House Speaker Nancy Pelosi has, for the first time, thrown her support behind a bill that would abolish radio’s decades-old performance royalty exemption. She’s vowed to “find a way forward” on passing a radio royalty.

More than a boost for the music industry’s effort, the Speaker’s office controls what comes to the House floor for a vote. Pelosi told a group of Recording Academy members on Capitol Hill for a daylong lobbying blitz yesterday that they were “sending a message” that “ideas, music, and imagination are as valuable as any material invention.” In her first public statement on the proposed Performance Rights Act, Pelosi said, “Artists deserve to be compensated for their work and rewarded for their contributions to our economy and our culture.”

Bill sponsors hope to see the royalty issue come to a vote in the House and Senate before Memorial Day. The bill isn’t on the calendar at the moment and non-binding resolutions opposing the fee have 259 co-sponsors in the House and 26 in the Senate. Despite a majority against it, Pelosi said she’ll work with key lawmakers to “find a way forward on the issue of performers’ rights.” That may be a signal she’s looking for a must-pass bill to attach the royalty to. Broadcasters potentially lost one member’s vote this week when Rep. Robert Brady (D-PA) pulled his name from the list opposing the royalty.

By MARK SHERMAN
The Associated Press
Thursday, January 21, 2010; 10:41 AM

WASHINGTON -- The Supreme Court ruled Thursday that corporations may spend as
freely as they like to support or oppose candidates for president and Congress, easing
decades-old limits on business efforts to influence federal campaigns.

By a 5-4 vote, the court overturned a 20-year-old ruling that said companies can be
prohibited from using money from their general treasuries to produce and run their own
campaign ads. The decision, which almost certainly will also allow labor unions to
participate more freely in campaigns, threatens similar limits imposed by 24 states.

It leaves in place a prohibition on direct contributions to candidates from corporations
and unions.

Critics of the stricter limits have argued that they amount to an unconstitutional restraint
of free speech, and the court majority agreed.

"The censorship we now confront is vast in its reach," Justice Anthony Kennedy said in
his majority opinion, joined by his four more conservative colleagues.

Strongly disagreeing, Justice John Paul Stevens said in his dissent, "The court's ruling
threatens to undermine the integrity of elected institutions around the nation."

Justices Ruth Bader Ginsburg, Stephen Breyer and Sonia Sotomayor joined Stevens'
dissent, parts of which he read aloud in the courtroom.

The justices also struck down part of the landmark McCain-Feingold campaign finance
bill that barred union- and corporate-paid issue ads in the closing days of election
campaigns.

Advocates of strong campaign finance regulations have predicted that a court ruling
against the limits would lead to a flood of corporate and union money in federal
campaigns as early as this year's midterm congressional elections.

"It's the Super Bowl of bad decisions," said Common Cause president Bob Edgar, a
former congressman from Pennsylvania.

The decision removes limits on independent expenditures that are not coordinated with
candidates' campaigns.

The case does not affect political action committees, which mushroomed after post-
Watergate laws set the first limits on contributions by individuals to candidates.
Corporations, unions and others may create PACs to contribute directly to candidates,
but they must be funded with voluntary contributions from employees, members and
other individuals, not by corporate or union treasuries.

Chief Justice John Roberts and Justices Samuel Alito, Antonin Scalia and Clarence
Thomas joined Kennedy to form the majority in the main part of the case.

Roberts, in a separate opinion, said that upholding the limits would have restrained "the
vibrant public discourse that is at the foundation of our democracy."

Stevens complained that those justices overreached by throwing out earlier Supreme
Court decisions that had not been at issue when this case first came to the court.

"Essentially, five justices were unhappy with the limited nature of the case before us, so
they changed the case to give themselves an opportunity to change the law," Stevens
said.

The case began when a conservative group, Citizens United, made a 90-minute movie
that was very critical of Hillary Rodham Clinton as she sought the Democratic
presidential nomination. Citizens United wanted to air ads for the anti-Clinton movie and
distribute it through video-on-demand services on local cable systems during the 2008
Democratic primary campaign.

But federal courts said the movie looked and sounded like a long campaign ad, and
therefore should be regulated like one.

The movie was advertised on the Internet, sold on DVD and shown in a few theaters.
Campaign regulations do not apply to DVDs, theaters or the Internet.

The court first heard arguments in March, then asked for another round of arguments
about whether corporations and unions should be treated differently from individuals
when it comes to campaign spending.

The justices convened in a special argument session in September, Sotomayor's first.
The conservative justices gave every indication then that they were prepared to take the
steps they did on Thursday.

The justices, with only Thomas in dissent, did uphold McCain-Feingold requirements
that anyone spending money on political ads must disclose the names of contributors.

Congress Daily

TELECOMMUNICATIONS

Wednesday, Jan. 20, 2010  

The battle over broadcasting's future is on.

