July 24, 2008-- July 31, 2008 is the deadline for television stations that were carried by a cable or satellite operator on a "distant signal" basis during calendar year 2007 to file claims for royalty fees arising from the distant retransmission of their locally produced programming.  When cable and satellite operators carry stations on a distant signal basis, they must pay copyright royalties to the Copyright Office.  The holders of the copyrights in the programs that were retransmitted on a distant signal basis are then entitled to seek a portion of those fees attributable to distant viewing of the programs to which they hold copyrights.  In the case of local television news or other locally produced programming, it is usually the station itself that is entitled to the fees.

The term "distant signal" is a term of art.  In general, a station will be distant on any cable system that is located outside of the station’s DMA, is located more than 35 miles from the station’s community of license and is outside the station’s Grade B contour.  In addition, the station cannot be significantly viewed in the area served by the cable operator and cannot have given the cable operator a direct license (permission to rebroadcast the station without paying royalties) for that carriage.  A station is distant on a satellite system where its signal is delivered to viewers located outside of the station’s DMA.   If you are not certain whether your station has been carried on a "distant signal" basis, please contact the firm immediately as this determination has to be made on a case-by-case basis.

July 31, 2008:

• Deadline to File Claims with Copyright Office for Distant Cable Carriage of Television Stations 
• Deadline to File Claims with Copyright Office for Distant Satellite Carriage of Television Stations

All claims are filed with the Copyright Office electronically, not with the FCC.  Also, separate claims must be filed for cable and satellite distant carriage.

October 1, 2008 is the deadline for television stations to make their triennial election between retransmission consent and must-carry on both cable and satellite systems.

October 1, 2008:

• Deadline to Elect Between Retransmission Consent and Must Carry on Cable Systems 
• Deadline to Elect Between Retransmission Consent and Must Carry on Satellite Systems 
• Deadline to Notify Satellite Carriers of Station's Intent to Terminate Analog Early

This year's elections are especially important because the rules governing digital carriage differ from legacy analog carriage rules in significant ways and because ongoing changes in the competitive landscape may affect markets and stations differently. 

Examples of some considerations include: 

• Whether high definition signals will be viewable on standard definition or analog sets.  The answer may differ from one DBS or cable provider to another, from market to market, and may change during the upcoming three year election cycle.  Choice of retransmission consent or must-carry may also affect the outcome.
• Which party controls and pays for any signal down-conversion and adjustment of aspect ratio.
• Whether and how multiplexed program streams and ancillary data will be carried.
• The capabilities of each multichannel platform and the need to access advanced capabilities, such as pass-through of interactive elements.
• Differential carriage on DBS systems.  DBS carriers are permitted to carry some local stations in high definition while denying high definition carriage to others during a phase-in period.  Electing retransmission consent may reduce the risk of differential treatment, or may lead to refusal of the DBS provider to carry the station altogether, depending on the DBS provider’s spot beam capacity.

Most existing carriage agreements are analog-centric, and digital-only carriage is covered inadequately, if at all.  The practice of many stations and multichannel providers of simply renewing or extending prior agreements can lead to many unfavorable and unanticipated post-transition consequences for both parties.  We highly recommend that you speak to us about your options and the impact of the digital transition on your station before making elections.  Making informed elections requires advance research and preparation.

The FCC's rule specifically dictates the required contents of the satellite notice and requires that such notice be sent by Certified Mail -- Return Receipt Requested.  While the rules do not dictate the content of cable elections, they must nevertheless be in writing, and should contain the same sort of information as the satellite elections.  Accordingly, we strongly 
recommend that stations follow the satellite election rule for cable as well and send all elections via Certified Mail.  The FCC rule identifying the required contents of the satellite elections is reprinted at the end of this Advisory.

October 1, 2008 is also the deadline by which stations must notify satellite carriers if they intend to terminate analog service after January 1 and before February 17, 2009.  Under the FCC's Second Report and Order in the Implementation of the Satellite Home Viewer Act, Local Broadcast Signal Carriage Issues, as of January 1, 2009, satellite carriers are required to commence carriage of stations' digital signals upon termination of analog broadcasting, so long as stations notify the satellite carriers in writing by October 1, 2008 of their intent to terminate analog operation early.  Again, we recommend that this notification be sent by Certified Mail.  Stations that will terminate analog operations prior to January 1, 2009 should contact the firm for assistance in coordinating notice to satellite carriers.

If you have any questions about these deadlines, or if you would like assistance in preparing your claims or election letters, please contact any of the lawyers in the Communications Practice Section.

For further information, please contact: 

Lauren Lynch Flick
Washington, DC
Tel: 1.202.663.8166
lauren.lynch.flick@pillsburylaw.com 

John Hane 
Washington, DC
Tel: 1.202.663.8116
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