FCC JURISDICTION, AHRA ISSUES HAVE IBOC SIDES SHARPLY DIVIDED

Those are the main battle lines in the newly emerging debate over whether IBOC content protections are necessary and whether the FCC has authority to impose them. Given the stakes -- based on IBOC’s potential ultimately to grow to become as ubiquitous as everyday analog radio -- this latest skirmish could become the most heated confrontation between the CE and recording industries since their DAT wars of the late 1980s and early 1990s, some believe.

The RIAA, which in its comments asked the FCC to impose content protection requirements when it issues its final service rules (CD June 18 p4), told the Commission it’s on solid jurisdictional grounds to do so under the Communications Act. Provisions in Title III of the Act, which gives the FCC the power to “generally encourage the larger and more effective use of radio in the public interest,” give the Commission “expansive authority to prescribe the manner in which broadcast stations operate,” the RIAA said. Under Title III, the RIAA argued, the Commission can require that licensees of radio stations that wish to broadcast digitally to include as part of their digital transmission “content protection requirements which the Commission determines are in the public interest.”

The RIAA cites 1968 and 1979 Supreme Court decisions in 2 cable cases to support its argument that the FCC also has “ancillary” jurisdiction under Title I of the Act to impose IBOC content protection rules “and to require that equipment manufacturers include mechanisms in DAB receivers that will honor those rules.” The cases, including a 1979 ruling in FCC v. Midwest Video Corp. upholding the Commission’s right to require cable companies to originate programming to promote diversity, also established that the FCC has jurisdiction under Title I of the Act “to adopt regulations that are reasonably ancillary to the effective performance of the Commission’s various responsibilities,” the RIAA said. “Title I manifestly extends to digital radio service and to receivers for digital broadcasts, and content protection rules are reasonably ancillary to the development of a digital radio services and to the promotion of ’the larger and more effective use of radio in the public interest,'” the RIAA said. It also said FCC action in the broadcast flag proceeding “leaves little doubt that these provisions give the Commission general authority to adopt content protection rules and to regulate radio equipment to give effect to such rules.”

The HRRC disagrees on the jurisdictional question. If the FCC were to “pursue the course being urged on it by the RIAA,” the HRRC told the FCC in its own comments filed before the RIAA proposals were disclosed, the Commission “would need to issue regulations that, for the purposes of copy protection, wrest control over broadcasts from broadcasters, wrest control over device design from device manufacturers, and wrest control over device usage from consumers. The Commission lacks jurisdiction to do any of these things.”

There’s nothing in the Communications Act and the Copyright Act that suggests the FCC has the authority to “impair free terrestrial broadcasts in aid of copy protection,” the HRRC argued. In the absence of any such jurisdictional “foothold,” it said, case law doesn’t support the RIAA argument that the Commission may fall back on its “public interest” authority under the Section 4(i) of the Communications Act to impose IBOC content protection rules.

Responding to questions in the FCC inquiry how IBOC content protections compared with the Commission’s imposition of rules under the broadcast flag, the HRRC said the 2 issues aren’t the same. Unlike the broadcast flag, “the target here would be the imposition of a copy protection regime,” the HRRC said. “Therefore, and inevitably, the focus would move from the regime itself to ‘holes’ in the regime, in the form of similarly available services that are not covered. This would lead to a bootstrapping of the concept of ancillary, toward infinity.”

As for the Commission’s asking whether the AHRA, on the books since 1992, didn’t already address the content community’s concerns about IBOC devices, the RIAA said it’s unlikely the law “would apply to many, or any, of the DAB receiver/recorders described” in the Commission’s IBOC inquiry. “The AHRA was designed to address a narrow issue -- serial copying by a limited class of devices,” the RIAA said. “Congress never intended it to serve as a comprehensive legislative solution to the issues posed by digital copying or distribution, particularly not on a wide-scale basis as made possible by DAB without content protection.”

Among the many reasons the RIAA said AHRA wouldn’t apply is its contention that it’s “unlikely that a device manufacturer could confidently comply with the requirement” to implement the Serial Copy Management System (SCMS), devised for DAT, in a DAB receiver/recorder. It said that’s because SCMS, which allows one digital copy of a recording but bars additional digital copies of that copy, “is only defined specifically in the Technical Reference Document for DAT players” under the AHRA (in fact, SCMS has been implemented in other consumer digital audio recorders, including audio CD-R recorders, MiniDisc equipment and DCC). Under the AHRA, the Commerce Secy. may certify an SCMS alternative, but in the 12 years since it was enacted, “neither a procedure for verifying compliance with the functional characteristics of SCMS nor a process for obtaining such certification” has been prescribed.

At least some of the IBOC products feared by the RIAA would be subject to the AHRA’s “statutory regime,” the HRRC said, taking the opposite view. “It is not too much to suppose that one reason products of the sort feared by the RIAA do not exist is the possible application of the AHRA to them, in circumstances judged to be burdensome,” the HRRC said: “Thus, it may be that at least some of the fears of the RIAA have already been addressed by the Congress; new prescriptive or proscriptive action by the Commission would only further distort the marketplace.”

Although the FCC has no power “authoritatively” to interpret or change the AHRA, “it cannot ignore it,” the HRRC said. Accordingly, if the Commission is to act on the RIAA proposals, it first “must wait for the Congress to act,” either by modifying the AHRA or giving the FCC the jurisdiction it now lacks, the HRRC said.