Catching Static

Satellite radio companies XM and Sirius come under fire for broadcasting local weather and traffic reports

From the Summer 2004 issue of The News Media & The Law, page 38.

By Corinna Zarek

It took more than 10 years of planning, petitioning and red tape for satellite radio to launch in the United States. However, certain broadcasts are now under threat of being grounded in battles over local programming.

In accordance with their licensing agreements with the Federal Communications Commission, the nation’s two satellite radio broadcasters — New York-based Sirius Satellite Radio and XM Satellite Radio, based in Washington, D.C. — must air all broadcasts nationally. The licensing agreements do not explicitly prohibit satellite broadcasters from airing local content; they only require that all broadcasts be transmitted nationally.

With the introduction this spring of city-specific, albeit nationally broadcast traffic and weather condition reports, XM and Sirius have come under fire for allegedly circumventing the implicit programming rule.

Lawmakers also are concerned that the satellite broadcasters will use their on-the-ground repeater towers — for re-transmitting satellite signals that are interrupted by tunnels or tall buildings — to air locally tailored broadcasts. In March, Rep. Chip Pickering (R-Miss.) introduced legislation to prevent the companies from airing differential broadcasts by requiring the FCC to revise its licensing rules.

Co-sponsored by Rep. Gene Green (D-Texas), bill H.R. 4026 is intended to maintain the “substantial governmental interest in promoting the continued availability of free radio programming.”

The bill, under review in the House Subcommittee on Telecommunications and the Internet as of early-August, further restricts the dissemination of local news by mandating that “digital audio radio satellite service licensees shall not . . . provide services that are locally differentiated or that result in programming being delivered to consumers in one geographic market that is different from the programming that is delivered to consumers in any other geographic market.”

Ron Rodrigues, a spokesperson for Sirius, said both satellite radio companies are already in compliance with the proposed requirements. Each satellite company operates terrestrial repeater towers throughout the U.S., but only to re-transmit interrupted signals due to tunnels or extremely large buildings. It’s those towers that have Pickering and others concerned.

According to First Amendment advocates, however, legislators and regulators should be fostering a competitive environment, allowing for the greatest amount of local content, rather than shutting speakers down.

“The FCC should encourage anyone who wants to offer local content to do so,” said Harold Feld, associate director of the Media Access Project, a group that promotes First Amendment broadcasting rights. “The more opportunity for people to hear local content over the public airwaves, the better.”

Broadcasters Battle

The FCC allocated licenses for satellite radio in 1995 and adopted rules two years later to govern the licensees. XM Radio first went on the air in 2001, followed by Sirius the following year.

For a monthly subscription fee of about $10, the companies’ combined 2.5 million subscribers can use their receivers to tune into approximately 100 commercial-free channels anywhere in the U.S. New car buyers can have XM or Sirius receivers installed directly as their car stereo system, and some rental car companies are now offering satellite radio as an option as well.

The XM and Sirius receivers, which come as car stereos, boom boxes and high-end home units, can also operate as traditional over-the-air AM and FM radios. Unlike traditional radio, however, satellite signals — broadcast directly from space to all receivers throughout the country — are almost never lost due to one’s geographic location.

It’s this innovation, as well as satellite radio’s growing number of subscribers, that has the National Association of Broadcasters concerned about the future of local news. In April, the trade association of over-the-air radio and television broadcasters petitioned the FCC to review whether the satellite companies are in violation of their licensing agreements by broadcasting city-specific traffic and weather channels.

“Our concern is purely based on the fact that they told the FCC one thing — that they would offer national programming — and by offering local weather and traffic they’ve gone against repeated filings with the FCC,” said Dennis Wharton, the NAB’s vice president for corporate communications. “It’s not consistent; it’s a matter of living up to their pledge.”

While all satellite broadcasts are aired nationally, the local reports still are inconsistent with the agreement the companies made with the FCC, he added.

“Certainly if not the letter of the law, the spirit of the rule has been broken,” Wharton said. “In our view, this ought to be a concern of a federal agency that asks its licensees to live up to an agreement.”

The FCC is generally technology neutral, and issues licenses when it determines allocation of a license or space on the spectrum to be in the public interest. A spokesperson for the FCC said the commission weighs public interest on a market-based approach, promoting competition and facilitating innovation.

Just prior to XM’s initial broadcasts, an FCC spokesperson told The Washington Post that the commission “‘did not specifically prohibit the provision of local weather and traffic information’ when it approved satellite radio service in 1997.”

The commission said it has received more than 25,000 public comments on the issue of city-specific national broadcasting as a result of the NAB petition. As of mid-July, the FCC had not released a ruling on the petition; no date has been set.

Nick Miller, a partner with the Washington, D.C., telecommunications firm Miller & VanEaton and a specialist in broadcasting issues, said the NAB has a “tough hill to climb.” The FCC does not often get into matters of localism, he said, and public interest groups and elected officials won’t likely oppose the reporting of traffic and weather news by satellite radio companies if it’s in their communities.

“Generally speaking,” Miller said, “those folks would like any community-specific programming they can get their hands on.”

Chance Patterson, XM’s vice president for corporate affairs, said the NAB is being a “bully,” and called its lobbying to curb competition a “dubious effort.”

“It’s not the job of the NAB to decide what kind of content should be heard on the radio,” Patterson said. “Their method is to protect community programming by limiting speech and the kind of content that can be heard on a competitive medium.”

City-specific content, he added, is what those who subscribe to satellite radio want.

“It’s not as if this programming is only useful for people in particular cities,” Patterson said. “It is programming they might want anywhere if they are traveling.”

“We’re giving listeners what they’re asking for.”