WASHINGTON—The FCC is moving forward with the proposed Fiscal Year 2020 regulatory fees that would collect $339 million, despite multiple arguments over different aspects of the plan from both cable operators and broadcasters.
The FCC is required to assess regulatory fees every year as a primary form of support for the commission. In May, the FCC proposed the $339 million total for fees, with an increase in fees for broadcasters as well as an increase in fees for DBS operators, bringing them closer to the fees paid by MVPDs. This latest action approves that proposal.
The FCC is determining the increase in broadcaster regulatory fees by switching up its method for calculating the fees. Previously, full-power TV station fees were based on the Nielsen Designated Market Area groupings. Now, after using a hybrid approach in 2019, the FCC is completely basing fees off of the actual population covered by a station that is calculated at .78 of one cent times population.
Many broadcasters and the NAB were against the proposal of raising broadcasters’ fees, particularly this year as the impact of the COVID-19 pandemic is affecting the bottom line of many stations.
The increase for DBS fees—from 72 cents per sub to 89 cents per sub—is a continuation of a regulatory fee policy that the FCC has been employing since 2015 that is bringing the annual regulatory fee for direct broadcast satellite operators closer to the level of MVPDs. Both sides of this argument, cable operators and DBS, had issues with this.
NCTA and ACA Connects, on the side of cable operators, wanted the fees to be raised to level with that of MVPDs, but the FCC said that its yearly increase is still a “reasonable” process. For the DBS side, AT&T and Dish sought to stop the fee increases, arguing MVPD issues do not impact them, an idea the FCC rejected.
NAB issued a comment from Senior Vice President of Communications Ann Marie Cumming in response to the FCC's decision:
"NAB believes strongly that the commission's methodology for calculating regulatory fees is deeply flawed and would not survive judicial review. However, we very much appreciate Chairman Pai and his staff correcting certain errors in the proposal's original calculations to result in reduced fees for many radio broadcasters. NAB urges the commission to convene stakeholders to take a closer look at its approach to regulatory fees to ensure that they are fairly and equitably applied for all entities that utilize commission resources."
The FCC says that all regulatory fees are due in September.
The full Report and Order from the FCC is available online.
