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JESSELL AT LARGE

NAB FIGHTS FCC

TVNEWSDAY, Mar 14 2008, 3:44 PM ET

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You know how I feel about the FCC’s new “enhanced” disclosure requirements. They’re just a back-door way for the agency to impose programming mandates on TV stations.

And, in addition impinging on stations’ right to air what they want, the requirements also present a big chore for stations. Each quarter, stations will have to prepare a detailed report on a newly created Form 355 listing various kinds of news, public affairs and other local programming.

You’ve really got to read the 42-page FCC order to see what a burden the new rules are. If you can’t stomach that, at least read David Oxenford’s synoposis.

In her Feb. 29 column for TVNEWSDAY, BCFM President Mary Collins concluded that the rules will force stations to “add one or more full-time employees just to monitor programming to ensure that Form 355 is filled out completely and accurately.”

I know that’s exactly what stations want to do—add another $100,000 to their payroll (two employees plus benes) that will produce no new programming, no viewership, no revenue.

All is not lost, however.

To its credit, the NAB is still trying to scuttle the entire regime.

The word is that the NAB is seriously contemplating challenging the new rules in federal court.

But first it is going to try an administrative remedy or two.

The Office of Management and Budget administers the Paperwork Reduction Act, a law designed to prevent the FCC and other agencies from imposing undue paperwork and recordkeeping burdens on businesses.

Believing that the enhanced disclosure rules are just the kind of regulations the Act is intended to prevent, the NAB will be filing comments with the OMB on May 21.

At the same time, the NAB is considering filing a petition for reconsideration at the FCC. Such appeals usually don’t accomplish much because they are to the same five people who voted for the rules in the first place.

But it may be a necessary prelude to a real appeal before a U.S. Court of Appeals. The NAB can tell the court that it exhausted all other means of overturning the rules.

I do hope that NAB goes all the way in trying to undo the rules because there are worse ones on the way.

A lawsuit is a fastball, high and tight. It will let FCC Chairman Kevin Martin and his Democratic enablers, Copps and Adelstein, know that the NAB is not going to stand by and allow broadcasters to be hobbled by silly and unnecessary regulations. Not without a fight.

If things go badly for broadcasters in their appeals, there is still hope.

Good ol’ Canadian ingenuity has come up with software that may not eliminate the Form 355 burden, but may make it a bit lighter.

Next month at the NAB Show, Toronto-based BroadView Software Inc. will unveil a new add-on to its trafficking and programming scheduling software that will electronically generate the Form 355 each quarter.

“We have a good toolset,” says BroadView President Michael Atkin. “It is our hope that we can help minimize the workload on stations.”

“If they have to do it, we are going to make it as easy as we can for them.”

A completed Form 355 could run 200 or 300 pages at a typical station, Atkin says. “This is not something that you can do in the last four days before the end of the quarter.”

But with the BroadView software, a station should be able to keep up with the reporting requirements by filling in the extra necessary “data points” every day, he says.

BroadView is not a panacea.

With the software, Atkins says, stations that rely heavily on network and syndicated programming may be able get by without hiring anybody.

But stations rich in news and public affairs may still require somebody to slice and dice the programs and properly tag the segments, he says.

(Don’t miss the irony here. The stations that provide heavy doses of the kinds of the programming that the FCC wants—local news and public affairs—will have hardest time with the recordkeeping and reporting.)

There is another downside to the BroadView software: It’s not free. Stations will still have to pay a monthly licensing fee based on what the underlying software does—trafficking or program scheduling or both—and other variables, including market size and station group size.

BroadView has not yet made deep inroads in the U.S. market. PBS, several noncommercial stations and Entravision are using its integrated product for scheduling and traffic, while Ion uses only the program scheduling portion.

Atkins hopes that the Form 355 module will help drive sales among commercial stations.


“I can see where the FCC wants to go with it,” he says, “but I can also see the challenges for the stations.”

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The NAB’s 2005 ouster of Eddie Fritts after 22 years on the job was an ugly affair. After butting heads too often over policy, particularly on media ownership, the powers-that-be on the NAB board pushed him out.

Or, perhaps, I should say it eased him out. Fritts did not leave empty handed. According to the NAB’s tax return for fiscal 2006 (ending April 1, 2007), he received $7.4 million in compensation, benefits and expenses in what I suppose is severance. He is listed on the return as “president emeritus,” even though he was long gone.

The big payday is on top of $2.26 million he received in the prior fiscal year (2005), even though he only was on the job part of the year.

Fritts is now running his own lobbying shop, which is, by all appearances, thriving. His clients include CBS, News Corp., DirecTV and MPAA, and, according to Kim McAvoy’s March 4 story, is raising funds for McCain, which means that if McCain wins in November, so will The Fritts Group.

The NAB’s 2006 return also reports that Fritts' successor, David Rehr, earned $825,000 in compensation and benefits. Not too shabby, but less than the $1 million-plus Fritts was taking down in his final years.

Rehr’s reportedly signed a new contract last year, so I would suspect that his compensation will increase significantly in fiscal 2007, which ends at the end of this month.

The 2006 return shows that NAB is a break-even operation, bringing in $55 million and spending $54.7 million. But those figures don’t even hint at the NAB’s wealth. At the end of the fiscal year, it was sitting on $100 million in cash, savings and investments. And the balance sheet shows a net worth of $78.9 million.

That NAB has been able to amass its fortune is due to the fabulously lucrative trade show it stages in Las Vegas each April. The NAB Show brought in $34.9 million in 2007. Although it doesn’t break out the expenses for the show, it says that cost of all of its conferences, conventions and meetings was just $16 million.

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I finally got around to applying for my $40 DTV converter coupons from NTIA today. It couldn’t be simpler. It takes about a minute. Just click here.

According to NTIA, I joined more than four million other households that have applied for more than 7.6 million coupons to date. (Think about that. Some homes actually asked for only one coupon.)

NTIA says it has sent out more than two million of the coupons so far.

Now, in truth, I don’t have any sets that receive off-air signals, but I will, if the broadcasters here in DMA 1 can get their digital signals cooking on high heat and if I can hook up a decent antenna. I’m about 20 miles west of the Empire State Building. Rabbit ears just won't cut it.

Is life possible with just of mix of broadcast, DVDs and the Internet? I intend to find out.

Harry A. Jessell is editor of TVNEWSDAY. If you would like to comment on this column, write him at hajessell@tvnewsday.com.

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