The conversion of broadcast television signals from analog to digital has sparked a host of technological, procedural, and legal questions about how those signals will be carried by cable operators. One key issue with First Amendment implications is "digital must-carry" - specifically whether a cable operator will be required to carry all of the multiplexed signals broadcast by a digital TV station, and how cable carriage will be implemented during the transition to digital broadcasting.

Background

   The 1992 Cable Act outlined provisions under which cable operators are obligated to carry the analog signals of broadcast television stations. Generally, a cable system with 12 or more active channels is required to carry local TV stations on up to one-third of its channels. The Act also provided for "retransmission consent," by which a cable operator must obtain permission from a broadcaster before carrying its signal. Commercial TV stations may choose to be carried under either must-carry or retransmission consent provisions.

   Meanwhile, the Telecommunications Act of 1996 established a mechanism for the conversion from analog to digital television signals, whereby existing broadcasters would receive an additional 6 MHz of spectrum for digital use and return their analog licenses to the government by 2006. Broadcasters will be able to use this new spectrum to broadcast one channel of high-definition programming or to "multiplex" several channels of standard-definition programming. The spectrum can also be used for "ancillary or supplementary services," such as data transmission for third parties.

FCC Proceeding

   The Federal Communications Commission released a notice of proposed rulemaking on July 10, 1998 seeking comment on the responsibilities of cable operators to carry digital broadcast signals ("Carriage of the Transmissions of Digital Television Broadcast Stations," CS Docket No. 98-120). The notice sought comment on "the critical issues surrounding the interoperability of the digital television broadcast system, the cable system and its components, and the digital receiver"; "on whether to amend the cable television broadcast signal carriage rules, embodied in must-carry and retransmission consent, to accommodate the carriage of digital broadcast television signals"; and on changes to other cable and open video system rules.

   The notice articulated the Commission1s interest in establishing "an efficient and orderly structure" that would allow issues to be resolved, to the extent possible, by market forces and private agreements. The structure should also respect "the First Amendment rights of all participants as established by court precedent," the notice said. The FCC's rulemaking action was triggered by Section 614(b)(4)(B) of the Communications Act of 1934 as amended by the Telecom Act of 1996:

At such time as the Commission prescribes modifications of the standards for television broadcast signals, the Commission shall initiate a proceeding to establish any changes in the signal carriage requirements of cable television systems necessary to ensure cable carriage of such broadcast signals of local commercial television stations which have been changed to conform with such modified standards.

   In addition, broadcasters point to Section 614(a) of the Communications Act: "Each cable operator shall carry, on the cable system of that operator, the signals of local commercial television stations and qualified low power stations as provided by this section." This language does not distinguish between analog and digital signals and thus applies to both, broadcasters contend.

   Meanwhile, the FCC's notice of inquiry points out that in the legislative history of the Telecom Act, "Congress stated that it did not intend to 'confer must-carry status on advanced television or other video services offered on designated frequencies' adding that the 'issue is to be the subject of a Commission proceeding....'" The notice also cites similar congressional intent in the legislative history of the Balanced Budget Act of 1997.

Transition period

A particularly thorny issue involves must-carry during the digital transition period between now and 2006, or beyond that date (with a waiver) until 85 percent of television households in a market can access digital signals. Analog/digital simulcasting is scheduled to phase in between 2003 and 2005, resulting in up to twice as many stations in operation with significant redundancy in program content. This raises the concern that cable operators would be forced to drop a variety of cable channels in order to carry duplicative broadcast channels. The Commission's notice of inquiry sought comment on several proposals for dealing with this situation:

• Immediate carriage. Cable systems would have to carry all commercial digital TV stations from the outset in addition to existing analog stations.
• System upgrade. Cable systems increasing their channel capacity through plant upgrades would be required to carry digital TV stations as they come on the air.
• Phase-in. Cable systems not upgrading their facilities would phase in digital stations at a rate of perhaps three to five per year to minimize channel lineup disruption.
• Either-or. Broadcasters would choose mandatory carriage for either their analog or digital signals until 2005, when must-carry would apply to digital signals only.
• Equipment penetration. Mandatory carriage would not be triggered until a significant number of consumers (e.g., 5 percent or 10 percent) had digital TVs or converters.
• Deferred. Digital must-carry would be deferred until perhaps 2002 when independent and smaller market stations are required to begin digital broadcasting.
• No must-carry. Digital broadcasters would not have must-carry rights until the transition period is over.

   Thus far the courts have weighed the constitutionality of must-carry only in the realm of analog broadcasting. In that context, First Amendment advocates have argued that must-carry is unconstitutional because it coerces the speech of cablecasters by forcing them to carry certain speech (i.e., local broadcast stations) at the expense of speech they might otherwise choose to disseminate. From this perspective, must-carry amounts to a content-specific regulation subject to strict scrutiny - which it could not withstand.

   The U.S. Supreme Court, however, has seen the matter differently. In Turner Broadcasting System, Inc. v. FCC, 117 S. Ct. 1174 (1997) ("Turner II"), the Court ruled by a slim 5-to-4 margin that the 1992 Cable Act's must-carry provision is content-neutral and thus subject only to the intermediate scrutiny of United States v. O'Brien, 391 U.S. 367 (1968). The majority ruled that the government1s desire to promote diversity, competition, and the economic health of broadcasters is a substantial interest not related to the suppression of speech, and that the must-carry statute is not "substantially broader than necessary" to advance that interest. In 1994 the Supreme Court reached a similar conclusion in Turner Broadcasting System, Inc. v. FCC, 512 U.S. 622 (1994) (3Turner Iż).

   Nonetheless, in both decisions Justices Ginsburg, O'Connor, Scalia, and Thomas found must-carry to be content specific and thus subject to strict scrutiny. Even Justice Breyer, who ultimately voted with the majority in Turner II, noted that mandatory carriage "extracts a serious First Amendment price" because "it interferes with the protected interests of the cable operators to choose their own programming."

   Despite the ruling's narrowest of margins and strongly worded dissent, the FCC apparently regards Turner II as a constitutional green light to proceed with some type of must-carry rules for digital broadcasting. "Such rules must be consistent ... particularly with the Supreme Court1s holding in [Turner II]," the Commission stated in its notice of inquiry at para. 15.

   No matter how carefully the FCC crafts regulations for digital must-carry, almost any action it takes can be expected to end up in the courts. In the case of multiplexing, for example, it is obvious that criteria would have to be developed to determine carriage versus non-carriage for certain channels. Such criteria might well be content specific and thus invite strict scrutiny.

   Even at a level of intermediate scrutiny, however, there is no guarantee that Turner II would sustain a must-carry regimen for digital broadcast signals. Not only did the justices split sharply in their view of content neutrality, but their thinking was influenced heavily by the economic and competitive exigencies of the analog environment. In addition, the Court's rulings were based on unusually specific findings by Congress in the 1992 Cable Act. In this technologically and economically dynamic industry the world has changed significantly since then, as even the FCC acknowledges in its notice. Multiplexing, which is at the heart of the digital must-carry debate, is a prime example of such change. Thus, Turner II might hold sign/ificantly less precedential value in the digital environment.

   As this proceeding moves into 1999, it is not clear how the FCC will fulfill its mandate from Congress "to ensure cable carriage of such [digital] broadcast signals." From a First Amendment perspective the larger question remains: Is there a way to resolve the digital cable carriage issue that does not amount to a suppression of speech?