Following a Federal Communications Commission investigation, as well as subsequent inquiries by the cable programmers and distributors involved, Nickelodeon and ABC Family have agreed to pay $1 million and $500,000, respectively, for carrying too much commercial matter in their kids' shows in violation of FCC limits.
It is the first such finding against a cable network or system for exceeding the limits.
In Nickelodeon's case, that was more than 1,000 30-second spots too many and 145 shows that contained ads for products associated with them, which, in the FCC's eyes, turns them into program-length commercials.
The Nickelodeon overages were for a 10-month inquiry period between November 2003 and August 2004.
ABC Family was found to have aired 31 program-length commercials over more than a year.
The limits are 10 and1/2 minutes of commercials on weekends, 12 and 1/2 minutes on weekdays.
In both cases, the overages were attributed to flawed internal procedures, computer problems, and human error.
The monetary hit will be even bigger, however, with Nickelodeon required to reduce its future commercial load by the number of minutes it exceeded those limits.
As part of consent decrees entered into with Viacom/Cox in San Diego (for Nickelodeon) and ABC Family/Time Warner Cable Of Hawaii/Charter (Spring, Tex.), the companies have agreed to a compliance plan to rectify the violations and prevent any future ones.
In the case of Nickelodeon, that means it will have to reduce its commercial load in future airings of the programs cited by the amount of the overages, estimated at 1,021 30-second spots. It will also have to conduct random inspections over the next two years and hand the results over to the FCC, as will ABC Family.
The overages were discovered as the result of routine FCC field office audits, followed by internal investigations by both Viacom and ABC Family.
David Solomon, chief of the Enforcement Bureau, says it is fair to take the consent decrees as an indication the commission is serious about enforcing the limits.
The FCC has been conducting field audits on broadcast station compliance with commercial limits for a couple of years now, but this was the first time it included cable in that audit.
By agreeing to pay the money, make other restitution, employ new safeguards and report regularly to the FCC, the companies avoid further investigations of other operators and possible violations at other times.
They also agree not to appeal the decision in court.
Viacom said in a statement: "We were extremely upset to discover that we exceeded our allotted commercial time due to human errors and computer system problems that occurred in our commercial logging systems. We did not intentionally violate the FCC rules, and we sincerely apologize for this mistake. While the vast majority of our programming hours were well under the FCC commercial allotments, we take full responsibility for any errors, and have initiated new procedures to help ensure this will not happen again."
In its statement, ABC Family Channel attributed the overages to computer error:
"We had previously been using a computer traffic system that did not read for notations regarding special children’s advertising restrictions and commercials were unintentionally placed in related programs. Once we became aware of the mistake, we did a thorough, voluntary review of our operation and have since revised our computer system to prevent future errors. We derived no economic benefit from the error, as these commercials were never sold for placement in related shows."