Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-02-01039/USCOURTS-caDC-02-01039-0/pdf.json

Parties Involved:
Alliance for Community Media
Petitioner
Association of Public Television Stations
Intervenor
Center for Digital Democracy
Petitioner
Federal Communications Commission
Respondent
United Church of Christ
Petitioner
United States of America
Respondent

Document Text:

Notice: This opinion is subject to formal revision before publication in the

Federal Reporter or U.S.App.D.C. Reports. Users are requested to notify

the Clerk of any formal errors in order that corrections may be made

before the bound volumes go to press.

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued March 10, 2003 Decided May 9, 2003

No. 02-1039

OFFICE OF COMMUNICATION, INC. OF THE

UNITED CHURCH OF CHRIST, ET AL.,

PETITIONERS

v.

FEDERAL COMMUNICATIONS COMMISSION AND

UNITED STATES OF AMERICA,

RESPONDENTS

ASSOCIATION OF PUBLIC TELEVISION STATIONS,

INTERVENOR

On Petition for Review of an Order of the

Federal Communications Commission

Harold Feld argued the cause for petitioners. With him on

the briefs was Andrew J. Schwartzman.

 Bills of costs must be filed within 14 days after entry of judgment.

The court looks with disfavor upon motions to file bills of costs out

of time.

USCA Case #02-1039 Document #748597 Filed: 05/09/2003 Page 1 of 14
2

Daniel M. Armstrong, Associate General Counsel, Federal

Communications Commission, argued the cause for respondents. With him on the brief were Catherine G. O’Sullivan

and Andrea Limmer, Attorneys, U.S. Department of Justice,

Jane E. Mago, General Counsel, Federal Communications

Commission, and Rodger D. Citron, Counsel. C. Grey Pash,

Jr., Counsel, entered an appearance.

Kevin C. Newsom argued the cause for intervenor. With

him on the brief were Robert A. Long, Jr., Marilyn Mohrman–Gillis and Lonna Thompson.

Before: RANDOLPH and ROGERS, Circuit Judges, and

WILLIAMS, Senior Circuit Judge.

Opinion for the Court filed by Circuit Judge ROGERS.

ROGERS, Circuit Judge: The Office of Communication, Inc.

of the United Church of Christ, the Alliance for Community

Media, and the Center for Digital Democracy (hereafter ‘‘the

UCC’’), petition for review of the Commission’s Order clarifying that noncommercial public television stations may offer

subscription services, including advertiser-supported subscription services, on their excess digital capacity. In re

Ancillary or Supplementary Use of Digital Television Capacity by Noncommercial Licensees, 16 F.C.C.R. 19,042 (2001)

(‘‘2001 Order’’). The UCC contends that the 2001 Order is

contrary to both the plain language of § 399b of the Communications Act, 47 U.S.C. § 399b, and Commission precedent.

We hold that the Commission reasonably interpreted § 399b

to prohibit only ‘‘broadcast’’ and not other transmissions of

advertisements by these stations. We further hold that the

Commission adequately addressed its precedent by explaining

that the high costs of digital technology required greater

flexibility, that digital technology offers enough capacity that

public stations can offer subscription services while still preserving their primary use for public educational broadcasts,

and that some prior Commission decisions had authorized

such stations to operate their facilities for commercial purposes on a limited basis. Accordingly, we deny the petition

for review.

USCA Case #02-1039 Document #748597 Filed: 05/09/2003 Page 2 of 14
3

I.

