Telecommunications (West's Encyclopedia of American Law)
The transmission of words, sounds, images, or data in the form of electronic or electromagnetic signals or impulses.
From the introduction of the telegraph in the United States in the 1840s to the present-day INTERNET computer network, telecommunication has been a central part of American culture and society. What would we do without telephone, radio, broadcast television, CABLE TELEVISION, satellite television, fax machines, cellular telephones, and computer networks? They have become integral parts of our everyday lives. And as telecommunication technology advanced, the more complicated the TELECOMMUNICATIONS industry became. As a result, federal and state governments attempted to regulate the pricing of telecommunication systems and the content of transmitted material. The Telecommunications Act of 1996 (Pub. L. No. 104-104), however, deregulated much of the telecommunication industry, allowing competition in markets previously reserved for government-regulated monopolies.
The first telegraph system in the United States was completed in 1844. Originally used as a way of managing railroad traffic, the telegraph soon became an essential means of transmitting news around the United States. The Associated Press was formed, in 1848, to pool telegraph expenses; other "wire services" soon followed.
(The entire section is 2662 words.)
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Telecommunications (Encyclopedia of Business and Finance)
Telecommunications is the transmission of data and information between computers using a communications link such as a standard telephone line. Typically, a basic telecommunications system would consist of a computer or terminal on each end, communication equipment for sending and receiving data, and a communication channel connecting the two users. Appropriate communications software is also necessary to manage the transmission of data between computers. Some applications that rely on this communications technology include the following:
- Electronic mail (e-mail) is a message transmitted from one person to another through computerized channels. Both the sender and receiver must have access to on-line services if they are not connected to the same network. E-mail is now one of the most frequently used types of telecommunication.
- Facsimile (fax) equipment transmits a digitized exact image of a document over telephone lines. At the receiving end, the fax machine converts the digitized data back into its original form.
- Voice mail is similar to an answering machine in that it permits a caller to leave a voice message in a voice mailbox. Messages are digitized so the caller's message can be stored on a disk.
- Videoconferencing involves the use of computers, television cameras, and communications software and equipment. This equipment makes it possible to conduct electronic meetings while the participants are at different locations.
- The Internet is a continuously evolving global network of computer networks that facilitates access to information on thousands of topics. The Internet is utilized by millions of people daily.
Actually, telecommunications is not a new concept. It began in the mid-1800s with the telegraph, whereby sounds were translated manually into words; then the telephone, developed in 1876, transmitted voices; and then the teletypewriter, developed in the early 1900s, was able to transmit the written word.
Since the 1960s, telecommunications development has been rapid and wide reaching. The development of dial modem technology accelerated the rate during the 1980s. Facsimile transmission also enjoyed rapid growth during this time. The 1990s have seen the greatest advancement in telecommunications. It is predicted that computing performance will double every eighteen months. In addition, it has been estimated that the power of the computer has doubled thirty-two times since World War II (With row, 1997). The rate of advancement in computer technology shows no signs of slowing. To illustrate the computer's rapid growth, Ronald Brown, former U.S. secretary of commerce, reported that only fifty thousand computers existed in the world in 1975, whereas, by 1995, it was estimated that more than fifty thousand computers were sold every ten hours (U.S. Department of Commerce, 1995).
Deregulation and new technology have created increased competition and widened the range of network services available throughout the world. This increase in telecommunication capabilities allows businesses to benefit from the information revolution in numerous ways, such as streamlining their inventories, increasing productivity, and identifying new markets. In the following sections, the technology of modern telecommunications will be discussed.
When computers were first invented, they were designed as stand-alone systems. As computers became more widespread, practical, useful, and indispensable, network systems were developed that allowed communication between computers. The term "network" describes computers that are connected for the purpose of sharing data, software, and hardware. The two types of networks include local area networks (LANs) and wide area networks (WANs). As the name suggests, LANs cover a limited geographic area, usually a square mile or less. This limited area can be confined to a room, a building, or a group of buildings. Although a LAN can include one central computer connected to terminals, more commonly it connects a group of personal computers. A WAN covers a much larger geographic area by means of telephone cables and/or other communications channels. WANs are often used to connect a company's branch offices in different cities. Some familiar public wide area networks include AT&T, Sprint, and MCI.
INTERNET, INTRANET, AND EXTRANET
"Internet work" is the term used to describe two or more networks that are joined together. The term "Internet" describes the collection of connected networks. The Internet has been made accessible by use of the World Wide Web. The Web allows users to navigate the millions of sites found on the Internet using software applications called Web browsers. People make use of the Internet in numerous ways for both personal and business applications. For instance, an investor is able to access a company directly and set up an investment account; a student is able to research an assigned topic for a class report; a shopper can obtain information on new and used cars.
The Internet concept of global access to information transferred to a private corporate network creates an intranet. In conjunction with corporate Internet access, many companies are finding that it is highly practical to have an internal intranet. Because of the increased need for fast and accurate information, an efficient and seamless communications line enabling all members to access a wealth of relevant information instantaneously is vital.
A company intranet in conjunction with the Internet can provide various types of information for internal and/or external use. Uses such as instantaneous transfer of information, reduced printing and reprinting, and elimination of outof-date information can provide great benefits to geographically dispersed groups. Some examples of information that an intranet might include are company and procedures manuals, a company phonebook and e-mail listings, insurance and benefits information, in-house publications, job postings, expense reports, bulletin boards for employee memoranda, training information, inventory lists, price lists, and inventory control information. Putting such applications on an intranet can serve a large group of users at a substantially reduced cost.
Some companies might want to make some company information accessible to preauthorized people outside the company or even to the general public. This can be done by using an extranet. An extranet is a collaborative network that uses Internet technology to link businesses with their suppliers, customers, or other businesses. An extranet can be viewed as part of a company's intranet. Access by customers would allow entering orders into a company's system. For example, a person may order airline tickets, check the plane schedule, and customize the trip to his or her preferences. In addition to time and labor savings, this type of order entry could also decrease errors made by employees when entering manually prepared orders.
Security and privacy can be an issue in using an extranet. One way to provide this security and privacy would be by using the Internet with access via password authorization. Computer dial in and Internet access to many financial institutions is now available. This is an example of limited access to information. While bank employees have access to many facets of institutional information, the bank customers are able to access only information that has to do with their own accounts. In addition to their banking account number, they would have to use their password to gain access to the information.
The physical devices making up the communications channel are known as the transmission media. These devices include cabling media (such as twisted-pair cable, coaxial cable, and fiber-optic cable) and wireless media (such as microwaves and other radio waves as well as infrared light). Wireless transmission has the advantage of not having to install physical connections at every point. Microwave stations use radio waves to send both voice and digital signals. The principal drawback to this system is that microwave transmission is limited to line-of-sight applications. Relay antennas are usually placed twenty-five to seventy-five miles apart and can have no interfering buildings or mountains between them. Earth-based microwave transmissions, called terrestrial microwaves, send data from one microwave station to another, similar to the method by which cellular telephone signals are transmitted.
Earth stations receive microwave transmissions and transmit them to orbiting communication satellites, which then relay them over great distances to receiving earth stations. Usually, geosynchronous satellites are placed roughly twenty-two thousand miles above the earth. Being geosynchronous allows the satellites to remain in fixed positions above the earth and to be constantly available to a given group of earth stations.
Many businesses either lease or rent satellite and/or microwave communication services through the telephone company or other satellite communication companies. If a business has only a small amount of information to be transmitted each day, it may prefer to use a small satellite dish antenna instead.
TYPES OF SIGNALS AND THEIR CONVERSION BY MODEM
Most telecommunications involving personal computers make use of standard telephone lines at some point in their data transmission. But since computers have been developed to work with digital signals, their transmission presents a noncompatible signal problem. Digital signals are on/off electrical pulses grouped in a manner to represent data. Originally, telephone equipment was designed to carry only voice transmission and operated with a continuous electrical wave called an analog signal. In order for telephone lines to carry digital signals, a special piece of equipment called a modem (MOdulator/DE Modulator) is used to convert between digital and analog signals. Modems can be either external to the computer, and thus to be moved from one computer to another, or they can be internally mounted inside the computer. Modems are always used in pairs.
Both the receiving and transmitting modems must operate at the same speed. Multiple transmission speeds allow faster modems to reduce their speed to match that of a slower modem. The transmission rate and direction are determining factors that influence the speed, accuracy, and efficiency of telecommunications systems.
Telecommunications is one of the fastest-growing areas of technology in the world. Because of its rapid growth, businesses and individuals can access information at electronic speed from almost anywhere in the world. By including telecommunications in their operations, businesses can provide better services and products to their customers. For individuals, telecommunications provides access to worldwide information and services.
"A Brief History of Data Communication." . 1999.
"Connecting the Nation: Classrooms, Libraries, and Health Care Organizations in the Information Age." Report prepared by National Telecommunications and Information Administration, Office of Telecommunications and Information Applications, U.S. Department of Commerce. .1995.
"Extranet and Intranet." http://www.whatis.com/extranet.htm. 1999.
"Geosychronous," "Modem," and "Cabling." (1995). The Volume Library, vol. 1. Nashville, TN: Southwestern.
Shelly, Gary B., Cashman, Thomas J., Waggoner, Gloria A., and Waggoner, William C. (1998). Discovering Computers 98, brief ed. Cambridge, MA: Course Technology.
Withrow, F. B. (1997). "Technology in Education and the Next Twenty-Five Years." Technological Horizons in Education Journal. (T.H.E.), 24(11):59-61.
Telecommunications (Encyclopedia of Management)
Traditionally, telecommunications denoted the long-distance connections that linked television networks to their affiliates and the long-distance phone connections that linked telephone networks to local switching centers. Hence the term applied both to AT&T's long-distance telephone network and to the television industry's worldwide networks-but each used very different technologies to transmit voice or video. Now with the rapidly growing size of the Internet, telecommunications has expanded to include data networks. The newest technologies to join the telecommunications industry are wireless phones and wireless data businesses.
Telecommunications and information-related industries continue to enjoy a rapid growth in the Internet and the wireless phone sectors. Table 1 provides a summary of the major classes of telecommunications services and how they function.
|Local and Regional Telephone|
|Internet and Data Networks|
THE REGULATORY ENVIRONMENT
The concept of universal service has traditionally referred to the goal that all Americans should have access to affordable telephone service. Television access does not require that homes be wired, so that is less problematic; but there is increasing pressure for universal Internet access. Universal telephone access has been met by means of policies established by government regulatory bodies. Phone or Internet services in densely populated areas promise good revenue and profits, because the cost of wiring businesses and residences is lessened by the short distances. The regulations are needed to ensure that people in remote areas have access; as people continue to move further and further away from population centers, the cost of bringing phone wires can be prohibitively expensive. But the phone companies are nonetheless required to extend the wire to them. The quid pro quo for making the huge investment to wire homes and businesses was protection from competitors; this protection was usually provided by state public utility commissions or municipal government policies. As a practical matter, limiting competition and the number of wires strung along highways and into homes makes good sense, especially from an aesthetic perspective.
