rule--
``(A) that alleges that such subscriber does not
receive a signal that meets or exceeds the Network
Nonduplication Signal Standard; and
``(B) includes a processing fee in an amount
prescribed by regulation to recover the cost of
administering the provisions of this paragraph;
the network nonduplication rights described in paragraph (3)
shall not apply to that subscriber unless such station submits
to the Commission or such entity and to the subscriber the
written findings and conclusions of a test conducted in
accordance with the provisions of section 73.686(d) of title
47, Code of Federal Regulations, or any successor regulation,
demonstrating that the subscriber receives a signal that meets
or exceeds the Network Nonduplication Signal Standard. A
subscriber is required to file a waiver request under paragraph
(4) before filing a petition under this paragraph. A subscriber
may not be required to bear any portion of the cost of such
test.
``(6) Recreational vehicle location.--In the case of a
subscriber to a satellite carrier who has installed satellite
reception equipment in a recreational vehicle, and who has
permitted any television network station seeking to assert
network nonduplication rights to verify the motor vehicle
registration, license, and proof of ownership of such vehicle,
the subscriber shall be considered to be outside the local
market and Reception Model Area of such station. For purposes
of this paragraph, the term `recreational vehicle' does not
include any residential manufactured home, as defined in
section 603(6) of the National Manufactured Housing
Construction and Safety Standards Act of 1974 (42 U.S.C.
5402(6)).
``(c) Review and Revision of Standards and Model.--
``(1) Ongoing inquiry required.--Not later than 2 years after
the date of enactment of the Satellite Competition and Consumer
Protection Act, the Commission shall conduct an inquiry of the
extent to which the Network Nonduplication Signal Standard, the
Network Nonduplication Reception Model, and the Reception Model
Areas of television stations are adequate to reliably measure
the ability of consumers to receive an acceptable over-the-air
television broadcast signal.
``(2) Data to be considered.--In conducting the inquiry
required by paragraph (1), the Commission shall consider as
evidence that consumers are not receiving a signal of the
quality described in such paragraph--
``(A) the number of subscribers requesting waivers
under subsection (b)(4), and the number of waivers that
are denied;
``(B) the number of subscribers submitting petitions
under subsection (b)(5), and the number of such
petitions that are granted;
``(C) the results of any consumer research study that
may be undertaken to carry out the purposes of this
section; and
``(D) the extent to which consumers are not legally
entitled to install broadcast reception devices assumed
in the Commission's standard.
``(3) Report and action.--The Commission shall submit to the
Congress a report on the inquiry required by this subsection
not later than the end of the 2-year period described in
paragraph (1). The Commission shall complete any actions
necessary to revise the Network Nonduplication Signal Standard,
the Network Nonduplication Reception Model, and the Reception
Model Areas of television stations in accordance with the
findings of such inquiry not later than 6 months after the end
of such 2-year period.
``(4) Data submission.--The Commission shall prescribe by
rule the data required to be submitted by television broadcast
stations and by satellite carriers to the Commission or such
designated entity to carry out this subsection, and the format
for submission of such data.''.
SEC. 104. CONSENT OF MEMBERSHIP TO RETRANSMISSION OF PUBLIC
BROADCASTING SERVICE SATELLITE FEED.
Section 396 of the Communications Act of 1934 (47 U.S.C. 396) is
amended by adding at the end the following new subsection:
``(n) The Public Broadcasting Service shall certify to the Board on
an annual basis that a majority of its membership supports or does not
support the secondary transmission of the Public Broadcasting Service
satellite feed, and provide notice to each satellite carrier carrying
such feed of such certification.''.
SEC. 105. INQUIRY ON RURAL SERVICE REQUIRED.
(a) Inquiry Required.--Within 180 days after the enactment of this
section, the National Telecommunications and Information Administration
shall complete an inquiry into the availability of local television
broadcast signals in small and rural markets as part of a service that
competes with, or supplements, video programming delivered by satellite
carriers or cable operators. The Administration shall submit to the
Committee on Commerce of the House of Representatives and the Committee
on Commerce, Science, and Transportation of the Senate a report on the
results of such inquiry.
(b) Analysis Required.--The inquiry under subsection (a) shall
include an analysis of--
(1) the technological capability of dual satellite dish
technology to receive effectively over-the-air broadcast
transmissions from the local market, the availability of such
capability in small and rural markets and the affordability of
such capability;
(2) the technological capability (including interference),
availability, and affordability of wireless cable (or
terrestrial wireless) delivery of local broadcast stations,
including the feasibility and desirability of the expedited
licensing of such competitive wireless technologies for rural
and small markets; and
(3) the technological capability, availability, and
affordability of a broadcast-only basic tier of cable service.
SEC. 106. DEFINITIONS.
Section 3 of the Communications Act of 1934 (47 U.S.C. 153) is
amended--
(1) by redesignating--
(A) paragraphs (49) through (52) as paragraphs (52)
through (55), respectively;
(B) paragraphs (39) through (48) as paragraphs (41)
through (50), respectively; and
(C) paragraphs (27) through (38) as paragraph (28)
through (39), respectively;
(2) by inserting after paragraph (26) the following new
paragraph:
``(27) Local market.--
``(A) In general.--The term `local market', in the
case of both commercial and noncommercial television
broadcast stations, means the designated market area in
which a station is located, and--
``(i) in the case of a commercial television
broadcast station, all commercial television
broadcast stations licensed to a community
within the same designated market area are
within the same local market; and
``(ii) in the case of a noncommercial
educational television broadcast station, the
market includes any station that is licensed to
a community within the same designated market
area as the noncommercial educational
television broadcast station.
``(B) County of license.--In addition to the area
described in subparagraph (A), a station's local market
includes the county in which the station's community of
license is located.
``(C) Designated market area.--For purposes of
subparagraph (A), the term `designated market area'
means a designated market area, as determined by
Nielsen Media Research and published in the DMA Market
and Demographic Report.'';
(3) by inserting after paragraph (39) (as redesignated by
paragraph (1) of this section) the following new paragraph:
``(40) Satellite carrier.--The term `satellite carrier' means
an entity that uses the facilities of a satellite or satellite
service licensed by the Commission, and operates in the Fixed-
Satellite Service under part 25 of title 47 of the Code of
Federal Regulations or the Direct Broadcast Satellite Service
under part 100 of title 47 of the Code of Federal Regulations,
to establish and operate a channel of communications for point-
to-multipoint distribution of television station signals, and
that owns or leases a capacity or service on a satellite in
order to provide such point-to-multipoint distribution, except
to the extent that such entity provides such distribution
pursuant to tariff under this Act.''; and
(3) by inserting after paragraph (50) (as redesignated by
paragraph (1) of this section) the following new paragraph:
``(51) Television network; television network station.--
``(A) Television network.--The term `television
network' means a television network in the United
States which offers an interconnected program service
on a regular basis for 15 or more hours per week to at
least 25 affiliated broadcast stations in 10 or more
States.
``(B) Television network station.--The term
`television network station' means a television
broadcast station that is owned or operated by, or
affiliated with, a television network.''.
SEC. 107. COMPLETION OF BIENNIAL REGULATORY REVIEW.
Within 180 days after the date of enactment of this Act, the
Commission shall complete the biennial review required by section
202(h) of the Telecommunications Act of 1996.
TITLE II--AMENDMENTS TO TITLE 17, UNITED STATES CODE
SEC. 201. LIMITATIONS ON EXCLUSIVE RIGHTS; SECONDARY TRANSMISSIONS BY
SATELLITE CARRIERS WITHIN LOCAL MARKETS.
(a) In General.--Section 119 of title 17, United States Code, is
amended to read as follows:
``Sec. 119. Limitations on exclusive rights; Secondary transmissions by
satellite carriers
``(a) Secondary Transmissions of Television Broadcast Stations by
Satellite Carriers.--
``(1) Statutory license.--Subject to the provisions of
paragraphs (2), (3), (4), and (5) of this subsection and
section 114(d), a secondary transmission that is in compliance
with the rules, regulations, and authorizations of the Federal
Communications Commission of a primary transmission made by a
television broadcast station and embodying a performance or
display of a work may have a statutory license under this
section if the satellite carrier makes a direct or indirect
charge to subscribers for the secondary transmission or to a
distributor that has contracted with the satellite carrier for
direct or indirect delivery of the secondary transmission. For
purposes of this section, the Public Broadcasting Service
satellite feed shall be considered a primary transmission made
by a television broadcast station that is in compliance with
the rules, regulations, and authorizations of the Federal
Communications Commission, except that subsequent to--
``(A) the date when a majority of subscribers to
satellite carriers are able to receive the signal of at
least one noncommercial educational television
broadcast station from their satellite carrier within
such stations' local market, or
``(B) 2 years after the effective date of the
Satellite Competition and Consumer Protection Act,
whichever is earlier, the statutory license created by this
section with respect to such satellite feed shall be
conditioned on the annual certification of support under
section 396(n) of the Communications Act of 1934.
``(2) Submission of subscriber lists.--(A) A satellite
carrier that makes secondary transmissions of a primary
transmission of a television broadcast station under paragraph
(1) shall, within 90 days after commencing such secondary
transmissions, submit to that station a list identifying all
subscribers to which the satellite carrier currently makes
secondary transmissions of that primary transmission. Such list
shall be organized by State, identifying all subscribers by
name (including street address, county, and 9-digit zip code)
in that State that receive secondary transmissions of that
primary transmission.
``(B) After the list is submitted under subparagraph (A), the
satellite carrier shall, on the 15th of each month, submit to
the television broadcast station a list identifying by State
the names (including street address, county, and 9-digit zip
code) of any subscribers who have been added or dropped as
subscribers since the last submission under this paragraph.
``(C) Subscriber information submitted by a satellite carrier
under this paragraph may be used only for purposes of
monitoring compliance by the satellite carrier with the
statutory license created by this section. The submission of
subscriber lists is only required for those television
broadcast stations that place on file with the Register of
Copyrights a document identifying the name and address of the
person to whom such submissions are to be made. The Register
shall maintain for public inspection a file of all such
documents.
``(3) Noncompliance with reporting and payment
requirements.--Notwithstanding the provisions of paragraph (1),
the willful or repeated secondary transmission to the public
that is in compliance with the rules, regulations, and
authorizations of the Federal Communications Commission by a
satellite carrier of a primary transmission made by a
television broadcast station and embodying a performance or
display of a work is actionable as an act of infringement under
section 501, and is fully subject to the remedies provided by
sections 502 through 506 and 509, if the satellite carrier has
not deposited the statement of account and royalty fees
required by subsection (b).
``(4) Willful alterations.--Notwithstanding the provisions of
paragraph (1), the secondary transmission to the public that is
in compliance with the rules, regulations, and authorizations
of the Federal Communications Commission by a satellite carrier
of a primary transmission made by a television broadcast
station and embodying a performance or display of a work is
actionable as an act of infringement under section 501, and is
fully subject to the remedies provided by sections 502 through
506 and sections 509 and 510, if the content of the particular
program in which the performance or display is embodied, or any
commercial advertising or station announcement transmitted by a
primary transmitter during, or immediately before or after the
transmission of such program, is in any way willfully altered
by the satellite carrier through changes, deletions, or
additions, or is combined with programming from any other
broadcast signal.
``(5) Discrimination by satellite carrier.--Notwithstanding
the provisions of paragraph (1), the willful or repeated
secondary transmission to the public that is in compliance with
the rules, regulations, and authorizations of the Federal
Communications Commission by a satellite carrier of a primary
transmission made by a television broadcast station and
embodying the performance or display of a work is actionable as
an act of infringement under section 501, and is fully subject
to the remedies provided by sections 502 through 506 and 509,
if the satellite carrier unlawfully discriminates against a
distributor.
``(6) Geographic limitation on secondary transmissions.--The
statutory license created by this section shall apply only to
secondary transmissions to subscribers located in the United
States.
``(b) Statutory License for Secondary Transmissions of Television
Broadcast Stations.--
``(1) Deposits with the register of copyrights.--A satellite
carrier whose secondary transmissions are subject to statutory
licensing under subsection (a) shall, on a semiannual basis,
deposit with the Register of Copyrights, in accordance with the
requirements that the Register shall prescribe by regulation--
``(A) a statement of account, covering the preceding
6-month period, specifying the names and locations of
all television broadcast stations whose signals were
retransmitted at any time during that period to
subscribers, the total number of subscribers that
received such secondarytransmissions, and such other
data as the Register of Copyrights may from time to time prescribe by
regulation, and
``(B) a royalty fee for that 6-month period, computed
as follows:
``(i) For each television network station
that is retransmitted to subscribers located
outside the local market of that station, by
multiplying the total number of subscribers
receiving such secondary transmission during
each calendar month by the royalty fee
prescribed in section 258.3(b)(2) of title 37,
Code of Federal Regulations, as in effect on
January 1, 1998.
``(ii) For each superstation that is
retransmitted to subscribers located outside
the local market of that station, by
multiplying the total number of subscribers
receiving such secondary transmission during
each calendar month by the royalty fee
prescribed in section 258.3(b)(1) of title 37,
Code of Federal Regulations, as in effect on
January 1, 1998.
``(iii) By adding together the totals
computed under clauses (i) and (ii).
For secondary transmissions of a television broadcast station
to subscribers who reside within the local market of that
station, there shall be no royalty fee.
``(2) Investment of fees.--The Register of Copyrights shall
receive all fees deposited under this section and, after
deducting the reasonable costs incurred by the Copyright Office
under this section (other than the costs deducted under
paragraph (4)), shall deposit the balance in the Treasury of
the United States, in such manner as the Secretary of the
Treasury directs. Any funds held by the Secretary of the
Treasury shall be invested in interest bearing securities of
the United States for later distribution with interest by the
Librarian of Congress as provided by this title. The Register
may, in the Register's discretion, at any time after four years
have elapsed since the close of any calendar year, close out
the royalty payments account for that calendar year, and may
treat any funds remaining in such account and any subsequent
deposits that would otherwise be attributable to that calendar
year as attributable to the succeeding calendar year.
``(3) Persons to whom fees are distributed.--The royalty fees
deposited under paragraph (2) shall, in accordance with the
procedures provided by paragraph (4), be distributed to those
copyright owners whose works were included in a secondary
transmission to the public made by a satellite carrier during
the applicable 6-month accounting period and who file a claim
with the Librarian of Congress under paragraph (4). For
purposes of section 802 of this title, with respect to royalty
fees paid by satellite carriers for retransmitting the Public
Broadcasting Service satellite feed, the Public Broadcasting
Service shall be agent for all public television copyright
claimants and all Public Broadcasting Service member stations.
``(4) Procedures for distribution.--The royalty fees
deposited under paragraph (2) shall be distributed in
accordance with the following procedures:
``(A) Filing of claims for fees.--During the month of
July in each year, each person claiming to be entitled
to statutory license fees for secondary transmissions
under this section shall file a claim with the
Librarian of Congress, in accordance with requirements
that the Librarian shall pre-
scribe by regulation. For purposes of this paragraph,
any claimants may agree among themselves as to the
proportionate division of statutory license fees among
them, may lump their claims together and file them
jointly or as a single claim, or may designate a common
agent to receive payment on their behalf.
``(B) Determination of controversy; distributions.--
After the first day of August of each year, the
Librarian of Congress shall determine whether there
exists a controversy concerning the distribution of
royalty fees. If the Librarian determines that no such
controversy exists, the Librarian shall, after
deducting reasonable administrative costs under this
paragraph, distribute such fees to the copyright owners
entitled to receive them, or to their designated
agents. If the Librarian finds the existence of a
controversy, the Librarian shall, pursuant to chapter 8
of this title, convene a copyright arbitration royalty
panel to determine the distribution of fees.