In 1997, the Commission issued its Fifth Report and Order

implementing the rules to manage the transition of the nation’s television technology to digital format. See In re

Advanced Television Sys. & Their Impact upon the Existing

Television Broad. Serv., 12 F.C.C.R. 12,809 (1997). As summarized by the Commission, that Order established standards

for license eligibility for digital broadcasting, specifically requiring that broadcasters continue to provide one free overthe-air television service in accordance with § 336 of the 1996

Telecommunications Act. In re Ancillary or Supplementary

Use of Digital Television Capacity by Noncommercial Licensees, 14 F.C.C.R. 537, 537 (1998) (notice of proposed rule

making) (‘‘NPRM’’) (citing 47 U.S.C. § 336). The Commission also permitted digital television licensees to ‘‘provide

ancillary or supplementary services provided these services

do not derogate the free digital television service.’’ Id.

Because the Commission did not differentiate between commercial and noncommercial licensees,1

 the Association of Public Television Stations (‘‘APTS’’), a national representative of

noncommercial television broadcast licensees that is an intervenor in the instant case, moved for clarification as to whether public television stations would be able to use excess

digital television spectrum capacity to generate revenue

through the provision of ancillary or supplemental services.

Id. In response, the Commission issued a Notice of Proposed

Rulemaking and opened a new proceeding, id. at 538, during

which it received comments from APTS, the UCC, and other

parties.

The Commission concluded in the 2001 Order on review

that noncommercial public television stations could use their

1 Under the Communications Act, a ‘‘noncommercial educational broadcast station,’’ a term synonymous with ‘‘public broadcast

station,’’ is a ‘‘noncommercial educational radio or television broadcast station TTT which is owned and operated by a public agency or

nonprofit private foundation, cooperation, or association’’ or ‘‘is

owned and operated by a municipality and which transmits only

noncommercial programs for educational purposes.’’ 47 U.S.C.

§ 397(6).

USCA Case #02-1039 Document #748597 Filed: 05/09/2003 Page 3 of 14
4

excess spectrum for revenue-generation through the provision

of ancillary or supplementary services, including the provision

of subscription television, so long as those activities did not

interfere with the primary operation of the station as a

nonprofit, noncommercial, educational broadcaster that must

also at all times provide one free over-the-air television

broadcast service. 2001 Order, 16 F.C.C.R. at 19,048–50.

Upon considering comments on whether any of the revenuegenerating ancillary or supplemental services could be advertiser-supported, particularly advertising that is provided over

subscription television, see NPRM, 14 F.C.C.R. at 549–50, the

Commission concluded that advertising would only be permitted for ‘‘non-broadcast’’ services, and that pursuant to its

decision in In re Subscription Video, 2 F.C.C.R. 1001 (1987),

subscription television services were ‘‘non-broadcast’’ and

therefore could be provided on an advertiser-supported basis

by noncommercial public television stations. 2001 Order, 16

F.C.C.R. 19,052–56. The Commission reiterated that advertising would not be permitted on ‘‘broadcast’’ services, and

that the ancillary ‘‘non-broadcast’’ services could not interfere

with the station’s obligation to serve primarily as a noncommercial broadcaster. Id. at 19,053–56.

II.

In its petition for review, the UCC contends that the 2001

Order violates § 399b because it is contrary to the plain

language of § 399b and that the Commission erred in relying

upon the definition of broadcasting from its 1987 Subscription

Video decision on the ground that Congress was assuming a

different definition of broadcasting when it enacted § 399b in

1981. The UCC further contends that the FCC has inadequately explained its departure from agency precedent that

prohibited broadcasting of advertisements by noncommercial

public television stations and restricted the transmission of

subscription television by those stations.

The court’s review of the Commission’s 2001 Order is

confined to determining whether it is ‘‘arbitrary, capricious,

an abuse of discretion, or otherwise not in accordance with

USCA Case #02-1039 Document #748597 Filed: 05/09/2003 Page 4 of 14
5

law.’’ 5 U.S.C. § 706(2)(A). Our review is thus deferential,

presuming the validity of the Commission’s action, and the

court must affirm unless the Commission failed to consider

relevant factors or made a clear error in judgment. Davis v.

Latschar, 202 F.3d 359, 365 (D.C. Cir. 2000); see, e.g., Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402,

415–16 (1971), abrogated on other grounds by Califano v.

