Comminity Television v. FED. Commun. Comm'n

• Citation: 216 F.3d 1133
• Decision Date: 07 July 2000
• Docket Number: 99-1082,Nos. 98-1106,98-1212,98-1259,s. 98-1106
• Parties: (D.C. Cir. 2000) Community Television, Inc., et al.,Appellant/Petitioners v. Federal Communications Commission, Appellee/Respondent Paxson Communications Corporation, et al.,Intervenors Association for Maximum Service Television, Inc., et al., Intervenor
• Court: United States Courts of Appeals. United States Court of Appeals (District of Columbia)

Page 1133

216 F.3d 1133 (D.C. Cir. 2000)

Community Television, Inc., et al.,Appellant/Petitioners v. Federal Communications Commission, Appellee/Respondent

Paxson Communications Corporation, et al.,Intervenors

Association for Maximum Service Television, Inc., et al., Intervenor

Nos. 98-1106, 98-1212, 98-1259, 99-1082

United States Court of Appeals FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued March 27, 2000

Decided July 7, 2000

[Copyrighted Material Omitted]

Appeals and Petitions for Review of Orders of the Federal Communications Commission

John Griffith Johnson, Jr. argued the cause for petitioners. With him on the briefs were Gene A. Bechtel, Christopher D. Imlay, Stephen T. Yelverton, Arthur H. Harding, R. Bruce Beckner, Jill Kleppe McClelland, and Daniel R. Ball. Richard F. Swift entered an appearance.

Scott D. Dailard argued the cause for intervenors Paxson Communications Corporation, et al. With him on the briefs were John R. Feore, Jr., Barry A. Friedman and David M. Silverman.

C. Grey Pash, Jr., Counsel, Federal Communications Commission, argued the cause for appellee. With him on the brief were Christopher J. Wright, General Counsel, Daniel M. Armstrong, Associate General Counsel, Joel Marcus and K. Michele Walters, Counsel, Joel I. Klein, Assistant Attorney General, U.S. Department of Justice, Robert B. Nicholson and Adam D. Hirsh, Attorneys. Catherine G. O'Sullivan, and Christopher J. Sprigman, Attorneys, U.S. Department of Justice, entered appearances.

Jonathan D. Blake was on the brief for intervenor Association for Maximum Service Television, Inc.

Before: Edwards, Chief Judge, Henderson and Rogers, Circuit Judges.

Opinion for the Court filed by Circuit Judge Rogers.

Rogers, Circuit Judge:

Petitioners and intervenors ¹ seek review of the Federal Communications Commission's final rules establishing the procedures and timetable under which television broadcasting will migrate from the now-prevalent analog technology to digital technology. Digital technology holds the promise of either greatly enhancing the audiovisual quality of television broadcasts or of replicating current quality while liberating substantial portions of the broadcast spectrum for other uses. Because of the massive investment required by broadcasters and consumers, who must purchase digital televisions or converter devices, to accomplish the analog-to-digital transition, the rules under review provide for a ten-year transition period during which licensed broadcasters and those with permits to construct broadcast facilities as of August 3, 1997, have received an additional channel to commence digital broadcasting while continuing analog broadcasts during the transition. At the end of the transition period, analog transmissions will cease; broadcasters will retain their new digital channels and give back to the FCC their analog channels. Thus by statute, essentially all television broadcasting in the United States will be exclusively by digital technology as of December 31, 2006. See 47 U.S.C. § 309(j)(14)(A)-(B).

To plan for the transition, the FCC indisputably faced myriad policy choices and a daunting engineering task. Given the complexity and interdependence of the decisions the FCC had to make, the trade-offs among competing interests would be unlikely to satisfy all broadcasters and consumers. Remarkably then, only a few broadcasters, four petitioners supported by three intervenors, challenge the final rules now. They contend that the FCC acted unlawfully by: (1) granting a second channel to broadcasters whose construction permit applications had been approved by April 3, 1997, while denying a second channel to those whose applications had not been so approved; (2) allotting that second channel to replicate the area served as of April 3, 1997, even if the broadcaster had applied to expand the service area as of that date; (3) adopting and applying its "service replication" principle in a way that unfairly favored VHF broadcasters over UHF broadcasters; and (4) deleting Channel 29 in State College, Pennsylvania and redistributing that spectrum where a would-be broadcaster had sought to apply to operate Channel 29. While petitioners' challenges may be sympathetic, we conclude that the FCC's decisions were neither arbitrary, capricious, nor contrary to law, and accordingly, we deny the petitions for review.

I.