In 1996 the Federal Communication Commission (FCC) issued an extensive new set of regulations to increase the competition in the industry. The local phone companies take serious objection to competitors coming into their territories and grabbing business and residential customers in the densely populated urban and suburban locations. But that is what is happening; cable-TV companies are partnering with long-distance companies and using their cables to offer a package of phone, TV, premium TV, digital music, Internet access, and e-mail. The Regional Bell Operating companies have also engaged in a variety of mergers. The FCC appears to be ready to approve mergers that open up competition in the local phone and cable-TV markets (e.g., AT&T was allowed to acquire TCI and other cable services), but not always the mergers between local phone companies.
The National Telecommunications and Information Administration (NTIA), an agency of the United States Department of Commerce, is the executive branch's principal voice on domestic and international telecommunications and information technology issues. NTIA works to spur innovation, encourage competition, help create jobs, and provide consumers with more choices and better quality telecommunications products and services at lower prices. Now that a considerable portion of today's business, communication, and research takes place on the Internet, access to the computers and networks may be as important as access to traditional telephone services. The NTIA is preparing policy to ensure access to the Internet service.
THE FCC AND COMPETITION IN THE TELEPHONE INDUSTRY
In 1982 AT&T signed a consent decree agreeing to the break up of its business into the long-distance business, which it retained, and seven Regional Bell Operating Companies (RBOCs), which became separate business entities serving specified regions. The Telecommunications Act of 1996 was a major revision of policy regulating the industry. That act attempted "to promote competition and reduce regulation in order to secure lower prices and higher quality services for American telecommunications consumers and encourage rapid deployment of new telecommunications technologies." The act tried to stimulate competition by laying down the conditions for regional phone companies to move into the long-distance arena and for long-distance carriers to offer business and residential phone services. But little in the way of increased competition has occurred in the mainstream telephone industry, even less in the cable-TV industry.
In 1999 competition was heating up as businesses in all three sectors went after three major opportunities for growth and increased profits: (1) the rapidly growing market for Internet access, (2) the rapidly growing market for wireless phones, (3) the opportunity to grab a share in all sectors by offering customers a package rate on phone, wireless phone, cable-TV, and Internet services. The current situation in these markets is:
- The long-distance market is rapidly expanding to serve both the increased number of long-distance phone calls and, especially, the greatly increased demand for Internet access. At the same time competition is increasing, and the amount of capacity is multiplying because of advances in fiber-optic technology. As a result, prices are declining and profits are squeezed because of the huge costs of upgrading the technology of the vast infrastructure
- Cable-TV companies are in the best position to become profitable, because their cable systems can provide the full package of services into the home. Providing long-distance phone service and Internet service requires a partnership with a long-distance carrier. As a result, mergers in the business have become hot topics. The cable-TV sector is the least competitive telecommunication market, and cable companies have been able to increase their rates. But many companies carry a large debt load resulting from the costs of upgrading their cable systems; repayment of their debt is the justification for rate increases.
- The regional phone carriers are poorly situated for long-term competition. Currently, most are protecting their profit margins and fending off competition. But direct competition from the cable-TV and AT&T companies in the local phone business could be catastrophic for them; AT&T is promising substantially lower monthly phone rates. The phone companies are impeded by their slow-speed wires and switches from providing high-speed Internet access-video over their system is impossible. They are being forced to consider the huge investment required by rewiring every home in order to stay competitive.
- The wireless phone business is largely unregulated, highly competitive, and growing very rapidly. Having a national network, whereby long distance calls remain on a single carrier's infrastructure, has become a strong competitive edge. The result is that customers' phones work in every major city and that there are no roaming changes to cover long-distance changes from other inter-exchange carriers. Bigger is better in this environment, and large wireless companies are thus merging with long-distance carriers.
- Internet access and e-mail are the fastest growing services in the telecommunications industry. The Internet-service business is made up of the linkages from homes and businesses to Internet service providers (ISPs), which in turn provide linkages to the major Internet backbone mostly provided by long-distance carrier MCI Worldcom. In 1999 most of the linkages from homes and businesses were carried by the local phone companies; while much faster speeds were available from the cable-TV firms, few were ready to provide data services. Competition for high-speed linkages from home or business to the Internet backbone will be intense. The cable-TV industry is much better positioned to capture business in the short term; eventually, digital lines into businesses and homes will probably be needed as voice, TV, data, and on-demand video are all delivered in a digital format as part of a package of services.
THE TELEPHONE INDUSTRY
A long-distance telephone call is the typical way in which most people experience the telephone network, which extends from home phones to a local switching center, then to another remote switching center, and finally to the home or business called. The term telecommunications primarily applies to the long-distance carriers, such as AT&T, MCI, and Sprint, which carry transmissions between switching centers. The local telephone markets are dominated by the Regional Bell Operating Companies (RBOCs), such as Verizon, BellSouth, and SBC Communications. The RBOCs bear the responsibility for universal access, for ensuring that every residence-no matter how remote-has affordable phone service. Often these rural and remote sites pay the minimum amount, approximately $15 per month, for the minimal service. The RBOCs claim that their costs for customers exceed $15 per month; the public utility commissions at the state level help the RBOCs subsidize those customers with revenue from urban and suburban customers, as well as access fees paid by long-distance carriers. The RBOCs are guaranteed a profit by the public utility commissions, but the rates have been virtually constant with little growth in the number of phones added. At present, this is a good business to be in, but it is expected to be a very bad business as competition from cable-TV companies drives down prices.
Each local telephone center is a hub from which copper wires extend to homes and businesses. This last mile of wiring is the window or portal into millions of homes and businesses, controlling-in some ways-the services provided and the revenues generated from homes and businesses. The last mile of wiring is also the major bottleneck to providing better and faster services to those millions of sites. The twisted pair wires in virtually every home are the major problem with boosting the speed of Internet access over those lines. But those millions of miles of wires are extremely expensive to replace. In order for the regional phone companies to effectively compete agains the cable-TV companies, they will have to rewire, thereby opening up the possibility of providing the full bundle of services to the home owners.
In every major Asian city, wireless phones are everywhere. This phenomenon will be repeated in the United States as more and more workers transact business away from their desks, and as less and less time is spent at home. It is quite possible that phone calls originating from wireless phones will surpass those from wired phones in the near future.
John Malone, a cable industry executive, coined the term convergence to describe the packaging of multiple services to customers, such as cable-TV, premium movie channels, Internet services, digital music channels, and phone service. Convergence is made possible by advances in transmission technology; all of those services can be provided to homes over a single cable. And that means that cable-TV companies can move into the phone business, phone companies can move into the TV business, etc. As convergence becomes a reality, competition in the telecommunications industry moves to new level.
All the major cable-TV companies have announced that they will provide high-speed Internet services alongside the regular TV and pay-per-view channels; TCI and Time Warner say they will also include telephone services. All these services will be offered over one coaxial cable (wire). The cable companies employ a transmission approach called broadband; Media One's logo includes the phrase "Broadband is the Future." Coaxial cable can carry high-speed data and/or multiple channels of video over an insulated central copper wire wrapped in another cylindrical conducting wire, which is then shielded and wrapped in a protective cover. This wire is split into many channels by breaking out the wiring spectrum into multiple frequencies and transmitting each channel on a separate frequency; this is what broadband means, it delivers an amazing amount of content by using frequency division multiplexing. Part of the available frequency spectrum is dedicated to data for Internet access and another part is dedicated to voice for telephony.
As great as broadband sounds, it has the inherent drawback of being an analog approach for sending digital TV signals, digital sound, and for sending and receiving digital data; at both ends of the cable, a digital-to-analog or analog-to-digital conversion is required. Another potential problem is that the data channel might become overloaded as more and more customers begin to interact with Internet services; broadband was designed as a transmission approach to send multiple channels of video one way only, while e-mail service is two way.
The unshielded, twisted pair of wires in virtually every home are the major impediment to boosting the speed of Internet access over phone lines. Speed for sending and receiving data is expressed in terms of how many bits (ones or zeros) per second can be moved. The maximum speed for a telephone modem is 56,000 bits per second; most people find that annoyingly slow. The phone companies are implementing a new service called digital subscriber line (DSL), which uses its four wires to carry both voice and data simultaneously in both directions. Data can be received or downloaded from the Internet at speeds up to 1.5 million bits per second, but data sent from the home moves at a much slower rate. DSL technology, however, is proving difficult and expensive to implement, especially at distances greater than two miles from the switching centers. The requisite DSL modems are also more expensive and difficult for users to install. DSL gives the phone companies voice and high-speed data services, it does not open up the lucrative premium TV market. In order for the regional phone companies to effectively compete against the cable-TV companies, they will have to re-wire, either with coaxial cables or fiber-optic cables. But that will make them competitive with the cable companies and open up the possibility of providing the full bundle of services to home owners.
Fiber-optic wiring is the preferred choice of the long distance companies and often the preferred choice of regional telephone companies as they upgrade in urban and suburban locations where demand for capacity is a concern. Fiber-optic media is much faster than electrical wires, it is unaffected by electrical interference, and much more secure. But it is much more expensive to install because these tiny glass filaments are very difficult to align and join together. Lasers transmit pulses of light, rather than electrical signals, to send data and photo-decoders to receive the data; hence the speed of the lasers is dependent on these devices. The hair-thin strands of fiber are made of very pure flexible glass or plastic filaments along which photons, the fundamental unit of light, move in waves or streams.
The speed and capacity of fiber-optic cables keeps on doubling and will continue to expand exponentially. In 1995 scientists introduced wavelength division multiplexing (WDM), a method of splitting (multiplexing) the cable into streams of color, each carrying 2.5 billion laser pulses per second. Initially each fiber carried eight streams of data at 2.5 gigabit speeds, the multiplexed total capacity being twenty gigabits per second. In 1997 new WDM devices doubled throughput with 16 color bands, and soon after it became possible to multiplex into 40 colors; in 1998 80-band systems were announced as were 160-band systems for the year 2000. At the same time, the lasers sending and receiving the data streams increased in speed from 2.5 gigabits to 10 gigabits. 400 gigabits-per-second speeds per fiber strand are commercially available, as well as, terabit speeds provide quite a contrast to the 56,000 bits per second modem speed.
So much additional capacity has become available that prices dropped by a substantial amount. Inexpensive high-speed communication links mean that distance is dead; instantaneous global transactions can become a reality.
There is rapid growth (approximately 80 percent per year) in the wireless phone business. Prices continue to decline for both the phone devices and the monthly service charges. Sprint, AT&T, and Verizon (to name a few companies) are advertising hundreds of minutes of calls anytime and to anywhere in the United States for $49 per month; this is an example of a price incentive made possible because of these companies national networks. It would not be surprising to see mergers between other long-distance companies, following the lead of MCI WorldCom.