``(C) Withholding of fees during controversy.--During
the pendency of any proceeding under this subsection,
the Librarian of Congress shall withhold from
distribution an amount sufficient to satisfy all claims
with respect to which a controversy exists, but shall
have discretion to proceed to distribute any amounts
that are not in controversy.
``(c) Definitions.--As used in this section--
``(1) Distributor.--The term `distributor' means any entity
which contracts to distribute secondary transmissions from a
satellite carrier and, either as a single channel or in a
package with other programming, provides the secondary
transmission either directly to individual subscribers or
indirectly through other program distribution entities.
``(2) Local market.--The term `local market' of a television
broadcast station has the meaning given that term section 3 of
the Communications Act of 1934 (47 U.S.C. 153) as interpreted
under the rules, regulations, and authorizations of the Federal
Communications Commission relating to carriage of television
broadcast signals by satellite carriers.
``(3) Primary transmission.--The term `primary transmission'
has the meaning given that term in section 111(f) of this
title.
``(4) Public broadcasting service satellite feed.--The term
`Public Broadcasting Service satellite feed' means the national
satellite feed distributed by the Public Broadcasting Service
for purposes of this section consisting of educational and
informational programming, to which the Public Broadcasting
Service holds national terrestrial broadcast rights.
``(5) Satellite carrier.--The term `satellite carrier' has
the meaning given that term in section 3 of the Communications
Act of 1934.
``(6) Secondary transmission.--The term `secondary
transmission' has the meaning given that term in section 111(f)
of this title.
``(7) Subscriber.--The term `subscriber' means an entity that
receives a secondary transmission service by means of a
secondary transmission from a satellite and pays a fee for the
service, directly or indirectly, to the satellite carrier or a
distributor.
``(8) Superstation.--The term `superstation' means a
television broadcast station, other than a television network
station, licensed by the Federal Communications Commission that
is secondarily transmitted by a satellite carrier, and includes
the Public Broadcasting Service satellite feed.
``(9) Television broadcast station.--The term `television
broadcast station' has the meaning given that term in section
325(b)(7) of the Communications Act of 1934.
``(10) Television network station.--The term `television
network station' means--
``(A) a television network station (as defined in
section 3 of the Communications Act of 1934); or
``(B) a noncommercial educational broadcast station
(as defined in section 397 of such Act).
``(d) Exclusivity of This Section With Respect to Secondary
Transmissions of Television Broadcast Stations by Satellite to Members
of the Public.--No provision of section 111 of this title or any other
law (other than this section) shall be construed to contain any
authorization, exemption, or license through which secondary
transmissions by satellite carriers of programming contained in a
primary transmission may be made without obtaining the consent of the
copyright owner.''.
(b) Conforming Amendments.--
(1) Table of contents.--The table of sections for chapter 1
of title 17, United States Code, is amended by striking the
item relating to section 119 and inserting the following:
``119. Limitation on exclusive rights: Secondary transmissions by
satellite carriers.''.
(2) Standing.--Subsection (e) of section 501 of title 17,
United States Code, is repealed.
SEC. 202. REDUCTION IN ROYALTY FEES.
The royalty fee prescribed in section 119(b)(1)(B)(i) of title 17,
United States Code, as amended by section 201(a) of this Act, is
reduced by 45 percent, effective upon July 1, 1999. The royalty fee
prescribed in section 119(b)(1)(B)(ii) of such title, as so amended, is
reduced by 30 percent, effective upon July 1, 1999.
Purpose and Summary
The purpose of H.R. 851, the Satellite Competition and
Consumer Protection Act, is to promote competition in the
market for multichannel video programming distribution
(``MVPD'') through the availability of satellite-delivered
local broadcast television programming. H.R. 851: (1) clarifies
the scope of local broadcast stations' rights in granting
retransmission consent to satellite carriers; (2) delays
implementation of satellite must-carry rules until January 1,
2002; (3) imposes network non-duplication, syndicated
exclusivity, and sports blackout rules for satellite-delivered
broadcast programming; (4) provides satellite carriers with a
permanent compulsory copyright license to transmit both local
and distant broadcast television programming; and (5) reduces
the copyright royalty fees that satellite carriers pay for the
out-of-market distribution of broadcast programming.
Background and Need for Legislation
The Current State of Video Competition
At its core, the Satellite Competition and Consumer
Protection Act is about promoting competition in the MVPD
market. A recent Federal Communications Commission (``FCC'')
report on the status of competition in the MVPD market
1 found that, while subscribership to satellite
television services is growing exponentially, incumbent cable
operators still retain a dominant position in the MVPD market,
with about 85 percent of the MVPD market. Moreover, the FCC's
report also found that cable rates increased an average of 8.5
percent over the 12-month period from June 1997 to June 1998,
compared to a 1.7 percent increase in the consumer price index
(``CPI'') for the same period.
---------------------------------------------------------------------------
\1\ See Annual Assessment of the Status of Competition in Markets
for the Delivery of Video Programming, Fifth Annual Report, CS Docket
No. 98-102 (rel. Dec. 23, 1998).
---------------------------------------------------------------------------
It is important to note that these cable rate increases
have occurred under the auspices of the FCC's cable rate
regulation regime (the statutory authority for which expired on
March 31, 1999). As a result, competition is widely viewed as
the most effective tool for protecting consumers against rate
increases. Thus, the Committee is exploring alternative, non-
regulatory means to promoting more competition in the MVPD
market, and satellite-delivered television is a key component
of that effort.
Emergence of Satellite Television
Satellite-delivered television arrived in the mid-1970s,
and emerged as a serious competitor in the MVPD market in the
1990s. During that period, it never competed directly against
other multichannel video programming providers, such as cable.
Instead, it served those markets (particularly rural markets)
where cable and over-the-air broadcast either could not or
would not provide service.
But recent advances in satellite technology (e.g., smaller
dishes, added signal capacity) have enabled distributors to
compete directly with cable and over-the-air broadcast
television service, even in urban markets. Satellite television
has, therefore, become a key competitor in the MVPD market. To
be sure, satellite television is not yet a complete substitute
for other terrestrial-based multichannel systems, such as cable
and wireless cable. In part, this is because satellite
television systems have traditionally lacked both the
technology and legal authority to distribute local broadcast
signals (i.e., ``local-into-local'').
Satellite television distributors have, therefore, sought
to differentiate their service by offering consumers hundreds
of channels of high-quality national programming, including
``packages'' of out-of-market broadcast signals (e.g., WCBS in
New York, or WRAL in Raleigh) as well as superstation signals
(e.g., WGN, WWOR). Notwithstanding the unavailability of local
broadcast programming, consumers have responded positively to
satellite television offerings. Satellite television--and
particularly high-powered direct broadcast satellite (``DBS'')
service--has made substantial inroads into incumbent cable's
historically dominant position in the MVPD market. The FCC's
report on the MVPD market found that over 10 million households
subscribe to satellite television service, and that two out of
three new subscribers to an MVPD service choose DBS.
SHVA's Compulsory Licensing Regime
The Committee finds that in order for satellite television
to compete more effectively with cable in the MVPD market,
Congress must reform the Satellite Home Viewer Act (``SHVA'').
First enacted in 1988, and then re-authorized in 1994, SHVA
governs the manner in which satellite television distributors
can re-transmit broadcast network programming to households in
markets unserved by either cable or over-the-air broadcast
television service. Specifically, SHVA currently extends to
satellite television distributors a ``compulsory copyright
license'' to re-transmit distant network-affiliated signals to
``unserved households.'' 2 Through a compulsory
license, satellite television distributors avoid the
significant transaction costs and practical difficulties of
obtaining clearance for every program carried on every
broadcast station. A compulsory license essentially ``compels''
a copyright holder to license its programming to a distributor
(such as a satellite television operator or a cable operator),
in return for the distributor paying a fee that is either
statutorily or administratively prescribed.
---------------------------------------------------------------------------
\2\ The current compulsory license also includes superstation
signals, such as WGN in Chicago. The superstation license, however, has
no geographic limitation similar to the unserved household limitation
on network programming signals. 17 U.S.C. Sec. 119(a)(1).
---------------------------------------------------------------------------
Congress, however, placed a key limitation on the satellite
distributors' compulsory license, i.e., the license permits
satellite television distributors to re-transmit out-of-market
network programming only to ``unserved households.'' SHVA
currently defines ``unserved households'' as those that: (1)
cannot receive an over-the-air signal of ``grade B intensity''
3 from a local broadcast station affiliated with
that network using a conventional roof-top antenna, and (2)
have not subscribed to a cable system that provides the signal
of a local broadcast station affiliated with that network
within the previous 90 days. Unserved households are
colloquially referred to as ``white areas,'' because their
television sets receive only ``white snow'' when using a
rooftop antenna.
---------------------------------------------------------------------------
\3\ ``Grade B intensity'' measures the strength of the television
signal at a given location.
---------------------------------------------------------------------------
The unserved household limitation is intended to protect
the traditional network-affiliate relationship. Broadcast
networks give local affiliates an exclusive license to
distribute network programming in a given market. Local
affiliates, in turn, rely upon and market this exclusivity to
attract commercial advertisers. Because advertising revenue is
its only source of revenue, a local broadcast station strives
to reach as many households as possible within its market.
Thus, when a satellite television operator distributes out-of-
market, or distant, network signals to households that can
otherwise receive local signals over the air, the local
broadcast station's viewership (and hence, advertising revenue)
necessarily declines. The unserved household limitation
therefore has helped to preserve local affiliates' bargained-
for exclusivity, and in doing so, promoted the development of
local programming and free, over-the-air television.
``White Area'' Litigation
The unserved household limitation, however, has proven to
be difficult to enforce, and as such, has led to a great deal
of confusion and uncertainty for consumers. In March 1997,
local television broadcast stations affiliated with CBS and Fox
filed suit in Miami, Florida, against PrimeTime 24, a
distributor of satellite-delivered network programming. The
broadcasters argued that PrimeTime 24 willfully violated SHVA's
unserved household limitation by selling packages of out-of-
market broadcast signals to households that were otherwise able
to receive local broadcast signals via conventional rooftop
antennas.
In December 1998, the Miami court ruled in favor of the
plaintiff broadcasters in light of the overwhelming evidence
that a substantial number of PrimeTime 24's subscribers lived
in close proximity to local broadcast station transmitters (or,
stated technically, lived ``within the stations' Grade A
contours''). The court, therefore, ordered that satellite
television distributors shut off network programming signals
for about 2.2 million households. But at a recent Subcommittee
on Telecommunications, Trade, and Consumer Protection hearing,
the Committee learned that the scope of the court's injunction
was unnecessarily broad. Specifically, testimony before the
Subcommittee made clear that as many as 10 percent of the homes
subject to the court's injunction were genuinely ``unserved''
and, therefore, eligible for satellite-delivered network
programming. While the courts' ability and authority to
interpret the law is unquestionable, their remedies are
sometimes too blunt, particularly in cases, such as this one,
where the remedy affects a broad class of consumers who, to the
best of their knowledge, violated no Federal law. It is,
therefore, critical that, on a going-forward basis, Congress
empower expert agencies with implementing and enforcing
telecommunications policy.
SHVA Reform: Enabling Local-into-Local
The key to more competition with cable, as well as a
partial solution to the ``white area'' problem, is to provide
satellite carriers with the legal authority to distribute local
broadcast signals back into local markets, i.e., ``local-into-
local.'' As previously stated, satellite carriers traditionally
lacked the technological capability to provide local broadcast
signals, and as a result, sold packages of distant network
signals to meet consumer demand for network programming.
Consequently, the satellite compulsory license was limited to
superstation and distant signal distribution.
But digital compression, as well as ``spot beam''
technology, have advanced to the point where satellite carriers
have enough capacity to carry many (if not all) local broadcast
signals from around the country. The Subcommittee received
testimony from two satellite carriers--Local TV on Satellite,
and EchoStar--that, within a couple of years, plan to provide
consumers living in numerous cities with access to their local
broadcast stations via satellite. Satellite television, in
other words, now has the technological ability to offer
consumers a complete substitute for incumbent cable offerings.
SHVA Reform: Refining Distant Signal Eligibility Rules
The other key component to reforming SHVA is to further
refine the rules regarding consumers' eligibility for distant
network signals. Under current law, a consumer's eligibility
for satellite-delivered network programming turns on whether he
or she, among other things, ``cannot receive, through the use
of a conventional outdoor rooftop receiving antenna, an over-
the-air signal of grade B intensity (as defined by the Federal
Communications Commission).'' 4 This eligibility
standard has led to protracted litigation between the
television broadcast industry and the satellite television
industry. The broadcast industry argues that the standard is
sufficient. The problem (in the broadcast industry's view) lies
not in the statute but with satellite television distributors
that have willfully violated the unserved household limitation.
The satellite industry maintains that the statute is too vague,
as well as outdated given that it relies on a signal intensity
standard that was acceptable to consumers in the 1950s but may
be unacceptable to today's consumers.
---------------------------------------------------------------------------
\4\ 17 U.S.C. Sec. 119(d)(10) (defining ``unserved household'' for
purposes of determining the scope of the network station compulsory
license).
---------------------------------------------------------------------------
In any event, it is clear to the Committee that criteria
for eligibility need refinement, both in terms of their
implementation and enforcement. Consumers have become pawns in
a lawsuit between two warring industries, and the Committee
seeks to avoid a repeat of this scenario. At the same time,
however, the Committee re-affirms its historical commitment to
localism. As previously mentioned, the unserved household
limitation served a valuable purpose: to preserve local
affiliates' bargained-for exclusivity, and promote the
development of local programming and free, over-the-air
television.
H.R. 851, therefore, seeks to achieve a critical balance
between promoting competition and preserving localism. In doing
so, H.R. 851 makes numerous changes to telecommunications and
copyright law to enable local-into-local, as well as to refine
the rules for consumer eligibility for distant network signals.
Moreover, these amendments are premised on the idea that, to
the extent possible, similar rules and obligations should apply
to similarly situated distributors of multichannel video
programming. In other words, because local-into-local will
enable satellite television service to serve as a more complete
substitute to cable service, then satellite and cable service
providers should operate on similar regulatory footing.
Hearings
The Subcommittee on Telecommunications, Trade, and Consumer
Protection held a hearing on February 24, 1999, to consider
issues relating to reform and reauthorization of the Satellite
Home Viewer Act. The Subcommittee received testimony from
Deborah Lathen, Chief, Cable Services Bureau, FCC; Charles C.
Hewitt, President, Satellite Broadcasting and Communications
Association (``SBCA''); Gene Kimmelman, Co-Director, Consumers
Union; Andy Fisher, Executive Vice President, Cox Broadcasting;
Jack Perry, President and Chief Executive Officer (``CEO''),
Decisionmark; Sophia Collier, President and CEO, Northpoint
Technology; Al DeVaney, President, NewsWeb Broadcasting; John
Hutchinson, Executive Vice President and Chief Operating
Officer, Local TV on Satellite; and David K. Moskowitz, Senior
Vice President and General Counsel, EchoStar.
Committee Consideration
On March 4, 1999, the Subcommittee on Telecommunications,
Trade, and Consumer Protection met in open markup session and
approved H.R. 851 for Full Committee consideration, amended, by
a voice vote. On March 25, 1999, the Full Committee met in open
markup session and ordered H.R. 851 reported to the House,
amended, by a voice vote, a quorum being present.
Rollcall Votes
Clause 3(b) of rule XIII of the Rules of the House requires
the Committee to list the recorded votes on the motion to
report legislation and amendments thereto.
