Telecommunications: Enhanced Data Collection and Analysis Could Inform FCC's Efforts to Complete the Digital Transition of Low-Power Television Stations and Reallocate Spectrum
Published: 2011-09-07T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: Television stations that broadcast at lower power levels were not required to meet the 2009 digital transition deadline for full-power stations. These low-power television stations transmit over a smaller area, and most are less regulated than full-power stations. Low-power television stations use valuable radio frequency spectrum, and the Federal Communications Commission (FCC) noted the stations' digital transition could aid its efforts to clear spectrum for wireless broadband. GAO examined (1) low-power television stations' location and status in transitioning to digital, (2) FCC's steps to transition low-power television stations to digital and whether these stations are facing challenges transitioning to digital, and (3) why low-power television stations were established and the extent to which FCC collects information to determine if low-power television service is meeting FCC's statutory and policy goals. GAO analyzed FCC data and documents, reviewed stakeholder comments, and interviewed agency officials, stakeholders, and low-power television licensees.
section_title: What GAO Found
paragraphs: Thousands of over-the-air low-power television stations serve communities across the United States in both urban and rural areas, and about 60 percent of all such stations have either completed the digital transition or have taken steps to transition. Over half of all low-power television stations are known as translators, which retransmit major network and other stations' programming in areas that cannot receive the signals from a primary station, generally in rural and mountainous areas. The remaining stations include low-power television stations known as LPTV stations and Class A stations. Class A stations have a special status that gives them greater interference protection than translator and LPTV stations and requires them to broadcast a minimum amount of locally produced programming. Some LPTV and Class A stations serve niche or local audiences with ethnic, religious, or other programming. In July 2011, FCC issued an order that established a deadline of September 1, 2015, for low-power television stations to cease analog broadcasts, but stations may still face challenges in making the transition to digital because of regulatory uncertainty. Specifically, an FCC proposal to reallocate spectrum from broadcasting to wireless broadband created regulatory uncertainty and difficulty for stations attempting to justify investing in transitioning to digital. Such a reallocation would leave fewer channels for television broadcasts and could make it difficult for low-power stations to find an available channel that does not interfere with other stations. FCC's order noted these concerns when adopting the 2015 deadline, rather than a previously proposed deadline of 2012, but it is currently unknown whether the uncertainty posed by the spectrum reallocation will be resolved prior to 2015. FCC's order adopted other measures, such as establishing a process for Class A stations to transfer their status to their new digital channels. Previously, without such a process, some stations delayed completing their transition to digital and others lost their Class A status after they transitioned to digital and ceased analog operation. According to FCC officials, such stations can apply to regain Class A status; however, stations may be unaware of this option as it is not explicit in the order. Low-power television stations were established to reach underserved communities; FCC has noted that the stations can positively affect FCC's goals of localism and diversity. However, FCC has not collected data to evaluate the extent to which these stations fulfill unmet community needs or contribute to meeting FCC's policy goals. Specifically, FCC does not collect programming data, is limited in its ability to identify stations that are not broadcasting, and has not evaluated low-power stations' impact in assessments of the information needs of communities. Lacking such information, FCC does not know the public benefit of stations and is limited in its ability to weigh the effects of its decisions on low-power television stations against the increasing need for spectrum for broadband services. Furthermore, although FCC proposed allowing additional stations to apply for Class A status as a means to preserve community programming, it has not issued an order and may need legislative guidance to determine the future of Class A status. FCC should (1) explore options for assessing the impact of low-power stations on the communities served and on FCC's goals, and (2) work with Congress as necessary to determine what the long-term role of Class A stations should be, whether additional stations should be permitted to apply for Class A status, and what criteria stations must meet to qualify for such status. FCC stated it is taking actions to address GAO's recommendations, and provided technical comments that were incorporated as appropriate.

section_title: Letter
paragraphs: There are thousands of licensed over-the-air low-power television stations  located throughout the country. Such low-power television stations, like  full-power television stations, use highly valued radio frequency spectrum  to transmit programming. Some low-power television stations provide  network programming to audiences otherwise unable to receive television  signals; others might originate niche programming that can be targeted to  specific groups, such as a Vietnamese-speaking community in a large  city, or local programming, such as coverage of high-school sports and  community events. Other stations provide general programming, such as  home shopping programming. Although the statutes governing the digital  transition of full-power stations did not require low-power television  stations to transition from analog to digital broadcasts during the 2009  transition of full-power stations, some low-power television stations have  transitioned to digital on their own accord. The remaining stations still  broadcast in analog. On July 15, 2011, the Federal Communications  Commission (FCC) issued an order establishing September 1, 2015, as  the deadline for low-power television stations to cease analog broadcasts  and convert to digital operations.
Digital transmissions are more efficient than analog transmissions in their  use of spectrum, and FCC has noted that transitioning low-power  television stations from analog to digital could aid FCC’s current efforts to  identify spectrum that could be made available for broadband services.  Specifically, in response to federal initiatives, FCC is reviewing options to  identify radio frequency spectrum that can be reallocated to commercial  wireless broadband services, with one such option being to reallocate  120 MHz of television broadcasting spectrum in this way. As more  Americans use Internet-connected mobile devices, analysts have  expressed concern that a lack of available spectrum for wireless  broadband will lead to higher prices, declines in service, and a lack of  innovation in the United States.
In response to your request and in light of FCC’s recent proceedings on  the digital transition of low-power television stations, we examined (1)  where low-power television stations are located and the status of their  transition to digital, (2) the steps FCC has taken to transition low-power  television stations to digital and whether the stations are facing  challenges transitioning to digital, and (3) why low-power television  stations were established and the extent to which FCC collects  information to determine if low-power television service is meeting FCC’s  statutory and policy goals.
