Early this month, the Copyright Office released a Notice of Proposed Rulemaking dealing with two separate but related issues. First, it asks for comments on certain changes in the reporting that cable systems and satellite TV operators provide to the Copyright Office on the programming that they carry – information that is used to provide baseline information for the Copyright Royalty Board to use in its determinations on how the royalties paid by cable systems for the carriage of television stations are distributed to the programmers and content owners that provide programming to the stations. While certainly the reporting of information used to distribute the royalties paid by cable and satellite for their compulsory license to carry the programming broadcast by TV stations is important, perhaps the more interesting portion of the Notice was the questions that it asked about the definition of a cable system – proposing to adopt the definition of cable systems that exclude Internet-based systems that has been reflected in recent court cases.

We have written about the issue of whether online platforms qualify for the compulsory license to carry television stations many times (see for instance our article here when the issue was first raised by Aereo), when services such as Aereo and FilmOn argued that they could carry television stations on their online platforms without specific consent from the stations as they qualified as cable systems. These arguments have been consistently rejected by the Courts (see, for instance, our articles here and here) , most recently in the Spring when the 9th Circuit Court of Appeals overturned the one District Court decision that had found that the argument advanced by FilmOn had merit (see our summary of the Ninth Circuit decision here). The Copyright Office proposes to adopt that definition.

The discussion of the adoption of that definition is rather limited, essentially pointing to the statutory definitions of a cable system that use phrase such as service to “contiguous communities”, “headends”, and other location-specific terminology. In addition, the Notice recaps precedent, both from prior Copyright Office pronouncements on the issue, from the fact that satellite television was not covered by the Section 111 compulsory license that applies to cable (and was given its own compulsory license in other sections of the Copyright Act), and the recent Court decisions that found that Internet services were not within the definition of a “cable system.”

The Notice also proposes to eliminate residual use of the phrase “Grade B contour,” which had previously been used to determine whether cable systems were carrying local television stations or “distant signals” for which they had to pay a higher royalty. Given the transition to digital, that nomenclature is no longer relevant, as the corresponding digital service is now the “noise limited contour.” Comments on numerous other proposed changes in the reports filed by cable systems are also proposed. These comments are due on January 16, with reply comments due by January 30 (see the Notice here establishing the Reply Comment date and allowing for meetings with the Copyright Office staff by interested parties both before and after the comments are filed, as long as “ex parte” statements summarizing the substance of the meetings are filed in the record of the proceeding).