Sanders, 430 U.S. 99 (1977). For challenges to the Commission’s construction of the statute it administers, the court’s

review is governed by the familiar framework in Chevron

U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837

(1984). Under the first step of the analysis the court must

determine ‘‘whether Congress has directly spoken to the

precise question at issue.’’ Id. at 842, ‘‘If the intent of

Congress is clear, that is the end of the matter; for the court,

as well as the agency, must give effect to the unambiguously

expressed intent of Congress.’’ Id. at 842–43 (footnote omitted). For this purpose the court ‘‘must first exhaust the

traditional tools of statutory construction,’’ including legislative history and statutory structure. Bell Atl. Tel. Cos. v.

FCC, 131 F.3d 1044, 1047 (D.C. Cir. 1997) (quotations omitted). Under the second step of the analysis, if ‘‘Congress has

not directly addressed the precise question at issue,’’ the

court must decide whether the agency’s action is a ‘‘permissible construction of the statute,’’ to which the court must

defer. Chevron, 467 U.S. at 843. The court’s review of the

Commission’s interpretation of its own regulations, in turn, is

more deferential, giving ‘‘controlling weight’’ to the Commission’s interpretation ‘‘unless it is plainly erroneous or inconsistent with the regulation.’’ High Plains Wireless, L.P. v.

FCC, 276 F.3d 599, 606 (D.C. Cir. 2002) (quotation omitted);

see Thomas Jefferson Univ. v. Shalala, 512 U.S. 504, 512

(1994).

A.

Subsection (a) of § 399b defines ‘‘advertising’’ as any message or other programming material which is broadcast or

otherwise transmitted in exchange for any remuneration and

which is intended —

USCA Case #02-1039 Document #748597 Filed: 05/09/2003 Page 5 of 14
6

(1) to promote any service, facility, or product

offered by any person who is engaged in such offering for profit;

(2) to express the views of any person with respect to any matter of public importance or interest;

or

(3) to support or oppose any candidate for political office.

47 U.S.C. § 399b(a). Subsection (b) then restricts the types

of services that can be offered:

(1) Except as provided in paragraph (2), each public

broadcast station shall be authorized to engage in

the offering of services, facilities, or products in

exchange for remuneration.

(2) No public broadcast station may make its facilities available to any person for the broadcasting of

any advertisement.

According to the UCC, the Commission’s 2001 Order violates

the plain language of § 399b by allowing the transmission of

advertisements by public broadcasting stations. The UCC

maintains that the broad language in § 399b(a), which includes messages ‘‘otherwise transmitted’’ within the definition

of ‘‘advertising’’ as well as the blanket prohibition of

§ 399b(b) on ‘‘any person’’ using facilities to broadcast advertising, necessarily means that the Commission’s distinction

between ‘‘broadcast’’ and ‘‘non-broadcast’’ services does not

apply in the context of § 399b. But, as the Commission

responds, the only provision of § 399b that prohibits advertising by public broadcasters refers only to ‘‘the broadcasting of

any advertisement,’’ and therefore the ‘‘broadcast/nonbroadcast’’ distinction is grounded in the terms of the statute.

Moreover, the structure of § 399b, which defines advertising

as material that is ‘‘broadcast or otherwise transmitted,’’ and

then prohibits only advertising that is ‘‘broadcast’’ supports

the distinction drawn by the Commission.

The UCC’s position that the 1987 Subscription Video decision cannot apply to the definition of ‘‘broadcasting’’ in § 399b

USCA Case #02-1039 Document #748597 Filed: 05/09/2003 Page 6 of 14
7

is similarly flawed. In Subscription Video the Commission

ruled that subscription television (and other telecommunications services) the could be viewed only by customers who

had purchased special equipment and paid a subscription fee

is not ‘‘broadcasting’’ for purposes of the definition of that

term in § 153(o) (now § 153(6)) of the Communications Act.