To address these questions, we analyzed data from FCC’s Consolidated  Database System to determine the number of existing licenses for low- power television stations, as well as data on their location, ownership,  and status in transitioning to digital. To determine the reliability of the  data, we reviewed FCC user guides and application forms, examined  data runs for duplicates and other inconsistencies, and interviewed  knowledgeable FCC officials regarding data entry and analysis  procedures. We interviewed selected low-power licensees and asked  them to verify FCC’s data regarding their status in transitioning, and to  give us their general impressions regarding the accuracy of FCC’s data  on low-power television stations. FCC’s system automatically captures  applications for station permits and licenses—necessary steps in  transitioning from analog to digital—and we cross-checked stations’ tower  coordinates against the community served by the station. We determined  the data were reliable for our purposes. When discussing the number of  stations in the report, we note that while FCC’s rules require licensees to  notify FCC when their station is silent (not broadcasting) for more than 10  days, there may be some licensed stations that are not actively  broadcasting and have not notified FCC. We did not attempt to  determine the number of stations that have gone silent without notifying  FCC that they are not broadcasting; therefore, we are including them in  our station counts. As a result, when we describe numbers of “stations” in  the report, we are referring to the number of current broadcast licenses.
We reviewed documentation of FCC’s actions to transition stations to  digital, and of any challenges stations may face in transitioning to digital.  This included FCC orders and notices of proposed rulemaking, and the  comments submitted by licensees and other stakeholders in response to  those notices. We interviewed FCC officials to better understand FCC’s  actions related to low-power television stations. In addition, we  interviewed representatives of 18 low-power licensees, which  cumulatively hold licenses for approximately 838 low-power television  stations, as well as industry representatives and legal counsel for some  low-power television stations. We reviewed documents and data from the  National Telecommunications and Information Administration (NTIA) and  the United States Department of Agriculture (USDA) to determine the  amount of federal funds used to aid low-power television stations’  transition to digital. We also analyzed FCC documents regarding the  creation of low-power television stations, and interviewed FCC officials  and reviewed documentation to determine the extent to which FCC tracks  whether low-power television stations are meeting FCC’s statutory and  policy goals.
We conducted this performance audit from October 2010 to September  2011 in accordance with generally accepted government auditing  standards. These standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  that the evidence obtained provides a reasonable basis for our findings  and conclusions based on our audit objectives. See appendix I for more  information about our scope and methodology.
subsections: section_title: Background
paragraphs: Low-power television stations, as indicated by their name, operate at  lower power levels and transmit over a smaller area than full-power  television stations. Low-power television station licensees can include  municipalities, universities, nonprofit groups, and small businesses. The  development of low-power television stations has evolved since FCC’s  1956 order allowing licensing of low-power translator stations. FCC has  maintained that most low-power television service is a “secondary  service,” meaning low-power television stations may not cause  interference to, and must accept interference from, full-power television  stations, which are classified as a “primary service.” When interference  cannot be remedied by adjusting an antenna or other technological  methods, low-power television stations must vacate the channel. In such  cases, low-power television stations can submit a displacement  application to FCC requesting permission to move to another channel or  they can request permission to turn off their broadcast signal while  searching for another channel. Cable and satellite providers are generally  not required to carry signals from low-power television stations, but some  low-power television stations are carried by cable or satellite systems in  situations where the low-power station wants to be carried and the cable  or satellite provider decides to carry it.
FCC uses the term “low-power television stations” to collectively refer to  three types of stations: (1) translator stations; (2) low-power television  stations that are not translator or Class A stations, which FCC refers to as  LPTV stations; and (3) Class A stations. To ensure consistency with  FCC’s terminology, we are using the term “low-power television stations”  to refer to all three types of stations.    Translator stations: Translator stations retransmit programming from a  primary station, such as a major network (ABC, CBS, FOX, or NBC)  or its affiliate, to audiences unable to receive the signal directly from  the primary station, usually because of distance or terrain barriers  (mountains) that limit the signal’s ability to travel long distances. FCC  rules prohibit translators from originating any programming.   LPTV stations: As with translator stations, FCC’s rules allow stations  with LPTV licenses to retransmit another station’s signals, but the  rules also allow LPTV stations to originate programming.   Class A stations: Unlike translator stations and LPTV stations, Class  A stations are classified as a primary service. When Congress passed  the Community Broadcasters Protection Act of 1999 (CBPA), it  provided the existing LPTV stations a onetime opportunity to apply for  a special primary status that gave the stations some interference  protection from full-power stations, thereby limiting the instances in  which Class A stations could be displaced by full-power stations. To  qualify for Class A status, an LPTV station was required, during the 90  days prior to enactment of CBPA on November 29, 1999, to   have broadcast a minimum of 18 hours per day,    have broadcast an average of at least 3 hours of locally produced  programming per week, and   be in compliance with FCC’s requirements for low-power  television stations.
Stations that applied for and received Class A status must meet  requirements that are not applied to other low-power television stations,  such as broadcasting an average of at least 3 hours per week of locally  produced programming.
Digital broadcasting provides clearer pictures and sound than analog  broadcasting. Analog signals fade with distance, so consumers living  farther from a television tower may experience degraded audio and video.  With digital technology, pictures and sounds are converted into a stream  of digits consisting of zeros and ones. Although digital signals also fade  with distance, techniques can be applied to maintain and improve the  quality of the broadcast so that pictures and sound generally retain their  quality.
To transition from analog to digital broadcasts, existing low-power  television stations must take the following steps:    Apply to FCC for a construction permit for a digital “flash cut,” digital  companion channel, or digital displacement. A flash cut means the  station will simultaneously turn off its analog signal and turn on its  digital signal, using its current analog channel as its new digital  channel. A digital companion channel means a different channel is  being used for the digital channel; thus, a station could operate its  analog and digital transmissions concurrently on different channels  until it decides to cease analog broadcasts. A digital displacement  would mean that a station is moving to another channel and is  transitioning to digital. It is similar to a flash cut in that the station will  simultaneously turn off its analog signal and turn on its digital signal,  but it will be using a different channel for the digital signal.    Construct its digital facilities by September 1, 2015.    Apply to FCC for a digital license upon completing the construction of  its digital facilities. The station may begin broadcasting digitally while  FCC is processing its license application.
