FCC Adopts New Rules for Broadcast Internet Services

The FCC has continued its rule modifications to support the roll out and full use of ATSC 3.0, and in its latest efforts, has adopted new rules governing the provision of ancillary and supplementary services, whether those services are provided using the ATSC 1.0 standard or the new IP-based ATSC 3.0 standard.

As a reminder, ancillary or supplementary services are all services provided on that portion of a TV station’s digital spectrum capacity or bitstream not needed to provide the required one free, over-the-air video broadcast signal to viewers, except that any video broadcast signal provided at no direct charge to viewers shall not be considered ancillary or supplementary. Ancillary or supplementary services include, but are not limited to, computer software distribution, data transmissions, teletext, interactive materials, aural messages, paging services, audio signals, or subscription video.  Video content aired on a multicast channel that is free to viewers is not ancillary or supplementary.  Stations that do provide ancillary or supplementary services have to remit 5% of revenues received from such services to the FCC by December 1^st of each year.

In the Report & Order, the FCC clarified how the 5% fee is to be calculated when a station is leasing spectrum to third parties providing ancillary/supplementary services, noting that the lessee’s revenue is not to be included as revenue in the 5% calculation unless the licensee and lessee are related.  In addition, for NCE TV stations, the FCC decided that non-profit ancillary or supplementary services would only carry an annual fee of 2.5%.

The FCC reiterated that the requirement remains for TV stations to continue to offer at least one free over the air standard definition signal (i.e., a station can’t offer all ancillary or supplementary services).