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The Digital Beat

Vol. 1, No. 5, 16 April 1999

Public Interest Obligations in Broadcasting ¿ International Comparisons

By RICHARD SOMERSET-WARD, Benton Fellow

INTRODUCTION

With the recommendations of a Presidential Advisory Committee delivered to the Vice President in 1998, the coming months will see review of the public interest obligations of broadcasters by the Federal Communications Commission and Congress. Although no other country has a comparable system of commercial or local broadcasting, there are occasional examples of international practice that have value when considering ways in which public interest obligations of American broadcasters can be better defined and enforced. In every instance, regulations arise from the same premise: that the spectrum is publicly owned, and that the broadcasters who get to use it, whether for profit or not-for-profit, have public interest obligations.

In most countries, the legal and regulatory system for broadcasting was erected on the basis of a) non-commercial public broadcasting, with commercial stations being added later, and b) a national or regional system, rather than a local one. No other country, moreover, has a First Amendment -- one of whose (unpremeditated) consequences is to preclude the possibility of public interest or social responsibility in broadcasting acquiring the sort of quasi-constitutional/quasi-legal status it has in most other countries.

Public interest obligations are therefore embedded in these other systems much more deeply -- almost always beginning with the charter (e.g. the BBC's charter in the United Kingdom) or the legislation which established a national broadcasting organization (e.g. Germany and Japan, where ZDF and NHK respectively were created after World War II by occupying powers using the model of the UK). These national broadcasting organizations are publicly owned and not-for-profit, but they are not necessarily barred from taking advertising (e.g. CBC, ZDF, etc.). Subsequent legislation to add commercial broadcasting to the mix almost always accepted, implicitly or explicitly, the public interest ethos of the national broadcaster.

In no other country, therefore, has the marketplace been given so much control over the nature and content of broadcasting as in the United States.

It is perhaps unthinkable that the United States can, at this late stage, introduce legislation or regulatory controls of the breadth and scope used in other countries -- they would, no doubt, be challenged as unconstitutional. But it is worth noting that the debate over the public interest obligations of broadcasters is much more intense in most countries than it presently is in the United States. In Germany, for instance, where commercial broadcasting is a comparatively recent addition, it amounts almost to a national obsession. In Australia and Canada, where (for different reasons) commercial pressures on traditionally non-commercial systems have put great strain on broadcasting, it has become a political issue of considerable importance.

In any case, there are valuable lessons to be learned from the approaches of other nation's to the challenges that exist here as well -- such as providing amble coverage of politics and elections. And there are also models that should be examined as we begin the age of digital television. To be considered are the roles of content quotas, sanctions, public participation, and the reliance on public television to fulfil the public interest.

Political Broadcasting

Television advertising expenditures in political campaigns in the US increased 800% between 1970 and 1996 -- more than any other category of campaign finance. Candidates have turned to television advertising, especially on broadcast television, because in many areas, it is the best medium to reach voters. In a democracy that aspires to be deliberative, television can do a great deal if it deals with political issues in a serious way. Engagement with serious issues can be educative; it can increase citizen involvement in political issues; it can make citizens better able to choose.

In most countries, public broadcasters have some sort of constitutional obligation to give free time to politicians -- certainly during election campaigns, very often at other times as well. In France, for instance, the two public service channels, France 2 and France 3, are required to transmit "twelve statements about a great national cause agreed annually by the government". Few other countries allow their governments so much latitude! The most sophisticated system is probably the British one -- and it is the most interesting to the United States because it is jointly operated by public and commercial broadcasters.

Each year, broadcasters (radio and television, public and private) make a joint offer of free airtime to the principal political parties. Politicians have no statutory right to this airtime: it is essentially an offer made by the broadcasters, but it is traditionally "negotiated" with the politicians before being finalized. The extent of a party's inclusion in the offer is governed by the percentage of total votes cast for that party in the previous election (i.e. a system of proportional representation) with additional calculations made to ensure adequate representation for regional parties in areas such as Scotland, Wales, and Northern Ireland.

In a non-election year, the principal parties can normally expect five broadcasts, each of five minutes, while smaller parties get less airtime. The scheduling of the broadcasts is at the discretion of the broadcasters, but an undertaking is given that they appear between 5:30pm and 11:30pm (all channels used to transmit them simultaneously, but this was so unpopular with the viewers that it was abolished a few years ago). The production costs are paid by the political parties, who also have editorial control. The content must observe the law of the land and be non-defamatory. Broadcasts may not include an appeal for funds, but they may urge viewers to become members of their party.