There were no recorded votes taken in connection with
ordering H.R. 851 reported. An Amendment in the Nature of a
Substitute offered by Mr. Tauzin, was agreed to, amended, by a
voice vote. An Amendment to the Tauzin Amendment in the Nature
of a Substitute offered by Mr. Boucher to require the National
Telecommunications and Information Administration to conduct a
study and report to Congress on the availability of local
television broadcast signals in small and rural markets as part
of a service that competes with, or supplements, video
programming delivered by satellite carriers or cable operators
was agreed to by a voice vote. An Amendment to the Tauzin
Amendment in the Nature of a Substitute offered by Mrs. Wilson
to exempt the provision of the bill relating to network non-
duplication for subscribers that install a satellite receiver
on a recreational vehicle, was agreed to by a voice vote. An
Amendment to the Tauzin Amendment in the Nature of a Substitute
offered by Mr. Green to require satellite providers or vendors
to provide a free, over-the-air antenna to receive local
broadcast signals to subscribers who have been terminated from
receiving a distant network signal, was withdrawn by unanimous
consent.
A motion by Mr. Bliley to order H.R. 851 reported to the
House, amended, was agreed to by a voice vote, a quorum being
present.
Committee Oversight Findings
Pursuant to clause 3(c)(1) of rule XIII of the Rules of the
House of Representatives, the Committee held an oversight
hearing and made findings that are reflected in this report.
Committee on Government Reform Oversight Findings
Pursuant to clause 3(c)(4) of rule XIII of the Rules of the
House of Representatives, no oversight findings have been
submitted to the Committee by the Committee on Government
Reform.
New Budget Authority, Entitlement Authority, and Tax Expenditures
In compliance with clause 3(c)(2) of rule XIII of the Rules
of the House of Representatives, the Committee finds that H.R.
851, the Satellite Competition and Consumer Protection Act,
would result in no new or increased budget authority,
entitlement authority, or tax expenditures or revenues.
Committee Cost Estimate
The Committee adopts as its own the cost estimate prepared
by the Director of the Congressional Budget Office pursuant to
section 402 of the Congressional Budget Act of 1974.
Congressional Budget Office Estimate
Pursuant to clause 3(c)(3) of rule XIII of the Rules of the
House of Representatives, the following is the cost estimate
provided by the Congressional Budget Office pursuant to section
402 of the Congressional Budget Act of 1974:
U.S. Congress,
Congressional Budget Office,
Washington, DC, April 7, 1999.
Hon. Tom Bliley,
Chairman, Committee on Commerce,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 851, the Satellite
Competition and Consumer Protection Act.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contacts are Mark Hadley
(for federal costs), Hester Grippando (for revenues), Theresa
Fullo (for the state and local impact), and Jean Wooster (for
the private-sector impact).
Sincerely,
Barry B. Anderson,
(For Dan L. Crippen, Director).
Enclosure.
H.R. 851--Satellite Competition and Consumer Protection Act
Summary: H.R. 851 would allow satellite carriers (companies
that use satellite transmissions to provide television signals
directly to consumers) to retransmit the signals of local
television broadcast stations into the local markets of those
stations. The bill would allow a local broadcast station to
require, by January 1, 2002, satellite carriers that serve
customers in its market to transmit its signal. In addition,
the bill would eliminate a 90-day waiting period for households
that switch from cable to satellite service.
Under the Satellite Home Viewer Act of 1988 (Public Law
100-667), satellite carriers pay a monthly royalty fee for each
subscriber to the U.S. Copyright Office for the right to
retransmit distant network and superstation signals by
satellite to subscribers for private home viewing. The
Copyright Office later distributes the fees to those who own
copyrights on the material retransmitted by satellite. The bill
would permanently extend the requirement that satellite
carriers pay royalty fees to the federal government. Beginning
July 1, 1999, the bill would reduce the current royalty fees
charged to superstations by 30 percent, to $0.19 per subscriber
per channel per month, and the fees paid by network stations by
45 percent to $0.15.
CBO estimates that enacting H.R. 851 would result in a net
increase in revenues of $477 million over the 2000-2004 period
and of $916 million over the 2005-2009 period. After review by
an arbitration panel, royalty fees are paid to copyright
owners, along with accrued interest earnings. With higher
royalty collections, the payments to copyright holders would
also be higher under H.R. 851, by an estimated $152 million
over the 2000-2004 period, and by another $750 million over the
following five years. Because H.R. 851 would affect both
revenues and direct spending, it would be subject to pay-as-
you-go procedures. Assuming appropriation of the necessary
amounts, CBO also estimates that complying with the provisions
of the bill would cost the Federal Communications Commission
(FCC) and the National Telecommunications and Informa-
tion Administration (NTIA) about $2 million in 2000 and less
than $500,000 in each subsequent year.H.R. 851 would impose
both intergovernmental and private-sector mandates, as defined by the
Unfunded Mandates Reform Act (UMRA), but CBO estimates that the cost of
the mandates would not exceed the thresholds established by UMRA ($50
million in 1996, adjusted for inflation for intergovernmental entities
and $100 million in 1996, adjusted for inflation for the private
sector).
Estimated cost to the Federal government: The estimated
budgetary impact of H.R. 851 is shown in the following table.
The costs of this legislation fall within budget function 370
(commerce and housing credit).
----------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
-----------------------------------------------------------
1999 2000 2001 2002 2003 2004
----------------------------------------------------------------------------------------------------------------
REVENUES AND DIRECT SPENDING \1\
Recepits and spending under current law:
Estimated revenues \2\.......................... 244 185 118 112 107 101
Estimated budget authority \3\.................. 272 281 219 142 131 121
Estimated outlays............................... 209 207 259 264 220 182
Proposed changes:
Estimated revenues.............................. 0 17 92 107 122 139
Estimated budget authority...................... 0 18 97 116 136 155
Estimated outlays............................... 0 0 4 19 35 94
Net increase in the surplus..................... 0 17 88 88 87 45
Receipts and spending under H.R. 851:
Estimated revenues \2\.......................... 244 202 210 219 229 240
Estimated budget authority \3\.................. 272 299 316 258 267 276
Estimated outlays............................... 209 207 263 283 255 276
----------------------------------------------------------------------------------------------------------------
\1\ In addition to the effects shown in the table, H.R. 851 would increase spending subject to appropriation by
about $2 million in 2000 and by less than $500,000 in each subsequent year.
\2\ Includes royalty fee collections from cable television stations, satellite carriers, and digital audio
devices.
\3\ Payments to copyright owners include interest earnings on securities held by the Copyright Office.
Basis of estimate: H.R. 851 would allow a satellite carrier
to make secondary transmissions of local television broadcasts,
eliminate the waiting period for switching from cable to
satellite service, reduce the rates of copyright royalty fees,
and permanently extend those fees. All of these provisions
would affect payments by satellite carriers to the federal
government and payments by the federal government to copyright
holders. CBO assumes that payments from the federal government
to copyright holders for satellite transmissions would follow
historical patterns. Assuming enactment of the bill before the
end of fiscal year 1999, CBO estimates that H.R. 851 would
increase revenues by $477 million and increase spending by $152
million over the 2000-2004 period.
Secondary transmission.--H.R. 851 would allow satellite
carriers to retransmit the signals of local television
broadcast stations into the local markets of those stations.
The bill also would eliminate a provision of current law that
requires households to wait 90 days between ending cable
service and beginning satellite service. These provisions would
make the services provided by satellite carriers more
attractive. As a result, CBO expects that the number of
subscribers to satellite services would increase more rapidly
than under current law. Based on information from the Copyright
Office, CBO estimates that under H.R. 851 the annual change in
the volume of satellite services would increase from a
projected rate of 10 percent a year to 17 percent in 2000.
In addition, H.R. 851 would allow a local broadcast station
to require, by January 1, 2002, satellite carriers that serve
customers in its market to transmit its signal. This provision
would reduce revenues from fees in two ways. First, satellite
carriers might enter new markets more slowly as they grapple
with the technical difficulty of carrying hundreds of local
signals. Second, satellite carriers would provide subscribers
with fewer distant network signals and more signals of local
broadcast stations. Under the bill, satellite carriers would
not pay the royalty fee for local broadcast stations.
CBO estimates that the annual growth in fee volume would
gradually decrease from the projected rate of 17 percent in
2000 to about 3 percent by 2009. Because the bill's provisions
could increase the incentives for choosing satellite service
over cable service, they might lead to a loss in revenues from
cable fees. However, based on information from the Copyright
Office and the cable and satellite industries, CBO estimates
that any such reduction in revenues would not be significant.
Reduction in the copyright royalty fee.--A rule issued on
October 28, 1997, by the Librarian of Congress, increased the
royalty fee to $0.27 per subscriber per month. H.R. 851 would
reduce the royalty fee on superstations by 30 percent to $0.19
per subscriber per channel per month and the rates on network
stations by 45 percent to $0.15, effective July 1, 1999. Based
on information from the Copyright Office, CBO estimates that
this provision would reduce revenues by $26 million in fiscal
year 2000, when the fees would expire under current law. But
this reduction would be more than offset by permanently
extending the copyright royalty fees.
Extension of copyright royalty fees.--Under current law,
the royalty fees for satellite carriers expire on December 31,
1999. H.R. 851 would permanently extend royalty fees,
increasing both revenue from satellite carriers and payments to
copyright holders (including interest) during the 2000-2004
period. In fiscal year 2000, the net change in estimated
revenues would be relatively small--$17 million--because the
additional revenue from extending the fees ($43 million) would
be partially offset by a reduction in fee payments due early in
the year under current law. By 2004, CBO expects additional
revenues to total $139 million because of the fee extension.
Payments to copyright holders.--H.R. 851 would result in
additional spending because all revenues are eventually paid to
copyright holders with interest. Historical spending patterns
indicate that copyright holders may receive the fees and
interest up to 10 years after the Copyright Office has
collected the revenues. Thus, CBO estimates a significant lag
between changes in revenues and the eventual changes in the
outlays that stem from copyright fees.
Discretionary spending.--H.R. 851 would require the FCC to
conduct rule makings containing technical and business
relationships between satellite carriers and local broadcast
stations. The bill also would require the FCC to report on
methods for facilitating the delivery of local signals in local
markets, especially smaller markets. Based on information from
the FCC, CBO estimates that implementing H.R. 851 would cost
the commission about $1 million in 2000 and less than $500,000
in each subsequent year, subject to the availability of
appropriated funds. H.R. 851 would require NTIA to report on
the availability of local television broadcast signals in small
and rural markets. Based on information from NTIA, CBO
estimates that conducting the inquiry would cost $500,000 to $1
million in 2000, subject to the availability of appropriated
funds.
Pay-as-you-go considerations.--The Balanced Budget and
Emergency Deficit Control Act sets up pay-as-you-go procedures
for legislation affecting direct spending or receipts. The new
changes in outlays and governmental receipts that are subject
to pay-as-you-go procedures are shown in the following table.
For the purposes of enforcing pay-as-you-go procedures, only
the effects in the current year, the budget year, and the
succeeding four years are counted.
----------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
----------------------------------------------------------------------------
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
----------------------------------------------------------------------------------------------------------------
Changes in outlays................. 0 0 4 19 35 94 108 125 153 173 191
Changes in receipts................ 0 17 92 107 122 139 156 172 186 197 205
----------------------------------------------------------------------------------------------------------------
Intergovernmental and private-sector impact: H.R. 851 would
impose both intergovernmental and private-sector mandates, as
defined by UMRA. The cost of the intergovernmental mandate
would be insignificant and would not exceed the threshold
established by UMRA ($50 million in 1996, adjusted for
inflation). The cost of the private-sector mandates imposed on
satellite carriers and network broadcast stations also would
not exceed the annual threshold for private-sector mandates
($100 million in 1996, adjusted for inflation).
Section 104 would impose a mandate on the Public
Broadcasting Service (PBS). The requirement would be both an
intergovernmental and private-sector mandate because PBS is
owned and operated by local noncommercial television stations
that include both publicly and privately owned stations. This
bill would require that PBS annually certify whether the
majority of its member stations support the retransmission of
PBS's national satellite feed. PBS must also provide such
certification to the satellite carriers that carry that feed.
Based on information from PBS, CBO estimates that the cost to
comply with this mandate wouldbe insignificant because PBS
regularly surveys its members for other purposes and could easily
incorporate this new requirement into existing surveys.
The remaining mandates would impose requirements on
satellite carriers and network stations, all private-sector
entities. Section 101 would require satellite carriers to
obtain consent from a television broadcast station to
rebroadcast programs to subscribers outside the local
broadcast. That requirement would be effective seven months
after enactment of this bill. The costs imposed on the
satellite carriers would be mostly administrative costs for
negotiating agreements with local network stations. CBO
believes that those costs would be small.
Section 103 would require that both satellite providers and
network television stations maintain a publicly available file
of subscribers' requests to allow the satellite retransmission
of the signal of a network affiliate. Information from
satellite carriers and networks indicates that most currently
maintain some or all of that information. CBO estimates that
the additional costs incurred by the satellite carriers and
network television stations would be small.
An additional economic effect of this bill (not associated
with a federal mandate) would result from changes to the
royalty fees paid by satellite carriers to copyright holders,
including some state and local government entities. The bill
would reduce the fees from current levels and permanently
extend them. If the current arrangement for collecting
royalties were to expire, satellite owners would have to reach
agreement with each copyright owner, which would be difficult
and expensive.
Previous CBO estimate: On March 8, 1999, CBO transmitted a
cost estimate for S. 247, the Satellite Home Viewers
Improvements Act, as ordered reported by the Senate Committee
on the Judiciary on February 25, 1999. That bill would extend
the requirement that satellite carriers pay royalty fees only
until December 31, 2004. Thus, S. 247 and H.R. 851 would have
different effects on revenues and spending over the 2005-2009
period. S. 247 does not contain provisions affecting the FCC or
NTIA.
Estimate prepared by: Federal costs: Mark Hadley; Revenues:
Hester Grippando; Impact on State, local, and tribal
governments: Theresa Gullo; Impact on the private sector: Jean
Wooster.
Estimate approved by: Robert A. Sunshine, Deputy Assistant
Director for Budget Analysis.
Federal Mandates Statement
The Committee adopts as its own the estimate of Federal
mandates prepared by the Director of the Congressional Budget
Office pursuant to section 423 of the Unfunded Mandates Reform
Act.
Advisory Committee Statement
No advisory committees within the meaning of section 5(b)
of the Federal Advisory Committee Act were created by this
legislation.
Constitutional Authority Statement
Pursuant to clause 3(d)(1) of rule XIII of the Rules of the
House of Representatives, the Committee finds that the
Constitutional authority for this legislation is provided in
Article I, section 8, clause 3, which grants Congress the power
to regulate commerce with foreign nations, among the several
States, and with the Indian tribes.
Applicability to Legislative Branch
The Committee finds that the legislation does not relate to
the terms and conditions of employment or access to public
services or accommodations within the meaning of section
102(b)(3) of the Congressional Accountability Act.
Section-by-Section Analysis of the Legislation
Section 1. Short title
Section 1 provides for the short title of the Act, the
``Satellite Competition and Consumer Protection Act.''
title i--amendments to the communications act of 1934
Section 101. Retransmission consent
Section 101 amends subsection 325(b) of the Communications
Act of 1934, which currently requires MVPDs to obtain the
consent of broadcast stations before retransmitting their
signals (unless the station has elected must-carry status
pursuant to section 614 (cable must-carry) or new section 338
(satellite must-carry)). New subsection 325(b), however,
provides for four exceptions to the general retransmission
consent rule. First, no MVPD need obtain consent to retransmit
the signal of non-commercial television broadcast stations.