In re Subscription Video, 2 F.C.C.R. 1001, 1004–06 (1987)

aff’d sub nom. Nat’l Ass’n for Better Broad. v. FCC, 849 F.2d

665 (D.C. Cir. 1988). The Commission explained in the 2001

Order, citing Lukhard v. Reed, 481 U.S. 368, 379 (1987)

(plurality op.), that in the absence of any indication by

Congress that § 339B locked in the Commission’s pre–1987

interpretation of ‘‘broadcasting,’’ it relied on the analysis in

Subscription Video to conclude that subscription television is

not ‘‘broadcasting’’ for purposes of the prohibition under

§ 399b(b). 2001 Order, 16 F.C.C.R. at 19,053–54 & n.60.

The UCC maintains that at the time that Congress enacted

§ 399b in 1981, the definition of ‘‘broadcasting’’ included

subscription television under both Commission and judicial

precedent, that Congress must be inferred to have been

aware of that interpretation, and that Congress must be

inferred to have adopted that interpretation and codified it in

the language of § 399b. Thus, even if the Commission’s

interpretation of ‘‘broadcasting’’ was appropriate for the general definition of the term under the Communications Act as a

whole, the UCC contends that it is inappropriate for § 399b’s

definition of the term.

The Supreme Court has acknowledged that it has not

always spoken in ‘‘entirely consistent terms’’ regarding the

effect of reenactment in the absence of affirmative indications

of agreement with agency regulations. Helvering v. Griffiths, 318 U.S. 371, 395–96 & n.47 (1943); see Doris Day

Animal League v. Veneman, 315 F.3d 297, 300 (D.C. Cir.

2003). In Commodity Futures Trading Comm’n v. Schor,

478 U.S. 833 (1986), a case most favorable to the UCC, the

Supreme Court stated that ‘‘when Congress revisits a statute

giving rise to a long-standing administrative interpretation

without pertinent change, the congressional failure to revise

or repeal the agency’s interpretation is persuasive evidence

USCA Case #02-1039 Document #748597 Filed: 05/09/2003 Page 7 of 14
8

that the interpretation is the one intended by Congress.’’ Id.

at 846 (quotation omitted). This court, on review of the order

in Subscription Video, recognized, however, that ‘‘Commission [has] exhibited some inconsistency in its treatment of

various forms of subscription television service as being or

not being ‘broadcasting.’ ’’ Nat’l Ass’n for Better Broad., 849

F.2d at 667 (footnote omitted). While the UCC appears to

contend that prior to Subscription Video the Commission had

a blanket rule that any sort of subscription television or other

subscription transmission service was not ‘‘broadcasting,’’ the

history is more complex. Subscription television was generally considered to be broadcasting under Commission precedent, see Nat’l Ass’n of Broadcasters v. FCC, 740 F.2d 1190,

1201–02 (D.C. Cir. 1984); see also Telecomms. Research &

Action Ctr. v. FCC, 801 F.2d 501, 514–15 (D.C. Cir. 1986),

since the 1960s, see In re Amendment of Part 73 of the

Commission’s Rules & Regulations (Radio Broad. Servs.) to

Provide for Subscription Television Serv., 15 F.C.C.2d 466,

472–73 (1968); In re Amendment of Part 73 of the Commission’s Rules & Regulations (Radio Broad. Servs.) to Provide

for Subscription Television Serv., 3 F.C.C.2d 1, 8–11 (1966).