During an election campaign (only about four weeks in Britain), the broadcasters make a special offer of time to the parties -- normally a year's allocation concentrated into the period of the campaign. The number of individual broadcasts is based on the same calculations as are applied in non-election years, but with additional time calculated by the number of candidates a party is fielding.

In exchange for this broadcast time, neither political parties nor individual candidates are allowed to buy time for political advertising.

Broadcasters are anxious to discontinue the grant of free time in non-election years, in view of the plethora of ways in which politicians can now reach voters (through the regular broadcasting of Parliament, for instance). But broadcasters remain committed to continue with the current arrangements during election campaigns, expanding them to give more emphasis to local and regional campaigns.

The President's Advisory Committee on public interest obligations (know as PIAC) has recommended that if Congress undertakes comprehensive campaign finance reform, broadcasters should commit firmly to do their part to reform the role of television in campaigns. This could include repeal of the "lowest unit rate" requirement in exchange for free airtime for candidates, a broadcast bank to distribute money or vouchers for airtime, and shorter time periods of selling political airtime, among other changes. In addition, PIAC recommends, the television broadcasting industry should voluntarily provide 5 minutes each night for candidate-centered discourse in the 30 days before an election.

A majority of the Committee went even further and made a strong recommendation for "free time" for national and local candidates for candidate-centered discourse. The majority recommendation sets the end of 1999 as a deadline for Congress to address the issue -- and suggests the FCC take up the issue if it gets bogged down in the political process.

Content Quotas

Quotas are not a popular method of regulating broadcasting. In most countries, voluntary codes of standards are preferred, but quotas are used when there are overriding concerns of national or public interest. These concerns almost always relate to cultural identity (as in Canada, Australia), language (as in France), and the protection of children.

The Australian Broadcasting Authority (ABA), which regulates commercial broadcasting, is required by the Broadcasting Services Act of 1992 to develop program standards covering the areas of children's programming and Australian content. The ABA imposes a 'transmission quota' of 50% Australian content across all categories of programs broadcast between 6am and midnight. The system for determining what is and what is not "Australian" is complicated and is based on a computation of Australian content, the use of Australian personnel, a quality factor (expensive drama scores higher than other programming), and the number of hours. Even stricter quotas are laid down for advertising - 80% of all advertisements broadcast by a licensee must be produced in Australia or New Zealand.

Children's Television Standards are also enforced by the ABA (children being defined as people under fourteen years of age): every station must broadcast at least 390 hours of children's programming a year, 50% of which must be first release. The quality of these programs is not prescribed, but their scheduling is -- stations have to notify the ABA of the times when children's programs will be broadcast and are prevented from broadcasting "unsuitable" material during the same time period. The Standards also limit the amount of advertising time allowed during children's programs, as well as the number of repetitions of the same advertisement, and they ensure that a clear distinction is made between what is programming and what is advertising.

In Canada, the most highly regulated system among Western nations, the Canadian Radio-Television and Telecommunications Commission (CRTC) lays down content quotas governing Canadian content levels in drama, children's programming, and documentaries as a condition of license renewal. Broadcasters are required to maintain a 50% minimum level of Canadian content between the hours of 6pm and midnight. Most broadcasters (but not the CBC) interpret this as local news between 6 and 7pm, and low-cost Canadian programming between 11pm and midnight, thus enabling them to devote most of the heart of prime time to American programming. Nevertheless, statistics show that, since the mid-1980s, the amount of Canadian programming being made -- and its audience share -- have increased significantly.

In France, a very different, and very specific, form of quotas is applied to France 2 (one of the two public service channels). The terms and conditions under which it operates state that each Sunday morning it must transmit "programs of a religious nature reflecting the main forms of worship practiced in France" (specifically, Catholicism, Protestantism, Judaism, and Islam). Moreover, France 2 is required to bear the cost of these programs, up to a stated maximum.

In the US, the Children's Television Act of 1990 requires the FCC, in its review of each television broadcast license renewal application, to "consider the extent to which the licensee...has served the educational and informational needs of children through the licensee's overall programming, including programming specifically designed to serve such needs." Congress found that television has the power to teach children -- that "television can assist children to learn important information, skills, values, and behavior, while entertaining them and exciting their curiosity to learn about the world around them." Congress also found, however, that there are significant market disincentives for commercial broadcasters to air children's educational and informational programming. In 1996, the FCC adopted rules which instructed broadcasters to air at least 3 hours per week of educational children's programming.

