The Honorable William E. Kennard
Chairman
Federal Communications Commission
445 12th Street, SW
Washington, DC 20554

Dear Chairman Kennard,

Last week, the Office of the Vice President shared with me Vice President Gore's October 20 letter to you concerning the public interest obligations of digital television broadcasters. With television stations around the country beginning digital broadcasts next month, there is no time like the present to begin a formal investigation of the many ways America's broadcasters could serve their local communities using digital technologies.

As you may well-know, the Benton Foundation was selected to be the home of the legacy of the Advisory Committee on the Public Interest Obligations of Digital Television Broadcasters (PIAC). In that role, the Benton Foundation pledges to assist you and the Commission in any way during the digital television proceedings. Since publication of the report last year, we have been speaking with a number of constituencies about the educational potential of digital television and their stake in the debate.

With this letter, I urge you to begin a digital television proceeding that includes the recommendations of the entire PIAC report Charting the Digital Broadcasting Future. The Vice President outlines very salient arguments for a proceeding addressing the quality of political discourse (let me add that the majority of PIAC favored mandated free time for political candidates), disaster warnings, disability access and diversity in broadcasting. But the remaining recommendations are perhaps even more important to the American public. Many of the recommendations should be addressed by a rulemaking as soon as possible including determining a set of minimum public interest obligations, disclosure of public interest activities, and multiplexing.

Additionally, while some of the recommendations may seem outside the purview of the Commission, I believe there are strong arguments that, as the expert agency, the Commission should address a number of the recommendations in a Notice of Inquiry. These recommendations include improving education through digital broadcasting, examining new approaches to public interest obligations in the new television environmnet, and a voluntary "Code of Conduct" for the broadcast industry.

All of the recommendations, I believe, deserve a full hearing by the Commission and input from the American public. I have attached a brief discussion, based on PIAC's recommendations, of the issues that the Commission should examine and their importance to the future of broadcasting and the nation. As broadcasters begin to use the additional spectrum allocated for the conversion to digital television, the public has no expectation of what to expect from the broadcasters licensed to serve their communities – and broadcasters, unfortunately, have no clear definition of their role as public trustees of the airwaves.

I will follow-up this letter next week with a phone call so that we can begin a discussion on the proceedings needed to realize television's full potential in the 21st century.

Sincerely,
Charles Benton

cc:
Commissioner Susan Ness
Commissioner Harold Furchtgott-Roth
Commissioner Michael Powell
Commissioner Gloria Tristani

In his October 20 letter to the Commission, Vice President Gore outlines very salient arguments for an FCC proceeding on digital television broadcasters' public interest obligations and specifically concerning the quality of political discourse, disaster warnings, disability access and diversity in broadcasting. Many more recommendations of PIAC should be addressed by the Commission including:

1. Disclosure of Public Interest Activities by Broadcasters
Effective regulation of the broadcast industry (even self-regulation) in the public interest requires the availability to the public of adequate information about what a local broadcaster is doing. Some valuable information is currently made available. For example, all television broadcasters must prepare and place in their public file separate quarterly reports on their non-entertainment programming responsive to ascertained community needs and on their children's programming. The Advisory Committee recommends that the Commission require that these reports be augmented by the addition of more information on stations' public interest programs and activities. That information should include 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. Information reporting requirements established for implementing the Children's Television Act (CTA) are a useful model. Under the CTA, broadcasters must identify and describe the programming, when it was aired, and how it meets the broadcaster's obligation to serve the public. 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.

Attached find Appendix A of Charting the Digital Broadcasting Future, a sample form using a check-off approach developed by a subcommittee of PIAC and headed by Gigi Sohn of the Media Access Project.

2. Voluntary Standards of Conduct
Many broadcasters feel a strong commitment to the public interest and their responsibilities as public trustees, and behave accordingly. To reinforce public service interests and standards, the National Association of Broadcasters adopted a "Code of Conduct" that set out appropriate principles and standards, and recognized those stations that adhered to the Code. The Code was abandoned in 1982 after the Department of Justice objected to certain aspects of the Code's advertising provisions. The Commission should initiate a Notice of Inquiry to examine the legality of a industry-wide code, especially the antitrust concerns.

A new industry statement of principles updating the 1952 Code would have many virtues. The most significant one is that it would enable the broadcasting industry to identify the high standards of public service that many stations follow and that represent the ideals and historic traditions of the industry. A new set of standards can help counteract short-term pressures that have been exacerbated by the incredibly competitive landscape broadcasters now face, particularly when compared to the first 30-some years of the television era. Those competitive pressures can lead to less attention to public issues and community concerns. A renewed statement of principles can make salient and keep fresh general aspirations that can easily be lost in the hectic atmosphere and pressures of day-to-day operations. Self-regulation by knowledgeable industry people could serve as an effective tool to minimize government regulation.

3. Minimum Public Interest Requirements
The Advisory Committee believes that having the broadcast industry adopt a strong set of voluntary standards of conduct, created and administered by the National Association of Broadcasters, would be a highly desirable step toward creating a digital world meeting the needs and interests of the American public. The Advisory Committee nevertheless recognizes an additional reality: not all broadcasters will subscribe to voluntary guidelines. Importantly, a large number of broadcast stations—perhaps as many as 400—are not members of the NAB and thus would not be affected by an industry-drafted and administered code.