By completing the digital transition of low-power television stations, FCC  will be able to reclaim spectrum being used by the stations that are  broadcasting in both analog and in digital (on a companion channel). In  addition, FCC has stated that having low-power television stations  complete their digital transition will simplify FCC’s efforts to reallocate  broadcast spectrum for broadband purposes, since there will be more  certainty regarding which channels low-power television stations are  using for their digital operations.
The federal government has established some funding for low-power  television stations to transition to digital. Congress created the Low- Power Television and Translator Upgrade Program, through which NTIA  made $44 million available to eligible rural stations for reimbursement of  equipment costs related to the transition from analog to digital service.  In addition, some public television low-power facilities used NTIA’s Public  Telecommunications Facilities Program and USDA’s Public Television  Station Digital Transition Grant Program to fund some of the costs for  transitioning to digital.
section_title: Several Thousand Low-Power Television Stations Are Located across the United States and Its Territories, and the Majority of Stations Have Taken Steps to Transition to Digital
subsections: section_title: Thousands of Low-Power Television Stations Provide Programming to Communities across the United States
paragraphs: As previously noted, we are using the term “low-power television stations”  to refer to translators, LPTV stations, and Class A stations. These  stations provide programming to communities throughout the United  States and its territories.
Translators: Over half of the roughly 6,400 low-power television stations  are translators. According to FCC data, there are about 3,900  translators located across the country, as shown in figure 1. Translators  tend to be concentrated in both rural and mountainous areas. Translator  stations may be part of publicly owned systems that retransmit television  signals to areas that cannot receive signals from full-power stations  because they are too far away, or because terrain blocks the signals. In  such cases, translators may be the only source of free over-the-air  programming from nearby full-power television stations, including network  programming, public broadcasting, and emergency alerts. For example, a  translator association in Colorado is a publicly owned system of stations  funded by local taxes that provides the only over-the-air television service  in the area, retransmitting a number of satellite and regional full-power  stations’ signals to rural communities surrounded by mountainous terrain.  Many viewers in this area cannot otherwise receive over-the-air television  signals from regional network broadcasters because of long distances  and rugged terrain.
Some translators are part of a “daisy chain,” in which multiple translators  relay signals from one translator to another, allowing the originating  station’s signal to be received a few hundred miles away. Translators  receive programming on an input channel, and retransmit the signal on an  output channel, meaning two channels are used per station, as shown in  figure 2. In cases where multiple stations’ signals are being retransmitted,  each station would require separate incoming and outgoing channels. For  example, a translator system in Utah retransmits signals for several Salt  Lake City stations. Because each site in Utah’s translator system must  use 2 separate, nonadjacent channels to successfully retransmit each  station’s signal with minimal interference, a site in the system  retransmitting nine stations’ signals would need 18 channels.
LPTV and Class A stations: According to FCC data, there are about 2,000  LPTV stations and about 500 Class A stations. As shown in figure 3,  these stations are located in both rural and urban areas throughout the  country.
FCC does not require broadcasters to submit programming information,  with limited exceptions, so it is difficult to report on the specific types of  programming provided by low-power television stations. However, based  on our interviews and reviews of documentation, it is evident that some  LPTV and Class A stations provide foreign-language, religious,  educational (e.g., programming from a university or local school system),  and home shopping programming. For example, one licensee we  contacted owns and operates several full-power, Class A, and LPTV  stations that air Spanish-language programming as an affiliate group for  the Telemundo network. This licensee told us that its Class A stations in  Washington, D.C., and Orlando, Florida, air daily local news broadcasts.  They also hold annual community events, providing the opportunity for  face-to-face interactions between station personnel and the community.  As previously noted, LPTV stations can act as translators by  retransmitting programming from a primary station, so some LPTV  stations may actually be serving the function of a translator, and the  number of such stations is unknown. For example, a licensee told us that  a LPTV station in Colorado acts primarily as a translator, but occasionally  overrides the system’s broadcast with its own broadcasts of local high- school sporting events, community meetings, and other events.
section_title: More than Half of Low- Power Television Stations Have Taken Steps to Transition to Digital
paragraphs: More than half of low-power television stations have taken steps to  transition to digital. Low-power television station representatives we  spoke with cited a number of benefits to broadcasting in digital, including  improved picture and sound quality and improved broadcast coverage.  Another significant benefit of digital is the ability to broadcast multiple  program streams through one 6-MHz channel, known as multicasting. For  example, a Class A station serving San Francisco and San Jose,  California, uses digital multicasting to provide 12 streams of television  programming on digital subchannels, including local broadcasts in  Vietnamese, Tagalog, Mandarin, Hindi, Punjabi, and Spanish.
Once stations have received a digital construction permit from FCC, the  actions the stations must take to transition their existing facilities to digital  vary, depending on the characteristics of individual stations, their  locations, and the markets they serve. For example, some stations may  need to update transmitter equipment to carry a digital signal in place of  an analog signal. Some stations, particularly those that must broadcast  from a new channel, will need to conduct an engineering analysis to  identify available spectrum and may need to purchase a new transmitter  and antenna equipment. Once stations have completed construction of  their FCC-approved digital facilities, they must apply for a license to  broadcast in digital. According to FCC’s data as of July 2011, about 29  percent of low-power television stations had completed the digital  transition. Figure 4 displays the percentage of all low-power television  stations that have completed various steps or have taken no action in  transitioning to digital.