However, the Commission and the courts in addressing a

similar issue sent mixed signals in their treatment of whether

certain kinds of subscription radio services were broadcasting. See In re Amendment of Section 73.202(b), 61 F.C.C.2d

113, 117–18 (1976); see also Functional Music, Inc. v. FCC,

274 F.2d 543, 548 (D.C. Cir. 1958); KMLA Broad. Corp. v.

Twentieth Century Cigarette Vendors Corp., 264 F. Supp. 35,

40–42 (C.D. Cal. 1967)

Furthermore, the UCC’s position would result in an anomaly: In National Association for Better Broadcasting the

court held that under Chevron II the Commission in 1987

reasonably redefined ‘‘broadcasting’’ under the 1934 Communications Act for purposes of subscription services. 849 F.2d

at 668–69. Were the UCC’s position to prevail, the court now

would conclude that an interpretation of the statute’s term

‘‘broadcasting’’ excluding subscription television is reasonable

for all of the regulatory scheme except § 399b, largely beUSCA Case #02-1039 Document #748597 Filed: 05/09/2003 Page 8 of 14
9

cause that provision was enacted years after adoption of the

basic scheme.

The legislative history on which the UCC relies does not

advance its position. The UCC points out that when Congress enacted § 399b it was concerned about Commission

regulations that would have expanded the opportunities for

public broadcasters to obtain money from various services.

See H.R. Rep. No. 97–82, at 23–24. The UCC further notes

that Congress approved a temporary pilot program to explore

advertising, but did not renew that program, see Public

Broadcasting Amendments Act of 1981 § 1232, 95 Stat. at

731, and Congress was concerned in 1981 about commercialization in public broadcasting, see H.R. Rep. No.

97–82, at 16. However, as both the Commission and intervenor point out, the legislative history endorsed increased flexibility on the part of public broadcasters in seeking moneymaking opportunities, prompting the enactment of

§ 399b(b)(1). See H.R. Rep. No. 97–82, at 7–8. Nothing in

the legislative history reveals congressional concern about the

specific issue of advertising-supported subscription television.

We therefore conclude that, under the first step of the

Chevron analysis, the intent of Congress is not clear on the

permissibility of advertising-supported subscription television

provided by noncommercial licensees and reject the UCC’s

contentions on this point. The UCC does not explicitly

contend that the Commission’s interpretation is impermissible

under the second step of Chevron; it contends that the

Commission’s interpretation has not been adequately supported in the rulemaking proceeding. Hence, we turn to the

latter question.

B.

The UCC contends that the 2001 Order is arbitrary and

capricious because the Commission did not adequately explain

its reversal of ‘‘two longstanding Commission policies.’’ The

UCC refers to (1) a ‘‘policy of 50 years to prohibit [public

broadcasters] from offering any form of advertiser supported

programming or sharing [public broadcaster]-dedicated freUSCA Case #02-1039 Document #748597 Filed: 05/09/2003 Page 9 of 14
10

quencies with commercial broadcasters,’’ and (2) a policy ‘‘of

declining to grant general authority to [public broadcasters]

to offer subscription television services.’’ Petitioners’ Br. at

34–35. In the Commission’s view, changes in technology now

allow multiple channels on digital frequencies such that the

flat ban on advertising is no longer appropriate, the policy on

subscription television previously allowed a case-by-case review of whether public broadcasters could offer subscription

television, and the current change to blanket approval is

justified by a change in technology. The UCC counters that

the Commission’s multiple channel argument is a post-hoc

explanation and does not respond to prior Commission concerns about the use of any advertising on public television.

Starting in 1952, the Commission prohibited the use of

commercials on public television. See In re Amendment of

Section 3.606 of the Comm’n’s Rules & Regulations, 41

F.C.C. 148, 165–66 (1952). The Commission rejected pleas

for allowing limited advertising on public broadcasting and

expressed concerns that any use of advertising by public

broadcasters would fundamentally undermine their noncommercial status. Id. Years later the Commission emphasized a need to ‘‘remove the programming decisions of public

broadcasters from the normal kinds of commercial market

pressures.’’ In re Comm’n Policy Concerning the Noncommercial Nature of Educ. Broad. Stations, 86 F.C.C.2d 141,

142 (1981); see also In re Comm’n Policy Concerning the

Noncommercial Nature of Educ. Broad. Stations, 90

F.C.C.2d 895, 900 (1982). There is no explicit discussion of

these past decisions in the 2001 Order. Instead, the Commission focused on whether subscription television falls within

the statutory definition of ‘‘broadcasting.’’ 2001 Order, 16

F.C.C.R. at 19,052–56. Nevertheless, the Commission adequately set forth the ‘‘multiple channel’’ analysis relied on in

its briefs.

