Monday, May 09, 2005

FCC exceeded authority with broadcast flag

A US court of appeal has put a dent in the FCC's madating of the broadcast flag.

The full decision is available online. The conclusion is pretty scathing about the FCC acting outside their authority:

"The FCC argues that the Commission has “discretion” to exercise “broad authority” over equipment used in connection with radio and wire transmissions, “when the need arises, even if it has not previously regulated in a particular area.” FCC Br.
at 17. This is an extraordinary proposition. “The [Commission’s] position in this case amounts to the bare suggestion that it possesses plenary authority to act within a given area simply because Congress has endowed it with some authority to act in that area. We categorically reject that suggestion. Agencies owe their capacity to act to the delegation of authority” from Congress. See Ry. Labor Executives’ Ass’n,
29 F.3d at 670. The FCC, like other federal agencies, “literally has no power to act . . . unless and until Congress confers power upon it.” La. Pub. Serv. Comm’n v. FCC, 476 U.S. 355, 374 (1986). In this case, all relevant materials concerning the FCC’s
jurisdiction – including the words of the Communications Act of 1934, its legislative history, subsequent legislation, relevant case law, and Commission practice – confirm that the FCC has no authority to regulate consumer electronic devices that can be
used for receipt of wire or radio communication when those devices are not engaged in the process of radio or wire transmission.

Because the Commission exceeded the scope of its delegated authority, we grant the petition for review, and reverse and vacate the Flag Order insofar as it requires demodulator products manufactured on or after July 1, 2005 to recognize and give effect to the broadcast flag.

So ordered."

That's what I'd call a pretty conclusive victory for the Amercian Library Association (ALA) and others who brought the case.

The film, broadcasting and cable industry lobbyists will now be relishing a further lucrative opportunity to convince US lawmakers to introduce the flag via a different route.

Declan also has the story.

Update (Thanks to Michael Geist for the links): The NYT also have a couple of readable stories on the issue and ask whether the broadcasters threat to pull HDTV broadcasts will now be followed through.

"In 2002, Mel Karmazin, then president of Viacom, threatened to withdraw high-definition versions of programming from the airwaves if the flag technology was not adopted, a threat echoed by other broadcasters and movie studios.

"Now we will see if threats to pull broadcasts from CBS and others are real or not," said Mark Cuban, owner of the Dallas Mavericks and HDNet, an all-HDTV channel available through cable and satellite, and an opponent of the broadcast flag.

Those measures are unlikely to be taken any time soon. First, advocates of the flag technology will try to circumvent the court's ruling through Congressional legislation. And despite the industry's alarm bells, Internet video piracy still is very much a nascent issue. At today's transmission speeds, it would take about 24 hours to send a one-hour show broadcast in HDTV over the Internet."

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