However, the progress toward transitioning varies by the different types of  low-power television stations, as shown in figure 5. Translator stations— about 35 percent of which have fully transitioned to digital—have made  the most progress in transitioning to digital, compared with about 19  percent of Class A stations and about 20 percent of LPTV stations. About  46 percent of LPTV stations have taken no action to transition to digital,  compared with about 36 percent of translators and about 37 percent of  Class A stations. Figure 5 shows the progress in transitioning to digital by  type of low-power television station, as of July 2011.
section_title: FCC Issued an Order Establishing a Deadline and Processes for Low- Power Television Stations to Transition to Digital, but These Stations Face Challenges in Transitioning Largely because of Regulatory Uncertainty
subsections: section_title: FCC Has Established a Deadline and Processes for Low-Power Television Stations to Transition to Digital
paragraphs: FCC previously allowed low-power stations to apply for digital facilities,  and recently established a deadline of September 1, 2015, for low-power  television stations to cease analog operations and convert to digital  broadcasting. In 2004, FCC announced that the statutorily established  deadline for full-power television stations to transition to digital did not  apply to low-power television stations. In explaining its decision, FCC  noted that it did not have sufficient spectrum to give all full-power and  low-power television stations digital companion channels, and raised  concerns that forcing low-power television stations to transition to digital  via flash cuts would result in a loss of service to viewers. FCC stated that  it would set a low-power digital transition deadline sometime after the full- power transition was complete (which happened in 2009), but did not  preclude existing low-power television stations from transitioning to digital  earlier. In 2005, FCC began accepting applications from existing LPTV  and translator stations that wanted to transition to digital by using a flash  cut. FCC subsequently opened two filing windows in 2006 and 2009  during which existing low-power television stations could apply for digital  companion channels. On October 28, 2010, citing the uncertainty posed  by the potential reallocation of spectrum from broadcasting to broadband  purposes and the potential impact on low-power licensees, FCC  announced a freeze on applications for new digital low-power television  stations. However, FCC is still accepting digital flash cut, digital  displacement, and digital companion channel applications from existing  analog low-power television stations.
In September 2010, FCC issued a Further Notice of Proposed  Rulemaking that requested public comment on potential deadlines and  proposed rules for the digital transition of low-power television stations.  In the notice, FCC proposed establishing a deadline of sometime in 2012  for low-power television stations to cease analog operations, but also  requested comment on whether a later date would be more feasible. The  majority of the comments from low-power television licensees stated that  a 2012 deadline was not feasible, and some cited the need for additional  time to raise funds, receive FCC approval of their applications, and buy  and install equipment. In July 2011, FCC issued an order establishing a  deadline of September 1, 2015, for low-power television stations to cease  analog operations and convert to digital broadcasting. FCC also stated  that it would allow low-power television stations to file for one 6-month  extension to finish completion of their digital facilities by March 1, 2016,  but that the stations must cease their analog broadcasts by the  September 1, 2015, deadline. FCC’s order also adopted prior proposals  to allow low-power television stations to use full-power emission masks,  which could help some stations more easily secure a channel by filtering  the station’s signal and reducing potential interference, and to increase  the power levels for low-power television stations using VHF channels.
section_title: The Regulatory Uncertainty Caused by FCC’s Proposed Spectrum Reallocation Creates Challenges for Low-Power Television Stations’ Transition to Digital
paragraphs: Our interviews with low-power television stations and other industry  stakeholders indicated that the most significant challenge faced by low- power television stations is a result of regulatory uncertainty surrounding  FCC’s proposed spectrum reallocation. Furthermore, although FCC’s July  15, 2011, Report and Order establishes a process for Class A stations to  transfer their protected status to their digital companion channel, the lack  of such a process had previously posed challenges for some stations in  their transition to digital.
FCC’s proposed spectrum reallocation: Several licensees reported, both  in speaking with us and in written comments submitted to FCC, that the  regulatory uncertainty created by FCC’s proposed spectrum reallocation  has negatively affected their ability to transition to digital. One of the  recommendations of the National Broadband Plan was for FCC to initiate  a rulemaking proceeding to reallocate 120 MHz of spectrum (equivalent  to 20 television channels) from television broadcasting to wireless  broadband to help meet the nation’s increasing demand for broadband  service.  To begin the process of freeing this spectrum, FCC issued a  Notice of Proposed Rulemaking in November 2010 that discussed using a  variety of tools, including incentive auctions where broadcasters could  volunteer to relinquish their spectrum in exchange for a portion of the  incentive auction proceeds—which would require congressional  approval—and channel sharing, meaning two or more previously distinct  stations split the use of one channel and its 6 MHz of bandwidth. FCC  would then “repack” broadcasters into a smaller number of channels and  auction a contiguous band of newly cleared spectrum for wireless  broadband uses. Given that the spectrum reallocation proceeding is in its  preliminary phase, it has not yet been decided how the proposed  reallocation would affect low-power television stations or if those stations  would be able to participate in incentive auctions or channel sharing.
Low-power licensees and industry representatives told us that FCC’s  proposal for reallocating broadcast spectrum for broadband purposes  created a significant amount of regulatory uncertainty about the fate of  low-power television stations. Some licensees believe that FCC should  not require low-power television stations to complete their transition to  digital until after any spectrum reallocation is completed, when there will  be more clarity regarding what channels are available for low-power  broadcasters. Low-power licensees are particularly concerned that if full- power stations are repacked into new channels, low-power television  stations could (1) be displaced if they cause interference to a relocated  full-power station, and (2) find that there are no available channels where  they could move to avoid interference. This is a concern for stations  located in urban markets where spectrum is already scarce and for  translator stations in rural areas that use several channels. As previously  noted, Utah’s daisy chain system of translators retransmits signals from  several Salt Lake City stations, with each signal requiring its own input  and output channels each time it is retransmitted. Officials from the Utah  system told us that spectrum is so crowded at certain sites that they have  had to make use of alternative technologies to avoid interference. They  believe that FCC’s spectrum reallocation, as proposed, would “destroy”  the state’s translator network. When FCC decided to adopt a digital  transition deadline of 2015, rather than the originally proposed 2012 date,  it acknowledged such concerns, noting that it would like to avoid requiring  that stations make the significant investment required for conversion to  digital facilities, when such facilities may have to be substantially modified  because of channel displacement or taken off the air altogether in  connection with the implementation of the spectrum reallocation.  However, since there is no hard deadline for the spectrum reallocation, it  could still occur after the digital transition of low-power television stations.
In its order, FCC states that even if the reallocation is not concluded  before the digital transition deadline, a 2015 deadline will permit low- power television stations to take specific reallocation proposals into  account when finalizing their transition plans.
