Federal Communications Commission Satellite Carrier Oversight Act

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Federal Communications Commission 
Satellite Carrier Oversight Act''.

SEC. 2. FINDINGS.

    (a) The Congress finds that:
            (1) Signal theft represents a serious threat to direct-to-
        home satellite television. In the Telecommunications Act of 
        1996, Congress confirmed the applicability of penalties for 
        unauthorized decryption of direct-to-home satellite services. 
        Nevertheless, concerns remain about civil liability for such 
        unauthorized decryption.
            (2) In view of the desire to establish competition to the 
        cable television industry, Congress authorized consumers to 
        utilize direct-to-home satellite systems for viewing video 
        programming through the Cable Communications Policy Act of 
        1984.
            (3) Congress found in the Cable Television Consumer 
        Protection and Competition Act of 1992 that without the 
        presence of another multichannel video programming distributor, 
        a cable television operator faces no local competition and that 
        the result is undue market power for the cable operator as 
        compared to that of consumers and other video programmers.
            (4) The Federal Communications Commission, under the Cable 
        Television Consumer Protection and Competition Act of 1992, has 
        the responsibility for reporting annually to the Congress on 
        the state of competition in the market for delivery of 
        multichannel video programming.
            (5) In the Cable Television Consumer Protection and 
        Competition Act of 1992, Congress stated its policy of 
        promoting the availability to the public of a diversity of 
        views and information through cable television and other video 
        distribution media.
            (6) Direct-to-home satellite television service is the 
        fastest growing multichannel video programming service with 
        approximately 8 million households subscribing to video 
        programming delivered by satellite carriers.
            (7) Direct-to-home satellite television service is the 
        service that most likely can provide effective competition to 
        cable television service.
            (8) Through the compulsory copyright license created by 
        Section 119 of the Satellite Home Viewer Act of 1988, satellite 
        carriers have paid a royalty fee per subscriber, per month to 
        retransmit network and superstation signals by satellite to 
        subscribers for private home viewing.
            (9) Congress set the 1988 fees to equal the average fees 
        paid by cable television operators for the same superstation 
        and network signals.
            (10) Effective May 1, 1992, the royalty fees payable by 
        satellite carriers were increased through compulsory 
        arbitration to $0.06 per subscriber per month for 
        retransmission of network signals and $0.175 per subscriber per 
        month for retransmission of superstation signals, unless all of 
        the programming contained in the superstation signal is free 
        from syndicated exclusivity protection under the rules of the 
        Federal Communications Commission, in which case the fee was 
        decreased to $0.14 per subscriber per month. These fees were 
        40-70 percent higher than the royalty fees paid by cable 
        television operators to retransmit the same signals.
            (11) On October 27, 1997, the Librarian of Congress adopted 
        the recommendation of the Copyright Arbitration Royalty Panel 
        and approved raising the royalty fees of satellite carriers to 
        $0.27 per subscriber per month for both superstation and 
        network signals, effective January 1, 1998.
            (12) The fees adopted by the Librarian are 270 percent 
        higher for superstations and 900 percent higher for network 
        signals than the royalty fees paid by cable television 
        operators for the exact same signals.
            (13) To be an effective competitor to cable, direct-to-home 
        satellite television must have access to the same programming 
        carried by its competitors and at comparable rates. In 
        addition, consumers living in areas where over-the-air network 
        signals are not available rely upon satellite carriers for 
        access to important news and entertainment.
            (14) The Copyright Arbitration Royalty Panel did not 
        adequately consider the adverse competitive effect of the 
        differential in satellite and cable royalty fees on promoting 
        competition among multichannel video programming providers and 
        the importance of evaluating the fees satellite carries pay in 
        the context of the competitive nature of the multichannel video 
        programming marketplace.
            (15) If the recommendation of the Copyright Arbitration 
        Royalty Panel is allowed to stand, the direct-to-home satellite 
        industry, whose total subscriber base is equivalent in size to 
        approximately 11 percent of all cable households, will be 
        paying royalties that equal half the size of the cable royalty 
        pool, thus giving satellite subscribers a disproportionate 
        burden for paying copyright royalties when compared to cable 
        television subscribers.

SEC. 3. DBS SIGNAL SECURITY.

    (a) Section 605(d) of the Communications Act of 1934 (47 U.S.C. 
605) is amended by adding after ``satellite cable programming,'' the 
following: ``or direct-to-home satellite services,''.

SEC. 4. PROCEEDING ON RETRANSMISSION OF DISTANT BROADCAST SIGNALS; 
              REPORT ON EFFECT OF INCREASED ROYALTY FEES FOR SATELLITE 
              CARRIERS ON COMPETITION IN THE MARKET FOR DELIVERY OF 
              MULTICHANNEL VIDEO PROGRAMMING.

    (a) Section 628 of the Communications Act of 1934 (47 U.S.C. 548) 
is amended--
            (1) by adding at the end of subsection (g): ``The 
        Commission shall, within 180 days of enactment of this 
        amendment initiate a notice of inquiry to determine the best 
        way in which to facilitate the retransmission of distant 
        broadcast signals such that it is more consistent with the 1992 
        Cable Act's goal of promoting competition in the market for 
        delivery of multichannel video programming and the public 
        interest. The Commission also shall within 180 days of 
        enactment report to Congress on the effect of the increase in 
        royalty fees paid by satellite carriers pursuant to the 
        decision by the Librarian of Congress on competition in the 
        market for delivery of multichannel video programming and the 
        ability of the direct-to-home satellite industry to compete.''.

SEC. 5. EFFECTIVE DATE OF INCREASED ROYALTY FEES.

    (a) Notwithstanding any other provision of law, the Copyright 
Office shall be prohibited from implementing, enforcing, collecting or 
awarding copyright royalty fees, and no obligation or liability for 
copyright royalty fees shall accrue pursuant to the decision of the 
Librarian of Congress on October 27, 1997, which established a royalty 
fee of $0.27 per subscriber per month for the retransmission of distant 
broadcast signals by satellite carriers, before January 1, 1999.

Summary: Federal Communications Commission Satellite Carrier Oversight Act - Amends the Communications Act of 1934 to: (1) include direct-to-home satellite services under provisions protecting signal broadcast. (2) direct the Federal Communications Commission (FCC) to initiate a notice of inquiry to determine the best way to facilitate the retransmission of distant broadcast signals in order to promote market competition for delivery of multichannel video programming in the public interest. And (3) direct the FCC to report to the Congress on the effect of the increase in royalty fees paid by satellite carriers for such retransmission on such competition and the ability of the direct-to-home satellite industry to compete. Prohibits the Copyright Office from implementing, before January 1, 1999, the decision of the Librarian of Congress which established a specified royalty fee per subscriber per month for the retransmission of distant broadcast signals by satellite carriers.