The Federal Communications Commission (FCC) has issued a Notice of Proposed Rulemaking (NPRM) in which it proposes satellite television “market modification” rules to implement Section 102 of the Satellite Television Extension and Localism Act Reauthorization Act of 2014 (STELAR). STELAR amends the Communications Act and the Copyright Act to give the FCC authority to modify a commercial television broadcast station’s local television market for purposes of satellite carriage rights. The FCC previously had such authority to modify markets only in the cable carriage context. The FCC also proposes to change the factors relevant to the market modification process. Below, we list some of the tentative conclusions and interpretations on which the FCC seeks comment.
The main effect of a market modification is to expand or contract the areas in which a station may elect mandatory carriage under the must-carry rules. To the extent that a station’s network affiliation or other agreements authorize a station to grant retransmission consent only in the station’s Nielsen DMA, a market modification petition granted by the FCC would not alter the boundaries of that DMA. However, for stations that have elected retransmission consent, a market modification may have implications with respect to the areas in which such stations’ signals may be carried as “local” signals under the copyright laws.