Low-power television licensees and their representatives told us that it is  difficult to secure digital transition financing because of the uncertainty  created by the proposed spectrum reallocation. The majority of those with  whom we spoke noted that many low-power licensees struggle financially  and could face difficulties financing their stations’ transition to digital.  Some stations have delayed their transition to digital because of concerns  that their investment will be lost because of a lack of available channels  or the need to spend additional funds to prevent interference with  relocated full-power stations. As previously mentioned, Congress  established NTIA’s Low-Power Television and Translator Upgrade  Program to help fund rural low-power television stations’ transition to  digital. As of June 2011, NTIA had reimbursed approximately $13 million  of the available $44 million to roughly 1,000 low-power television stations  for digital transition equipment costs. Some licensees have stated that  they would not have been able to transition to digital without federal  funds. However, NTIA’s program is a reimbursement program, and some  licensees have noted that it is difficult to obtain financing for the up-front  costs. The last day to apply for funds from NTIA’s program is July 2,  2012. FCC recommended that NTIA explore seeking an extension of the  statutory deadline from Congress given the number of low-power  television stations that will transition after the expiration of the program in  2012.
FCC’s actions related to Class A stations: In its July 15 Report and Order,  FCC established a process for Class A stations to transfer their protected  status to their digital companion channel, which had previously posed  challenges for some stations in their transition to digital. Prior to the  order, Class A stations that transitioned to digital by flash cutting on their  existing channel retained their Class A status since they were not  changing channels. However, this was not the case for Class A stations  that were using a digital companion channel to transition to digital. To  keep their Class A status, these stations had to continue to broadcast on  their existing analog channel, to which the Class A status was related. If  the Class A station chose to turn off its analog signal without requesting  special temporary authority from FCC to remain silent, then it lost its  Class A protected status, making the station vulnerable to displacement  by full-power stations or other primary users of spectrum. This led some  Class A stations to delay completing their transition to digital, and some  other stations lost their Class A status after transitioning to digital, as  discussed below.
When FCC established rules in 2004 for the digital transition of low-power  television stations, it made it clear that it was not at that time providing  Class A status to the digital companion channel of an analog Class A  station. FCC stated that providing Class A status to these stations’ digital  companion channels would complicate the digital transition of full-power  stations, since full-power stations must protect Class A stations from  interference. However, FCC stated that its intention was for Class A  stations to retain their status on the channel they ultimately chose for  digital operations, and that FCC would address the issue of how to permit  Class A digital companion channels after the completion of the digital  transition of full-power stations. Prior to establishing a process for Class  A stations to transfer their status to a digital companion channel, FCC  officials told us that Class A stations operating on a digital companion  channel could request special temporary authority to remain silent on  their analog facilities for up to 1 year, after which, by statute, the license  expires. While such procedures are contained in FCC’s rules, FCC did  not make any public statement directing such stations to enlist this  procedure to retain their Class A status. According to FCC staff, a total of  five Class A stations lost their Class A status after transitioning to digital  and shutting off their analog signal. For example, a low-power PBS  station in Pablo, Montana, that provides local programming to the Salish  and Kootenai tribes, told us that it lost its Class A status when it  transitioned to digital in 2009 and shut off its analog signal. FCC officials  told us that these stations could apply to have their Class A status  reinstated for their digital facilities, provided that they continued to comply  with Class A eligibility requirements and that there would be no adverse  effect on other stations. However, the stations may be unaware of this  opportunity, as it is not explicitly stated in the July 15 Report and Order.
section_title: FCC Authorized Low- Power Television Stations to Reach Underserved Communities, but FCC Has Not Fully Evaluated the Extent to Which Low-Power Television Stations Have Met This Goal
subsections: section_title: FCC Authorized Low- Power Television Service to Reach Underserved Communities and Help Meet its Broad Policy Goals of Localism and Diversity
paragraphs: FCC’s orders classifying the various types of low-power television  stations noted that each service fulfilled a need for television broadcasting  in underserved or unserved communities. Providing service to  underserved communities could include providing television service in an  area that had none, or providing specific groups with programming  tailored to their needs (e.g., ethnic or religious programming), which was  otherwise unavailable. In addition, FCC has highlighted how service to  these communities has led to positive impacts on FCC’s goals of localism  and diversity, including ownership by minorities and women. FCC’s 1956  order establishing a licensing process for translators noted that the  translators were primarily intended to provide television to areas without  service, but added that they could bring multiple services to communities  too small to support several stations. FCC subsequently established a  licensing process for LPTV stations in 1982, stating that LPTV stations  could add to programming diversity and would be particularly suited to  providing local programming. In subsequent policy statements, FCC has  repeatedly cited LPTV stations’ positive impact on providing service to  underserved communities and on FCC’s policy goals of localism and  diversity. For example, in 1994, FCC stated that it established the LPTV  service as a means of increasing diversity in television programming and  station ownership, and noted that the hallmarks of LPTV stations are  localism and niche programming.
In CBPA, Congress also cited localism and diversity as goals.  Specifically, it found that a small number of LPTV license holders had  operated their stations in a manner beneficial to the public good by  providing broadcasting that would not otherwise be available to their  communities. Congress further found that it was in the public interest to  promote diversity in television programming, for example, the  programming provided by LPTV stations to foreign-language  communities, and directed FCC to establish a process to provide certain  LPTV stations with interference protection equivalent to that afforded to  full-power stations (i.e., primary status). This led to FCC’s 2000 order  implementing CBPA and allowing low-power stations to apply for Class A  status, which noted LPTV stations’ contribution of locally originated  programming to underserved communities and niche programming for  specific groups, and also stated that LPTV service significantly increased  the diversity of broadcast station ownership by providing first-time station  ownership opportunities for minorities and women. FCC concluded that  acting to improve the commercial viability of such LPTV stations was  consistent with FCC’s fundamental goals of ensuring localism and  diversity in television broadcasting. More recently, FCC’s 2009 Annual  Performance Report noted that low-power television stations are an  important source of local community information, and FCC’s 2010  notice on the digital transition of low-power television stations  emphasized that FCC seeks to ensure the continued viability of low- power television stations that offer important services to specializ minority audiences, foreign-language communities, and rura l areas.