Wireless phones and wireless data services send and receive voice and data from their antennae to local towers, which are, in turn, linked to adjacent towers and long-distance lines. The area within range of any tower is called a cell; most are adjacent to other cells, forming a honeycomb pattern. As mobile wireless phones move from cell to cell, their calls are automatically switched from tower to tower. There are many dead spots-especially in rural areas-with no reception because there are no towers nearby.
The first cell phones were analog devices, with well-known security problems and often poor-quality reception. Cellular phones broadcast in the 800-900 MHz frequencies; which some scanners can hear. The newer digital phones provide better security and better quality sound, but they operate at lower voltages, have shorter ranges, and require more towers. The PCS standard for digital phones has been widely accepted in the United States, but Europeans have adopted another digital standard, GSM, making wireless communications during international travel difficult.
There is already a great deal of push to commercially provide wearable PCs, combinations of PDAs (personal digital assistants) and phones that handle both voice and data. A small single device would offer voice mail and e-mail, pager and beeper services, Internet access, word processing, spreadsheets, and graphics. Digital phones can handle digital data. The next generation, of wireless services, is available now; these Internet devices will feature 400,000 bps speeds, with more to come.
CONVERGENCE ON DIGITAL TRANSMISSION
Many of the long-distance companies have adopted and are implementing a data networking approach, now being called an IP standard from the UNIX TCP/IP protocol suite. Data, voice, and video are being sent digitally as packets of data, rather than as parts of an analog frequency. The digital approach promises faster, cheaper and better telecommunications services; it is especially well suited to the fiber-optic wiring. But it is the widespread acceptance of digital players, e.g., digital TV, digital phones, CD and DVD video and music players, not to mention PCs, which suggests that digital data networks make the most sense. And in the long-distance arena, with the amount of data surpassing the amount of voice, moving both voice and data to IP networking, as AT&T is, reduces complexity and duplication.
Cable-TV transmissions employ frequency division multiplexing to continuously send many channels one way to the TV tuners. Data and voice transmissions are two way, often short bursts from sender and receiver. This adds considerable complexity, as TCI and Time Warner discovered during the Implementation of phone and Internet services over their coaxial cables.
Phone conversations are semi-permanent sessions between sender and receiver. The phone companies use circuit-switching technology to connect the two parties by establishing a circuit, or connection, for the duration of the call for the exclusive use of the two parties. But that is preceded by establishing the linkage or circuit through the local switching center, the long-distance carrier, and the other switching center. Here again the wire capacity is broken up into circuits using frequency division multiplexing. The traditional T-1 line provides twenty-four separate telephone circuits over copper wire; each circuit is equivalent to 64,000 bits per second digital channel.
Data network standards were established as millions of local area networks were created in businesses all over the world. Data is sent and received in packets, called datagrams, defined by protocols, such as the dominant IP protocol. The packets have a "to" address, a "from" address, lots of digital data, and error-checking data; each packet also indicates that it is one of many in a group, to be assembled by the receiving computer. Data networks operate like the mail delivery system; data is put into the envelop, the to and from addresses contain both a single individual address as well as the area's zip code. Trucks (wires) take all the mail to central hubs, where it is again sorted and sent to further destinations and, eventually to the right zip code post office, which delivers the envelop to the right home address. Data networks use packet switching devices, typically routers, to truck the packets from router to router along the path.
Packet switching is much more efficient for little e-mail messages or slow phone conversations. With packet switching, an exclusive circuit need not be maintained-the entire bandwidth is always open to accept packets. The standard for fiber optic transmission is 2.5 Gbps (2.5 billion bits per second), so very large documents or books can be moved in the blink of an eye. Compressed video and compressed music take up lots of bandwidth; a CD holds 600 million bytes (4.8 billion bits), but that can be compressed by half into roughly 2.5 billion bits, and could be send and received in a second.
TURMOIL IN THE TELECOMMUNICATIONS INDUSTRY
The telecommunications industry is in turmoil because
- data has surpassed voice as the predominant content to be transmitted,
- the convergence of the telephone, cable TV, and data communications industries,
- the rapidly increasing addition of transmission capacity and rapidly decreasing prices.
Traditionally, the industry was dominated by AT&T, which built a highly reliable infrastructure to carry phone messages. Much of the telecom infrastructure throughout the world is optimized for voice, and is poorly situated for carrying data. At the current time, data make up 98 percent of the telecommunication content. Every major organization has built its own data networks, and the quantity of traffic continues to grow. These internal data networks are fast and inexpensive because they are digital. By contrast, internal data networks routinely transmit and receive data at ten million bits of data per second; phone modems, which permit data to be carried over the phone lines, are limited to 56,000 bits per second. Businesses can lease high-speed (1 million bits per second) data lines from telecommunication providers, but these lines are expensive.
The fiber-optic technology described above promises huge advances in capacity resulting in potential decreases in transmission prices. The contrast between the speeds of the fiber cables compared to speeds experienced by most residential customers and many businesses using modems in untenable. Fiber-optic cables operate at billions of bits per second, and soon at trillions of bits per second. Local-area networks (LANs) linking PCs together operate at 10-100 million bits per second and higher, at very low costs. The slow speed of modems using phone wires is especially a problem as users attempt to download software or music, or even to access graphic-intensive Web sites.
Remaining profitable as prices drop is a difficult process. The PC industry is the clearest precedent; major computer companies, e.g., IBM, NCR, and Digital Equipment, Hewlett-Packard, were often at a disadvantage against newer companies such as Dell and Gateway. Similarly, it will be difficult for large telecommunications companies, such as AT&T, to compete against newer competitors such as Quest and ITCX. The larger long-distance carriers have world-wide operations and the economic benefits of huge scope and scale; they need not depend upon any other company's services. But these large long-distance companies have enormous investments in a now-profitable, but rapidly obsoleting, infrastructure. AT&T, for example, is battered by operating cost and price structures that reflect the past limitations of transmission capacity, which, in turn, resulted from slow-speed media and switching devices. It is much cheaper to maintain a single strand of fiber-optic cable and its switches than thousands of copper cables and their switches, when both carry the same amount of digital data/voice/video. The large traditional companies will be squeezed by the need to make major new investments in the latest fiber-optic switching technologies, while at the same time covering the costs of operating the old infrastructure as the prices are dropping.
Another problem for the established long-distance carriers is their requirement to pay access fees to the Regional Bell operating companies that complete their calls to customers. The rationale for the access fees is that the long-distance carriers need to contribute to the costs of providing universal service across the country, especially to the rural telephone companies, rather than have those costs shouldered only by local phone companies. The long-distance companies are saddled with $25 billion of subsidies to the local phone services. As AT&T broke up in 1984, the long-distance business was highly profitable; long-distance calls were billed at 50 cents per minute in 1984, with access fees at 15 cents per minute; now the average long distance charge is below 10 cents per minute, but the access fees remain high-above three cents per minute.
Despite growing pressures from businesses and residential customers, access to the Internet continues to be largely funneled through telephone modems, devices which translate digital computer data into analog signals that are then carried over phone lines. The local telephone companies appear highly resistant to upgrading their technologies and wiring. They are trying to introduce high-speed 1.5 million bits per second (inbound only) Internet access using new modem technologies, but appear to be having problems rolling out these Internet services to residential customers. Cable-TV companies provide Internet access via cable modems in the major metropolitan areas. The phone companies offer high-speed Internet access via DSL modems, but only a very limited number of homes have been wired with DSL. The cable-TV providers and the local telephone services continue to be protected by the FCC from the competitive pressures assailing the long-distance companies; they have been protected from the need to deploy digital technology in order to remain competitive.
By contrast, newer wireless cellular phone companies require a relatively small investment for a regional phone system, serving a city and suburbs, for example. But many wireless phone customers abhor the roaming charges, which are costly because the regional wireless company has to subcontract with a long-distance carrier for calls outside its region.
The telecommunications industry is experiencing a whirlwind of activity. Rapid growth is occurring in every sector of the industry, but data networks to accommodate Internet traffic are growing as fast as companies can implement them. The industry competes globally, and having global reach appears to be a competitive edge. Bigger is indeed better if the goal is to connect businesses in the United States to their sub-sidiaries in other regions of the globe. At the same time, the ability to deploy technology that is smaller, faster, and cheaper gives advantage to smaller, more agile companies. Smaller is better if, and only if, government regulations permit smaller companies to take chunks of the more lucrative business segments from the established companies.
In the short term, the best telecommunications segment is the cable television business. Protected by municipal regulations, the cable companies have been able to raise prices for the traditional TV fare. But it turns out that broadband cable technology is the best way to provide a wide variety of services into millions of homes: TV, pay-per-view video, Internet access, e-mail, telephone, and digital tunes. The major cable companies could be sending millions of home bills for over $100 per month for such packages.
In the short term, the regional phone companies are in the worst strategic position. The barrier to entry to compete against the cable companies is the steep cost of rewiring millions of homes and businesses and replacing their circuit switching systems. The traditional technology is obsolete and neither ISDN nor DSL can make telephone companies competitive against cable companies.
In the short term the wireless phone business will continue to grow and prosper. It is safe to predict continuing growth for the foreseeable future. The speculation that virtually every adult in the United States will own a wireless phone surprises very few people; virtually every adult in Singapore and Hong Kong already does. Here again, having a global or national network is a powerful competitive advantage to a wireless phone company; Sprint and AT&T are both trying to grab market share by advertising low prices for calls anywhere in the United States. Calls are handled by one carrier from end to end, resulting in less complexity, less cost, and better service. New digital phones already offer caller ID and voice mail; and by adding computing power these devices are also offering e-mail and access to business databases via the Internet. Sending and receiving wireless data is relatively easy in a digital environment.
"Distance is dead," claims Tom Peters in his book The Circle of Innovation, and that will be the single most important factor shaping the economy for the next 50 years. In the short term, demand for long-distance carriers will continue to grow at the same time that the capacity of every fiber strand is more than doubling every year. The Internet growth driving demand for backbone capacity is particularly high.
Laser pulses transmit data along the hair-thin glass fibers. Each strand of fiber-optic cable can now move data at a very high speed. Voice and data traffic on the North American long-distance backbone now approximates 1 terabit-each strand of new fiber-optic cable may be able to carry that much. Cables often contain ninety-six strands of fiber, but some have as many as 436 strands. Capacity should catch up with demand within the first decade of the twenty-first century. Indeed there should be a glut of capacity. And that means continually declining prices. The trick in this business segment will be to offer very low prices and have very low costs.
Douskalis, Bill. IP Telephony: The Integration of Robust VoIP Services. Upper Saddle River, NJ: Prentice-Hall PTR, 2000.
Freeman, Roger L. Fundamentals of Telecommunications. 2nd ed. New York: John Wiley & Sons, 2005.
Schoning, Heinrich. Business Management of Telecommunications. Englewood Cliffs, NJ: Prentice-Hall, 2005.