In the 2001 Order the Commission stated that ‘‘digital

technology will allow sufficient capacity for public television

stations to offer a range of services while preserving their

primary use for a nonprofit, noncommercial, educational

USCA Case #02-1039 Document #748597 Filed: 05/09/2003 Page 10 of 14
11

broadcast service.’’ Id. at 19,049. The Commission had

discussed more broadly in the NPRM the capacity for digital

broadcasters to provide multiple channels, referring to the

Fifth Report and Order. 14 F.C.C.R. at 539–40. Further,

the entire proceeding arose in the context of the digital

television rulemaking where the Commission had stated that

it would only allow ancillary and supplemental services such

as subscription television to the extent that licensees continued to offer free broadcasting to the public. 2001 Order, 16

F.C.C.R. at 19,049. For public broadcasting, this will mean

that licensees must provide at least one noncommercial free

broadcasting service at all times. Id. Hence, the Commission adequately articulated the ‘‘multiple channel’’ argument

in the 2001 Order, and to the extent that the UCC’s position

against allowing advertising is that advertising-supported services will completely supplant noncommercial services provided by noncommercial licensees, the Commission’s reasoning is

sufficient.

A separate question is whether advertising on subscription

television is so pernicious to public broadcasting that it should

not be allowed at all, as appeared to be the Commission’s

position in the 1950s. The Commission’s position to some

extent softened, as it recognized, in the 1980s once Congress

authorized public broadcasters to offer services and facilities

for remuneration other than advertising. See NPRM, 14

F.C.C.R. at 547–48. And, in the 2001 Order the Commission

considered the tradeoff between allowing public broadcasters

greater flexibility to obtain money to pay for the transition to

digital broadcasting and the risk that ‘‘allowing [public broadcasters] to provide advertiser-supported services will denigrate the noncommercial nature of the public television system.’’ 16 F.C.C.R. at 19,055 (footnote omitted); see also id.

at 19,049. The Commission recognized in the NPRM that, on

the one hand, ‘‘the costs of converting to digital service will be

considerable,’’ while, on the other hand, it was ‘‘sensitive to

the concerns raised TTT that in permitting [noncommercial

public television stations] flexibility in providing [a range of

revenue-generating ancillary or supplementary services] we

must be consistent with Section 399b and also not undermine

USCA Case #02-1039 Document #748597 Filed: 05/09/2003 Page 11 of 14
12

their fundamental mission of providing a noncommerical educational broadcast service.’’ 14 F.C.C.R. at 546. The Commission explained in the 2001 Order that the requirements

that public broadcasters maintain free over-the-air service

with no advertising and that the broadcasters use their

spectrum primarily for noncommercial uses, as well as the

restrictions on licensees as non-profits, tax requirements, and

oversight by other bodies, reduced the risk that the very

limited advertising allowed under the new rule would fundamentally undermine the noncommercial nature of the public

broadcasting system. 16 F.C.C.R. at 19,055; see also id. at

19,049; NPRM, 14 F.C.C.R. at 548–49. The Commission

reserved the right to take additional action if these constraints were inadequate. 2001 Order, 16 F.C.C.R. at 19,055–

56. Consequently, although the Commission never explicitly

addressed its decisions in the 1950s or 1980s, it addressed the

concerns raised in those decisions and adequately explained

its change in position.

