Don’t Jeopardize DTV Bill With Broadcast Flag, Consumer Groups Warn

The winning groups hailed the ruling as a “slam dunk”; not only is it sweeping in its finding that the FCC lacks jurisdiction, but it says so in strong language, they said. For example, the court said, in its 7 decades “the FCC never before asserted such sweeping authority. Indeed, in the past, the FCC has informed Congress that it lacked any such authority. In our view, nothing has changed to give the FCC the authority that it now claims.”

In imposing broadcast flag rules, the Commission relied exclusively on its ancillary jurisdiction under Title I of the Communications Act of 1934, the court said. However, the “general jurisdictional grant” under Title I, though address TV receiver regulation, applies only to devices “engaged in the process of receiving a television broadcast,” the court said. It doesn’t authorize the Commission to regulate receivers “after a transmission is complete,” the decision said. “As a result, the FCC’s purported exercise of ancillary authority founders on the first condition. There is no statutory foundation for the broadcast flag rules, and consequently, the rules are ancillary to nothing.”

“There are so many people who want the DTV transition, including Mr. Barton, that I think they'll be disinclined to muck it up with a very controversial provision,” Public Knowledge Pres. Gigi Sohn told reporters. She was referring to the House Commerce Committee chairman, who’s believed to preparing legislation on a date certain for return of the analog spectrum. After 3 years of fighting the broadcast flag at the FCC and in court, Sohn said, “we now have a significant constituency that just doesn’t like it. If you put it on a bill that we may otherwise like, it could cause it great harm. It will weigh this thing down.”

CEA seemed mindful of warnings like Sohn’s when it hailed the court’s decision, but at the same urged it not affect “the nation’s successful, ongoing transition” to DTV. CEA Pres. Gary Shapiro urged policy makers to “continue to focus on the key issues that will help accelerate and ensure a consumer-friendly approach to the transition, specifically setting a hard date for ending analog television signals.” As for the ruling, Shapiro said courts “are right to be wary when government institutions seek to regulate the specific features and functions of safe, useful consumer technology.” He said CEA will study the order “with a focus on continuing efforts to preserve the freedom to innovate while protecting the interests of patent and copyright owners.”

Immediately after the ruling, Philips and Thomson were among CE makers pledging to support MPAA’s quest for a bill, provided it’s narrowly crafted to grant the FCC jurisdiction that the Appeals Court said the Commission lacks. Sohn reacted by saying her group and other petitioners were “disappointed but not surprised.” She said she sent Shapiro an e-mail asking that other CEA members “remain neutral, if not support[ing] us.”

Again, Sohn warned that “there’s now a significant number of consumers in the grass roots” plus an “energized library community” intent on fighting the broadcast flag. Philips and Thomson may support MPAA in its legislative initiative, “but they're probably going to hear from their constituents. I'll take my chances on constituents turning this around.” Fred von Lohmann of the Electronic Frontier Foundation said he hopes in addressing the broadcast flag Congress will hear not just from big CE companies like Philips and Thomson that made their voices known during the broadcast flag proceeding: “I hope Congress will hear instead from the many small innovative companies depending on being able to access future television broadcasts that we all enjoy.”

Thomson Vp-Govt. Affairs Dave Arland said his firm “certainly would support any effort by Hollywood to narrowly craft legislation that Congress could enact that would give the Commission the authority” to impose broadcast flag regulations. “We've been very involved in the process of reacting to the idea of the flag, to help people understand what it is and what it isn’t,” Arland said, noting Thomson’s SmartRight technology is one of 13 certified by the FCC for use with the broadcast flag. Thomson “certainly would support” an MPAA legislative initiative because “it’s important to have certainty in the market and important to have content that’s broadcast over the air to be protected the same way it’s protected over cable or over satellite,” Arland said.

At Philips, Vp-Govt. Affairs Thomas Patton said his company believes “the broadcast flag regime should be reinstated by Congress.” Philips has argued strongly that any content protection scheme for DTV should be administered by the FCC, Patton said. “We also have argued we want to find solutions to the problem that our friends in the content community face -- the potential for indiscriminate redistribution over the Internet of high- value content.” Patton said Philips “will join others I'm sure in seeking new congressional reinstatement of the broadcast flag regime.” He said his company has always believed in striking the right “balance” between protecting intellectual property and consumers’ fair use prerogatives, and believes broadcast flag strikes that balance.

The decision could create a “digital TV divide” by slowing or eliminating access to high-quality digital programming, MPAA Pres. Dan Glickman said in a statement. If the broadcast flag can’t be used, program providers will have to decide if the risk of theft is too great on broadcast TV and could limit programming to cable, satellite and other “more secure delivery systems,” he said.

“Without a broadcast flag, consumers may lose access to the very best programming offered on local television,” NAB Pres. Eddie Fritts said in a statement. The flag aims to guard against “unauthorized indiscriminate” redistribution of programming over the Internet. NAB will work with Congress to authorize implementation of a broadcast flag that preserves local TV, Fritts said.

The ruling marks a “significant step” toward restoring consumers’ right to make lawful copies of digital content, said the American Library Assn. (ALA), a petitioner in the case. “The broadcast flag seriously undermined the rights allowed nonprofit educational institutions under the TEACH Act to distribute content over the Internet for distance learning purposes,” said ALA Exec. Dir. Emily Sheketoff. The FCC doesn’t have the right to mandate technological copy protections, Sheketoff said.

Consumer groups hailed the decision. “The Court’s ruling overturns yet one more aspect of the illegal and ill-considered assault by the FCC on the fundamental principles of open and nondiscriminatory access to the means of expression in our society,” said Gene Kimmelman, senior dir.-public policy at Consumers Union. The Consumer Federation of America said the FCC should focus on promoting speech and communications, not restricting it.