FCC Regulations (Encyclopedia of Everyday Law)
The Federal Communications Commission (FCC) is a large, independent United States government agency. On June 19, 1934, Congress enacted legislation establishing the Federal Communications Commission (FCC). This important legislation made the administrative duties of regulating broadcasting and wired communications into a single agency. The FCC had three divisions: broadcast, telegraph, and telephone. Its prime directive was to create "a rapid, efficient, nationwide, and worldwide wire and radio communication service." The FCC's first seven commissioners and 233 employees soon began to consolidate the rules and procedures from three other agencies:
- Federal Radio Commission
- Interstate Commerce Commission
- Postmaster General into one agency
FCC has JURISDICTION in all 50 states, the District of Columbia, and U.S. possessions such as Puerto Rico, Guam, American Samoa, and the American Virgin Islands.
The FCC has grown a great deal over the years. Today it has nearly 2,000 employees and, in addition, to its original mandate, has added oversight responsibilities in new communications technologies such as satellite, microwave, and private radio communications. There are six major sections of the 1934 Act, called "titles." They are:
- Title I: This section describes the administration, formation, and powers of the FCC.
- Title II: This section is about common carrier regulation.
- Title III: This section concerns broadcast station requirements.
- Titles IV and V: These two sections deal with JUDICIAL REVIEW and enforcement of the Act.
- Title VI: This section describes various provisions of the Act including amendments to the Act and the emergency war powers of the president. It also extends FCC power to regulate cable television.
The 1934 Act restricts FCC regulatory authority to interstate and international common carriers. For purposes of the Act, telephone and microwave communications are deemed common carriers.
Many of the prototypes for broadcasting regulations were created before the 1934 Act by the Federal Radio Commission. Sections 303-307 defines many of the FCC's powers related to broadcasting. Other sections either put limits on FCC's authority or some of the activities of broadcasters:
- The FCC may not censor broadcast stations.
- Individuals may not uttering obscene or indecent language over a broadcast station.
- The "Equal Time Rule" requires broadcasters to provide an equal opportunity to candidates seeking political office.
- Under the "Fairness Doctrine," broadcasters must allow for rebuttal of controversial viewpoints.
The 1934 Act has been amended many times. Communication technology has changed dramatically during the FCC's history. These changes include the introduction of the following:
- Satellite and microwave communications
- Cable television
- Cellular telephone
- PCS (personal communications) services
FCC responsibilities have increased to accommodate the regulatory issues presented by these new technologies. Consequently, it now shares regulatory power with other federal, executive, and judicial agencies.
The FCC oversees all broadcasting regulation. The FCC can license operators of telecommunication services and has recently used auctions as a means of determining who would be awarded licenses for personal communications services. The FCC enforces the requirements for wire and wireless communications through its rules and regulations. The FCC handles major issues at its monthly meetings; it deals with less important issues by circulating them among the commissioners for action. The language of the Act is flexible, sufficient to work as a framework for the FCC to promulgate new rules and regulations related to a huge variety of technologies and services.
The president appoints and the Senate confirms the FCC's five commissioners. They serve 5-year terms, unless appointed to fill an unexpired term. One of the five commissioners is designated by the president to serve as chairperson. The chairperson delegates management and administrative responsibility to the managing director of the FCC. To preserve a certain degree of political equilibrium, one political party may only have three commissioners at any one time. No commissioner may have a financial interest in any business related to the work of the commission. The five FCC commissioners supervise all of their organization's official activities and delegate agency responsibilities to staff units and bureaus.
Bureaus and Offices
The FCC contains four key branches and divisions:
- Mass Media Bureau, which oversees licensing and regulation of broadcasting services
- Common Carrier Bureau, which handles interstate communications service providers
- Cable Bureau, which oversees rates and competition provisions of the cable act of 1992
- Private Radio Bureau, which regulates microwave and land mobile services
And there are special offices within the FCC that help support the four bureaus:
- The Field Operations Bureau, which provides enforcement, engineering and public outreach programs.
- The Office of Engineering and Technology, which provides engineering expertise and knowledge to the FCC and tests equipment for compliance with FCC standards.
- The Office of Plans and Policy, which functions as a sort of think tank for the FCC.
The FCC contains six Bureaus and ten Staff Offices, arranged by function. The sixteen bureaus and offices are:
- Consumer & Governmental Affairs Bureau
- Enforcement Bureau
- International Bureau
- Media Bureau
- Office of Administrative Law Judges
- Office of Communications Business Opportunities
- Office of Engineering And Technology
- Office of Inspector General
- Office of Legislative Affairs
- Office of Media Relations
- Office of Plans And Policy
- Office of The General Counsel
- Office of The Managing Director
- Office of Work Place Diversity
- Wireless Telecommunications
- Wireline Competition Bureau.
These bureaus' responsibilities include:
- Analyzing complaints and conducting investigations
- Developing and implementing regulatory programs
- Participating in hearings
- Processing applications for licenses and other filings
Although these various divisions within the FCC have individual functions, they frequently join to address issues that affect the entire FCC.
The Fairness Doctrine
First Amendment issues have been the most active areas of public controversy among broadcasters since the Communications Act of 1934. The FRC and then the FCC have maintained that "scarcity" requires a licensee to operate a broadcast station in the public trust; a station is not meant to be an exclusive means to promote its owners' views. This controversial doctrine formed the basis of many FCC rules up through the mid-1980s.
The FAIRNESS DOCTRINE withstood constitutional challenges. For example, in 1969 the Doctrine was held to be constitutional by the Supreme Court in Red Lion Broadcasting v. FCC (395 U.S. 367). Broadcasters had complained vociferously about the doctrine, complaining that it produces a chilling effect on free speech. Despite the potential for conflict, though, the FCC determined a station's fairness record on the overall programming record of the licensee. The U.S. Supreme Court also reaffirmed that as long as a licensee met its public TRUSTEE obligations, the licensee was not obligated to sell or give time to specific opposing groups to meet Fairness Doctrine requirements. Eventually, the FCC commissioners pursued policies of deregulation and began looking for ways to eliminate the Fairness Doctrine.
In 1985, an FCC report concluded that scarcity was no longer a valid argument and the Fairness Doctrine unduly prevented broadcasters from airing more controversial material. Two subsequent federal court cases finally allowed the FCC to eliminate the Fairness Doctrine in 1987. The FCC revoked the Fairness Doctrine, with the exception of the personal attack and political editorializing rules that remain in effect.
The FCC and Broadcasting
Since the FCC's founding, the act of determining whether a licensee has fulfilled its responsibilities under the "public interest, convenience and necessity" standard of the Act has varied a great deal depending upon the composition of Commission and the various orders or requests from Congress. The FCC enjoys broad authority under section 303 to do the following:
- Approve equipment and set standards for levels of interference
- Assign frequencies and power
- Classify stations and prescribe services
- Issue cease and desist orders
- Levy fines and forfeitures
- Make regulations for stations with network affiliations
- Prescribe qualifications for station owners and operators
Perhaps the FCC's most important powers are those associated with licensing. These powers allow the FCC to license or short-license broadcast licenses. It can also withhold, fine, revoke or renew broadcast licenses and construction permits based on its own evaluation of whether the station has served in the PUBLIC INTEREST. Even though the FCC can revoke a license, it has not used this authority much over its 60-year history.
Before the era of deregulation, the FCC had a set of complicated rules and regulations for broadcasters. At the same time, it also gave licensees a lot of scope to determine what constituted service in the public interest based on local needs; this was known as the "Ascertainment Policy." Once the FCC licensed a station, the station's operator had to monitor the technical, operational, and programming functions of the station. It also had to maintain files on all aspects of station operations for several years.
The requirements for filing for and renewing licenses for broadcasters are greatly reduced today. But when two or more applicants compete for the same license or when someone challenges a Petition to Deny, the FCC determines which of the rival applicants is the most qualified to own and operate the broadcasting facility. There are strict procedures for hearings that ensure that the applicants' rights are protected. Consequently, the FCC's adjudicative process can be expensive and time-consuming.
Broadcast Regulation and FCC Policy Decisions
Because the 1934 Act does not enumerate specific powers to regulate networks, the FCC has sought to regulate the relationship between affiliated stations and broadcast networks. Following the promulgation of the FCC's Chain Broadcasting Regulations, major radio and television networks challenged the Commission's authority to promulgate such rules. Their 1943 suit, National Broadcasting Co., Inc. et al. v. United States (319 U.S. 190) resulted in the Supreme Court upholding the constitutionality of the 1934 Act as well as the FCC's rules related to business alliances. In its opinion, the Court pointed out the broad and flexible powers granted to the FCC by Congress. The FCC has used the network case as a precedent to justify its broad discretionary powers in numerous subsequent rulings.
The FCC promulgated the seven-station rule, multiple-ownership and cross-ownership restrictions, and cable television-broadcast television cross-ownership rules to promote a diverse group of owners and opinions in various markets and geographical areas. But as the FCC licensed more radio and television stations, restrictions that limited ownership to a few stations made less sense to the FCC. Thus, recognizing greater market competition, the Commission relaxed ownership rules in 1985. Subsequently, the FCC eased restrictions on the following areas:
- Duopoly and Syndication
- Financial Interest Rules
- Limits on Commercials
Regulating Broadcast Television and Radio
To broadcast radio or TV signals in the United States, an owner or operator must obtain a license from the FCC. The FCC licenses all transmitters whose signal can travel distances, although there are a few exceptions for very low power radio transmitters, such as those in CB radios and walkie-talkies.
The FCC licenses radio transmitters according to geography and certain other common ownership rules that are intended to help prevent radio stations from interfering with the signals of other stations. The spectrum of available radio and television frequencies is limited, so the FCC can issue only a limited number of licenses. Therefore, broadcast licenses are extremely valuable, particularly in large cities.
The FCC limits individuals or CORPORATE entities from acquiring more than a certain number of stations in order to promote diverse viewpoints over the airwaves. The Telecommunications Act of 1996 relaxed these limits, sparking a wave of recent broadcast mergers and acquisitions.
Wireless "Cellular" And "PCS" Communications
The FCC administers licensing for wireless communications. This industry is growing rapidly, evidenced by the many new products and services using wireless frequencies that are announced every week. Cellular creates a system of mobile communications through "cells," which are small, linked service areas that operate using analog technologies.
Personal communications services (PCS) are essentially mobile phones that operate with digital technologies. PCS units can provide a range of services and features such as paging, answering services, and text messaging. The newest PCS versions even permit users to send and receive text e-mail.
Communications law is a broad field covering many issues that arise from the transmission of information. But every communications law issue involves problems with either "content" or "distribution."Some of the most common problems associated with content include:
Getting Involved in FCC Rulemaking
When the FCC considers changes to its rules, it seeks comments from interested parties. These filings are known as "comments." The FCC then allows for a periodsually around 30 days- for interested individuals or groups to respond to the comments of others; these responses are known as "reply comments."