section_title: FCC Does Not Have Data to Evaluate whether Low- Power Service Is Meeting Goals, and May Not Understand How Its Decisions on Low-Power Television Stations Affect Communities
paragraphs: Although FCC’s low-power television goals—meeting the needs of  underserved communities, and contributing to localism and diversity—are  well documented, FCC has not collected data to evaluate the extent to  which the stations fulfill unmet needs or contribute to meeting FCC’s  policy goals. FCC’s decisions regarding the reallocation of broadcast  spectrum and its implementation of the digital transition of low-power  television stations will affect the continued operation of some low-power  television stations. However, FCC’s ability to weigh the effects of its  decisions on low-power television stations, the communities they serve,  and FCC’s goals of localism and diversity against the increasing need for  wireless broadband spectrum could be limited by a lack of data. In  addition, external data on these issues are limited; the trade association  for Class A and LPTV stations has disbanded, and several consumer  groups we contacted stated that they were not focusing on low-power  television stations. We have noted the importance of collecting and  analyzing data as a means to evaluate progress toward goals and inform  agency decisions. Specifically, our publication Standards for Internal  Control in the Federal Government states that management should  ensure that there are adequate means of obtaining information from  external stakeholders that may have a significant impact on the agency’s  achieving its goals. In addition, our Internal Control Management and  Evaluation Tool notes the need to obtain and provide to managers any  relevant external information that may affect the achievement of the  agency’s missions, goals, and objectives, particularly information related  to legislative or regulatory developments and political or economic  changes.
FCC is not able to determine the extent to which low-power television  stations provide local programming and meet the programming needs of  underserved communities. FCC requires all full-power and Class A  stations to file children’s programming reports; beyond this, FCC does not  collect data on the types of programming that full- or low-power television  stations provide. In 2008, FCC issued an order that would have required  full-power and Class A broadcasters to file a standardized form with FCC  describing the broadcaster’s programming, including local programming  and programming for underserved communities. FCC noted that this  would help clarify what broadcasters are doing to serve the public interest  and allow FCC to monitor trends in the broadcasting industry. However,  this requirement was not implemented because of legal challenges, and  FCC officials told us they are working to address industry opposition. As a  result, FCC’s ability to determine the overall community impact of the  stations, including whether the stations are serving underserved  communities by providing local or foreign-language programming, is  limited. Some stakeholders have suggested that FCC use the revised  programming form to collect and analyze data on how broadcasters were  serving the public interest and weigh the loss of broadcast service against  the benefits from reallocating spectrum to wireless broadband.
FCC’s lack of data may affect its ability to provide Congress with  information regarding whether additional Class A stations would help FCC  meet its broadcast localism goals. LPTV stations have not had an  opportunity to apply for Class A status since the onetime filing opportunity  in 2000. In 2008, FCC noted that it tentatively concluded that it should  allow additional qualified LPTV stations to be granted Class A status. It  stated that increasing the number of Class A stations would ensure the  existence of continued community programming and the availability of  Class A status would provide investment protection for LPTV stations  looking to make investments in the digital transition. FCC sought  comments on its statutory authority to create additional Class A stations  and how to define eligibility, but has not issued an order deciding whether  to create additional Class A stations and may need legislative guidance  from Congress on whether additional stations can apply for Class A  status after the original window of eligibility established by CBPA. It is  possible that some LPTV stations are fulfilling the requirements of Class  A stations by providing local programming without Class A protection, but  the extent to which this is the case cannot be determined without  programming data.
As part of the 2009 digital television transition of full-power stations, FCC  did use some of the technical data it collects from low-power licensees to  create an internal document for a commissioner that identified areas in  which the only source of over-the-air broadcasting is a low-power  television station. However, FCC does not know the number of stations  that have ceased broadcasting without FCC’s permission, some of whom  may be holding their license for speculative purposes. Low-power  licensees and their representatives told us that some low-power  construction permits and licenses are being obtained by “spectrum  squatters” that hold on to the permit or license in hope of selling it to an  interested party. FCC officials acknowledged that some licensees only  broadcast the minimal amount of time needed to maintain their license  and are simply holding the license in an attempt to sell it. They also noted  that as long as applicants comply with FCC’s rules, FCC cannot act  against a station that may be obtaining a construction permit or license for  speculative reasons. Additionally, FCC’s system for storing construction  permit and license applications does not automatically cancel expired  licenses and construction permits, which has led to expired licenses and  construction permits temporarily remaining in the system. FCC officials  told us that FCC keeps track of stations that report being silent, but it  does not have the resources to do the extensive field testing necessary to  identify which stations have gone silent without notifying FCC. They also  stated that FCC is working on ways to find these stations without  extensive field testing and periodically checks for expired licenses and  construction permits in order to cancel them and update their status in the  system.
In addition to lacking data about the contributions of low-power television  stations to FCC’s goals of localism and diversity, FCC has never formally  evaluated the extent to which low-power television stations actually affect  these goals. In initiating the 2010 quadrennial review of its broadcast  ownership rules, FCC does not mention low-power television stations  when discussing the policy goals of localism and diversity; however, it  did include low-power licensees as panelists on some of its ownership  workshops. Similarly, in June 2011, an FCC working group released a  white paper on the media and the information needs of communities that  described the various types of low-power television stations, but did not  assess their impact on communities and FCC’s goals of localism and  diversity. FCC officials told us that they have not formally evaluated low- power television stations’ impact on localism and diversity because low  power television stations are not subject to programming requirements  (with the exception of local programming requirements for Class A  stations) and are not considered in FCC’s multiple ownership rules and  policies. However, given FCC’s efforts to reallocate spectrum, FCC’s  ability to determine the public benefit derived from spectrum allocations to  low-power broadcasters would be enhanced by information on the impact  of low-power stations on communities and FCC’s goals. In addition, we  have previously identified weaknesses in FCC’s collection of data on  minority- and women-owned stations, including the lack of an FCC  requirement that low-power television stations file such information.  FCC recently began collecting ownership information from Class A and  LPTV stations, with the first submission due July 8, 2010, but, according  to FCC, the response rate was low. FCC officials told us they were  sending letters to licensees in an attempt to increase the response rate  for the 2011 filing. FCC officials stated that they hoped the data would  provide a baseline that they could eventually use to evaluate overall  trends in female and minority broadcast ownership, including LPTV and  Class A station ownership.