Second, no satellite carrier need obtain consent to retransmit
the signal of any station outside the station's local market if
such station was a superstation as of May 1, 1991, was
distributed directly tosubscribers pursuant to the satellite
compulsory license as of July 1, 1998, and the satellite carrier
complies with all network non-duplication, syndicated exclusivity, and
sports blackout rules pursuant to new section 712. Third, until seven
months after enactment, no satellite carrier need obtain consent to
retransmit station signals to subscribers residing in distant markets.
And fourth, no non-satellite MVPD need obtain consent to retransmit the
signal of any station outside the station's local market if such
station was a superstation as of May 1, 1991, and the signal was
distributed to the non-satellite MVPD's headend pursuant to the
satellite compulsory license as of July 1, 1998.
Subsection 325(b) further requires the FCC to issue
implementing rules within one year of enactment. Subsection
325(b) specifically directs the FCC to ensure that its rules
(1) establish election time periods, and (2) prohibit stations
from engaging in discriminatory practices, understandings,
arrangements, and activities, including exclusive contracts for
carriage, that prevent a satellite carrier from obtaining
retransmission consent from stations. With regard to the second
criteria, the Committee notes that the FCC's rules may not
require stations to provide retransmission consent to different
MVPDs on identical terms. Each MVPD is architecturally unique.
Cable systems serve a local or regional territory, whereas
satellite systems have a national footprint. Stations may
therefore properly choose to provide consent on varying terms
and conditions to reflect the inherent differences in video
programming distribution systems.
Finally, subsection 325(b) makes clear that a station
electing carriage pursuant to retransmission consent may not
avail itself of the satellite must-carry requirements under new
section 338. This limitation is parallel to the limitation on
stations' ability to secure cable carriage pursuant to cable
must-carry once they have elected retransmission consent.
Section 102. Must-carry for satellite carriers retransmitting
television broadcast signals
Section 102 creates new section 338 of the Communications
Act of 1934 to address satellite carriers' must-carry
obligations. In particular, subsection 338(a) requires
satellite carriers, by January 1, 2002, to carry all local
broadcast stations signals in a market in which it carries at
least one such signal. The Committee points out that nothing in
subsection 338(a) is intended to compel the carriage of
multiple signals from any one broadcast station, to require the
carriage of both digital and analog signals during the
transition to digital television, or to otherwise supersede
existing statutory authority regarding the carriage of analog
or digital signals transmitted by broadcasters.
Subsection 338(b) requires television broadcast stations
that assert must-carry rights to bear the costs of delivering a
good quality signal to the designated local receive facility of
the satellite carrier, or to an alternative facility that is
acceptable to at least one-half of the stations in the same
market that are also asserting must-carry rights. Subsection
338(c) provides that, notwithstanding the general must-carry
requirement, satellite carriers are not required to transmit
substantially duplicative local television station signals
within the local market, nor are satellite carriers required to
retransmit more than one affiliate of a television broadcast
network. With regard to carriage of multiple local non-
commercial television stations, subsection 338(c) directs the
FCC to ensure that such stations receive the same degree of
carriage by satellite systems that they presently receive from
cable systems.
Pursuant to subsection 338(d), even though they are not
required to provide local television broadcast signals on any
particular channel, satellite carriers must retransmit local
television broadcast signals to subscribers on contiguous
channels, and provide access to such signals at a
nondiscriminatory price, and in a non-discriminatory manner, on
any on-screen program guide or similar interface. Subsection
338(e) provides that satellite carriers may not accept or
request compensation in cash or in kind in exchange for
carriage of a local television broadcast station, or for
channel positioning rights provided to the local television
broadcast station.
Subsection 338(f) outlines a complaint procedure for a
local television station to follow in the event that the
station believes a satellite carrier has wrongly denied
carriage to the station under section 338. Finally, subsection
338(g) gives the FCC 180 days to implement satellite must-carry
rules.
Section 103. Nonduplication of programming broadcast by local stations
Section 103 replaces section 712 of the Communications Act
of 1934 to establish rules relating the non-duplication of
broadcast programming distributed via satellite. As amended,
subsection 712(a) requires the FCC to issue rules that enable
local broadcast stations to assert network non-duplication,
syndicated exclusivity, and sports blackout rights against
satellite carriers distributing other broadcast programming.
Subsection 712(a) further states that, to the extent possible,
local broadcast stations shall have the same degree of
protection against duplication as they do in the context of
cable distribution of other broadcast programming.
Given the uniqueness of the network-affiliate relationship,
subsection 712(b) provides specific guidelines with regard to
the duplication of network programming via satellite. In the
cable context, the FCC's network non-duplication rules permit a
local network television station to ask that a cable operator
delete duplicative network programming from another network
television station re-
transmitted by the cable operator into a specified zone
associated with the local network television station.
Subsection 712(b) is intended to operate as the satellite
equivalent of the network non-duplication rules that currently
apply to cable operators. To begin with, it directs the FCC to
establish a ``Network Nonduplication Signal Standard'' that, at
least initially, will be the FCC's existing grade B signal
contours,5 and to also establish a new ``Network
Nonduplication Reception Model'' that can reliably and
presumptively predict the ability of a consumer to receive a
signal in accordance with the Network Nonduplication Signal
Standard. Subsection 712(b) directs the FCC, within 180 days of
enactment, to incorporate into its Model signal interference
caused by terrain, building structures, and other land cover
variations. The FCC is further directed to continually refine
the Model and additional data as it becomes available.
Together, the Signal Standard and the Model will generate a
``Reception Model Area'' (``RMA'') for each television
broadcast station, throughout which consumers are predicted to
have access to a signal in accordance with the Network
Nonduplication Signal Standard.
---------------------------------------------------------------------------
\5\ See 47 C.F.R. Sec. 73.683.
---------------------------------------------------------------------------
Subsection 712(b) then identifies the scope of television
broadcast station's network non-duplication rights, depending
upon whether the satellite carrier is distributing local
broadcast signals back into their originating markets (i.e.,
local-into-local). Specifically, in cases where the satellite
carrier is offering local-into-local, a network television
station may assert non-duplication rights against a satellite
carrier within the same geographic area throughout which the
station may assert non-duplication rights with respect to cable
retransmission of television broadcast signals. (However, in
cases where there are two network stations that are affiliates
of the same television network, and both stations are located
within the same local market, neither station may assert non-
duplication rights in an area that is outside the station's
RMA.) In cases where a satellite carrier is not offering local-
into-local, a network television station may assert non-
duplication rights against a satellite carrier within that
network television station's RMA.
The Committee recognizes that, even though subsection
712(b) requires the FCC to continually refine its Network
Nonduplication Reception Model, there inevitably will be
occasions where some consumers are erroneously deemed
ineligible for satellite-delivered network programming.
Accordingly, subsection 712(b) provides consumers with the
added protection of an expeditious waiver process. In
particular, subsection 712(b) makes clear that consumers may
seek a waiver from a network television station that has
asserted network non-duplication rights affecting the consumer.
The station must accept or reject the waiver request within 30
days. In the event the station denies the waiver, subsection
712(b) further permits the consumer to submit a petition to the
FCC (or a neutral third party of the FCC's choosing), alleging
that he or she does not receive the required signal intensity.
The petition will be deemed granted, unless the network
television station submits to the FCC (or the neutral third
party) the written findings and results of a test that prove
that the consumer does, in fact, receive the required signal
intensity. Subsection 712(b) makes clear that under no
circumstances is the consumer to be required to bear any
portion of the cost of the test. Finally, in cases where
consumers adequately demonstrate that they have installed
satellite television services in a recreational vehicle,
subsection 712(b) deems those consumers to be outside network
television stations' local markets and RMAs, and thus eligible
for satellite-delivered network programming without
restriction.
Section 712 provides one other measure to ensure that the
eligibility criteria serve the interests of both competition
and localism: an ongoing review of the signal intensity
standard and the predictive model. Subsection 712(c) directs
the FCC to conduct an inquiry, and report to Congress within
two years of enactment, on the extent to which the Network
Nonduplication Signal Standard, the Network Nonduplication
Reception Model, and the Reception Model Areas are adequate to
reliably measure the ability of consumers to receive an
acceptable over-the-air television broadcast signal. As part of
its inquiry, the FCC must consider, among other things, the
number of consumers that have requested waivers from their
local broadcaster, and the number of waivers that broadcasters
have denied. The Committee believes that, in cases where the
Model fails to accurately predict consumer eligibility, the
waiver process is critical to ensuring that consumers are
expeditiously served, with the least amount of administrative
and financial burden.
Subsection 712(c) directs the FCC to revise its eligibility
rules in accordance with the findings from its inquiry, within
six months of completing the inquiry and submitting a report to
Congress. The Committee emphasizes that the FCC is required to
make only those changes that flow from the findings from its
inquiry. Thus, if the FCC finds that the grade B signal
intensity standard, when applied in conjunction with a refined
predictive model, and an expedited waiver process, adequately
serve consumers, then the FCC shall refrain from modifying the
signal intensity standard.
Section 104. Consent of membership to retransmission of public
broadcasting service satellite feed
Section 104 amends section 396 of the Communications Act of
1934 to require the Public Broadcasting Service (``PBS'') to
annually certify to the Corporation for Public Broadcasting
(``CPB'') that a majority of PBS' member stations support a
national PBS satellite feed. Satellite carriers will have
access to the feed through a compulsory license that is created
in subsection 201(a) of H.R. 851.
No later than two years after enactment, however, the
compulsory license for a PBS feed will be conditioned upon the
annual certification process in subsection 396(n). The
Committee views this annual certification process as a critical
component of the compulsory license. While the Committee
supports wide availability of satellite-delivered PBS
programming (and therefore provides for a conditional
compulsory license), the Committee at the same time seeks to
ensure that PBS member stations support the satellite feed.
Section 105. Inquiry on rural service required
Section 105 directs the National Telecommunications and
Information Administration (``NTIA'') of the Department of
Commerce to conduct an inquiry into the availability of local
television broadcast signals in small and rural markets as part
of a service that competes with, or supplements, video
programming delivered by satellite carriers or cable operators.
NTIA is further required to submit to the Committee, as well as
the Committee on Commerce, Science, and Transportation of the
Senate, a report on the results of the inquiry.
Section 106. Definitions
Section 106 amends section 3 of the Communications Act of
1934 to include definitions of ``local market,'' ``satellite
carrier,'' and ``television network; television network
station.''
Section 107. Completion of biennial regulatory review
Section 107 provides that, within 180 days after the date
of enactment, the FCC will complete the biennial review
required by section 202(h) of the Telecommunications Act of
1996. In particular, the FCC will issue a notice of proposed
rulemaking and a final report and order on those rules that are
covered under ``MM Dkt. No. 98-35, NOI, FCC 98-37.''
TITLE II--AMENDMENTS TO TITLE 17, UNITED STATES CODE
Section 201. Limitations on exclusive rights; secondary transmissions
by satellite carriers within local markets
(a) In general
Subsection 201(a) amends section 119 of the Copyright
Act.6 Subsection 119(a) expressly establishes a
compulsory license for satellite carriers to retransmit local
and distant television broadcast station signals to
subscribers, irrespective of where they reside. The license is
conditioned upon carrier compliance with FCC rules and
regulations (which are established in Title I of the bill), as
well as compliance with monthly submissions of detailed
subscriber lists.
---------------------------------------------------------------------------
\6\ 17 U.S.C. Sec. 119.
---------------------------------------------------------------------------
The Committee notes that new subsection 119(a) removes all
provisions regarding the unserved household limitation that are
currently in the satellite compulsory license. It is illogical
to place territorial restrictions on compulsory licenses, given
that they are designed to effectuate telecommunications policy
goals (e.g., localism, and the viability of free, over-the-air
television), and not copyright interests. Therefore, Title I of
H.R. 851--which addresses amendments to the Communications Act
of 1934--properly identifies any and all geographic limitations
on satellite carriers' ability to retransmit broadcast
programming, and Title II conditions the carriers' compulsory
license on compliance with FCC rules established pursuant to
Title I.
The Committee also notes that new subsection 119(a) unifies
the compulsory license for local and distant licenses, and
makes both licenses permanent (as opposed to sunsetting one,
but making the other permanent). Many rural and small markets
rely, and will continue to rely for some time, upon satellite-
delivered distant signals as their only source of network
programming. It therefore makes no sense to the Committee to
effectively discriminate against consumers living in these
markets by sunsetting the distant signal license, while also
making the local license permanent. Similarly, new subsection
119(a) makes the compulsory license available for distribution
to both residences and commercial establishments alike. Many
consumers have no access to multichannel video programming at
their place of residence. They therefore rely on commercial
establishments for access to a wide variety of satellite-
delivered information and video programming. The Committee is
satisfied that submissions of detailed subscriber lists will
minimize any potential piracy associated with distribution to
commercial establishments.
Finally, subsection 119(a) also establishes a compulsory
license for satellite carriers to retransmit a national PBS
feed. The compulsory license for a national PBS feed, however,
is conditional. Beginning no later than two years after
enactment, PBS must make an annual certification to CPB in
accordance with subsection 396(n) of the Communications Act of
1934.
Subsection 119(b) makes clear that the local-into-local
license is royalty-free. Subsection 119(b) also codifies the
current statutory royalty fees paid by satellite carriers for
the retransmission of distant network and superstations. Those
rates are then reduced by the percentages provided in section
202 of the bill.
(b) Conforming amendments
Subsection 201(b) makes certain conforming amendments to
Title 17. It also removes the standing of local broadcast
stations to sue for infringement under Section 501 of the
Copyright Act. The Committee finds that local broadcast
stations have sufficient remedies available to them under the
Communications Act of 1934 to protect their legitimate
telecommunications-related interests. It is, therefore,
unnecessary to give stations an additional right of action
under the Copyright Act to protect their non-copyright-related
interests. This is not to say that stations have no legal
recourse in cases where their copyright interests have been
infringed upon. To the contrary, the Copyright Act still
permits a station to bring an infringement action, but only for
those programs for which the station owns the copyright.
Section 202. Reduction in royalty rates
Section 202 of H.R. 851 reduces the copyright royalty fees
paid by satellite carriers for the retransmission of network
and superstation signals by 45 percent and 30 percent,
respectively.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, existing law in which no change is
proposed is shown in roman):
COMMUNICATIONS ACT OF 1934
* * * * * * *
TITLE I--GENERAL PROVISIONS
* * * * * * *
SEC. 3. DEFINITIONS.
For the purposes of this Act, unless the context otherwise
requires--
(1) * * *
* * * * * * *
(27) Local market.--
(A) In general.--The term ``local market'',
in the case of both commercial and
noncommercial television broadcast stations,
means the designated market area in which a
station is located, and--
(i) in the case of a commercial
television broadcast station, all
commercial television broadcast
stations licensed to a community within
the same designated market area are
within the same local market; and
(ii) in the case of a noncommercial
educational television broadcast
station, the market includes any
station that is licensed to a community
within the same designated market area
as the noncommercial educational
television broadcast station.
(B) County of license.--In addition to the
area described in subparagraph (A), a station's
local market includes the county in which the
station's community of license is located.
(C) Designated market area.--For purposes of
subparagraph (A), the term ``designated market
area'' means a designated market area, as
determined by Nielsen Media Research and
published in the DMA Market and Demographic
Report.
[(27)] (28) Mobile service.--The term ``mobile
service'' means a radio communication service carried
on between mobile stations or receivers and land
stations, and by mobile stations communicating among
themselves, and includes (A) both one-way and two-way
radio communication services, (B) a mobile service
which provides a regularly interacting group of base,
mobile, portable, and associated control and relay
stations (whether licensed on an individual,
cooperative, or multiple basis) for private one-way or
two-way land mobile radio communications by eligible
users over designated areas of operation, and (C) any
service for which a license is required in a personal
communications service established pursuant to the
proceeding entitled ``Amendment to the Commission's
Rules to Establish New Personal Communications
Services'' (GEN Docket No. 90-314; ET Docket No. 92-
100), or any successor proceeding.