The FCC encourages comments from members of the public on its proceedings and proposed rulemakings. Comments are either formal or informal. Formal comments are those that have a specific deadline and require a certain number of copiessually four. Additionally, the FCC places formal comments in the DOCKET. Docket numbers are crucial to make sure that an individual's comments are considered, no matter how they are submitted. To locate a docket number, people can contact the Office of Public Affairs, Public Service Division, or the bureau or office responsible for the item.
All of the FCC's decision-makers read and consider formal comments. But informal comments are those that do not meet deadline or copy requirements. While they are placed in the docket, they will not be as widely distributed within the FCC for review. There is no guarantee that informal comments will be read. If individuals file formal comments, they must deliver an original plus four copies of their comments to the FCC's Office of the Secretary. If they want their formal comments to be sent to the commissioners themselves, they need to submit an original and nine copies.
Unfortunately, many people do not comment on issues of interest to them because they think that comments must be prepared and filed by an attorney. This is not true; individuals need not hire an attorney to prepare comments. There is no set format for comments, and anyone may prepare and file comments. People can prepare comments as they would a short statement or a brief letter. Of course, comments may also be detailed documents prepared by an outside law firm or other professional.
When preparing comments for the FCC, people should try to prepare sound arguments. Well-argued comments are the most helpful to the Commission when it is formulating new rules. In the end, new rules must stand the test of petitions of reconsideration by the parties involved, and sometimes they also face court challenges.
Making a Personal Presentation
Any communication directed to the merits or outcome of an FCC proceeding is considered an "ex parte" presentation. Citizens may appear in person before FCC officials to make an ex parte presentation. Ex parte presentations may also be made in writing. The FCC has specific disclosure requirements associated with different forms of ex parte presentations:
- Oral ex parte presentations: If individuals want to make oral ex parte presentations and present data or arguments in that proceeding that are not already reflected in their written comments, they must provide an original and one copy of a written memorandum to the Secretary (with a copy to the Commissioner or staff member involved) that summarizes the data and arguments they intend to present. Their memoranda must clearly indicate on its face the docket number of the particular proceeding(s) to which it relates, the fact that an original and one copy have been submitted to the Secretary, and it must be labeled or captioned as an ex parte presentation. Individuals can file their memoranda on the date of their oral presentations.
- Written ex parte presentations: Individuals must provide two copies of the written presentation to the Commission's Secretary to be included in the public record. This must occur on the same day the presentation is submitted. They need to be sure to include the docket number on the face of the presentation to which it relates, and that two copies of it have been submitted to the Secretary, and label it as an ex parte presentation.
It is a good idea to contact the FCC staff member associated with the proceeding before planning an ex parte presentation. Because some proceedings are restricted, staff can let people know if they can make a presentation and can explain the rules for doing so.
The FCC actively encourages participation in its rulemaking process. One way it does so is by urging the public to submit comments on proposed rules through electronic mail and fax. If individuals file comments via email and want it to be treated as "formal," they should also print out their comments and send the original plus four copies to the Secretary's office by the stated deadline. If they cannot make the deadline this way, or if they are faced with the prospect of commenting informally or not commenting at all, they should go ahead and submit their comments any way they can, then follow up with a phone call to ensure the FCC received them. If they merely file their comments via email or fax or in the form of a letter without the extra four copies, the FCC will consider them to be "informal" comments.
Other First Amendment Issues
The FCC has recently been confronted with several controversial issues concerning indecent or obscene broadcasts. And increasingly suggestive music lyrics prompted the FCC to take action against several licensees in 1987. In a formal Public Notice, the FCC restated a generic definition of indecency, which was subsequently upheld by the U.S. Court of Appeals. With encouragement by Congress, the FCC increased its efforts to limit the broadcast of indecent programming material. This action includes such instances as the graphic depiction of aborted fetuses in political advertising. Various FCC enforcement rules, including a 24-hour ban and a "safe harbor period" from midnight to 6 a.m., have been challenged in court.
Currently the FCC has come under criticism on several fronts. Its critics claim that the agency is unnecessary and the Communications Act of 1934 is outdated. Sweeping changes in communications technology are placing new burdens on the commission's resources. But it remains to be seen whether the FCC will be substantially changed in the future.
The ARRL's FCC Rule Book: Complete Guide to the FCC Regulations. Hogerty, Tom, ed. American Radio Relay League, Incorporated, 1998.
The Broadcaster's Survival Guide: A Handbook of FCC Rules and Regulations for Radio and TV Stations. Whitley, Jack W. and Gregg P. Skall, St. Martin's Press, Inc., 1990.
Communications Deregulation and FCC Reform: Finishing the Job. Eisenach, Jeffrey, and Randolph J. May, eds. Kluwer Academic Publishers, 2001.
Electronic Media and Government. Smith, F. Leslie, Milan Meeske, and John W. Wright II, Longman, 1995.
Electronic Media Law and Regulation. Creech, Kenneth, Focal Press/Butterworth Legal Publishers, 1993.
FCC: The Ups And Downs of Radio-TV Regulation. Ray, William B., Iowa State University Press, 1990.
Mass Communications Law in a Nutshell. Carter, T. Barton, Harvey L. Zuckman, and Juliet Lushbough, West Publishing, 1994.
Federal Communications Commission (FCC)
445 12th St., S.W.
Washington, DC 20554 USA
Phone: (888) 225-5322
Fax: (202) 418-0232
National Association of Broadcasters (NAB)
1771 N Street, NW
Washington, DC 20036 USA
Phone: (202) 429-5300
Fax: (202) 429-4199
National Exchange Carrier Association (NECA)
80 South Jefferson Road
Whippany, NJ 07981-1009 USA
Phone: (800) 228-8597
Fax: (973) 884-8469
Telecommunications Industry Association (TIA)
2500 Wilson Blvd., Suite 300
Arlington, VA 22201 USA
Phone: (703) 907-7700
Fax: (703) 907-7727
Satellite And Cable (Encyclopedia of Everyday Law)
To begin to comprehend the issues and the many laws and regulations related to satellite and cable industries in the United States, one must first understand a bit about the Federal Communications Commission (FCC). Congress created the FCC when it enacted the Communications Act of 1934. The Act was intended in part to help regulate interstate and foreign commerce in communications via wire and radio to help make available a rapid, efficient, nationwide, and worldwide wire and radio communications service. Note that the term "radio" has been interpreted in its most inclusive sense to also apply to television. The FCC has grown into a very large governmental agency, and its functions have expanded to include oversight of the satellite and cable telecommunications media. Questions about satellite or cable laws or regulations are most likely addressed by the FCC.
The FCC has five commissioners, appointed by the president and confirmed by the Senate, who oversee the operations of the agency. There are various operating bureaus under the commissioners, one of which is the Mass Media Bureau. Different bureaus within the FCC regulate different aspects of telecommunications media. For example, the Mass Media Bureau regulates amplitude and frequency modulation, low-power television, and direct broadcast satellite. The Common Carrier Bureau regulates telephone and cable operations.
The FCC licenses new broadcast stations based on the needs of communities in a given region and on technical engineering considerations that prevent interference between stations. The FCC must approve a host of activities by broadcasters, including allocations of new stations and applications to build, modify, renew, or sell a station. When the FCC considers an application for any of these activities, it tries to determine if granting the request serves the PUBLIC INTEREST. This kind of review is required by the Communications Act.
The FCC and Censorship
The FCC expects stations to manifest an awareness of the important problems or issues in the communities they serve by presenting programming and/or announcements about local issues. In the end, though, it is broadcasters and not the FCC (or any other government agency) who are responsible for selecting all the content of their programs. The Communications Act and parts of the U.S. Constitution prohibit the FCC from censoring broadcast content. These considerations limit the FCC's role in overseeing the content of programming. But the FCC is permitted to levy fines on a station or revoke its license if the station has violated any of the following three considerations:
- Restrictions on indecent programming
- Limits on the number of commercials aired during children's programming
- Rules involving candidates for public office
Other FCC Enforcement Functions
The FCC's authority differs greatly regarding standard broadcast television stations and other types of television channels such as cable television. Cable television channels are available by subscription only; they cannot be received over the air. Consequently, cable operators are subject to a different set of FCC rules than broadcast television stations. A broadcast television station on a cable system is regulated as a broadcast station.
The FCC enforces regulations designed to promote competition among cable companies, satellite companies, and other firms offering video programming services to the general public. This competition-promotion function includes a variety of issues such as the following:
- Commercial availability of set-top boxes
- Commercial leased access
- Mandatory carriage of television broadcast signals
- Open video systems
- Over-the-air reception devices
- Program access
- The accessibility of closed captioning and video description on television programming
More specific information about these functions can be found on the FCC's website, http://www.fcc.gov.
Problems with Cable Operators
Basically, decisions concerning what services to offer and most other programming decisions are within the discretion of the cable operator. The FCC is powerless to address most complaints against cable companies other than specific violations concerning indecent programming, the limit on the number of commercials aired during children's programming, and the rules involving candidates for public office.
Interference is occasionally a problem for cable subscribers. One common source of interference is home electronics equipment. To receive the clearest signals, the equipment must be adequately designed with circuitry or filtering technologies that reject unwanted signals emitted from nearby transmitters. The FCC recommends that users contact the manufacturer and/or the store where the equipment was purchased to resolve the interference problem.
If users have a complaint about cable rates or poor service, they should direct their communication to their local franchise authority. A franchising authority is the municipal, county, or other government organization that regulates certain aspects of the cable television industry at the local or state level. There are approximately 30,000 franchising authorities in the United States. The name of the franchising authority is often found on the front or back of a cable bill. If the name of the franchising authority is not on the bill, users can contact their cable company or their local town or city hall.
The cable television industry goes to great lengths to protect its programs from theft. Theft most often occurs when consumers are able to receive content over cable channels for which they have not paid in their subscription account. To block these signals, cable television firms encrypt or scramble their signals so that the subscriber receives only the services for which they have paid. Occasionally, some scrambling techniques employed by cable companies do not block the entire audio and video signals. "Signal bleed" occurs when consumers are able to view such inadequately blocked broadcast material. Signal bleed may cause concern for parents because it may permit children in homes with a cable subscription to view programming that contains objectionable material.
Blocking Programs or Channels
Cable television operators determine the channels that are available on their cable systems. To help increase the number of subscribers, a cable operator will select channels that appear likely to attract a broad spectrum of viewers. Because of this, a cable subscriber may receive programs as part of a programming package that he or she does not wish to view.
Federal law now requires broadcasters of most programming available on television to alert viewers if a program contains violence, inappropriate language, or other material that a viewer may find offensive. Generally, the broadcaster and not the cable operator is responsible for the programming that is shown on a particular channel. The cable operator usually does not have the right to prevent the transmission of a program containing objectionable material. Individual subscribers, however, have two important tools that they may use to prevent programs or channels from being viewed on their television sets.
- Lockboxes. These are devices a subscriber may buy or LEASE from the subscriber's cable company. They are also available from some retail electronic stores. A lock-box can literally lock particular channels so that the programming cannot be viewed.