section_title: Conclusions
paragraphs: Low-power television stations use highly valued radio frequency spectrum  to transmit programming, and the demand for such spectrum continues to  increase as the United States experiences significant growth in  commercial wireless broadband services. Since additional spectrum  capacity will be needed to accommodate future growth, transitioning low- power television stations from analog to digital would aid FCC’s current  efforts to identify spectrum that could be made available for broadband  services. FCC has repeatedly noted the benefits of low-power television  stations in serving communities, such as providing programming that  would not otherwise be available, and expanding ownership opportunities  for minorities and women. However, FCC has not taken steps to collect  information that would inform its understanding of the impact of low-power  television service on communities—whether these stations are reaching  underserved communities; aiding FCC’s policy goals of localism and  diversity; or, as in the case of speculative licenses and those stations that  have gone silent, providing no community benefit. In addition, it is  possible that the three types of low-power television stations are affecting  communities differently—for example, a translator may be the only source  of free over-the-air network television for some communities, while a  Class A station may be the only source of foreign-language  programming—however, FCC does not have the data to determine if this  is the case. Lacking such information, FCC does not know the public  benefit of low-power television stations’ receiving spectrum for television  broadcast. Given that spectrum is a valuable and scarce natural resource  and initiatives are under way in the federal government to identify  spectrum that can be repurposed for broadband services, a thorough  understanding of the community benefits derived from low-power station  licenses could prove very valuable. Especially as FCC makes important  decisions related to spectrum allocations, such information could enable  FCC to weigh the potential loss of low-power television service against  the benefits of reallocating spectrum to broadband services.
With respect to Class A stations, Congress previously determined that  such stations had operated in a manner beneficial to the public good by  providing broadcasting to their communities that would not otherwise be  available, and instructed FCC to allow low-power television stations in  operation at the time of CBPA to apply for protected status. However, it is  possible that some low-power television stations currently provide  programming commensurate with that of Class A stations, but do not  have protected status because they were not in operation during the  statutorily provided onetime opportunity to apply for such status. FCC  sought comments on its statutory authority to create additional Class A  stations and how to define eligibility, but it may need legislative guidance  from Congress on this issue. Whether FCC concludes that it has statutory  authority, or needs Congress to revise CBPA first, eligibility of additional  stations to seek Class A status needs to be resolved.
section_title: Recommendations for Executive Action
paragraphs: The Federal Communications Commission should take the following two  actions:    Explore options for assessing how the three types of low-power  television stations have affected the communities they serve and have  contributed to FCC’s policy goals of localism and diversity. Such an  assessment could include evaluating what existing data FCC could  use and what additional data should be collected to inform such an  assessment.   Work with Congress, as necessary, to determine what the long-term  role of Class A stations should be, whether additional low-power  television stations should be permitted to apply for Class A status, and  what criteria stations must meet to qualify for such status. Such  criteria could include attributes that contribute to FCC’s goals of  serving underserved communities and enhancing localism and  diversity, such as providing locally produced programming and  programming otherwise unavailable to communities.
section_title: Agency Comments and Our Evaluation
paragraphs: We provided a draft of this report to FCC for its review and comment. In  response, FCC provided technical comments, which we incorporated as  appropriate, and written comments, which are reprinted in appendix II. In  its written comments, FCC did not agree or disagree with our  recommendations but discussed planned and ongoing actions to address  them. In particular, in response to our recommendation to explore options  for assessing how low-power television stations have affected the  communities they serve and have contributed to FCC’s policy goals of  localism and diversity, FCC stated that it will ask its Federal Advisory  Committee on Diversity in Communications in the Digital Age to address  this issue. Regarding our recommendation that FCC work with Congress,  as necessary, to determine what the long-term role of Class A stations  should be, whether additional low-power television stations should be  permitted to apply for Class A status, and what criteria stations must meet  to qualify for such status, FCC stated that it plans to analyze the data  from Class A stations’ children’s programming reports to determine the  stations’ measures to provide educational and informational children’s  programming. While this is a useful first step, additional work may be  needed to provide Congress with the information it needs to make  decisions regarding whether other stations should be allowed to apply for  Class A status and what criteria such stations must meet. Overall, FCC  stated that its spectrum priorities have changed in response to a growing  demand for wireless broadband services, and it is examining the role of  low-power television stations in providing over-the-air service to rural and  underserved communities as it is considering incentive auction and  channel-sharing initiatives to free up spectrum for wireless broadband.
FCC also commented that because of broadcasters’ free speech rights,  FCC is limited in its ability to evaluate the programming choices made by  low-power television stations. FCC added that, with the exception of  Class A stations, low-power television stations operate with secondary  interference protection and are not subject to the programming or  operational obligations of full-power television stations. FCC further noted  that since many low-power television stations are translators, FCC has  not found the need to collect extensive programming data from low-power  television stations. While we understand the need to respect  broadcasters’ free speech rights, we believe that FCC should collect data  to better understand the extent to which low-power television stations  address community needs and contribute to FCC’s goals of localism and  diversity. In addition, FCC could collect data beyond programming  information, such as whether a low-power television station is the sole  source of emergency information for a community.
We are sending copies of this report to the Chairman of the Federal  Communications Commission and appropriate congressional committees.  In addition, the report is available at no charge on GAO’s website at  http://www.gao.gov.
If you or your staff have any questions concerning this report, please  contact me on (202) 512-2834 or goldsteinm@gao.gov. Contact points for  our Offices of Congressional Relations and Public Affairs may be found  on the last page of this report. Key contributors to this report are listed in  appendix III.
section_title: Appendix I: Scope and Methodology
paragraphs: To determine where low-power television stations are located, we pulled  data from the Federal Communication Commission’s (FCC) Consolidated  Database System (CDBS) on the coordinates of low-power television  stations. We crossed the coordinates against the communities served by  the stations, as a check on the data. In addition, FCC officials told us they  cross-check coordinates data against existing data for stations located on  towers registered to the Federal Aviation Administration (FAA), and we  determined that over 36 percent of stations are on such towers. To  determine the status of low-power television stations’ transition to digital,  we pulled data from the CDBS to first identify all existing digital and  analog low-power television stations. Then, we identified the number of  existing analog low-power television stations that  requested or received a digital flash cut or digital companion channel  construction permit, requested or received a digital displacement for an existing analog  station, or   are operating a digital companion channel.