Despite growing opposition in Washington and strong resistance from television stations, the FCC is proceeding with a controversial plan to reallocate a significant portion of digital airwaves to wireless carriers.

But in a nod to congressional overseers and the powerful National Association of Broadcasters, headed by former Sen. Gordon Smith, R-Ore., the commission prefers to take a soft-pedal approach.

"Depending on what the proposal is, it could make the broadcasters a subordinate feature in American life," Smith warned in an interview.

Citing the billions of dollars spent on last year's digital TV transition, Smith added: "To have a federal policy in place that essentially says 'never mind' I think is very unwise and very unfair."

While the FCC initially floated the idea of forcing stations to relinquish half their spectrum, it now says that would be a last resort. Instead, it wants to give stations -- particularly struggling ones -- a chance to turn in licenses voluntarily.

This approach would buy time for pending legislation that could free up more airwaves by requiring the government to inventory its communications spectrum.

If necessary, tougher measures could be imposed. "They're not really mutually exclusive," said Phil Bellaria, director of scenario planning for the FCC's Omnibus Broadband Initiative, referring to the ideas in play.

The tussle is a flashpoint in the agency's upcoming national broadband plan that will seek to achieve universal, affordable wireless broadband by 2020. Some experts think the challenge of finding more spectrum contributed to the FCC's decision to give the plan to Congress on March 17, a month late.

Broadcasters speak of dire consequences if their frequencies are cut, with free over-the-air high-definition broadcasts and ancillary digital channels among the casualties. That message is resonating with key lawmakers, including House Energy and Commerce Communications Subcommittee Chairman Rick Boucher, D-Va., former House Energy and Commerce Chairman John Dingell, D-Mich., and Rep. Greg Walden, R-Ore.

Sen. Olympia Snowe, R-Maine, a senior Senate Commerce Committee member, issued a statement expressing "reservations about the FCC's increased focus on broadcasters" while several spectrum proceedings are pending.

Like Snowe, Commerce ranking member Kay Bailey Hutchison prefers an analysis of previously allocated commercial spectrum to determine "if we can promote leasing and other arrangements" that use it more effectively, a committee source said.

"There has been a rush to judgment by some to identify particular areas of the spectrum for reallocation," the source said, referring to broadcast airwaves. "This type of snap judgment is premature without the type of broad analysis and inventory she supports."

The FCC has sought to assure broadcasters that their airwaves can be reallocated with few disruptions. It wants to begin with a "market-based" approach under which stations could voluntarily hand in licenses or consolidate while receiving financial compensation for returned frequencies. But success hinges on the level of participation.

Mandatory steps include requiring broadcasters to cede half their airwaves and double up on transmission towers. The FCC insists each station could offer either one high-definition signal or up to three ancillary signals in not-as-sharp standard definition.

David Donovan, president of the Association for Maximum Television Service, a broadcast industry group, counters that the high-definition TV alternative cannot be offered under this approach, grousing: "To call it HDTV is like calling a weed a rose."

The FCC could "repack" stations closer together without reducing spectrum, though there are downsides. Many broadcasters would have to acquire new transmitters, which could be paid for with auction proceeds, and relocate on the dial. Only a small amount of frequencies would be recouped and viewers would have to rescan their sets.

Another option involves auctioning "overlay licenses" that would let wireless carriers use unoccupied TV spectrum. To expand service, auction winners could negotiate with stations to relocate on the band or go dark, prompting broadcasters to worry about interference and undue pressure.

"We'll explore any ideas the FCC puts on the table," said NAB spokesman Dennis Wharton.

by John K. Hane and Paul A. Cicelski

Earlier today the United States Court of Appeals for the District of Columbia Circuit overturned a decision of the Federal Communications Commission that had prohibited any single cable television operator from serving more than 30 percent of all cable subscribers nationally.

In vacating the FCC’s rule, the Court held that the FCC’s action was “arbitrary and capricious” because the FCC did not adequately demonstrate that permitting a cable operator to serve more than 30 percent of subscribers would reduce “either competition or diversity in programming.”  The Court also determined that the FCC failed to fully consider the increased competition cable operators face from satellite and fiber optic cable providers as well as the fact that there has been a “dramatic increase” over the years both “in the number of cable networks and in the programming available to subscribers.”  Citing the “egregious” nature of the FCC’s actions, the Court vacated the 30 percent subscriber cap in its entirety.

The FCC adopted the cap under a provision of the 1992 Cable Act that requires the FCC to adopt rules to prevent cable consolidation from impeding the “flow of video programming” to consumers.  The practical effect of this decision may be limited, since any cable merger would still be subject to FCC and antitrust approvals.  Chairman Genachowski released a statement this afternoon stating that “As part of the Cable Act, Congress required the Commission to adopt horizontal ownership limits to enhance effective competition in the cable television marketplace” and that the FCC “will take this decision fully into account in future action to implement the law.”