- V-chip. A V-chip is circuitry in a television capable of identifying governmental ratings and blocking the programming that an individual finds inappropriate. Depending on its technical specifications, the V-chip may block individual programs, or it may be used to block one or more channels entirely. All television screens that are 13-inches or larger and that are manufactured or imported for use in the United States are required by law to be equipped with the V-chip. The law required manufacturers to produce 50% of their televisions with the V-chip by 1999, and the remaining 50% were to contain the v-chip by 2000. Televisions not equipped with a V-chip may be fitted with one.
The Satellite Home Viewer Improvement Act of 1999
The Satellite Home Viewer Improvement Act of 1999 (SHVIA) provides significant modifications to the Satellite Home Viewer Act of 1988, the Communications Act, and the U.S. COPYRIGHT Act. SHVIA was enacted to promote competition among multi-channel video programming distributors. These include satellite companies and cable television operators. It was also intended to encourage an increase in programming choices.
SHVIA allows satellite companies to broadcast local TV signals to their subscribers who live in the local TV station's market. SHVIA also allows satellite companies to provide "distant" network broadcast stations to certain eligible satellite subscribers. The satellite company has the option of providing local TV signals into a local TV station's market, but it does not have to do so. Some satellite companies have opted to provide this service in some viewing markets. Users can contact their satellite company to determine whether and when the service is available in their market.
Generally, users may install a satellite dish that is 1 meter (39.37 inches) or less on their own property or property on which they have the exclusive use, such as leased or rented property. In Section 207 of the Telecommunications Act of 1996, Congress adopted the Over-the-Air Reception Devices Rule. This rule applies to governmental and nongovernmental restrictions imposed on a consumer's ability to receive video programming signals from direct broadcast satellites, wireless cable providers, and television broadcast stations. The rule outlaws restrictions intended to prevent a consumer from installing, maintaining, or using an antenna. The rule applies to a broad range of potential regulatory bodies, laws, or regulations:
- Building regulations
- Condominium or cooperative association restrictions
- Homeowner association rules
- Land-use regulations
- Lease restrictions
- Other restrictions on property within the exclusive use or control of the antenna user where the user has an ownership or leasehold interest in the property
- Private covenants
- Zoning regulations
There is a three-part test to determine whether a particular restriction is illegal under the rule. It must:
- Unreasonably delay or prevent the use of the antenna
- Unreasonably increases the cost of the antenna or service
- Prevent a person from receiving or transmitting an acceptable quality signal
The rule does not prohibit restrictions based on legitimate safety concerns, nor does it prohibit restrictions intended to preserve designated or eligible historic or prehistoric properties. In such cases, the restriction must be no more burdensome than necessary to accomplish its safety or preservation purposes.
Some Activities Not Regulated by the FCC
The FCC licenses individual stations only; it does not license radio or television networks, which are organizations composed of multiple stations. Examples of networks include ABC, NBC, CBS, and Fox. The FCC does license the owners of particular stations within those networks. The FCC does not regulate information provided over the Internet.
The FCC cannot regulate closed-circuit radio or television, which means that it cannot control what is carried over closed-circuit systems in, for example, department stores, airports, or casinos. Additionally, the FCC has no authority over the following:
- Promoters of prizefights
- Sports teams or leagues
Arrangements for broadcasting these events and other exhibitions are made privately between owners of the rights (such as sports teams or leagues) and the stations and/or network involved.
Finally, the FCC cannot regulate:
- Companies that measure the size and other characteristics of radio and TV audiences
- Music-licensing organizations
- News-gathering organizations (Like AP or UPI) that provide stations with news and comment
- Record companies
- The manufacture and distribution of audio and video recordings
- The production, distribution and rating of motion pictures
- The publishing of newspapers, books, or other printed material
American Broadcast Regulation and the First Amendment: Another Look. Tillinghast, Charles H., Iowa State University Press, 2000.
The Cable and Satellite Television Industries. Parsons, Patrick R., Robert M. Frieden, and Rob Frieden, Allyn & Bacon, 1997.
"Consumer & Governmental Affairs Bureau." Available at http://www.fcc.gov/cgb/consumers.html. Federal Communications Commission, 2002.
The First Amendment and the Fifth Estate: Regulation of Electronic Mass Media. 5th ed., Carter, T. Barton, Marc A. Franklin, and Jay B. Wright. Foundation Press, 1999.
Satellite Communications Regulations in the Early 21st Century: Changes for a New Era. Salin, Patrick-André, M. Nijhoff, 2000.
Selling the Air: A Critique of the Policy of Commercial Broadcasting in the United States. Streeter, Thomas, University of Chicago Press, 1996.
Telecommunications Law and Policy. Benjamin, Stuart Minor, Douglas Gary Lichtman, and Howard A. Shelanski, Carolina Academic Press, 2001.
Video Scrambling & Descrambling for Satellite & Cable TV. Graf, Rudolf F., and William Sheets, Newnes, 1998.
Advanced Television Systems Committee (ATSC)
1750 K Street NW, Suite 1200
Washington, DC 20006 USA
Phone: (202) 828-3130
Fax: (202) 828-3131
Federal Communications Commission (FCC)
445 12th Street, SW
Washington, DC 20554 USA
Phone: (888) 225-5322
Fax: (202) 418-0232
National Telecommunications and Information Administration (NTIA)
1401 Constitution Ave.,
NW Washington, DC 20230 USA
Phone: (202) 482-7002
North American Association of Telecommunications Dealers (NATD)
1045 E. Atlantic Avenue, Suite 206
Delray Beach, FL 33483 USA
Phone: (561) 266-9440
Fax: (561) 266-9017
Satellite Industry Association (SIA)
225 Reinekers Lane Suite, 600
Alexandria, VA 22314 USA
Phone: (703) 549-6990
Fax: (703) 549-7640
Telephone (Encyclopedia of Everyday Law)
Invented by Alexander Graham Bell in 1876, the original telephone was described as a mere improvement upon the magnetic telegraph, which sent data as fast as electrons could move along wires. Unlike telegraph companies, however, telephone companies do not receive, transmit, or deliver messages in the ordinary sense of these terms. Instead, telephone companies furnish customers with networks, facilities, and devices through which conversations can take place over long distances.
The telephone-services sector began to develop in the late nineteenth century when several PATENTS registered by Bell began to expire, while independent local telephone companies began to proliferate in major cities. At first, telephone service in the United States was predominantly local because satisfactory technology for transmitting long-distance calls did not exist. However, American telephony witnessed an explosion in technological innovations during the early twentieth century, including the invention of a "vacuum tube," which allowed phone conversations to be transmitted over distances of several miles.
The Bell telephone companiesnder the parentage of the American Telephone and Telegraph Company (AT&T)atented and deployed this technology across state lines. But they typically refused to allow independent telephone companies to interconnect with their long-distance service. As a result of this handicap and the intense price competition with the Bell companies, many independent telephone service providers chose to sell their companies to AT&T. By the advent of the 1930s, AT&T controlled approximately 80% of local exchange lines in the United States. These practices placed AT&T in the cross hairs of antitrust authorities, who convinced Congress of the need for regulation in this area.
The Communications Act of 1934
After conducting a series of hearings on AT&T's growing dominance over American telephoning, Congress determined that AT&T and its competitors were public service CORPORATIONS whose facilities and instruments were devoted to public use, which made them subject to two kinds of legislative control, state and federal. States may regulate the transmission of telephone communications wholly within state BOUNDARIES, Congress said, so long as such intrastate communications do not substantially affect interstate commerce. Once a telephone communication crosses state boundaries or substantially affects commerce in more than one state, Congress observed, the Commerce Clause of the U.S. Constitution gives only federal authorities the power to regulate such interstate communications. U.S.C.A.Const.Art. I, section 8, clause 3. Congress formalized these findings in the Communications Act of 1934.
The Communications Act of 1934 establishes a dual system of state and federal regulation for telecommunications services. 47 USCA sections 151 et seq. The act grants the FCC broad authority, but also clearly delineates a strict separation between inter-state and intrastate JURISDICTION, and denies the FCC authority over most intrastate communications. The act also establishes the Federal-State Communications Joint Board to hear disputes that involve questions concerning both interstate and intrastate telephone transmissions, and any other telecommunications dispute deemed to involve a mixture of state and federal concerns.
In determining whether the FCC has jurisdiction to regulate a particular telephone service provider, the focus is on the nature of the service at issue, since the FCC may regulate telephone services only to the extent of their interstate use. However, purely intrastate telephone facilities and services that are used to complete even a single interstate call can fall under FCC jurisdiction depending on the nature of that phone call. Thus, the FCC has authority to regulate use of an intrastate call made on a Wide Area Telecommunications Service (WATS) when that service is used as part of an interstate communications network. National Association of Regulatory Utility Commissioners v. F.C.C., 746 F.2d 1492 (D.C. Cir. 1984). Similarly, where a telephone company has all of its facilities within one state and solely engages in intrastate telephone communication except for its physical connection with carriers doing business in other states, it is still subject to federal regulation under the Communications Act as a connecting carrier. At the same time, the FCC does not have authority to order connecting carriers to continue interconnection agreements with interstate telecommunication service providers. Accordingly, connecting carriers are free to remove their interconnection with any interstate carrier, and thereby remove themselves completely from jurisdiction of the FCC.
Recent Amendments to the Communications Act of 1934
Telephone companies that are subject to federal jurisdiction under the Communications Act are also subject to any other applicable laws, regulations, or rules enacted by Congress or promulgated by a federal agency. On three occasions during the 1990s Congress amended the Communications Act of 1934, updating its provisions in light of technological developments and market conditions. In 1991 Congress passed the Telephone CONSUMER PROTECTION Act (TCPA) to give Americans greater freedom at home from unsolicited commercial advertisements. 47 U.S.C.A. section 227. The TCPA generally imposes restrictions on unsolicited advertisements made through automatic telephone dialing systems, artificial or prerecorded voice messages, and telephone facsimile machines.
The FCC began fleshing out these restrictions when it promulgated a regulation requiring telemarketers to create do-not-call lists for consumers who ask not to receive further SOLICITATION. The FCC also limited the hours during which telemarketers may call a consumer's residence (not prior to 8 a.m. or after 9 p.m.). Additionally, the FCC issued a rule flatly prohibiting the transmission of unsolicited advertisements via telephone facsimile machines. Finally, the FCC published a regulation requiring all artificial or prerecorded messages delivered by an auto-dialer to clearly identify the caller at the beginning of the message.
In 1992 Congress again amended the Communications Act of 1934, when it passed the Telephone Disclosure and Dispute Resolution Act (TDDRA). 15 U.S.C.A. section 5701. The TDDRA regulates how telephone carriers may offer pay-per-call services (e.g., 900 numbers), and prohibits unfair and deceptive practices undertaken by telephone carriers in connection with pay-per-call services, including misleading and FRAUDULENT billing and collection practices.
