Politics and Technology

It kind of went unnoticed given all of the commotion at the Federal Communications Commission’s (FCC) open meeting on October 27 about the Universal Service Fund (USF) and Intercarrier Compensation System (ICC) reform. However, on the same day they put another kettle on the stove to boil in the form of a request for comment on rules that would require TV broadcasters to put their files online, including for political ads. It took a while but it too is now at a boil.

The issue

As part of its charter in overseeing the use of the public airwaves, the FCC (News - Alert) over the years has imposed a variety of rules regarding broadcaster obligations to serve the public interest as requisite in the licensing/re-licensing process. In regards to political campaigns for instance, stations are not allowed to discriminate in the prices they charge one campaign versus another. The issue is that, according to the National Association of Broadcasters (NAB), the records concerning political advertising change rapidly as elections approach and are kept in paper files.

The NAB says that for local broadcasters to convert these files for display online for the sake of transparency would be costly and time-consuming. Estimates are this could cost upwards of $24 million in year one and $15 million in following years. As an item on the subject on Adage quoted a recent letter from an NAB attorney to the FCC, "The political file must be very frequently updated, particularly during the periods close to local, state and federal elections…Developing a system of uploading, organizing, and ensuring timely online access to the political file presents a significant challenge." Needless-to-say, consumer groups disagree.

In fact, consumer groups still chaffing from the Supreme Court Citizens United decision that gave corporations and unions the ability to spend unlimited funds on political advertising and to do so anonymously think that transparency, disclosure and real-time access to information would be a good first step in reigning in the influence of such groups if they were known to the public.

Another side of this multi-headed hydra is that such transparency would be good for politicians who could have a better comfort level that the current lax system of regulation regarding campaign charges by broadcasters is being lived up to. The downside is that it would also be a great piece of competitive information in terms of what and where money is being spent and by whom.

There is also an issue, if the rules were to go into effect, as to who would have to pay for the institution of such a regime. Naturally, the industry feels it should be the FCC. As noted, this is coming to a boil.

Where we go from here

While the NAB reviews its response and promises vigorous participation in the item, as a result of the FCC’s vote to proceed with the proposal, the next steps are for it to be printed in the Federal Register in the next few days, at which point, there will be 30 days for public comment to aid the Commission in drawing up regulations.

Getting ready for battle

Without going into the flurry of comments on the subject, it is clear to see where the battle lines are going to be. The industry is going to complain about how onerous and costly this will be while consumer groups will question the justification for keeping this information private. What will be most interesting to watch will be how various groups — that currently can spend at will on political ads without identification of who they are and how much they are paying — will attempt to influence the process. While they are not stakeholders subject to FCC regulation, they certainly have a vested interest in the outcome of this proceeding.

The best that can be said about this is:

• It is a good thing the FCC is trying to get a jump on the issue far enough in advance of the 2012 elections, although even this could be problematic given possible court actions.
• If nothing else, it raises the entire issue of broadcaster obligations during political campaigns to the importance it deserves.

The publication of the request for comments should be fascinating.

Peter Bernstein is a technology industry veteran, having worked in multiple capacities with several of the industry's biggest brands, including Avaya, Alcatel-Lucent, Telcordia, HP, Siemens (News - Alert), Nortel, France Telecom, and others, and having served on the Advisory Boards of 15 technology startups. To read more of Peter's work, please visit his columnist page.