From its inception, the television broadcasting industry has relied on a common set of technical standards to maximize the availability of television. When the FCC made its first allotment of spectrum for broadcast television in 1941, it also adopted the basic engineering standards devised by the National Television System Committee for monochromatic (black-and-white) television service.² See Notice of Inquiry, In the Matter of Advanced Television Systems and Their Impact on the Existing Television Broadcast Service, 2 F.C.C.R. 5125, 5126 (1987). That standard, commonly referred to as NTSC, was revised in 1953 to allow for color television broadcasting, and again in 1984 to allow for broadcasts using stereophonic sound. Id. Relying on the NTSC standard, the FCC maintains the Television Table of Allotments, 47 C.F.R. § 73.606, which is the master plan for allocating NTSC television broadcast channels to communities throughout the country. See WITN-TV v. FCC, 849 F.2d 1521, 1522-23 (D.C. Cir. 1988). The Table of Allotments designates how many full service, low power, and television translator channels are assigned to each community, see 47 C.F.R. §§ 73.601, 73.606, and these designations distinguish between VHF ("very high frequency") Channels 2-13 and UHF ("ultra high frequency") Channels 14-69.

Although the NTSC standard proved to be workable for more than fifty years, in light of the development of new broadcasting technologies, the emergence of competing standards, and the growing popularity of cable television, members of the television broadcasting industry petitioned for a rule making in 1987 for the adoption of a new and improved standard for provision of "advanced" television, or "ATV".³The FCC obliged. See Notice of Inquiry, 2 F.C.C.R. 5125.The development of the rules under review illustrates the difficult policy issues and complex engineering challenges faced by the FCC. At the outset of the rule making proceeding, the FCC ordered a freeze on any amendments to the Television Table of Allotments and on all applications for construction permits for vacant television channels in the thirty busiest television markets in order to preserve its options for reallocating spectrum should that become necessary. See Advanced Television Systems, 776 Rad. Reg.2d (P&F) 843 (1987) ("Freeze Order"). By 1991, the FCC tentatively opined, and ultimately decided that: migration to a new standard would be in the public interest; the transition to a digital standard would not involve rededication of broadcast spectrum; incumbent broadcasters would be the parties best suited to implement the transition to a digital standard; a transition period during which NTSC broadcasts would continue would be necessary; and the width of a digital channel would not exceed the NTSC-standard width of 6 MHz. Notice of Proposed Rule making, 6 F.C.C.R. at 7024 ("NPRM").To carry out these policies, the FCC proposed to pair DTV channels with analog licenses, providing incumbent broadcasters with a second 6 MHz channel for digital broadcasts (a "DTV channel") without charge for use during the transition period to allow for both digital and NTSC broadcasts. Id. at 7025-26. In the period between the initial NPRM in 1991 and 1996, following a series of reports and orders and further notices of proposed rulemaking, the FCC's transition plan had been substantially developed.

Then, in 1996, Congress enacted the Telecommunications Act of 1996, Pub. L. No. 101-104, 110 Stat. 56 (1996) ("1996 Act"), preempting to a limited degree some FCC decisions related to the analog-to-digital transition. Thereafter the relevant decisions by the FCC occurred as follows: On July 25, 1996, the FCC adopted its Sixth Further Notice of Proposed Rule making, 11 F.C.C.R. 10968 (1996), in which it set forth the proposed DTV Table of Allotments showing which broadcasters would receive which DTV channels.⁴Then, on April 3, 1997, the FCC adopted two reports and orders that are directly at issue. In the Fifth Report and Order, 12 F.C.C.R. 12809 (1997), the FCC issued initial DTV licenses to incumbent broadcasters and set forth the timetable and terms under which the transition to DTV would take place. In the Sixth Report and Order, 12 F.C.C.R 14588 (1997), the FCC promulgated the final DTV Table and set forth its rationale for the decisions reflected therein. In response to petitions for reconsideration, the FCC reaffirmed, clarified, and, in some measure, revised its decisions in two rounds. See Memorandum Opinion and Order on Reconsideration of the Fifth Report and Order ("Service Reconsideration"), 13 F.C.C.R. 6860 (1998); Memorandum Opinion and Order on Reconsideration of the Sixth Report and Order ("Allotment Reconsideration"), 13 F.C.C.R. 7418 (1998); Second Memorandum Opinion and Order on Reconsideration of the Fifth and Sixth Report and Orders ("SMOOR"), 14 F.C.C.R. 1348 (1998).

In Part II of this opinion we address whether the FCC was statutorily barred from issuing DTV licenses in the Fifth Report and Order, and if not, whether the FCC arbitrarily failed to grant a second DTV channel to Pappas Telecasting of Southern California, Entravision Communications Company, Corridor Television, and Paxson Communications Corporation. In Part III we address whether the FCC arbitrarily decided not to upgrade the service area covered by the DTV allotments for Community Television, Inc. and Paxson Communications Corporation. In Part IV we address whether the FCC arbitrarily deviated from its service-replication policy when assigning Minority Television Project, Inc.'s...