Therefore, despite the Committee's stated preferences for voluntary self-regulation and maximum broadcaster flexibility, the Advisory Committee recommends that the FCC adopt a set of mandatory minimum public interest requirements for digital broadcasters. These minimum standards should be drafted in a way that would not impose an undue burden on digital broadcast stations, and should apply to areas generally accepted as important universal responsibilities for broadcasters—as well as for cable and satellite providers. Any set of minimum standards should be drafted by the FCC in close conjunction with broadcasters and representatives of the public, and phased in over several years beginning with stations' transmission of digital signals.

There was a broad consensus on the Advisory Committee that there should be minimum standards. The areas these minimums should address include: community outreach, accountability, public service announcements, public affairs programming, and closed captioning.

4. Improving Education Through Digital Broadcasting
The Advisory Committee made three recommendations regarding education and digital television: a) enhanced and permanent funding for public broadcasting, b) reservation of the equivalent of 6 MHz of spectrum for each viewing community in order to establish channels devoted specifically to noncommercial educational programming and c) including datacasting as a means for fulfilling public interest obligations.

On points a and c, the Commission may find that funding and new spectrum allocations are outside of its authority, however, through a Notice of Inquiry, the Commission could collect data for Congress on both the costs for the conversion to digital for public broadcasters and the need for educational programming in this nation.

The opportunity for digital television to improve student achievement has extraordinarily high stakes for our Nation. The acquisition and use of knowledge is a major resource for our society in the coming century and is pivotal for our quality of life, our economic development, our democracy, and indeed our security. The Nation's success depends upon how effectively all members of our society are prepared to use information technologies, which in turn means that the proficiency of our citizens depends upon the quality of our educational offerings and the capacity of students to utilize information technologies for educational ends. We put our children at a competitive disadvantage in the global economy if we do not invest wisely in educational resources.

The capacity of digital television to expand the flow of information and communication to and within our school systems, and to the population as a whole will require new and imaginative decisions on the dedication of entire channels or sub-channels, and the interaction between programming and datacasting in the digital form. The Commission is the best agency to make recommendations to Congress on how to address these needs.

Concerning datacasting, the Commission could begin a rulemaking now that would address the potential public interest dividend and provide some guidance for broadcasters – especially at a time when much of their digital capacity is not being used due to the small number of digital sets now in the market.

5. Multiplexing and the Public Interest
If broadcasters decide to use their digital real estate for multiple commercial channels (whether or not they are high definition), each generating its own revenue stream, then it is appropriate to consider whether the public interest requires a different formula. This is especially true since, as compression technology evolves, the number of channels possible may increase substantially, to six, eight or more.

The Telecommunications Act provided for the Commission to assess fees from digital broadcasters who get paid for ancillary or supplementary services -- subscription channels, paging services, pay-per-view and the like. It does not prohibit broadcasters from using multiple signals -- multicasting several over-the-air channels that get revenue from commercials. There is good reason to let the marketplace settle whether a single high-definition broadcast signal, multiple standard definition channels, datacasting, or various combinations of them, will work best. Innovation and testing the markets in this area should not be unreasonably stifled, particularly since multichannel broadcasting could provide long sought new competition to cable and other multichannel program distributors.

Additionally, it is conceivable that broadcasters who apply multiplexing will simply cannibalize their single signal, achieving no additional revenues or perhaps merely stabilizing current market share. There should be some additional benefit to the public if its grant to broadcasters of the valuable digital television spectrum results in enhanced economic benefits for broadcasters.

6. New Approaches to Public Interest Obligations in the New Television Environment
The broadcast world will soon change from one with some stability and certainty—one analog signal for each broadcast station, operating usually 24 hours a day—to one with unpredictability, uncertainty and fluidity. Some broadcasters will operate one signal, as before, only in digital instead of analog. Some may operate multiple signals, perhaps two, perhaps many more, throughout the day and night. Others will shift between one high-definition channel and multiple channels. Others will add datacasting to the mix. Applying existing public interest obligations to this variegated universe will not be easy, and will certainly not entail a simple one-for-one exchange.

Looking ahead to the digital era, where the flexibility to fit the different patterns that will develop and that will change over time will be increasingly important, many members of the Advisory Committee believe that the Administration, the Congress and the FCC should consider developing a whole new model of public interest obligations.

There are many models to consider. A promising approach would be to move to a kind of "pay-or-play" model. Under this model, broadcasters would be given the choice of maintaining the existing regime of public interest obligations, or of paying a share of revenues to bypass those obligations, while receiving in return an expedited license renewal process. Another option is embodied in a proposal made several years ago by Henry Geller, a telecommunications scholar and former FCC general counsel. Geller would implement a mandatory "pay" system whereby all broadcasters would be relieved of their public interest obligations in exchange for 2 percent of their gross revenues and 1 percent of the revenues from license transfers. The money collected under the Geller plan would be used for an endowment for public broadcasters, other noncommercial telecommunications entities and noncommercial programming, including programming for children, and for free time for political candidates.

Attached, find Appendix D of Charting the Digital Broadcasting Future, an outline of five innovative approaches to public interest responsibilities.

www.benton.org/PIAC/cb103099.html
Posted 11/01/99