In the age of digital television -- when a single station can provide four to six video channels where it can now only provide one -- PIAC recommends multiplying broadcasters' public interest obligations by the additional number of channels they provide. The Committee also recommends the creation of new, noncommercial channels devoted to educational programming for all ages.

Sanctions

In order to be effective, broadcasting supervision must have sanctions at its disposal, and those sanctions must be graded. When the only available sanction is withdrawal of license, there is a natural reluctance to use it. The most effective systems are those that range from verbal warnings via written admonitions, to the imposition of drastic financial penalties...to withdrawal of license.

In France, operating licenses for commercial channels are issued for ten years, and they are issued free of charge. By the terms of a law passed in 1994, they are then automatically renewed for two further terms of five years each -- unless the license holder has committed "serious misconduct" or has failed to maintain the required "pluralism" in its broadcasting. In theory, the operating license may be withdrawn or suspended at any time if the holder is deemed to have breached the obligations it agreed to in consultations with the regulatory body (the Conseil Superieur de l'Audiovisuel -- CSA) when the license was originally granted. But the only available sanctions -- withdrawal or suspension of license -- are generally deemed to be so drastic that there is very little chance of their being applied. The French system is thus not unlike the American one.

In Italy, the system established by the 1990 Broadcasting Act gives the regulatory authority a range of sanctions -- fining stations for minor violations, suspending licenses for a maximum of 30 days, and proposing to the competent minister the actual revoking of a license in the most serious cases. Unfortunately, the regulatory authority, the Garente (guarantor) is a single individual, appointed for a period of only three years, and lacking sufficient staff or budget to be effective.

In Britain, the 1990 Broadcasting Act authorized the Independent Television Commission (ITC), which is responsible for regulating commercial television, to award franchises to the highest bidders in separate auctions for each available franchise (16 of them). The ITC -- displaying a splendid disregard for the political intent of the Act, but still acting strictly within its terms -- decided that, before auctioning the franchises, it would impose a "quality threshold" on the bidders. Those unable to guarantee that they would broadcast programming of sufficient quality were denied the right to bid in the auction at all. Reaching the threshold required a potential bidder to guarantee at least 90 minutes a day of high quality current affairs programming, two hours a week of religious programming, and ten hours a week of children's television. Applicants also had to spell out in hours and minutes the amount of time they intended to devote to other areas (drama, sports, news, factual programming, education, the arts, etc.), and they were formally warned that, if successful, these specifics (as well as the business plan by which they were to be achieved) would be written into their licenses as binding obligations. Furthermore, the ITC insisted that it would review the performance of the new licensees at the end of the first year of their operation. It did so, in great detail, and published its findings. As a result, one company was formally warned that it was not meeting its license conditions, and that it was in imminent danger of losing its license. Over and above this licensing procedure, the ITC has periodically made "interventions" in response to violations of its program code - for example, it fined one company 500,000 pounds ($800,000) for giving "undue prominence" to commercial products in programs.

The Telecommunications Act of 1996 modified previous statutory provisions in the US regarding license terms for broadcast stations. Prior to the Act, television broadcast licenses were for 5 years -- the Act extended them to eight years. The FCC also has the authority to fine stations for failing to comply with broadcast rules.

Public Hearings

There is a democratic argument that, since the spectrum is publicly owned and licensed in the "public interest, convenience, and necessity", the public has a right to scrutinize the way in which its spectrum is actually being used. Adequate scrutiny through the existing system of FCC renewal hearings is ineffectual. Even though such hearings are open to the public, they are almost always held in Washington -- rather than locally -- and there are so many renewals that the vast majority of them are virtually automatic ("postcard renewal"). The public's input is also limited around content areas. Stations are supposed to track viewers' comments on violent programming and FCC rules adopted concerning children's programming rely on parents to determine if shows are actually educational.

It would be logical (in terms of democracy, at least) for all license holders, as part of an ascertainment process, to be required to hold a public meeting once a year, properly advertised and promoted, at which the station would account to the public for its stewardship of the airwaves and hear the public's views on whether or not it was fulfilling its public interest obligations. Public dissatisfaction could thus be brought to the attention of the licensing authority, the FCC.

In Canada, voluntary codes of public interest obligations and broadcast ethics are given teeth by the ability of the Canadian Broadcast Standards Council (CBSC) to hear complaints, in public, when the voluntary codes are alleged to have been broken. The CBSC was established by the Canadian Association of Broadcasters (the industry association of commercial broadcasters) in order to hear public complaints of a station's abrogation of its own voluntary code of conduct. The CBSC's membership includes both broadcast industry and non-broadcast industry representatives -- i.e. it is not a closed professional clique of broadcasters.