We removed construction permits that had expired. We did not remove  licenses with past expiration dates if FCC considers them active, as  indicated by a facility status of “licensed” or “licensed and silent.” Active  licenses with past expiration dates represented less than 5 percent of the  total active licenses in CDBS, and some may have renewal applications  or other actions pending. We then assigned stations to the following  categories:    digital transition completed (all licensed digital low-power television  stations that are not a companion channel for a licensed analog  channel); licensed digital companion channel;   analog stations granted a digital construction permit for flash cut,  companion channel, or displacement;    analog stations that had applied for a digital construction permit for  flash cut, companion channel, or displacement; and   analog stations that have taken no action (none of the above).
To determine the number of stations that had taken no action to transition  to digital, we identified the number of analog stations that (1) had not  requested or received a digital construction permit (or had received such  a permit but it had expired), and (2) were not operating a digital  companion channel.
To determine the reliability of data pulled from CDBS, we reviewed FCC  user guides and forms for the system, and interviewed knowledgeable  FCC officials regarding data entry and analysis procedures. In addition to  receiving tables from FCC, we created tables from FCC’s raw data to  determine the low-power television stations’ status in transitioning to  digital, and the location of facilities. We compared FCC’s tables against  our own, and we examined data runs for duplicates and other  inconsistencies. Finally, we interviewed selected low-power licensees and  asked them to verify FCC’s data regarding their status in transitioning,  and asked them for their general impressions regarding the accuracy of  FCC’s data. We note that applicants for a construction permit,  displacement, or license from FCC enter the data regarding the location  of their station, although as previously mentioned, FCC does check the  data against existing data for stations on FAA-registered towers. FCC’s  system automatically captures applications for station permits and  licenses—necessary steps in transitioning from analog to digital—and we  cross-checked stations’ tower coordinates against the community of city  and state served by the station. We determined the data were reliable for  our purposes. When discussing the number of stations in the report, we  note that while FCC’s rules require licensees to notify FCC when their  station is silent (not broadcasting) for more than 10 days, there may be  some licensed stations that are not actively broadcasting without notifying  FCC. However, these stations are holding licenses for particular pieces of  spectrum; therefore, we are including them in our station counts.  Therefore, when we describe numbers of stations in the report, the word  “stations” includes actively broadcasting stations and other stations that  may not be actively broadcasting, but which have licenses to broadcast.
To identify the steps FCC has taken to transition low-power television  stations to digital, and any challenges low-power television stations are  facing transitioning to digital, we interviewed FCC officials and reviewed  FCC’s orders and notices of proposed rulemaking relating to the digital  transition of low-power television stations and the proposed reallocation  of broadcast spectrum for wireless broadband, as well as comments  submitted in response to FCC’s requests for comments on these issues.  In addition, we reviewed the National Broadband Plan and a related  technical paper on the proposed spectrum reallocation, as well as  documents regarding the proposed spectrum reallocation from an FCC- sponsored broadcast engineering forum and an FCC webinar with state  broadcasting associations. We also interviewed representatives of 18  low-power licensees, which cumulatively hold licenses for approximately  838 low-power television stations. These licensees included owners of all  three types of low-power television stations; owners of a large number of  stations and owners of a small number of stations; owners providing  foreign-language, religious, or local programming; and municipalities that  own low-power television stations.
Further, we also interviewed legal counsel for some low-power television  stations and representatives from the National Translator Association,  Spectrum Evolution, Association for Maximum Service Television,  Association of Public Television Stations, Public Broadcasting Service,  and the League of United Latin American Citizens. We received written  responses to questions we submitted to the Minority Media  Telecommunications Council. We interviewed officials from the National  Telecommunications and Information Administration (NTIA) and the  United States Department of Agriculture (USDA) regarding the types of  low-power television stations that apply to their programs for funding to  transition to digital, and the challenges they face. In addition, we reviewed  documents and data from NTIA and USDA to determine the amount of  federal funds used to aid low-power television stations’ transition to  digital.
To obtain information on why low-power television stations were  established, we reviewed FCC’s 1956 order establishing a licensing  process for translators; the Notice of Inquiry, staff report, and resulting  1982 order establishing a licensing process for nontranslator, non-Class  A low-power television stations; and the Community Broadcasters  Protection Act of 1999 and resulting FCC implementation order creating  Class A stations. In addition, we reviewed contemporary FCC documents  for language regarding the purpose and benefits of low-power television.  To determine the extent to which FCC is tracking whether low-power  television stations are meeting their statutory and policy goals, we  interviewed FCC officials and reviewed relevant documents to identify the  types of information FCC collects, how it has used such data in the past,  and its current plans for using the data. In addition, we reviewed  comments submitted by low-power licensees and stakeholder groups  regarding FCC’s data on low-power television stations, and we  interviewed low-power licensees and their representatives to get their  perspectives on whether FCC has the data it needs to evaluate the extent  to which low-power television stations are meeting their statutory and  policy goals. We contacted a number of consumer groups to discuss low- power television stations’ impacts on communities, but the majority did  not respond or stated they were not working on the issue.
We conducted this performance audit from October 2010 to September  2011 in accordance with generally accepted government auditing  standards. These standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  that the evidence obtained provides a reasonable basis for our findings  and conclusions based on our audit objectives.
section_title: Appendix II: Comments from the Federal Communications Commission
section_title: Appendix III: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Staff Acknowledgments
paragraphs: In addition to the contact named above, Sally Moino, Assistant Director;  Cheron Green; Brian Hartman; Crystal Huggins; Bert Japikse; John  Mingus; Josh Ormond; Amy Rosewarne; Andrew Stavisky; and Hai Tran  made key contributions to this report.