Specifically, the TDDRA provides that any inter-state telephone service, other than a telephone company directory assistance service, that charges consumers for information or entertainment must be provided through a 900 number unless it is offered under what is termed a "pre-subscription or comparable arrangement." That pre-subscription or comparable arrangement may be a preexisting contract by which the caller has "subscribed" to the information or entertainment service. The arrangement may also be made through the caller's authorization to bill an information or entertainment service call to a prepaid account or to a credit, DEBIT, charge, or calling card. Telephone companies may not disconnect local or long-distance telephone service for failure to pay 900 number charges, and must offer consumers the option of blocking access to 900 number services if technically feasible. Telephone companies that bill consumers for pay-per-call and pre-subscribed information or entertainment services must show those charges in a portion of the bill that is separate from local and long-distance charges.
Despite increased regulation at the federal level, the telephone service market in the United States remained largely monopolistic for most of the twentieth century, continuing to be dominated by a few small companies in each region of the country. Congress attempted to increase competition by passing the Telecommunications Act 1996 (the "1996 Act"), which allows multiple "local exchange carriers" (LECs) to compete for customers. 1996 Pub.L. No. 104-104. The 1996 Act amends the 1934 Act by distinguishing between incumbent LECs (ILECs) and competing LECs (CLECs). ILECs are existing telephone service providers that have established a telecommunications network in a given market. CLECs are telephone service providers that seek access to an ILEC's market.
One way in which the 1996 Act attempts to improve competition is through "interconnection agreements" and "reciprocal compensation agreements." 47 U.S.C.A. section 251. "Interconnection agreements" require ILECs to make their telecommunications networks available (via purchase or LEASE) to CLECs so that a phone call initiated by the customer of an ILEC may be connected to the customer of a CLEC, and vice versa. "Reciprocal compensation agreements" require the carrier for the customer who initiates a phone call to share some of its revenues from that call with the carrier of the customer who receives the call (the telecommunications industry describes the LEC of the customer who receives the call as the one that "terminates" the call and not the one that "receives" it). These requirements were challenged and upheld in federal court on two separate appeals, and are now under consideration by the U.S. Supreme Court. Illinois Bell Telephone Co. v. Worldcom Technologies, Inc., 179 F.3d 566 (7th Cir. 1999); Bell Atlantic Maryland, Inc. v. MCI WorldCom, Inc., 240 F.3d 279 (4th Cir. 2001). In a related case, the U.S. Supreme Court upheld FCC rules that require ILECs to lease their networks to competitors at heavily discounted rates. Verizon Communications, Inc. v. F.C.C., U.S., S.Ct. , L.Ed.2d , 2002 WL 970643 (U.S., May 13, 2002).
State Regulation of Telephone Companies and Services
State law regulates intrastate telephone services that do not substantially affect interstate commerce. It is the policy of each state to protect the PUBLIC INTEREST in having adequate and efficient telecommunications services available to every state resident at a just, fair, and reasonable rate. To carry out this policy and to regulate rates, operations, and services, state public utility commissions (PUCs) have the general power to regulate and supervise the business of each public utility within its jurisdiction and to do anything that is necessary and convenient in the exercise of its power. For example, state PUCs are typically given exclusive jurisdiction to determine whether a telephone utility should be permitted to close a business office in a given community.
PUCs are also commonly charged with the exclusive responsibility to enhance competition by adjusting regulation to match the degree of competition in the marketplace so that costs associated with running a utility do not deter new telephone service providers from entering the market. State PUCs must ensure that telephone rates are not unreasonably preferential, prejudicial, predatory, or discriminatory and are applied equitably and consistently throughout its jurisdiction. Additionally, PUCs may supplement federal law by enacting their own rules and regulations governing pay-per-call services, unsolicited advertisements, automatic dial announcing devices, or any other feature of local telephone service that might adversely affect consumers.
An individual, partnership, or corporation may not normally offer local telephone service without complying with PUC rules and regulations. In most states, the PUC requires that before a telephone company may provide local service each company must obtain (1) a certificate of convenience and necessity; (2) a certificate of operating authority; or (3) a service provider certificate of operating authority. PUCs may revoke or amend a certificate of convenience and necessity, a certificate of operating authority, or a service provider certificate of operating authority after notice and HEARING if it finds that the certificate holder has never provided or is no longer providing service in all or any part of the certificated area. PUCs may also require one or more public utilities to provide service in an area affected by the revocation or amendment of a certificate held by a public utility.
Organized for public purposes to more efficiently serve its customers, telephone companies are usually granted special privileges and powers in addition to those that they possess as private corporations. For example, telephone corporations, telephone cooperatives, and foreign telephone companies are often given the power of eminent domain, which gives these entities a right-of-way to erect, construct, and maintain necessary stations, plants, equipment, or lines upon, through, or over private land. The delegation of the state's power of eminent domain has been held valid because of the public good derived from installing telecommunications systems on private property.
On the other hand, local telephone companies have no absolute right to use city streets to erect telephone poles or configure their facilities and networks. Instead, telephone companies must first obtain consent from the municipal authorities of the city in which they are seeking to provide telephone service. This consent is commonly manifested by the grant of a franchise from the governing municipal authority, and PUCs should not unreasonably restrict the rights and powers of municipalities in granting or refusing a telephone company the right to use city streets. However, cities, towns, and villages have no right to deny telephone companies all use of their streets, and when a municipal corporation unlawfully rejects a telephone company's application to erect poles and string wires along certain public streets, it abandons the right to prescribe the streets on which the line will be constructed.
American Jurisprudence. St. Paul: West Group, 1998
West's Encyclopedia of American Law. St. Paul: West Group, 1998
Federal Communications Commission
445 12th Street S.W.
Washington, DC 20554 USA
Phone: (888) 225-5322
Fax: (202) 835-5322
Primary Contact: Michael K. Powell, Chairman
Public Utility Commission of Texas
1701 N. Congress Avenue
Austin, TX 78711-3326 USA
Phone: (512) 936-7000
Primary Contact: Lane Lanford, Executive Director
Television (Encyclopedia of Everyday Law)
American businesses pour billions of dollars each year into marketing their services and products on television. Transmitted to viewers through electro-magnetic airwaves, satellite feeds, optical fibers, and cable lines, television programming often transcends state lines. The interstate character of this commercial activity brings regulation of television within the purview of the Commerce Clause of the U. S. Constitution. U.S.C.A. Const. Art. I, section 8, cl. 3. Under the Commerce Clause, federal courts have ruled that Congress has the power to regulate "radio communications," including the power to control the number, location, and activities of broadcasting stations around the country. Technical Radio Laboratory v. Federal Radio Commission, 36 F.2d 111 (App. D.C. 1929).
Pursuant to this power Congress passed the Communications Act of 1934, which expanded the definition of "radio communication" to include "signs, signals, pictures, and sounds of all kinds, including all instrumentalities, facilities, apparatus, and services . . . incidental to such transmission." 47 U.S.C.A. sections 151 et seq. With the advent of television in the late 1930s and its growth in popularity during the 1940s and 1950s, "radio communication" was eventually interpreted to encompass television broadcasts as well. Connecticut Committee Against Pay TV v. Federal Communications Commission, 301 F.2d 835 (D.C. Cir. 1962).
The rapid growth of telecommunications also prompted Congress to create the Federal Communications Commission (FCC), an EXECUTIVE BRANCH agency charged with overseeing the telecommunications industry in the United States. The FCC has exclusive JURISDICTION over granting, denying, reviewing, and terminating television broadcast licenses. The FCC is also responsible for establishing guidelines, promulgating regulations, and resolving disputes involving various broadcast media. In 1978 Congress established the National Telecommunications and Information Administration (NTIA) to serve as the policy arm for federal regulation of telecommunications. Together with the FCC, the NTIA formulates and presents official White House positions on a variety of domestic and international telecommunication-related issues.
Fueled in part by growing public sentiment against the increasingly violent nature of television programming, NTIA and FCC officials recommended that federal law give parents greater control over the programming viewed by their children. Congress responded by enacting the Telecommunications Act of 1996, which introduced a ratings system that requires television shows to be rated for violence and sexual content. PUBLIC LAW 104-104, February 8, 1996, 110 Stat 56. The act also created the so-called V-chip, a receptor inside television sets that gives parents the ability to block programs they find unsuitable for their children. Under the act, authority to establish TV ratings is given to a committee comprised of parents, television broadcasters, television producers, cable operators, PUBLIC INTEREST groups, and other interested individuals from the private sector.
Federal regulation of television broadcasting preempts any conflicting state or local regulation. However, the federal government's power to regulate television is not absolute. In regulating television, both Congress and the FCC must do so to advance the public interest. Congress and the FCC also must be sensitive to First Amendment concerns. Television broadcast companies are entitled to exercise robust journalistic freedom that is consistent with the right of the public to participate in a diverse marketplace of ideas, a marketplace that itself is tempered by appropriate social, political, esthetic, moral, and cultural values. CBS, Inc. v. F. C. C., 453 U.S. 367, 101 S. Ct. 2813, 69 L. Ed. 2d 706 (1981).
Regulation of Television Broadcast Licenses
The Communications Act of 1934 confers upon the FCC the sole authority to examine applications for television broadcast licenses and to grant, refuse, or revoke them as the public interest, convenience, or necessity requires. Each license granted for the operation of a television station lasts for a term of not to exceed eight years and may be renewed for a term of not to exceed eight years, measured from the expiration date of the preceding license.
The FCC has broad discretion to establish the qualifications for applicants seeking a television broadcast license and for licensees seeking renewal. The FCC has exercised this discretion to prescribe an assortment of qualifications relating citizenship, financial SOLVENCY, technical prowess, and moral character, among other criteria the commission has deemed relevant in determining the fitness of particular applicants to run a television station. The FCC will also compare the programming content proposed by an applicant to the content of existing programming. The FCC favors applicants who will make television entertainment more diverse and competitive.
To limit the concentration of power in television broadcast rights, the FCC has promulgated rules restricting the number of television stations that a licensee may operate. An applicant who has reached the limit may seek an amendment, WAIVER, or exception to the rule, and no licensee may be denied an additional license until he or she has been afforded a full HEARING on the competing public interests at stake. Applicants or licensees who are dissatisfied with a decision issued by the FCC may seek review from the U. S. Court of Appeals for the District of Columbia Circuit, which has exclusive jurisdiction over appeals concerning FCC decisions granting, denying, modifying, or revoking television broadcast licenses. 47 U.S.C.A. section 402(b). Decisions rendered by the D. C. Circuit are appealable to the U. S. Supreme Court.
The FCC is authorized to assess and collect a schedule of license fees, application fees, equipment approval fees, and miscellaneous regulatory assessments and penalties to cover the costs of its enforcement proceedings, policy and rulemaking activities, and user information services. The commission may establish these charges and review and adjust them every two years to reflect changes in the CONSUMER PRICE INDEX. Failure to timely pay a fee, ASSESSMENT, or PENALTY is grounds for dismissing an application or revoking an existing license.
