CBS wants the FCC to reinstate the UHF discount “without waiting to launch any further proceeding on other ownership issues,” the broadcaster's Washington officials told aides to Commissioners Ajit Pai and Mike O'Rielly in a meeting last week, according to an ex parte filing in docket 13-236. Restoring the discount is expected to be an early target of the FCC under the new administration (see 1701110067). “Time is of the essence in providing broadcasters the ownership breathing room they so desperately need to compete with other video services,” CBS said. The FCC failed to offer “a shred of evidence that the public interest is in any way adversely affected by retaining the UHF discount, especially given the passage of time since the DTV transition, the point when UHF and VHF stations supposedly became technical equivalents,” CBS said. Numerous industry officials and the FCC said that after the DTV transition, UHF spectrum became more desirable than VHF, undercutting the original rationale for the discount. Industry officials said it's unlikely the new FCC would restore the discount before the ongoing reconsideration process of the item is complete. Replies are due Jan. 23.

The FCC Media Bureau granted Hemisphere Media Group's request for a declaratory ruling allowing Hemisphere to be foreign owned up to 49.99 percent, the bureau said in a declaratory ruling released Wednesday. “The public interest would be served by permitting foreign ownership in excess of the 25 percent benchmark.” Hemisphere asked the commission to give permission for Mexico-based Cinéma Aeropuerto and its foreign-owned parent companies to own up 49.99 percent. Aeropuerto already owned 7 percent, and one of Aeropuerto's parent companies is partially controlled by a trust committee that has one member in common with Hemisphere's board, the ruling said. Allowing foreign investment in the media company could lead to reciprocity for U.S broadcasters from Latin America, Hemisphere and the bureau said.

Advertisers need to be careful when running ads or promotions that refer to the NFL’s upcoming Super Bowl, said Wilkinson Barker trademark attorney Mitchell Stabbe in a blog post Tuesday. “The NFL’s rule book defines trademark violations very broadly,” said Stabbe. “If anyone were willing to throw the red flag to challenge the league’s position, a review from the booth might reverse some of those calls.” Though the NFL challenges almost any use of the term “Super Bowl,” some of those challenges are vulnerable to argument, Stabbe said. One example is local broadcasters that use the word Super Bowl in the title of a news program about the game, Stabbe said. “There is a strong argument that such naming constitutes permissible ‘nominative fair use,’” Stabbe said. The NFL also looks dimly on advertising that uses the term “Super Bowl,” or paid events or contests that use the trademark, Stabbe said. The league has a “huge incentive” to be so aggressive with trademark protection because its Super Bowl advertisers pay the league a great deal for exclusive sponsorship rights, Stabbe said. Uses of the trademark outside those agreements chip away at that exclusivity, he said. Broadcasters are better off not running the risk of litigation with the league, since they need the NFL to give them media credentials to cover the Super Bowl, Stabbe said.

Nexstar completed its $4.6 billion buy of Media General, it said in a news release Tuesday. Formerly Nexstar Broadcasting, the company will now be called Nexstar Media Group, the release said. The FCC Media and Wireless bureaus last week approved the deal and a waiver to allow the transaction to be consummated during the still-ongoing incentive auction (see 1701110078). “The Media General transaction increases Nexstar’s broadcast portfolio by approximately two thirds, more than doubles the Company’s audience reach, provides entrée to 15 new top-50 DMAs [designated market areas] and offers synergies related to the increased scale of the combined digital operations,” the buyer said. Nexstar said it completed the 13 divestitures associated with the deal. “Our increased scale will allow us to create news bureaus in more state capitals than any other broadcaster, and Nexstar Media Group will produce over 3,500 hours a week of local news for medium and small markets while employing almost 10,000 people,” said CEO Perry Sook.

Pandora shares were up 6.5 percent in mid-day trading Friday to $12.78 after an announcement Thursday of a 7 percent workforce reduction and higher-than-forecast Q4 revenue projections. CEO Tim Westergren called the job cuts a “tough, but important” moment in evolving to a “large, enduring” business.” In a news release after markets closed Thursday, the company said it expects to exceed previously announced Q4 2016 revenue projections ($362 million to $374 million) and adjusted EBITDA loss guidance ($51 million to $39 million) ranges, crediting “strong advertising performance.” The company, due to launch its long-awaited on-demand music service this quarter, surpassed the 4.3 million paid subscriber mark in Q4, it said. Pandora launched its mid-tier Pandora Plus plan at the end of Q3 -- a remake of its Pandora One offering -- and said it generated more than 375,000 net new subscribers by year-end. It did so largely through homegrown marketing, saving on customer acquisition costs, said Westergren in a letter to shareholders. “More than 70 percent of our new subscribers came from in-app promotion,” said Westergren, saying that’s a competitive advantage that bodes well for Pandora being able to upsell existing customers to its upcoming premium subscription business. In the two months since the completion of direct agreements with music labels and publishers, the company saw a “dramatic increase” in partnership activity, with “thousands of artists” publishing more than 7,000 messages heard by Pandora listeners over 600 million times. Such artist engagement is driving listening session length, said Westergren. Dougherty & Co. analyst Steven Frankel maintained a “neutral” rating on Pandora in an investor note, citing stiff competition from Apple, Spotify and others as it rolls out its on-demand services. “Given the execution risk,” Dougherty will maintain its rating “until we have more confidence in management's ability to reach, maintain and scale profitability," Frankel said.

