Washington Post 2012 Annual Report Download - page 39

In a separate “localism” proceeding that was opened in late 2007, the FCC received comments on whether to adopt
additional proposals, including license renewal guidelines that would establish minimum amounts of locally oriented
programming, require broadcasters to establish permanent community advisory boards and require stations to locate their
main studios in their communities of license. The localism proceeding remains pending at the FCC. It is not possible to
predict what, if any, effect adoption of the proposed new obligations would have on PNS’s operations, but a substantial
increase in programming obligations could adversely affect PNS.
The FCC has other regulations and policies to ensure that broadcast licensees operate in the public interest, including
rules requiring the closed-captioning of programming to assist television viewing by the hearing impaired and the equal
employment opportunities rule requiring station licensees to provide equal opportunity in employment to all qualified job
applicants and prohibiting discrimination against any person based on race, color, religion, national origin or gender. In
addition, pursuant to the U.S. Federal Twenty-First Century Communications and Video Accessibility Act (CVAA), the FCC
has adopted video description rules to assist television viewing by the visually impaired. Thus, (1) television stations
affiliated with one of the four highest ranking television networks in the top 25 markets must provide 50 hours per
calendar quarter of audio description of key visual elements in programming aired during prime time or children’s
programming and (2) television stations affiliated with any television network must pass through video descriptions when
the network provides them. The FCC began requiring compliance with the new rules on July 1, 2012, and the rules could
impose additional costs on the PNS stations that could affect PNS’s operations. In January 2012, the FCC adopted rules
under the CVAA requiring captioned programs that are shown on TV also be captioned when re-shown on the Internet.
The rules went into effect for pre-recorded video programming that is not edited for the Internet on September 30, 2012.
The rules will apply to live and near-live Internet programming on March 30, 2013, and for pre-recorded video
programming that is substantially edited for the Internet on September 30, 2013. The CVAA also directs the FCC to
adopt rules to help ensure that certain video programming distributors convey emergency information in a manner that is
accessible to persons who are blind or visually impaired. The FCC launched a rulemaking on this issue in 2012, and the
CVAA requires the FCC to issue rules by April 9, 2013. The Company cannot predict the compliance deadline that the
FCC will establish or the content of the rules it will adopt. The FCC also has issued rules designed to maintain a consistent
loudness between programming and commercial advertisements, which became effective in December 2012.
Compliance with new rules on captioning programming delivered over the Internet, on emergency information
accessibility and on commercial loudness could impose additional costs on the PNS stations that could affect PNS’s
operations.
Political Advertising. The FCC regulates the sale of advertising by PNS’s stations to candidates for public office and
imposes other restrictions on the broadcast of political announcements more generally. The application of these
regulations may limit the advertising revenues of PNS’s television stations during the periods preceding elections.
Broadcast Indecency. The FCC’s policies prohibit the broadcast of indecent and profane material during certain hours
of the day, and the FCC regularly imposes monetary forfeitures when it determines that a television station violated that
policy. Many broadcasters have argued, among other things, that the FCC has failed to justify its indecency decisions
adequately, that the FCC’s policy is too subjective to guide broadcasters’ programming decisions and that its enforcement
approach otherwise violates the First Amendment.
In 2009, the U.S. Supreme Court issued a decision, Fox Television Stations, Inc.v.FCC, in which it reversed a decision
by the U.S. Court of Appeals for the Second Circuit. The Second Circuit decision had held that the FCC violated its
procedural obligations when it found that certain television stations’ broadcasts of so-called “fleeting expletives” were
indecent. Following the U.S. Supreme Court’s reversal and remand of the decision, the Second Circuit invalidated the
FCC’s indecency policy on another basis, finding that the FCC’s policy was unconstitutionally vague. Following that
decision, in ABC, Inc.v.FCC, the Second Circuit vacated a monetary forfeiture issued by the FCC against 52 television
stations affiliated with the ABC network (including PNS station KSAT) based on the broadcast of an allegedly indecent
scene in an episode of NYPD Blue. The Second Circuit found that there was “no significant distinction” between the FCC
policy that it found unconstitutional in its second Fox decision and the policy that the FCC applied with respect to NYPD
Blue. Accordingly, the court held the forfeiture against KSAT invalid. The FCC asked the U.S. Supreme Court to review
both the Fox and ABC cases, and the U.S. Supreme Court held oral argument on the combined cases in January 2012.
In June 2012, the U.S. Supreme Court ruled that the fines in this case were unconstitutional because the FCC had failed
to provide advance notice to broadcasters of what the FCC deemed to be indecent, but it also upheld the FCC’s
authority to regulate broadcast decency. This ruling could result in additional regulatory risks.
Sponsorship Identification. The FCC’s rules require that broadcast stations make announcements in connection with
certain broadcasts for which they have received payment or other consideration. During 2006 and 2007, three PNS
stations responded to FCC complaints alleging that they, along with numerous other television stations and cable
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