Content Regulation: The Fairness Doctrine
The original rationale for federal regulation of telecommunications was grounded in the finite number of frequencies on which to broadcast. Many Americans worried that if Congress did not exercise its power over interstate commerce to fairly allocate the available frequencies to licensees who would serve the public interest, then only the richest members of society would own television broadcast rights and television programming would become onedimensional, biased, or slanted. Only by guaranteeing a place on television for differing opinions, some Americans contended, would the truth emerge in the marketplace of ideas. These concerns manifested themselves in the FAIRNESS DOCTRINE.
First fully articulated in 1949, the Fairness Doctrine had two parts: it required broadcasters to (1) cover vital controversial issues in the community; and (2) provide a reasonable opportunity for the presentation of contrasting points of view. Violation of the doctrine could result in a broadcaster losing its license. Not surprisingly, licensees grew reluctant to cover controversial stories out of fear of being punished for not adequately presenting opposing views. First Amendment advocates decried the Fairness Doctrine as chilling legitimate speech. The doctrine came under further scrutiny in the 1980s when the explosion of cable television stations dramatically expanded the number of media outlets available.
In 1987 the FCC abolished the Fairness Doctrine by a 4-0 vote, concluding that the free market and not the federal government is the best regulator of news content on television. Individual media outlets compete with each other for viewers, the FCC said, and this competition necessarily involves establishing the accuracy, CREDIBILITY, reliability, and thoroughness of each story that is broadcast. Over time the public weeds out news providers that prove to be inaccurate, unreliable, one-sided, or incredible.
Content Regulation: Rules Underlying the Fairness Doctrine
Despite the death of the Fairness Doctrine in 1987, two underlying rules that were developed during its existence remained in effect for another 13 years: the personal attack rule and the political editorial rule. The personal attack rule required broadcast licensees to notify persons who were maligned or criticized during their station's coverage of a controversial public issue and allow the attacked persons to respond over the licensees' air waves. If the attack was made upon the honesty, character, or integrity of another person, the licensee was required to provide a script or tape of the attack to the person identified before giving that person a reasonable opportunity to respond. The political editorial rule afforded political candidates notice of and opportunity to respond to editorials opposing them or endorsing another candidate.
These rules were called into question by a federal court that ordered the FCC to either provide a detailed justification for their continued application or abandon them. Radio-Television News Dirs. Ass'n v. FCC, 229 F.3d 269 (D.C. Cir. 2000). Initially, the FCC suspended the rules on a temporary basis, while it discussed the rules' usefulness. Based on these preliminary discussions, the commission formally repealed both rules on October 26, 2000. Notwithstanding the REPEAL, the FCC has since scheduled hearings to revisit whether these rules might still serve the public interest.
Although the demise of the Fairness Doctrine and its underlying rules have given broadcasters greater control over the content of their programming, broadcasters still may not discriminate among candidates for public office. Once a broadcaster permits one candidate for public office to use its facilities, it must afford equal opportunities to all other candidates for the same office. Broadcast stations that willfully or repeatedly fail to provide a legally qualified candidate for elective office reasonable access to their airwaves may subject themselves to sanctions, including revocation of their licenses. The FCC "equal time" provisions apply only to the candidates themselves and not to appearances made by campaign managers or other supporters. The determination of what constitutes a legally qualified candidacy is made by reference to state law.
Content Regulation: Indecency
Within the universe of First Amendment protection, broadcast radio and television stations have been subjected to greater regulation than any other verbal, visual, or printed medium of expression. The licensing process by itself gives the federal government more power over the content of television and radio broadcasts than it has over any print medium. Radio and television stations have been required to carry public service messages that they might not otherwise have chosen to carry, and they have been subjected to censure for broadcasting materials that would not have been punishable if they had been published in another medium.
The United States Code prohibits the broadcast of any material that is "obscene, indecent, r profane," but offers no definition for those terms. 18 U.S.C.A. section 1464. Instead, that task is left to the FCC through its rulemaking and adjudicatory functions. In 1978 the U. S. Supreme Court upheld an FCC order finding that a pre-recorded satirical monologue violated this prohibition by making repeated use of seven "dirty words" during an afternoon broadcast. F. C. C. v. Pacifica Foundation, 438 U.S. 726, 98 S.Ct. 3026 57 L.Ed.2d 1073 (1978). The Supreme Court acknowledged that the monologue was not obscene and thus could not have been regulated had it been published in print. But the Court distinguished broadcast media from print media, pointing out that radio and television stations are uniquely pervasive in Americans' lives, and are easily accessible by impressionable children who can be inadvertently exposed to offensive materials without adult supervision. Print media, the Court said, do not intrude upon Americans' privacy to the same extent or in the same manner. Thus, the Court concluded that the FCC could regulate indecent speech on radio and television but cautioned that the commission must do so in a manner that does not completely extinguish such speech.
The FCC order had defined indecent speech as "language that describes, in terms patently offensive as measured by contemporary community standards for the broadcast medium, sexual or excretory activities and organs, at times of the day when there is a reasonable risk that children may be in the audience." In the Matter of a Citizen's Complaint against the Pacifica Foundation, 56 F. C.C.2d 94 (1975). As cable television gained prominence during the 1980s, it became unclear whether the FCC's prohibition applied to this burgeoning medium. Cable operators do not use broadcast spectrum frequencies, but they are licensed by local communities in the same way broadcast television station operators are licensed by the FCC. Moreover, cable operators partake in the same kind of First Amendment activities as do their broadcast television counterparts.
Congress tried to clarify the responsibilities of cable operators when it passed the Cable Television CONSUMER PROTECTION and Competition Act of 1992 (CTCPCA). 47 U.S.C.A. section 521 et seq. CTCPCA authorized cable channel operators to restrict or block indecent programming. The authorization applied to leased access channels, which federal law requires cable systems to reserve for LEASE by unaffiliated parties, and public access channels, which include educational, governmental, or local channels that federal law requires cable operators to carry. Cable operators claimed that the STATUTE was fully consistent with the First Amendment because it left judgments about the suitability of programming to the editorial discretion of the operators themselves. But cable television viewers filed a lawsuit arguing that the statute violated the First Amendment by giving cable operators absolute power to determine programming content.
In 1996 the case was appealed to the U. S. Supreme Court, which issued an opinion that was as badly divided as the litigants. Denver Area Educational Telecommunications Consortium, Inc. v. F.C.C., 116 S. Ct. 2374, 135 L. Ed. 2d 888 (U.S. 1996). In handing down its 5-4 decision, the Court first noted that cable television shares the same characteristics of broadcast television that were discussed in the Pacifica case, namely that it is uniquely pervasive, is capable of invading the privacy of viewers' homes, and is easily accessible by children. Despite the similarities, the Court held that CTCPCA had violated the First Amendment by giving cable operators the power to prohibit patently offensive or indecent programming transmitted over public access channels. The court reasoned that locally accountable bodies comprised of community members are better capable of addressing programming concerns, and thus creating a "cable operator's veto" was not the least restrictive means of addressing the appropriateness and suitability of cable television programming.
With respect to leased access channels, the Court ruled that CTCPCA also violated the First Amendment by requiring cable system operators to segregate patently offensive programming on separate channels and then requiring the operators to block those channels from viewer access until individual cable subscribers requested access in writing. The Court said that these requirements had an obvious speech-restrictive effect on viewers and were not narrowly or reasonably tailored to protect children from exposure to indecent materials. The Court cited the V-chip, discussed above, as one less restrictive means of accomplishing the same objective.
The Court's divisive opinion in Denver Area Educational Telecommunications Consortium answered only the questions presented about the constitutionality of CTCPCA. Congress and the FCC continue to hold hearings and investigate alternative ways to effectively regulate cable and broadcast television content without running afoul of the First Amendment. At the same time, the telecommunications industry continues to develop new ways to transmit programming into would-be viewers' homes. Accordingly, the law in this area of telecommunications remains in flux.
Regulation of Advertising
The law governing television advertising is more settled. The First Amendment permits governmental regulation of television advertising and other forms of commercial speech so long as the government's interest in doing so is substantial, the regulations directly advance the government's asserted interest, and the regulations are no more extensive than necessary to serve that interest. This test affords advertisers more First Amendment protection than does the public-interest test under which federal courts review most FCC content-related regulations. In a free enterprise system the law recognizes that consumers depend on unfettered access to accurate and timely information regarding the quality, quantity, and price of various goods and services.
Conversely, society is not served by false, deceptive, or harmful advertisements, and thus regulations aimed at curbing such advertising are typically found to serve a substantial governmental interest. The best example involves the federal ban on cigarette advertising. In 1967 the FCC acted upon citizen complaints against the misleading nature of tobacco advertisements by implementing a rule that required any television station carrying cigarette advertisements to also air public service announcements addressing the health risks posed by tobacco. This rule was upheld in Banzahf v. FCC, 405 F.2d 1082 (D.C. Cir 1968). Two years later Congress intervened by passing the Public Health and Cigarette Smoking Act of 1969, which banned all electronic advertising of cigarettes as inherently misleading and harmful. Pub. L. No. 91-222, 84 Stat. 87. The act took effect in 1971 and survived a court challenge that same year. Capital Broadcast. Co. v. Mitchell, 333 F. Supp. 582 (D.D.C. 1971), aff'd mem, 405 U.S. 1000, 92 S.Ct. 1289, 321 L. Ed.2d 472 (1982). The law remains in effect today.
Unlike other areas of telecommunications law, Congress has allowed states to adopt their own regulations governing false and deceptive advertising. Many states have responded by adopting the Uniform Deceptive Trade Practices Act (UDTPA), which prohibits three specific types of representations: (1) false representations that goods or services have certain characteristics, ingredients, uses, benefits, or quantities; (2) false representations that goods or services are new or original; and (3) false representations that goods or services are of a particular grade, standard, or quality. Under the UDTPA, liability may arise for advertisements that are only partially accurate, if the inaccuracies are likely to confuse prospective consumers. Ambiguous representations may require clarification to prevent the imposition of liability. For example, a business that accuses a competitor of being "untrustworthy" may be required to clarify that description with additional information if consumer confusion is likely to result.
American Jurisprudence. West Group, 1998.
http://caselaw.lp.findlaw.com/data/constitution/amendment01 U..S. Constitution: First Amendment.
West's Encyclopedia of American Law. West Group, 1998.
Federal Communications Commission
445 12th Street S.W.
Washington, DC 20554 USA
Phone: (888) 225-5322
Fax: (202) 835-5322
Primary Contact: Michael K. Powell, Chairman
Free Speech Coalition
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Washington, DC 64196 USA
Phone: (202) 638-1501
Fax: (202) 662-1777
Primary Contact: Jeffrey Douglas, Director
National Telecommunications and Information Administration
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Primary Contact: Sheila Williams, Secretary