[(28)] (29) Mobile station.--The term ``mobile
station'' means a radio-communication station capable
of being moved and which ordinarily does move.
[(29)] (30) Network element.--The term ``network
element'' means a facility or equipment used in the
provision of a telecommunications service. Such term
also includes features, functions, and capabilities
that are provided by means of such facility or
equipment, including subscriber numbers, databases,
signaling systems, and information sufficient for
billing and collection or used in the transmission,
routing, or other provision of a telecommunications
service.
[(30)] (31) Number portability.--The term ``number
portability'' means the ability of users of
telecommunications services to retain, at the same
location, existing telecommunications numbers without
impairment of quality, reliability, or convenience when
switching from one telecommunications carrier to
another.
[(31)] (32)(A) Operator.--The term ``operator'' on a
ship of the United States means, for the purpose of
parts II and III of title III of this Act, a person
holding a radio operator's license of the proper class
as prescribed and issued by the Commission.
(B) ``Operator'' on a foreign ship means, for the
purpose of part II of title III of this Act, a person
holding a certificate as such of the proper class
complying with the provision of the radio regulations
annexed to the International Telecommunication
Convention in force, or complying with an agreement or
treaty between the United States and the country in
which the ship is registered.
[(32)] (33) Person.--The term ``person'' includes an
individual, partnership, association, joint-stock
company, trust, or corporation.
[(33)] (34) Radio communication.--The term ``radio
communication'' or ``communication by radio'' means the
transmission by radio of writing, signs, signals,
pictures, and sounds of all kinds, including all
instrumentalities, facilities, apparatus, and services
(among other things, the receipt, forwarding, and
delivery of communications) incidental to such
transmission.
[(34)] (35)(A) Radio officer.--The term ``radio
officer'' on a ship of the United States means, for the
purpose of part II of title III of this Act, a person
holding at least a first or second class radiotelegraph
operator's license as prescribed and issued by the
Commission. When such person is employed to operate a
radiotelegraph station aboard a ship of the
UnitedStates, he is also required to be licensed as a ``radio officer''
in accordance with the Act of May 12, 1948 (46 U.S.C. 229a-h).
(B) ``Radio officer'' on a foreign ship means, for
the purpose of part II of title III of this Act, a
person holding at least a first or second class
radiotelegraph operator's certificate complying with
the provisions of the radio regulations annexed to the
International Telecommunication Convention in force.
[(35)] (36) Radio station.--The term ``radio
station'' or ``station'' means a station equipped to
engage in radio communication or radio transmission of
energy.
[(36)] (37) Radiotelegraph auto alarm.--The term
``radiotelegraph auto alarm'' on a ship of the United
States subject to the provisions of part II of title
III of this Act means an automatic alarm receiving
apparatus which responds to the radiotelegraph alarm
signal and has been approved by the Commission.
``Radiotelegraph auto alarm'' on a foreign ship means
an automatic alarm receiving apparatus which responds
to the radiotelegraph alarm signal and has been
approved by the government of the country in which the
ship is registered: Provided, That the United States
and the country in which the ship is registered are
parties to the same treaty, convention, or agreement
prescribing the requirements for such apparatus.
Nothing in this Act or in any other provision of law
shall be construed to require the recognition of a
radiotelegraph auto alarm as complying with part II of
title III of this Act, on a foreign ship subject to
such part, where the country in which the ship is
registered and the United States are not parties to the
same treaty, convention, or agreements prescribing the
requirements for such apparatus.
[(37)] (38) Rural telephone company.--The term
``rural telephone company'' means a local exchange
carrier operating entity to the extent that such
entity--
(A) provides common carrier service to any
local exchange carrier study area that does not
include either--
(i) any incorporated place of 10,000
inhabitants or more, or any part
thereof, based on the most recently
available population statistics of the
Bureau of the Census; or
(ii) any territory, incorporated or
unincorporated, included in an
urbanized area, as defined by the
Bureau of the Census as of August 10,
1993;
(B) provides telephone exchange service,
including exchange access, to fewer than 50,000
access lines;
(C) provides telephone exchange service to
any local exchange carrier study area with
fewer than 100,000 access lines; or
(D) has less than 15 percent of its access
lines in communities of more than 50,000 on the
date of enactment of the Telecommunications Act
of 1996.
[(38)] (39) Safety convention.--The term ``safety
convention'' means the International Convention for the
Safety of Life at Sea in force and the regulations
referred to therein.
(40) Satellite carrier.--The term ``satellite
carrier'' means an entity that uses the facilities of a
satellite or satellite service licensed by the
Commission, and operates in the Fixed-Satellite Service
under part 25 of title 47 of the Code of Federal
Regulations or the Direct Broadcast Satellite Service
under part 100 of title 47 of the Code of Federal
Regulations, to establish and operate a channel of
communications for point-to-multipoint distribution of
television station signals, and that owns or leases a
capacity or service on a satellite in order to provide
such point-to-multipoint distribution, except to the
extent that such entity provides such distribution
pursuant to tariff under this Act.
[(39)] (41)(A) Ship.--The term ``ship'' or ``vessel''
includes every description of watercraft or other
artificial contrivance, except aircraft, used or
capable of being used as a means of transportation on
water, whether or not it is actually afloat.
(B) A ship shall be considered a passenger ship if it
carries or is licensed or certificated to carry more
than twelve passengers.
(C) A cargo ship means any ship not a passenger ship.
(D) A passenger is any person carried on board a ship
or vessel except (1) the officers and crew actually
employed to man and operate the ship, (2) persons
employed to carry on the business of the ship, and (3)
persons on board a ship when they are carried, either
because of the obligation laid upon the master to carry
shipwrecked, distressed, or other persons in like or
similar situations or by reason of any circumstance
over which neither the master, the owner, nor the
charterer (if any) has control.
(E) ``Nuclear ship'' means a ship provided with a
nuclear powerplant.
[(40)] (42) State.--The term ``State'' includes the
District of Columbia and the Territories and
possessions.
[(41)] (43) State commission.--The term ``State
commission'' means the commission, board, or official
(by whatever name designated) which under the laws of
any State has regulatory jurisdiction with respect to
intrastate operations of carriers.
[(42)] (44) Station license.--The term ``station
license,'' ``radio station license,'' or ``license''
means that instrument of authorization required by this
Act or the rules and regulations of the Commission made
pursuant to this Act, for the use or operation of
apparatus for transmission of energy, or
communications, or signals by radio by whatever name
the instrument may be designated by the Commission.
[(43)] (45) Telecommunications.--The term
``telecommunications'' means the transmission, between
or among points specified by the user, of information
of the user's choosing, without change in the form or
content of the information as sent and received.
[(44)] (46) Telecommunications carrier.--The term
``telecommunications carrier'' means any provider of
telecommunications services, except that such term does
not include aggregators of telecommunications services
(as defined in section 226). A telecommunications
carrier shall be treated as a common carrier under this
Act only to the extent that it isengaged in providing
telecommunications services, except that the Commission shall determine
whether the provision of fixed and mobile satellite service shall be
treated as common carriage.
[(45)] (47) Telecommunications equipment.--The term
``telecommunications equipment'' means equipment, other
than customer premises equipment, used by a carrier to
provide telecommunications services, and includes
software integral to such equipment (including
upgrades).
[(46)] (48) Telecommunications service.--The term
``telecommunications service'' means the offering of
telecommunications for a fee directly to the public, or
to such classes of users as to be effectively available
directly to the public, regardless of the facilities
used.
[(47)] (49) Telephone exchange service.--The term
``telephone exchange service'' means (A) service within
a telephone exchange, or within a connected system of
telephone exchanges within the same exchange area
operated to furnish to subscribers intercommunicating
service of the character ordinarily furnished by a
single exchange, and which is covered by the exchange
service charge, or (B) comparable service provided
through a system of switches, transmission equipment,
or other facilities (or combination thereof) by which a
subscriber can originate and terminate a
telecommunications service.
[(48)] (50) Telephone toll service.--The term
``telephone toll service'' means telephone service
between stations in different exchange areas for which
there is made a separate charge not included in
contracts with subscribers for exchange service.
(51) Television network; television network
station.--
(A) Television network.--The term
``television network'' means a television
network in the United States which offers an
interconnected program service on a regular
basis for 15 or more hours per week to at least
25 affiliated broadcast stations in 10 or more
States.
(B) Television network station.--The term
``television network station'' means a
television broadcast station that is owned or
operated by, or affiliated with, a television
network.
[(49)] (52) Television service.--
(A) Analog television service.--The term
``analog television service'' means television
service provided pursuant to the transmission
standards prescribed by the Commission in
section 73.682(a) of its regulations (47 C.F.R.
73.682(a)).
(B) Digital television service.--The term
``digital television service'' means television
service provided pursuant to the transmission
standards prescribed by the Commission in
section 73.682(d) of its regulations (47 C.F.R.
73.682(d)).
[(50)] (53) Transmission of energy by radio.--The
term ``transmission of energy by radio'' or ``radio
transmission of energy'' includes both such
transmission and all instrumentalities, facilities, and
services incidental to such transmission.
[(51)] (54) United states.--The term ``United
States'' means the several States and Territories, the
District of Columbia, and the possessions of the United
States, but does not include the Canal Zone.
[(52)] (55) Wire communication.--The term ``wire
communication'' or ``communication by wire'' means the
transmission of writing, signs, signals, pictures, and
sounds of all kinds by aid of wire, cable, or other
like connection between the points of origin and
reception of such transmission, including all
instrumentalities, facilities, apparatus, and services
(among other things, the receipt, forwarding, and
delivery of communications) incidental to such
transmission.
* * * * * * *
TITLE III--PROVISIONS RELATING TO RADIO
PART I--GENERAL PROVISIONS
* * * * * * *
SEC. 325. FALSE DISTRESS SIGNALS; REBROADCASTING; STUDIOS OF FOREIGN
STATIONS.
(a) * * *
[(b)(1) Following the date that is one year after the date of
enactment of the Cable Television Consumer Protection and
Competition Act of 1992, no cable system or other multichannel
video programming distributor shall retransmit the signal of a
broadcasting station, or any part thereof, except--
[(A) with the express authority of the originating
station; or
[(B) pursuant to section 614, in the case of a
station electing, in accordance with this subsection,
to assert the right to carriage under such section.
[(2) The provisions of this subsection shall not apply to--
[(A) retransmission of the signal of a noncommercial
broadcasting station;
[(B) retransmission directly to a home satellite
antenna of the signal of a broadcasting station that is
not owned or operated by, or affiliated with, a
broadcasting network, if such signal was retransmitted
by a satellite carrier on May 1, 1991;
[(C) retransmission of the signal of a broadcasting
station that is owned or operated by, or affiliated
with, a broadcasting network directly to a home
satellite antenna, if the household receiving the
signal is an unserved household; or
[(D) retransmission by a cable operator or other
multichannel video programming distributor of the
signal of a superstation if such signal was obtained
from a satellite carrier and the originating station
was a superstation on May 1, 1991.
For purposes of this paragraph, the terms ``satellite
carrier'', ``superstation'', and ``unserved household'' have
the meanings giventhose terms, respectively, in section 119(d)
of title 17, United States Code, as in effect on the date of enactment
of the Cable Television Consumer Protection and Competition Act of
1992.]
(b)(1) No cable system or other multichannel video
programming distributor shall retransmit the signal of a
television broadcast station, or any part thereof, except--
(A) with the express authority of the originating
station;
(B) pursuant to section 614, in the case of a station
electing, in accordance with this subsection, to assert
the right to carriage under such section; or
(C) pursuant to section 338, in the case of a station
electing, in accordance with this subsection, to assert
the right to carriage under such section.
(2) The provisions of this subsection shall not apply--
(A) to retransmission of the signal of a
noncommercial television broadcast station;
(B) to retransmission of the signal of a television
broadcast station outside the station's local market by
a satellite carrier directly to its subscribers, if--
(i) such station was a superstation on May 1,
1991;
(ii) as of July 1, 1998, such station was
retransmitted by a satellite carrier under the
compulsory license of section 119 of title 17,
United States Code; and
(iii) the satellite carrier complies with all
network nonduplication, syndicated exclusivity,
and sports blackout rules adopted by the
Commission pursuant to section 712 of this Act;
(C) until 7 months after the date of enactment of the
Satellite Competition and Consumer Protection Act, to
retransmission of the signal of a television network
station directly to a satellite antenna, if the
subscriber receiving the signal is located in an area
outside the local market of such station; or
(D) to retransmission by a cable operator or other
multichannel video provider, other than a satellite
carrier, of the signal of a television broadcast
station outside the station's local market if such
signal was obtained from a satellite carrier and--
(i) the originating station was a
superstation on May 1, 1991; and
(ii) as of July 1, 1998, such station was
retransmitted by a satellite carrier under the
compulsory license of section 119 of title 17,
United States Code.
(3)(A) * * *
* * * * * * *
(C) Within 45 days after the date of enactment of the
Satellite Competition and Consumer Protection Act, the
Commission shall commence a rulemaking proceeding to revise the
regulations governing the exercise by television broadcast
stations of the right to grant retransmission consent under
this subsection, and such other regulations as are necessary to
administer the limitations contained in paragraph (2). The
Commission shall complete all actions necessary to prescribe
such regulations within one year after such date of enactment.
Such regulations shall--
(i) establish election time periods that correspond
with those regulations adopted under subparagraph (B)
of this paragraph; and
(ii) prohibit television broadcast stations that
provide retransmission consent from engaging in
discriminatory practices, understandings, arrangements,
and activities, including exclusive contracts for
carriage, that prevent a satellite carrier from
obtaining retransmission consent from such stations.
(4) If an originating television station elects under
paragraph (3)(B) to exercise its right to grant retransmission
consent under this subsection with respect to a cable system,
the provisions of sec-
tion 614 shall not apply to the carriage of the signal of such
station by such cable system. If an originating television
station elects under paragraph (3)(C) to exercise its right to
grant retransmission consent under this subsection with respect
to a satellite carrier, the provisions of section 338 shall not
apply to the carriage of the signal of such station by such
satellite carrier.
(5) The exercise by a television broadcast station of the
right to grant retransmission consent under this subsection
shall not interfere with or supersede the rights under section
[614 or 615] 338, 614, or 615 of any station electing to assert
the right to signal carriage under that section.
* * * * * * *
(7) For purposes of this subsection, the term `television
broadcast station' means an over-the-air commercial or
noncommercial television broadcast station licensed by the
Commission under subpart E of part 73 of title 47, Code of
Federal Regulations, except that such term does not include a
low-power or translator television station.
* * * * * * *
SEC. 338. CARRIAGE OF LOCAL TELEVISION SIGNALS BY SATELLITE CARRIERS.
(a) Carriage Obligations.--
(1) In general.--Subject to the limitations of
subparagraph (2), each satellite carrier providing
secondary transmissions to subscribers located within
the local market of a television broadcast station of a
primary transmission made by that station shall carry
upon request all television broadcast stations located
within that local market, subject to section 325(b), by
retransmitting the signal or signals of such stations
that are identified by Commission regulations for
purposes of this section.
(2) Effective date.--No satellite carrier shall be
required to carry local television broadcast stations
under paragraph (1) until January 1, 2002.
(b) Good Signal Required.--
(1) Costs.--A television broadcast station asserting
its right to carriage under subsection (a) shall be
required to bear the costs associated with delivering a
good quality signal to the designated local receive
facility of the satellite carrier or to another
facility that is acceptable to at least one-half the
stations asserting the right to carriage in the local
market.