In Britain, the government is committed to the creation of a Broadcasting Consumers Council through the merger of two existing bodies - the Broadcasting Standards Council, which deals with complaints concerning the depiction of violence and sex, and lapses of taste and decency; and the Broadcasting Complaints Commission, which hears allegations by individuals or organizations who feel they have been unfairly treated, or misrepresented, in broadcast programs.

In Australia, the Australian Broadcasting Authority (ABA), which regulates the commercial sector and makes licenses subject to social responsibility and content standards (including the areas of children's programming and Australian content), was given extensive powers in 1977 legislation to make broadcasters responsive to community needs. One of those powers was the ability to hold public hearings within a community to ascertain whether or not the broadcaster was fulfilling its obligations. Controversially, and as a result of commercial pressure, the Broadcasting Services Act of 1992 withdrew this power and hearings are now conducted out of the public eye.

In general, a worldwide survey will show that opportunities for public involvement in the monitoring and enforcement of broadcast standards are becoming fewer and weaker. This undoubtedly reflects the success of commercial broadcasters in lobbying governments to weaken all forms of oversight, especially oversight by the consumers themselves, the public, who own the airwaves.

As part of the package of recommendations sent to Vice President Gore last year, PIAC suggested stronger disclosure rules for broadcasters so the public could track how their airwaves are used. Reports would be made to the public on a broadcasters' activity including, but not be limited to, contributions to political discourse, public service announcements, children's and educational programming, local programming, programming that meets the needs of underserved communities, and community-specific activities. The Committee also recommended that broadcasters distribute such public interest information more widely, perhaps through cooperation with local newspapers and/or local program guides so that viewers can more readily identify and evaluate the efforts local broadcasters are making to address their interests. Similarly, since many local television stations now maintain Internet websites, they could post this information there on a regular basis.

Greater availability of relevant information will increase awareness and promote continuing dialogue between digital television broadcasters and their communities and provide an important self-audit to the broadcasters, the PIAC report reads.

An Advisory Role for the Public

Almost all democracies other than the United States offer the public (i.e. the non-broadcasting community) an advisory role in the governance of broadcasting. In some cases, particularly those with a centralized broadcasting system, this allows for public input in the overall regulation and ethos of national systems (e.g. Britain). In others, with a more localized system (though none of them are anything like so localized as in the United States), it allows for public representation in the direction of individual stations -- not as shareholders, but as outside advisors.

In Britain, the Independent Television Commission (ITC), which regulates all forms of advertising-financed television, has ten affiliated advisory bodies. They represent different groups and interests within the population, and they are free (indeed, they are expected) to adopt critical attitudes towards the programming and program philosophies of individual television companies. The BBC has an equally elaborate structure of advisory committees -- carefully balanced by geography, gender, and ethnic and social backgrounds -- which are charged with providing a constant flow of information to the BBC's governing body on the needs and interests of audiences in all parts of the United Kingdom.

In Japan, Article 3-4 of the Broadcast Law (as amended in 1998) requires that all broadcasting stations shall have a consultative organization "for the purpose of maintaining the appropriateness of broadcast programs." Stations are bound to consult with these bodies on any changes they propose making to their codes of standards, and they are bound to hear, and reply to, any views the consultative organizations may express about programming or program policies.

In Italy, Article 28 of the 1990 Broadcasting Act established a Viewers' Council to advise the national regulatory authority (the Garante) on the interests of viewers and listeners. The Council has 18 members (ten of them selected by user associations, eight of them nominated by media experts, analysts and scholars) and has been active in helping broadcasters work out satisfactory guidelines in areas such as protection of children's rights, in denouncing misconduct by broadcasters, and in putting pressure on the Garante to take action in cases of misconduct.

Reliance on Public Broadcasting to Fulfill the "Public Interest"

The implicit (and sometimes explicit) basis for broadcasting in several countries is that a strong and reliable public broadcasting system can be used to fulfill the public interest obligations of all broadcasters - thus removing the need for too close supervision of commercial broadcasters.

In February, 1994, the Federal Constitutional Court in Germany ruled that commercial broadcasting is only permissible if public broadcasting fulfills its basic functions. Public broadcasters, the Court said, are required to provide a broad spectrum of programs for society ("Grundversorgung"), whereas commercial broadcasters are necessarily governed by the marketplace and cannot be expected to deliver anything like so broad a spectrum of programming. This is acceptable, the Court concluded, provided the public broadcasters are doing their job, and (by implication) that they are adequately funded to do that job.