Further, the Commission properly addressed its prior rule

that only allowed subscription television transmission by noncommercial licensees on a case-by-case basis. There is no

merit to the Commission’s contention that the UCC waived

this issue; during Commission proceedings, it commented on

February 16, 1999, ‘‘At [the] time of the Subscription Video

decision, noncommercial licensees did not have the authority

to provide such services, and they still do not today. See

Amendment of Part 73.642(a) of the Commission’s Rules, 97

F.C.C.2d 411 (1984).’’ But the UCC’s contention that the

Commission deviated from its 1984 decision misconstrues that

decision as concluding that the provision of subscription video

services would in all cases interfere with the station’s ability

to offer educational programming. The 1984 decision did not

completely ban subscription television service by public

broadcasters but instead required them to obtain waivers to

provide the service. In re Amendment of Part 73.642(a) of

the Comm’n’s Rules Concerning Subscription Television Authorization for Noncommercial Educ. Television Station Licensees, 97 F.C.C.2d 411, 411 (1984). In that proceeding, the

Commission rejected a proposal to allow blanket subscription

USCA Case #02-1039 Document #748597 Filed: 05/09/2003 Page 12 of 14
13

television provision by public broadcasters because, while

‘‘there are benefits to be derived from using [subscription

television] as a supplementary fundraising device,’’ the Commission concluded that ‘‘these benefits are diminished by

changing the system to one which could be dominated by’’

subscription television. Id. at 413.

The ‘‘multiple channel’’ rationale raised by the Commission

in general, and the requirement that public broadcasters use

their spectrum primarily for television broadcasts, undercuts

the concerns expressed in the 1984 decision. The Commission could appropriately conclude that the multiple channels

of digital television combined with the requirement that noncommercial, educational broadcasting be the primary use of

television facilities would prevent the wholesale conversion of

public broadcasting to subscription television and would ameliorate the concerns expressed in 1984. Although in the 2001

Order the Commission did not formally address its 1984

concerns even as it amended § 73.642 of its regulations, 16

F.C.C.R. at 19,049–50, the Commission noted in the NPRM

that its 1984 decision had been made in the context of

television ‘‘operating with analog technology,’’ where subscription television might supplant free public broadcasting.

14 F.C.C.R. at 547. The Commission distinguished its prior

subscription television decision by stating that the instant

proceeding ‘‘concerns digital television, which offers significant new challenges and opportunities to’’ public broadcasters. Id. at 548. All this occurred in the context of a

rulemaking proceeding where multiple channels would be

available to digital broadcasters. See id. at 539; 2001 Order,

16 F.C.C.R. at 19,043 n.4. In light of the limited and

conclusory nature of the UCC’s comments on this point,

Reytblatt v. United States Nuclear Regulatory Comm’n, 105

F.3d 715, 722 (D.C. Cir. 1997), the discussion in the NPRM,

the fact that the Commission’s discussion in the 2001 Order of

the ‘‘multiple channel’’ argument immediately preceded its

amendment of § 73.642, see 2001 Order, 16 F.C.C.R. at

19,049, and the fact that the Commission allowed subscription

television only on ‘‘excess digital capacity’’ such that the fear

of displacement of free public broadcasting would not apply,

USCA Case #02-1039 Document #748597 Filed: 05/09/2003 Page 13 of 14
14

see id. at 19,042, 19,049–50, particularly given the requirement that noncommercial licensees are required to maintain

one free over-the-air video programming service, id. at

19,049, we conclude that the Commission adequately both

developed its ‘‘multiple channel’’ distinction and addressed its

prior decisions. To the extent that the UCC also challenges

the permissibility of leasing spectrum for advertisingsupported subscription television, it raises the same issue as

direct use of the spectrum for that purpose, and hence, in

light of our disposition, there is no need to decide whether the

UCC properly raised its leasing challenge in ex parte comments.

Accordingly, we deny the petition for review.

USCA Case #02-1039 Document #748597 Filed: 05/09/2003 Page 14 of 14