(2) Regulations.--The regulations issued under
subsection (g) shall set forth the obligations
necessary to carry out this subsection.
(c) Duplication Not Required.--
(1) Commercial stations.--Notwithstanding subsection
(a), a satellite carrier shall not be required to carry
upon request the signal of any local commercial
television broadcast station that substantially
duplicates the signal of another local commercial
television broadcast station which is secondarily
transmitted by the satellite carrier within the same
local market, or to carry upon request the signals of
more than 1 local commer-
cial television broadcast station in a single local
market that is affiliated with a particular television
network.
(2) Noncommercial stations.--The Commission shall
prescribe regulations limiting the carriage
requirements under subsection (a) of satellite carriers
with respect to the carriage of multiple local
noncommercial television broadcast stations. To the
extent possible, such regulations shall provide the
same degree of carriage by satellite carriers of such
multiple stations as is provided by cable systems under
section 615.
(d) Channel Positioning.--No satellite carrier shall be
required to provide the signal of a local television broadcast
station to subscribers in that station's local market on any
particular channel number or to provide the signals in any
particular order, except that the satellite carrier shall
retransmit the signal of the local television broadcast
stations to subscribers in the stations' local market on
contiguous channels and provide access to such station's
signals at a nondiscriminatory price and in a nondiscriminatory
manner on any navigational device, on-screen program guide, or
menu.
(e) Compensation for Carriage.--A satellite carrier shall not
accept or request monetary payment or other valuable
consideration in exchange either for carriage of local
television broadcast stations in fulfillment of the
requirements of this section or for channel positioning rights
provided to such stations under this section, except that any
such station may be required to bear the costs associated with
delivering a good quality signal to the local receive facility
of the satellite carrier.
(f) Remedies.--
(1) Complaints by broadcast stations.--Whenever a
local television broadcast station believes that a
satellite carrier has failed to meet its obligations
under this section, such station shall notify the
carrier, in writing, of the alleged failure and
identify its reasons for believing that the satellite
carrier is obligated to carry upon request the signal
of such station or has otherwise failed to comply with
other requirements of this section. The satellite
carrier shall, within 30 days of such written
notification, respond in writing to such notification
and either begin carrying the signal of such station in
accordance with the terms requested or state its
reasons for believing that it is not obligated to carry
such signal or is in compliance with other requirements
of this section, as the case may be. A local television
broadcast station that is denied carriage in accordance
with this section by a satellite carrier or is
otherwise harmed by a response by a satellite carrier
that it is in compliance with other requirements of
this section may obtain review of such denial or
response by filing a compliant with the Commission.
Such complaint shall allege the manner in which such
satellite carrier has failed to meet its obligations
and the basis for such allegations.
(2) Opportunity to respond.--The Commission shall
afford the satellite carrier against which a complaint
is filed under subparagraph (A) an opportunity to
present data and arguments to establish that there has
been no failure to meet its obligations under this
section.
(3) Remedial actions; dismissal.--Within 120 days
after the date a complaint is filed under subparagraph
(A), the Commission shall determine whether the
satellite carrier has met its obligations under this
chapter. If the Commission determines that the
satellite carrier has failed to meet such obligations,
the Commission shall order the satellite carrier, in
the case of an obligation to carry a station, to begin
carriage of the station and to continue such carriage
for at least 12 months, or, in the case of the failure
to meet other obligations under this section, shall
take other appropriate remedial action. If the
Commission determines that the satellite carrier has
fully met the requirements of this chapter, the
Commission shall dismiss the complaint.
(g) Regulations by Commission.--Within 180 days after the
date of enactment of this section, the Commission shall,
following a rulemaking proceeding, issue regulations
implementing this section.
(h) Definitions.--As used in this section:
(1) Subscriber.--The term ``subscriber'' means an
entity that receives a secondary transmission service
by means of a secondary transmission from a satellite
and pays a fee for the service, directly or indirectly,
to the satellite carrier or to a distributor.
(2) Distributor.--The term ``distributor'' means an
entity which contracts to distribute secondary
transmissions from a satellite carrier and, either as a
single channel or in a package with other programming,
provides the secondary transmission either directly to
individual subscribers or indirectly through other
program distribution entities.
(3) Local receive facility.--The term ``local receive
facility'' means the reception point in each local
market which a satellite carrier designates for
delivery of the signal of the station for purposes of
retransmission.
(4) Television broadcast station.--The term
``television broadcast station'' has the meaning given
such term in section 325(b)(7).
(5) Secondary transmission.--The term ``secondary
transmission'' has the meaning given such term in
section 119(c) of title 17, United States Code.
* * * * * * *
PART IV--ASSISTANCE FOR PUBLIC TELECOMMUNICATIONS FACILITIES;
TELECOMMUNICATIONS DEMONSTRATIONS; CORPORATION FOR PUBLIC BROADCASTING
* * * * * * *
Subpart D--Corporation for Public Broadcasting
SEC. 396. DECLARATION OF POLICY.
(a) * * *
* * * * * * *
(n) The Public Broadcasting Service shall certify to the
Board on an annual basis that a majority of its membership
supports or does not support the secondary transmission of the
Public Broadcasting Service satellite feed, and provide notice
to each satellite carrier carrying such feed of such
certification.
* * * * * * *
TITLE VII--MISCELLANEOUS PROVISIONS
* * * * * * *
[SEC. 712. SYNDICATED EXCLUSIVITY.
[(a) The Federal Communications Commission shall initiate a
combined inquiry and rulemaking proceeding for the purpose of--
[(1) determining the feasibility of imposing
syndicated exclusivity rules with respect to the
delivery of syndicated programming (as defined by the
Commission) for private home viewing of secondary
transmissions by satellite of broadcast station signals
similar to the rules issued by the Commission with
respect to syndicated exclusivity and cable television;
and
[(2) adopting such rules if the Commission considers
the imposition of such rules to be feasible.
[(b) In the event that the Commission adopts such rules, any
willful and repeated secondary transmission made by a satellite
carrier to the public of a primary transmission embodying the
performance or display of a work which violates such Commission
rules shall be subject to the remedies, sanctions, and
penalties provided by title V and section 705 of this Act.]
SEC. 712. NONDUPLICATION OF PROGRAMMING BROADCAST BY LOCAL STATIONS.
(a) Extension of Network Nonduplication, Syndicated
Exclusivity, and Sports Blackout to Satellite Retransmission.--
Within 45 days after the date of enactment of the Satellite
Competition and Consumer Protection Act, the Commission shall
commence a single rulemaking proceeding to establish
regulations that apply network nonduplication protection,
syndicated exclusivity protection, and sports blackout
protection to the retransmission of broadcast signals by
satellite carriers to subscribers. To the extent possible
consistent with subsection (b), such regulations shall provide
the same degree of protection against retransmission of
broadcast signals as is provided by the network nonduplication
(47 C.F.R. 76.92), syndicated exclusivity (47 C.F.R. 151), and
sports blackout (47 C.F.R. 76.67) rules applicable to cable
television systems. The Commission shall complete all actions
necessary to prescribe regulations required by this section so
that the regulations shall become effective within 1 year after
such date of enactment.
(b) Establishment of Network Nonduplication Boundaries.--
(1) Establishment of signal standard for network
nonduplication required.--The Commission shall
establish a signal intensity standard for purposes of
determining the network nonduplication rights of local
television broadcast stations. Until revised pursuant
to subsection (c), such standard shall be the Grade B
field strength standard prescribed by the Commission in
section 73.683 of the Commission's regulations (47
C.F.R. 73.683). For purposes of this section, the
standard established under this paragraph is referred
to as the ``Network Nonduplication Signal Standard''.
(2) Establishment of improved predictive model
required.--Within 180 days after the date of enactment
of the Satellite Competition and Consumer Protection
Act, the Commission shall take all actions necessary,
including any reconsideration, to develop and prescribe
by rule a point-to-point predictive model for reliably
and presumptively determining the ability of individual
locations to receive signals in accordance with the
Network Nonduplication Signal Standard. In prescribing
such model, the Commission shall ensure that such model
takes into account terrain, building structures, and
other land cover variations. The Commission shall
establish procedures for the continued refinement in
the application of the model by the use of additional
data as it becomes available. For purposes of this
section, such model is referred to as the ``Network
Nonduplication Reception Model'', and the area
encompassing locations that are predicted to have the
ability to receive such a signal of a particular
broadcast station is referred to as that station's
``Reception Model Area''.
(3) Network nonduplication.--The network
nonduplication regulations required under subsection
(a) shall allow a television network station to assert
nonduplication rights as follows:
(A) If a satellite carrier is retransmitting
that station, or any other television broadcast
stations located in the same local market, to
subscribers located in that station's local
market, the television network station may
assert nonduplication rights against the
satellite carrier throughout the area within
which that station may assert such rights under
the rules applicable to cable television
systems (47 C.F.R. 76.92), except as provided
in subparagraph (C).
(B) If a satellite carrier is not
retransmitting any television broadcast
stations located in the television network
station's local market to subscribers located
in such market, the television network station
may assert nonduplicationrights against the
satellite carrier in the geographic area that is within such station's
Reception Model Area, but such geographic area shall not extend beyond
the local market of such station.
(C) If there are 2 or more television network
stations that are each affiliates of a single
television network within the same local
market, neither such station may assert under
subparagraph (A) nonduplication rights against
a satellite carrier in an area that is outside
the Reception Model Area of that station.
(4) Waivers.--The network nonduplication protection
described in paragraph (3) shall not apply to a
subscriber who files with the satellite carrier a
written waiver with respect to that subscriber obtained
from a television network station allowing the
subscriber to receive satellite retransmission of
another network station affiliated with that same
network. The television network station shall accept or
reject a subscriber's request for a waiver within 30
days after receipt of the request. The television
network station and the satellite carrier shall
maintain a file available to the public that contains
such waiver requests and the acceptances and rejections
thereof.
(5) Objective verification.--If a subscriber submits
a petition to the Commission or an entity designated by
the Commission by rule--
(A) that alleges that such subscriber does
not receive a signal that meets or exceeds the
Network Nonduplication Signal Standard; and
(B) includes a processing fee in an amount
prescribed by regulation to recover the cost of
administering the provisions of this paragraph;
the network nonduplication rights described in
paragraph (3) shall not apply to that subscriber unless
such station submits to the Commission or such entity
and to the subscriber the written findings and
conclusions of a test conducted in accordance with the
provisions of section 73.686(d) of title 47, Code of
Federal Regulations, or any successor regulation,
demonstrating that the subscriber receives a signal
that meets or exceeds the Network Nonduplication Signal
Standard. A subscriber is required to file a waiver
request under paragraph (4) before filing a petition
under this paragraph. A subscriber may not be required
to bear any portion of the cost of such test.
(6) Recreational vehicle location.--In the case of a
subscriber to a satellite carrier who has installed
satellite reception equipment in a recreational
vehicle, and who has permitted any television network
station seeking to assert network nonduplication rights
to verify the motor vehicle registration, license, and
proof of ownership of such vehicle, the subscriber
shall be considered to be outside the local market and
Reception Model Area of such station. For purposes of
this paragraph, the term ``recreational vehicle'' does
not include any residential manufactured home, as
defined in section 603(6) of the National Manufactured
Housing Construction and Safety Standards Act of 1974
(42 U.S.C. 5402(6)).
(c) Review and Revision of Standards and Model.--
(1) Ongoing Inquiry Required.--Not later than 2 years
after the date of enactment of the Satellite
Competition and Consumer Protection Act, the Commission
shall conduct an inquiry of the extent to which the
Network Nonduplication Signal Standard, the Network
Nonduplication Reception Model, and the Reception Model
Areas of television stations are adequate to reliably
measure the ability of consumers to receive an
acceptable over-the-air television broadcast signal.
(2) Data to Be Considered.--In conducting the inquiry
required by paragraph (1), the Commission shall
consider as evidence that consumers are not receiving a
signal of the quality described in such paragraph--
(A) the number of subscribers requesting
waivers under subsection (b)(4), and the number
of waivers that are denied;
(B) the number of subscribers submitting
petitions under subsection (b)(5), and the
number of such petitions that are granted;
(C) the results of any consumer research
study that may be undertaken to carry out the
purposes of this section; and
(D) the extent to which consumers are not
legally entitled to install broadcast reception
devices assumed in the Commission's standard.
(3) Report and action.--The Commission shall submit
to the Congress a report on the inquiry required by
this subsection not later than the end of the 2-year
period described in paragraph (1). The Commission shall
complete any actions necessary to revise the Network
Nonduplication Signal Standard, the Network
Nonduplication Reception Model, and the Reception Model
Areas of television stations in accordance with the
findings of such inquiry not later than 6 months after
the end of such 2-year period.
(4) Data submission.--The Commission shall prescribe
by rule the data required to be submitted by television
broadcast stations and by satellite carriers to the
Commission or such designated entity to carry out this
subsection, and the format for submission of such data.
* * * * * * *
----------
TITLE 17--COPYRIGHTS
* * * * * * *
CHAPTER 1--SUBJECT MATTER AND SCOPE OF COPYRIGHT
Sec.
101. Definitions.
* * * * * * *
[119. Limitations on exclusive rights: Secondary transmissions of
superstations and network stations for private home viewing.]
119. Limitation on exclusive rights: Secondary transmissions by
satellite carriers.
* * * * * * *
[Sec. 119. Limitations on exclusive rights: Secondary transmissions of
superstations and network stations for private home
viewing
[(a) Secondary Transmissions by Satellite Carriers.--
[(1) Superstations.--Subject to the provisions of
paragraphs (3), (4), and (6) of this subsection and
section 114(d), secondary transmissions of a primary
transmission made by a superstation and embodying a
performance or display of a work shall be subject to
statutory licensing under this section if the secondary
transmission is made by a satellite carrier to the
public for private home viewing, and the carrier makes
a direct or indirect charge for each retransmission
service to each household receiving the secondary
transmission or to a distributor that has contracted
with the carrier for direct or indirect delivery of the
secondary transmission to the public for private home
viewing.
[(2) Network stations.--
[(A) In general.--Subject to the provisions
of subparagraphs (B) and (C) of this paragraph
and paragraphs (3), (4), (5), and (6) of this
subsection and section 114(d), secondary
transmissions of programming contained in a
primary transmission made by a network station
and embodying a performance or display of a
work shall be subject to statutory licensing
under this section if the secondary
transmission is made by a satellite carrier to
the public for private home viewing, and the
carrier makes a direct or indirect charge for
such retransmission service to each subscriber
receiving the secondary transmission.
[(B) Secondary transmissions to unserved
households.--The statutory license provided for
in subparagraph (A) shall be limited to
secondary transmissions to persons who reside
in unserved households.
[(C) Submission of subscriber lists to
networks.--A satellite carrier that makes
secondary transmissions of a primary
transmission made by a network station pursuant
to subparagraph (A) shall, 90 days after
commencing such secondary transmissions, submit
to the network that owns or is affiliated with
the network station a list identifying (by name
and street address, including county and zip
code) all subscribers to which the satellite
carrier currently makes secondary transmissions
of that primary transmission. Thereafter, on
the 15th of each month, the satellite carrier
shall submit to the network a list identifying
(by name and street address, including county
and zip code) any persons who have been added
or dropped as such subscribers since the last
submission under this subparagraph. Such
subscriber information submitted by a satellite
carrier may be used only for purposes of
monitoring compliance by the satellite carrier
with this subsection. The submission
requirements of this subparagraph shall apply
to a satellite carrier only if the network to
whom the submissions are to be made places on
file with the Register of Copyrights a document
identifying the name and address of the person
to whom such submissions are to be made. The
Register shall maintain for public inspection a
file of all such documents.