A logical corollary to this philosophy is that public broadcasting should not compete for the same funding as commercial broadcasters. In Britain, Australia, Sweden and some other countries, public broadcasters are forbidden to take advertising. In Italy and France, on the other hand, public broadcasters rely heavily on advertising revenues: as a result, a brutal battle for advertisers has severely weakened the public broadcasters. In Canada, where CBC gets 25% of its revenues from advertising, and even has commercial affiliates, the conflict is less destructive.

The United States has the worst of all worlds. Public broadcasting is severely underfunded and unable to provide "a broad spectrum of programs for society," while at the same time it is attempting to improve its funding base by infringing on commercial territory through "enhanced underwriting" and other stratagems that may eventually include actual advertising.

PIAC urges Congress to consider ways to provide increased funding for public broadcasting in the digital era, and to create a trust fund to make such funding assured and permanent, and to move public broadcasting out of the whipsaw of the political arena. Many members suggested that funding mechanisms for support of noncommercial, public broadcasting should include fees paid by commercial broadcasters. In January, the Benton Foundation, the Project on Media Ownership, the Media Access Project, the Center for Media Education and the Civil Rights Forum released polling data (../Policy/TV/edtv.html) that points to strong public support for such a proposal. In fact, 79% of Americans support a requirement that broadcasters to pay 5% of their profits into a public broadcasting fund.

Conclusion

PIAC also recommended a voluntary "code of conduct" be written and adopted by the broadcast industry. Nearly four months after those recommendations were published, there has been no move by the industry to do so. If broadcasters will not take the lead in framing a new compact with the communities they are licensed to serve, the public will voice its demands to the FCC and to Congress.

What programming services does a broadcast licensee owe its community? Should broadcasters make time available to candidates for free -- especially during elections -- as is the case in many other countries? Even though quotas are not a popular form of regulation, do national concerns regarding education, democracy, and children necessitate them?

How can the public be given a greater role in determining if a broadcaster is actually using spectrum in the "public interest, convenience, and necessity?" Could local communities hold broadcasters accountable to their public interest obligations while reducing the burden of the FCC through a formal advisory role, a mandated ascertainment process, and public forums?

Or would we rather rely on a strong and reliable public broadcasting system can to fulfill all the public interest obligations of all broadcasters - thus removing the need for close supervision of commercial broadcasters?

As we address these questions in the months to come, it is worth our time to consider the way other countries do these things. Not all are appropriate for the US, but some of them may provide us with ideas (or the germs of ideas) that can be useful in the battle to get some sort of public interest obligations formalized in this country.


©Benton Foundation, 1999
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The Digital Beat is a free online news service of the Benton Foundation's Communications Policy & Practice program <../cpphome.html>. Our aim is to equip you to be engaged in the public debate on the public interest in digital television and the Internet. We will chronicle the action at the Federal Communications Commission and in Congress, the efforts of public interest advocates, the work of nonprofit organizations and government agencies to create new public services, technology developments, and communications trends.

Benton houses the legacy of the Presidential Advisory Committee on Public Interest Obligations of Digital Television Broadcasters <../piac> and is committed to using its report and recommendations as a starting point for achieving access, diversity, equity, and education in the new media. Additional contributors to the Digital Beat include the Media Access Project (MAP), the Center for Media Education (CME), and the Civil Rights Forum on Telecommunications.

The Benton Foundation's Communications Policy and Practice Project is a nonpartisan initiative to strengthen public interest efforts in shaping the emerging National Information Infrastructure (NII). It is Benton's conviction that the vigorous participation of the nonprofit sector in policy debates and demonstration projects will help realize the public interest potential of the NII.

Media Access Project (MAP) <www.mediaaccess.org>, is the only freestanding public interest law firm which is primarily devoted to representing the public's interest on electronic media issues through policy advocacy at the Federal Communications Commission and the Courts, advocacy in the media and other public fora, and day-to-day counseling of civic organizations and individuals.

The Center for Media Education (CME) <www.cme.org> is a national non-profit organization dedicated to improving the quality of electronic media, especially on the behalf of children and families.

The Civil Rights Forum on Communications Policy <www.civilrightsforum.org> works to bring civil rights organizations and community groups into the debate over the future of our media environment that environment is the key to the future of the nation.

The Alliance for Community Media ( www.alliancecm.org) is committed to assuring everyone's access to electronic media. The Alliance accomplishes this by creating public education, advancing a positive legislative and regulatory environment, building coalitions, and supporting local organizing.

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