Making a Case for Court-Watching

Federal judgments could help decide the future of communications policy in 2013

Some of the biggest action in
the communications policy sphere
in 2013 could come from the federal
courts as FCC regs and decisions are probed
and the limits of the FCC’s authority are tested.
Among the issues at stake are the status of overthe-
top video, the FCC’s network neutrality
rules, the commission’s first program-carriage
complaint decision against a cable operator—Tennis Channel v. Comcast—and even the
FCC’s ability to define its own authority.

Net Neutrality. All eyes will be on the oral
argument in the Verizon/MetroPCS challenge to
the FCC’s Open Internet order, which is expected
to come sometime in the first quarter in the D.C.
Circuit, according to attorneys, lobbyists and
FCC officials past and present. If the FCC loses,
which even some Open Internet order fans suggest
could be the case, the commissioners will
have to decide whether to use the fallback position
of classifying Internet access as a Title II
telecom service subject to mandatory access. That would be a poison pill
to cable operators, which grudgingly did not publicly complain about the
compromise order to which they were party. FCC chairman Julius Genachowski
has refused to close the Title II docket, though it remains unclear
whether he would have the three votes needed to impose that alternative.

Carriage, anyone?
The D.C. appeals court has scheduled Feb.
25 for oral argument in Comcast’s challenge to the FCC’s decision
that the nation’s largest cable operator used discrimination by carrying
NBC Sports Network (then called Versus) and Golf Channel on more
widely viewed tiers than Tennis Channel. Comcast says the decision
has implications for its First Amendment right to program its own
channels. The MSO’s fortunes were buoyed by the three judges chosen
to hear the appeal, according to knowledgeable court-watchers. Two
were described by multiple sources familiar with the court as “conservative”
and “anti-regulatory.” One source said, “They will be receptive
to Comcast’s arguments, including its First Amendment claims.”

Aereo: At presstime, an appeals court had not ruled on whether it would
turn over a lower court decision and enjoin Aereo from delivering overthe-
air TV signals to customers without paying broadcasters for the transmissions—
which broadcasters argue are retransmissions in violation of
copyright. How those courts decide could determine
whether broadcasters get compensated for
in-market, over-the-top delivery of their signals,
which could become the next retrans cash infusion
if video moves online in a big way.

There are limits… The Supreme Court has
taken a challenge by state regulators to the FCC’s
power, citing rule change. The issue is not the
rule itself, but whether the FCC has the power
to de! ne its own authority. One FCC source suggested
the D.C. Circuit might even wait to render
its decision on network neutrality until the
Supreme Court decided this case, particularly if
the lower court had questions about the FCC’s
authority to impose the Internet regs. But a veteran
cable attorney didn’t think the D.C. Circuit
would hold off. If the court reins in that authority,
the FCC may have to go to Congress for help in
clarifying it. And given Congress’ political divide,
that “help” might be a very long time coming.

Also on the docket: At presstime, the FCC appeared to still be anticipating
an early 2013 vote on media ownership despite pushback from
minority groups and unions. The other big-ticket item is a framework for
spectrum incentive auctions, which the commission is targeting for a midyear
vote, though that timetable could be pushed back if Genachowski
were to decide to exit in the spring, as many are predicting; the chairman
has declined comment on the widespread speculation.

While the Congress is new, the political divide remains and will likely
prevent any major communications-related bills from being enacted
anytime soon. There could be hearings on media violence in the wake
of the Sandy Hook shootings, and a bill could be passed authorizing a
study on the impact of that media violence on kids.

There will almost certainly be more hearings on privacy and data security,
perhaps follow-up hearings on spectrum incentive auctions as the
FCC’s self-imposed deadline approaches, and talk about revising the Communications
Act to get rid of those regulatory silos everybody is always
dissing. But words will speak louder than actions if past is prologue, with
Republicans trying to push for FCC reforms like shot clocks and restrictions
on merger reviews and conditions and Dems pushing back.

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