[(3) Noncompliance with reporting and payment
requirements.--Notwithstanding the provisions of
paragraphs (1) and (2), the willful or repeated
secondary transmission to the public by a satellite
carrier of a primary transmission made by a
superstation or a network station and embodying a
performance or display of a work is actionable as an
act of in-
fringement under section 501, and is fully subject to
the remedies provided by sections 502 through 506 and
509, where the satellite carrier has not deposited the
statement of account and royalty fee required by
subsection (b), or has failed to make the submissions
to networks required by paragraph (2)(C).
[(4) Willful alterations.--Notwithstanding the
provisions of paragraphs (1) and (2), the secondary
transmission to the public by a satellite carrier of a
primary transmission made by a superstation or a
network station and embodying a performance or display
of a work is actionable as an act of infringement under
section 501, and is fully subject to the remedies
provided by sections 502 through 506 and sections 509
and 510, if the content of the particular program in
which the performance or display is embodied, or any
commercial advertising or station announcement
transmitted by the primary transmitter during, or
immediately before or after, the transmission of such
program, is in any way willfully altered by the
satellite carrier through changes, deletions, or
additions, or is combined with programming from any
other broadcast signal.
[(5) Violation of territorial restrictions on
statutory license for network stations.--
[(A) Individual violations.--The willful or
repeated secondary transmission by a satellite
carrier of a primary transmission made by a
network station and embodying a performance or
display of a work to a subscriber who does not
reside in an unserved household is actionable
as an act of infringement under section 501 and
is fully subject to the remedies provided by
sections 502 through 506 and 509, except that--
[(i) no damages shall be awarded for
such act of infringement if the
satellite carrier took corrective
action by promptly withdrawing service
from the ineligible subscriber, and
[(ii) any statutory damages shall not
exceed $5 for such subscriber for each
month during which the violation
occurred.
[(B) Pattern of violations.--If a satellite
carrier engages in a willful or repeated
pattern or practice of delivering a primary
transmission made by a network station and
embodying a performance or display of a work to
subscribers who do not reside in unserved
households, then in addition to the remedies
set forth in subparagraph (A)--
[(i) if the pattern or practice has
been carried out on a substantially
nationwide basis, the court shall order
a permanent injunction barring the
secondary transmission by the satellite
carrier, for private homeviewing, of
the primary transmissions of any primary network station affiliated
with the same network, and the court may order statutory damages of not
to exceed $250,000 for each 6-month period during which the pattern or
practice was carried out; and
[(ii) if the pattern or practice has
been carried out on a local or regional
basis, the court shall order a
permanent injunction barring the
secondary transmission, for private
home viewing in that locality or
region, by the satellite carrier of the
primary transmissions of any primary
network station affiliated with the
same network, and the court may order
statutory damages of not to exceed
$250,000 for each 6-month period during
which the pattern or practice was
carried out.
[(C) Previous subscribers excluded.--
Subparagraphs (A) and (B) do not apply to
secondary transmissions by a satellite carrier
to persons who subscribed to receive such
secondary transmissions from the satellite
carrier or a distributor before November 16,
1988.
[(D) Burden of proof.--In any action brought
under this paragraph, the satellite carrier
shall have the burden of proving that its
secondary transmission of a primary
transmission by a network station is for
private home viewing to an unserved household.
[(6) Discrimination by a satellite carrier.--
Notwithstanding the provisions of paragraph (1), the
willful or repeated secondary transmission to the
public by a satellite carrier of a primary transmission
made by a superstation or a network station and
embodying a performance or display of a work is
actionable as an act of infringement under section 501,
and is fully subject to the remedies provided by
sections 502 through 506 and 509, if the satellite
carrier unlawfully discriminates against a distributor.
[(7) Geographic limitation on secondary
transmissions.--The statutory license created by this
section shall apply only to secondary transmissions to
households located in the United States.
[(8) Transitional signal intensity measurement
procedures.--
[(A) In general.--Subject to subparagraph
(C), upon a challenge by a network station
regarding whether a subscriber is an unserved
household within the predicted Grade B Contour
of the station, the satellite carrier shall,
within 60 days after the receipt of the
challenge--
[(i) terminate service to that
household of the signal that is the
subject of the challenge, and within 30
days thereafter notify the network
station that made the challenge that
service to that household has been
terminated; or
[(ii) conduct a measurement of the
signal intensity of the subscriber's
household to determine whether the
household is an unserved household
after giving reasonable notice to the
network station of the satellite
carrier's intent to conduct the
measurement.
[(B) Effect of measurement.--If the satellite
carrier conducts a signal intensity measurement
under subparagraph (A) and the measurement
indicates that--
[(i) the household is not an unserved
household, the satellite carrier shall,
within 60 days after the measurement is
conducted, terminate the service to
that household of the signal that is
the subject of the challenge, and
within 30 days thereafter notify the
net-
work station that made the challenge
that service to that household has been
terminated; or
[(ii) the household is an unserved
household, the station challenging the
service shall reimburse the satellite
carrier for the costs of the signal
measurement within 60 days after
receipt of the measurement results and
a statement of the costs of the
measurement.
[(C) Limitation on measurements.--(i)
Notwithstanding subparagraph (A), a satellite
carrier may not be required to conduct signal
intensity measurements during any calendar year
in excess of 5 percent of the number of
subscribers within the network station's local
market that have subscribed to the service as
of the effective date of the Satellite Home
Viewer Act of 1994.
[(ii) If a network station challenges whether
a subscriber is an unserved household in excess
of 5 percent of the subscribers within the
network's station local market within a
calendar year, subparagraph (A) shall not apply
to challenges in excess of such 5 percent, but
the station may conduct its own signal
intensity measurement of the subscriber's
household after giving reasonable notice to the
satellite carrier of the network station's
intent to conduct the measurement. If such
measurement indicates that the household is not
an unserved household, the carrier shall,
within 60 days after receipt of the
measurement, terminate service to the household
of the signal that is the subject of the
challenge and within 30 days thereafter notify
the network station that made the challenge
that service has been terminated. The carrier
shall also, within 60 days after receipt of the
measurement and a statement of the costs of the
measurement, reimburse the network station for
the cost it incurred in conducting the
measurement.
[(D) Outside the predicted grade b contour.--
(i) If a network station challenges whether a
subscriber is an unserved household outside the
predicted Grade B Contour of the station, the
station may conduct a measurement of the signal
intensity of the subscriber's household to
determine whether the household is an unserved
household after giving reasonable notice to the
satellite carrier of the network station's
intent to conduct the measurement.
[(ii) If the network station conducts a
signal intensity measurement under clause (i)
and the measurement indicates that--
[(I) the household is not an unserved
household, the station shall forward
the results to the satellitecarrier who
shall, within 60 days after receipt of the measurement, terminate the
service to the household of the signal that is the subject of the
challenge, and shall reimburse the station for the costs of the
measurement within 60 days after receipt of the measurement results and
a statement of such costs; or
[(II) the household is an unserved
household, the station shall pay the
costs of the measurement.
[(9) Loser pays for signal intensity measurement;
recovery of measurement costs in a civil action.--In
any civil action filed relating to the eligibility of
subscribing households as unserved households--
[(A) a network station challenging such
eligibility shall, within 60 days after receipt
of the measurement results and a statement of
such costs, reimburse the satellite carrier for
any signal intensity measurement that is
conducted by that carrier in response to a
challenge by the network station and that
establishes the household is an unserved
household; and
[(B) a satellite carrier shall, within 60
days after receipt of the measurement results
and a statement of such costs, reimburse the
network station challenging such eligibility
for any signal intensity measurement that is
conducted by that station and that establishes
the household is not an unserved household.
[(10) Inability to conduct measurement.--If a network
station makes a reasonable attempt to conduct a site
measurement of its signal at a subscriber's household
and is denied access for the purpose of conducting the
measurement, and is otherwise unable to conduct a
measurement, the satellite carrier shall within 60 days
notice thereof, terminate service of the station's
network to that household.
[(b) Statutory License for Secondary Transmissions for
Private Home Viewing.--
[(1) Deposits with the register of copyrights.--A
satellite carrier whose secondary transmissions are
subject to statutory licensing under subsection (a)
shall, on a semiannual basis, deposit with the Register
of Copyrights, in accordance with requirements that the
Register shall prescribe by regulation--
[(A) a statement of account, covering the
preceding 6-month period, specifying the names
and locations of all superstations and network
stations whose signals were transmitted, at any
time during that period, to subscribers for
private home viewing as described in
subsections (a)(1) and (a)(2), the total number
of subscribers that received such
transmissions, and such other data as the
Register of Copyrights may from time to time
prescribe by regulation; and
[(B) a royalty fee for that 6-month period,
computed by--
[(i) multiplying the total number of
subscribers receiving each secondary
transmission of a superstation during
each calendar month by 17.5 cents per
subscriber in the case of superstations
that as retransmitted by the satellite
carrier include any program which, if
delivered by any cable system in the
United States, would be subject to the
syndicated exclusivity rules of the
Federal Communications Commission, and
14 cents per subscriber in the case of
superstations that are syndex-proof as
defined in section 258.2 of title 37,
Code of Federal Regulations;
[(ii) multiplying the number of
subscribers receiving each secondary
transmission of a network station
during each calendar month by 6 cents;
and
[(iii) adding together the totals
computed under clauses (i) and (ii).
[(2) Investment of fees.--The Register of Copyrights
shall receive all fees deposited under this section
and, after deducting the reasonable costs incurred by
the Copyright Office under this section (other than the
costs deducted under paragraph (4)), shall deposit the
balance in the Treasury of the United States, in such
manner as the Secretary of the Treasury directs. All
funds held by the Secretary of the Treasury shall be
invested in interest-bearing securities of the United
States for later distribution with interest by the
Librarian of Congress as provided by this title.
[(3) Persons to whom fees are distributed.--The
royalty fees deposited under paragraph (2) shall, in
accordance with the procedures provided by paragraph
(4), be distributed to those copyright owners whose
works were included in a secondary transmission for
private home viewing made by a satellite carrier during
the applicable 6-month accounting period and who file a
claim with the Librarian of Congress under paragraph
(4).
[(4) Procedures for distribution.--The royalty fees
deposited under paragraph (2) shall be distributed in
accordance with the following procedures:
[(A) Filing of claims for fees.--During the
month of July in each year, each person
claiming to be entitled to statutory license
fees for secondary transmissions for private
home viewing shall file a claim with the
Librarian of Congress, in accordance with
requirements that the Librarian of Congress
shall prescribe by regulation. For purposes of
this paragraph, any claimants may agree among
themselves as to the proportionate division of
statutory license fees among them, may lump
their claims together and file them jointly or
as a single claim, or may designate a common
agent to receive payment on their behalf.
[(B) Determination of controversy;
distributions.--After the first day of August
of each year, the Librarian of Congress shall
determine whether there exists a controversy
concerning the distribution of royalty fees. If
the Librarian of Congress determines that no
such controversy exists, the Librarian of
Congress shall, after deducting reasonable
administrative costs under this paragraph,
distribute such fees to the copyright owners
entitled to receive them, or to their
designated agents. If theLibrarian of Congress
finds the existence of a controversy, the Librarian of Congress shall,
pursuant to chapter 8 of this title, convene a copyright arbitration
royalty panel to determine the distribution of royalty fees.
[(C) Withholding of fees during
controversy.--During the pendency of any
proceeding under this subsection, the Librarian
of Congress shall withhold from distribution an
amount sufficient to satisfy all claims with
respect to which a controversy exists, but
shall have discretion to proceed to distribute
any amounts that are not in controversy.
[(c) Adjustment of Royalty Fees.--
[(1) Applicability and determination of royalty
fees.--The rate of the royalty fee payable under
subsection (b)(1)(B) shall be effective unless a
royalty fee is established under paragraph (2) or (3)
of this subsection.
[(2) Fee set by voluntary negotiation.--
[(A) Notice of initiation of proceedings.--On
or before July 1, 1996, the Librarian of
Congress shall cause notice to be published in
the Federal Register of the initiation of
voluntary negotiation proceedings for the
purpose of determining the royalty fee to be
paid by satellite carriers under subsection
(b)(1)(B).
[(B) Negotiations.--Satellite carriers,
distributors, and copyright owners entitled to
royalty fees under this section shall negotiate
in good faith in an effort to reach a voluntary
agreement or voluntary agreements for the
payment of royalty fees. Any such satellite
carriers, distributors, and copyright owners
may at any time negotiate and agree to the
royalty fee, and may designate common agents to
negotiate, agree to, or pay such fees. If the
parties fail to identify common agents, the
Librarian of Congress shall do so, after
requesting recommendations from the parties to
the negotiation proceeding. The parties to each
negotiation proceeding shall bear the entire
cost thereof.
[(C) Agreements binding on parties; filing of
agreements.--Voluntary agreements negotiated at
any time in accordance with this paragraph
shall be binding upon all satellite carriers,
distributors, and copyright owners that are
parties thereto. Copies of such agreements
shall be filed with the Copyright Office within
30 days after execution in accordance with
regulations that the Register of Copyrights
shall prescribe.
[(D) Period agreement is in effect.--The
obligation to pay the royalty fees established
under a voluntary agreement which has been
filed with the Copyright Office in accordance
with this paragraph shall become effective on
the date specified in the agreement, and shall
remain in effect until December 31, 1999, or in
accordance with the terms of the agreement,
whichever is later.
[(3) Fee set by compulsory arbitration.--
[(A) Notice of initiation of proceedings.--On
or before January 1, 1997, the Librarian of
Congress shall cause notice to be published in
the Federal Register of the initiation of
arbitration proceedings for the purpose of
determining a reasonable royalty fee to be paid
under subsection (b)(1)(B) by satellite
carriers who are not parties to a voluntary
agreement filed with the Copyright Office in
accordance with paragraph (2). Such arbitration
proceeding shall be conducted under chapter 8.
[(B) Establishment of royalty fees.--In
determining royalty fees under this paragraph,
the copyright arbitration royalty panel
appointed under chapter 8 shall establish fees
for the retransmission of network stations and
superstations that most clearly represent the
fair market value of secondary transmissions.
In determining the fair market value, the panel
shall base its decision on economic,
competitive, and programming information
presented by the parties, including--
[(i) the competitive environment in
which such programming is distributed,
the cost of similar signals in similar
private and compulsory license
marketplaces, and any special features
and conditions of the retransmission
marketplace;
[(ii) the economic impact of such
fees on copyright owners and satellite
carriers; and
[(iii) the impact on the continued
availability of secondary transmissions
to the public.
[(C) Period during which decision of
arbitration panel or order of librarian
effective.--The obligation to pay the royalty
fee established under a determination which--
[(i) is made by a copyright
arbitration royalty panel in an
arbitration proceeding under this
paragraph and is adopted by the
Librarian of Congress under section
802(f), or
[(ii) is established by the Librarian
of Congress under section 802(f),
shall become effective as provided in section
802(g) or July 1, 1997, whichever is later.
[(D) Persons subject to royalty fee.--The
royalty fee referred to in subparagraph (C)
shall be binding on all satellite carriers,
distributors, and copyright owners, who are not
party to a voluntary agreement filed with the
Copyright Office under paragraph (2).
[(d) Definitions.--As used in this section--
[(1) Distributor.--The term ``distributor'' means an
entity which contracts to distribute secondary
transmissions from a satellite carrier and, either as a
single channel or in a package with other programming,
provides the secondary transmission either directly to
individual subscribers for private home viewing or
indirectly through other program distribution entities.
[(2) Network station.--The term ``network station''
means--
[(A) a television broadcast station,
including any translator station or terrestrial
satellite station that rebroadcasts all or
substantially all of the programmingbroadcast
by a network station, that is owned or operated by, or affiliated with,
one or more of the television networks in the United States which offer
an interconnected program service on a regular basis for 15 or more
hours per week to at least 25 of its affiliated television licensees in
10 or more States; or
[(B) a noncommercial educational broadcast
station (as defined in section 397 of the
Communications Act of 1934).
[(3) Primary network station.--The term ``primary
network station'' means a network station that
broadcasts or rebroadcasts the basic programming
service of a particular national network.
[(4) Primary transmission.--The term ``primary
transmission'' has the meaning given that term in
section 111(f) of this title.
[(5) Private home viewing.--The term ``private home
viewing'' means the viewing, for private use in a
household by means of satellite reception equipment
which is operated by an individual in that household
and which serves only such household, of a secondary
transmission delivered by a satellite carrier of a
primary transmission of a television station licensed
by the Federal Communications Commission.
[(6) Satellite carrier.--The term ``satellite
carrier'' means an entity that uses the facilities of a
satellite or satellite service licensed by the Federal
Communications Commission and operates in the Fixed-
Satellite Service under part 25 of title 47 of the Code
of Federal Regulations or the Direct Broadcast
Satellite Service under part 100 of title 47 of the
Code of Federal Regulations, to establish and operate a
channel of communications for point-to-multipoint
distribution of television station signals, and that
owns or leases a capacity or service on a satellite in
order to provide such point-to-multipoint distribution,
except to the extent that such entity provides such
distribution pursuant to tariff under the
Communications Act of 1934, other than for private home
viewing.
[(7) Secondary transmission.--The term ``secondary
transmission'' has the meaning given that term in
section 111(f) of this title.
[(8) Subscriber.--The term ``subscriber'' means an
individual who receives a secondary transmission
service for private home viewing by means of a
secondary transmission from a satellite carrier and
pays a fee for the service, directly or indirectly, to
the satellite carrier or to a distributor.
[(9) Superstation.--The term ``superstation'' means a
television broadcast station, other than a network
station, licensed by the Federal Communications
Commission that is secondarily transmitted by a
satellite carrier.
[(10) Unserved household.--The term ``unserved
household'', with respect to a particular television
network, means a household that--
[(A) cannot receive, through the use of a
conventional outdoor rooftop receiving antenna,
an over-the-air signal of grade B intensity (as
defined by the Federal Communications
Commission) of a primary network station
affiliated with that network, and
[(B) has not, within 90 days before the date
on which that household subscribes, either
initially or on renewal, to receive secondary
transmissions by a satellite carrier of a
network station affiliated with that network,
subscribed to a cable system that provides the
signal of a primary network station affiliated
with that network.
[(11) Local market.--The term ``local market'' means
the area encompassed within a network station's
predicted Grade B contour as that contour is defined by
the Federal Communications Commission.
[(e) Exclusivity of This Section With Respect to Secondary
Transmissions of Broadcast Stations by Satellite to Members of
the Public.--No provision of section 111 of this title or any
other law (other than this section) shall be construed to
contain any authorization, exemption, or license through which
secondary transmissions by satellite carrier for private home
viewing of programming contained in a primary transmission made
by a superstation or a network station may be made without
obtaining the consent of the copyright owner.]
Sec. 119. Limitations on exclusive rights; Secondary transmissions by
satellite carriers
(a) Secondary Transmissions of Television Broadcast Stations
by Satellite Carriers.--
(1) Statutory license.--Subject to the provisions of
paragraphs (2), (3), (4), and (5) of this subsection
and section 114(d), a secondary transmission that is in
compliance with the rules, regulations, and
authorizations of the Federal Communications Commission
of a primary transmission made by a television
broadcast station and embodying a performance or
display of a work may have a statutory license under
this section if the satellite carrier makes a direct or
indirect charge to subscribers for the secondary
transmission or to a distributor that has contracted
with the satellite carrier for direct or indirect
delivery of the secondary transmission. For purposes of
this section, the Public Broadcasting Service satellite
feed shall be considered a primary transmission made by
a television broadcast station that is in compliance
with the rules, regulations, and authorizations of the
Federal Communications Commission, except that
subsequent to--
(A) the date when a majority of subscribers
to satellite carriers are able to receive the
signal of at least one noncommercial
educational television broadcast station from
their satellite carrier within such stations'
local market, or
(B) 2 years after the effective date of the
Satellite Competition and Consumer Protection
Act,
whichever is earlier, the statutory license created by
this section with respect to such satellite feed shall
be conditioned on the annual certification of support
under section 396(n) of the Communications Act of 1934.
(2) Submission of subscriber lists.--(A) A satellite
carrier that makes secondary transmissions of a primary
transmission of a television broadcast station under
paragraph (1) shall, within 90 days after commencing
such secondary transmissions, submit to that station a
list identifying all subscribers to which the satellite
carrier currently makes secondary transmissions of that
primary transmission. Such list shall be organized by
State, identifying all subscribers by name (including
street ad-
dress, county, and 9-digit zip code) in that State that
receive secondary transmissions of that primary
transmission.
(B) After the list is submitted under subparagraph
(A), the satellite carrier shall, on the 15th of each
month, submit to the television broadcast station a
list identifying by State the names (including street
address, county, and 9-digit zip code) of any
subscribers who have been added or dropped as
subscribers since the last submission under this
paragraph.
(C) Subscriber information submitted by a satellite
carrier under this paragraph may be used only for
purposes of monitoring compliance by the satellite
carrier with the statutory license created by this
section. The submission of subscriber lists is only
required for those television broadcast stations that
place on file with the Register of Copyrights a
document identifying the name and address of the person
to whom such submissions are to be made. The Register
shall maintain for public inspection a file of all such
documents.
(3) Noncompliance with reporting and payment
requirements.--Notwithstanding the provisions of
paragraph (1), the willful or repeated secondary
transmission to the public that is in compliance with
the rules, regulations, and authorizations of the
Federal Communications Commission by a satellite
carrier of a primary transmission made by a television
broadcast station and embodying a performance or
display of a work is actionable as an act of
infringement under section 501, and is fully subject to
the remedies provided by sections 502 through 506 and
509, if the satellite carrier has not deposited the
statement of account and royalty fees required by
subsection (b).
(4) Willful alterations.--Notwithstanding the
provisions of paragraph (1), the secondary transmission
to the public that is in compliance with the rules,
regulations, and authorizations of the Federal
Communications Commission by a satellite carrier of a
primary transmission made by a television broadcast
station and embodying a performance or display of a
work is actionable as an act of infringement under
section 501, and is fully subject to the remedies
provided by sections 502 through 506 and sections 509
and 510, if the content of the particular program in
which the performance or display is embodied, or any
commercial advertising or station announcement
transmitted by a primary transmitter during, or
immediately before or after the transmission of such
program, is in any way willfully altered by the
satellite carrier through changes, deletions, or
additions, or is combined with programming from any
other broadcast signal.
(5) Discrimination by satellite carrier.--
Notwithstanding the provisions of paragraph (1), the
willful or repeated secondary transmission to the
public that is in compliance with the rules,
regulations, and authorizations of the Federal
Communications Commission by a satellite carrier of a
primary transmission made by a television broadcast
station and embodying the performance or display of a
work is actionable as an act of infringement under
section 501, and is fully subject to the remedies
provided by sections 502 through 506 and 509, if the
satellite carrier unlawfully discriminates against a
distributor.
(6) Geographic limitation on secondary
transmissions.--The statutory license created by this
section shall apply only to secondary transmissions to
subscribers located in the United States.
(b) Statutory License for Secondary Transmissions of
Television Broadcast Stations.--
(1) Deposits with the register of copyrights.--A
satellite carrier whose secondary transmissions are
subject to statutory licensing under subsection (a)
shall, on a semiannual basis, deposit with the Register
of Copyrights, in accordance with the requirements that
the Register shall prescribe by regulation--
(A) a statement of account, covering the
preceding 6-month period, specifying the names
and locations of all television broadcast
stations whose signals were retransmitted at
any time during that period to subscribers, the
total number of subscribers that received such
secondary transmissions, and such other data as
the Register of Copyrights may from time to
time prescribe by regulation, and
(B) a royalty fee for that 6-month period,
computed as follows:
(i) For each television network
station that is retransmitted to
subscribers located outside the local
market of that station, by multiplying
the total number of subscribers
receiving such secondary transmission
during each calendar month by the
royalty fee prescribed in section
258.3(b)(2) of title 37, Code of
Federal Regulations, as in effect on
January 1, 1998.
(ii) For each superstation that is
retransmitted to subscribers located
outside the local market of that
station, by multiplying the total
number of subscribers receiving such
secondary transmission during each
calendar month by the royalty fee
prescribed in section 258.3(b)(1) of
title 37, Code of Federal Regulations,
as in effect on January 1, 1998.
(iii) By adding together the totals
computed under clauses (i) and (ii).
For secondary transmissions of a television broadcast
station to subscribers who reside within the local
market of that station, there shall be no royalty fee.
(2) Investment of fees.--The Register of Copyrights
shall receive all fees deposited under this section
and, after deducting the reasonable costs incurred by
the Copyright Office under this section (other than the
costs deducted under paragraph (4)), shall deposit the
balance in the Treasury of the United States, in such
manner as the Secretary of the Treasury directs. Any
funds held by the Secretary of the Treasury shall be
invested in interest bearing securities of the United
States for later distribution with interest by the
Librarian of Congress as provided by this title. The
Register may, in the Register's discretion, at any time
after four years have elapsed since the close of any
calendar year, close out the royalty payments account
for that calendar year, and may treat any funds
remaining in such ac-
count and any subsequent deposits that would otherwise
be attributable to that calendar year as attributable
to the succeeding calendar year.
(3) Persons to whom fees are distributed.--The
royalty fees deposited under paragraph (2) shall, in
accordance with the procedures provided by paragraph
(4), be distributed to those copyright owners whose
works were included in a secondary transmission to the
public made by a satellite carrier during the
applicable 6-month accounting period and who file a
claim with the Librarian of Congress under paragraph
(4). For purposes of section 802 of this title, with
respect to royalty fees paid by satellite carriers for
retransmitting the Public Broadcasting Service
satellite feed, the Public Broadcasting Service shall
be agent for all public television copyright claimants
and all Public Broadcasting Service member stations.
(4) Procedures for distribution.--The royalty fees
deposited under paragraph (2) shall be distributed in
accordance with the following procedures:
(A) Filing of claims for fees.--During the
month of July in each year, each person
claiming to be entitled to statutory license
fees for secondary transmissions under this
section shall file a claim with the Librarian
of Congress, in accordance with requirements
that the Librarian shall prescribe by
regulation. For purposes of this paragraph, any
claimants may agree among themselves as to the
proportionate division of statutory license
fees among them, may lump their claims together
and file them jointly or as a single claim, or
may designate a common agent to receive payment
on their behalf.
(B) Determination of controversy;
distributions.--After the first day of August
of each year, the Librarian of Congress shall
determine whether there exists a controversy
concerning the distribution of royalty fees. If
the Librarian determines that no such
controversy exists, the Librarian shall, after
deducting reasonable administrative costs under
this paragraph, distribute such fees to the
copyright owners entitled to receive them, or
to their designated agents. If the Librarian
finds the existence of a controversy, the
Librarian shall, pursuant to chapter 8 of this
title, convene a copyright arbitration royalty
panel to determine the distribution of fees.
(C) Withholding of fees during controversy.--
During the pendency of any proceeding under
this subsection, the Librarian of Congress
shall withhold from distribution an amount
sufficient to satisfy all claims with respect
to which a controversy exists, but shall have
discretion to proceed to distribute any amounts
that are not in controversy.
(c) Definitions.--As used in this section--
(1) Distributor.--The term ``distributor'' means any
entity which contracts to distribute secondary
transmissions from a satellite carrier and, either as a
single channel or in a package with other programming,
provides the secondary transmission either directly to
individual subscribers or indirectly through other
program distribution entities.
(2) Local market.--The term ``local market'' of a
television broadcast station has the meaning given that
term section 3 of the Communications Act of 1934 (47
U.S.C. 153) as interpreted under the rules,
regulations, and authorizations of the Federal
Communications Commission relating to carriage of
television broadcast signals by satellite carriers.
(3) Primary transmission.--The term ``primary
transmission'' has the meaning given that term in
section 111(f) of this title.
(4) Public broadcasting service satellite feed.--The
term ``Public Broadcasting Service satellite feed''
means the national satellite feed distributed by the
Public Broadcasting Service for purposes of this
section consisting of educational and informational
programming, to which the Public Broadcasting Service
holds national terrestrial broadcast rights.
(5) Satellite carrier.--The term ``satellite
carrier'' has the meaning given that term in section 3
of the Communications Act of 1934.
(6) Secondary transmission.--The term ``secondary
transmission'' has the meaning given that term in
section 111(f) of this title.
(7) Subscriber.--The term ``subscriber'' means an
entity that receives a secondary transmission service
by means of a secondary transmission from a satellite
and pays a fee for the service, directly or indirectly,
to the satellite carrier or a distributor.
(8) Superstation.--The term ``superstation'' means a
television broadcast station, other than a television
network station, licensed by the Federal Communications
Commission that is secondarily transmitted by a
satellite carrier, and includes the Public Broadcasting
Service satellite feed.
(9) Television broadcast station.--The term
``television broadcast station'' has the meaning given
that term in section 325(b)(7) of the Communications
Act of 1934.
(10) Television network station.--The term
``television network station'' means--
(A) a television network station (as defined
in section 3 of the Communications Act of
1934); or
(B) a noncommercial educational broadcast
station (as defined in section 397 of such Act.
(d) Exclusivity of This Section With Respect to Secondary
Transmissions of Television Broadcast Stations by Satellite to
Members of the Public.--No provision of section 111 of this
title or any other law (other than this section) shall be
construed to contain any authorization, exemption, or license
through which secondary transmissions by satellite carriers of
programming contained in a primary transmission may be made
without obtaining the consent of the copyright owner.
* * * * * * *
CHAPTER 5--COPYRIGHT INFRINGEMENT AND REMEDIES
* * * * * * *
Sec. 501. Infringement of copyright
(a) * * *
* * * * * * *
[(e) With respect to any secondary transmission that is made
by a satellite carrier of a primary transmission embodying the
performance or display of a work and is actionable as an act of
infringement under section 119(a)(5), a network station holding
a copyright or other license to transmit or perform the same
version of that work shall, for purposes of subsection (b) of
this section, be treated as a legal or beneficial owner if such
secondary transmission occurs within the local service area of
that station.]
* * * * * * *
ADDITIONAL VIEWS
H.R. 851 the Satellite Competition and Consumer Protection
Act established a means for satellite television carriers to
legally carry and retransmit local television network signals,
thus providing a viable competitor to the cable industry.
Recent events led to the termination of network signals to
millions of satellite television subscribers. Under current law
only those persons who can not receive a network signal through
an over the air television antenna are eligible to receive and
purchase a distant network package through their satellite
carriers. Unfortunately, there are many customers who live in
areas of the country, for example in downtown areas, that can
receive a clear network signal and were still sold these
distant network packages. It is these customers who deserve a
measure of relief. These are ineligible customers who were sold
an illegal product.
H.R. 851 takes many steps to solve the problem of satellite
customers who might have been ineligible to receive a distant
network signal but were still sold distant network packages.
The provisions providing for local into local service will
start to alleviate this problem. However, many of these
customers were still sold either through the carrier or a local
vendor a distant network package that was terminated. Until
local into local service is available in all markets, these
satellite carriers or local vendors should be held accountable
and are obligated to provide their customers with access to a
local network signal.
Satellite carriers and the local vendors need to fulfill
their obligations to their customers and provide them with
access to a network signal.
Gene Green.