The design of the incentive auction is flawed, and FCC Commissioners Ajit Pai and Mike O'Rielly should pause it and rethink “the entire process of spectrum allocation,” said broadcast company Max Media CEO Gene Loving in a letter to the commissioners Thursday. “Taking a cue from President-Elect Trump’s efforts to reevaluate all government programs, I urge you to consider whether this auction, which was started under the previous administration, will likely end up as 'failed' just as the new commission takes over, leaving the new administration holding the proverbial bag,” said Loving. “I’m certainly not an expert in auction theory, but the results of the forward auction are clear evidence of a flaw in the design, possibly due to the wireless bidders being told over and over that if they don’t like the price, the auction will be rerun again and again and again,” the letter said. “Perhaps rather than announce the clearing values, the commission should have kept that information confidential. Wireless bidders should have been told only how much spectrum would be made available.” Under the new FCC administration, the auction could be temporarily halted and redesigned “to ensure the future spectrum needs are truly met that reflect the reality of the market, not a flawed auction process,” said Loving. “In line with the Trump administration business approach to running government, all 126 megahertz cleared in Stage 1 could be purchased by a specific purpose entity financed through the issue of bonds. That entity could then be charged with selling spectrum when demand merits the sale, meaning when prices are high enough so that the US Treasury could make a profit, or even better, leasing spectrum to the wireless industry at a monthly fee to create a long term income stream for the government and an ongoing return to U.S. taxpayers.”

Norway’s decision to become the first country to begin the “forced turn-off” of analog FM (see 1701090023) “is causing not just static, but outright anger,” said NAB Chief Operating Officer Christopher Ornelas in a Thursday blog post. “The angst stems from the fact that the shutdown could leave tens of thousands of people without access to some of their favorite free and local radio stations.” Norway’s example “has prompted a smattering of press reports suggesting that America may eventually follow suit,” said Ornelas. His “bottom line” response is that “no way will America go Norway’s route and ‘turn off’ FM radio,” he said. “It’s just not going to happen, in my lifetime or yours.” Norway uses the Eureka-147 digital audio broadcasting system, but “we in the U.S. chose a different path to digital radio,” he said. The HD Radio system in the U.S. “uses identical spectrum and the same channels for both analog and digital services,” he said. “Thus, there's no cost-saving advantage to shutting down analog FM services in America,” as there is in Norway, which requires “two separate swaths of spectrum for radio” to run analog and digital services with the same content, he said. “Turning off analog FM is apparently seen by the Norwegian parliament as a cost-saving efficiency -- even though actual radio listeners in Norway are quite unhappy about losing this service.”

FCC political file rules could be made stricter through upcoming legislation, said Reps. Ben Ray Lujan, D-N.M., and John Yarmuth, D-Ky., in a joint statement Thursday. The Media Bureau's recent clarification of political file rules (see 1701090064) is encouraging but “more work needs to be done,” they said. “We hope that the incoming Administration keeps its word to drain the swamp by strengthening disclosure requirements to reveal the true donors behind issues ads, as well as making the online political file machine readable,” said the statement. “The public deserves to know who is funding the political ads that they see, and that information should be easily accessible to all. We plan to reintroduce legislation this Congress that will do just that.”

Various court challenges of the FCC 2014 quadrennial review ownership rules were transferred, as expected (see 1611170055), to the 3rd U.S. Circuit Court of Appeals, said an order (in Pacer) filed by the court clerk Wednesday. Though appeals of the FCC rules had been filed both in the 3rd and D.C. circuits, the case was given to the D.C. Circuit in a lottery to determine venue. The Prometheus Radio Project filed an unopposed motion to move the case to the 3rd Circuit, since that court heard the previous iterations. Other petitioners challenging the rules are the Multicultural Media, Telecom and Internet Council, News Media Alliance and National Association of Black Owned Broadcasters. NAB appealed the rules to the FCC, and several attorneys said they expect the court to allow the process at the agency -- which will shortly be controlled by Republicans seen as hostile to the ownership rules -- to play out first.

The ATSC 3.0 suite of standards will have “future extensibility” to support an upgrade to 8K resolution, ATSC President Mark Richer emailed us Tuesday through a spokesman. ATSC 3.0's H.265 video codec “can be extended to support delivery of 8K video,” Richer said. ATSC 3.0 also “incorporates a number of other mechanisms for future extensibility, including the “flexible boot strap signal” in the standard’s physical layer and the internet protocol layer, he said. “These and other features of 3.0 could be used to signal the presence and parameters of the 8K transmission to new receivers.” ATSC 3.0's framers for years have positioned 8K as “within the realm” of where the standard ultimately would “evolve to” (see 1404080061). As an issue, 8K jumped in importance at CES with the multitude of 8K TV prototypes showcased on the main show floor and analyst projections that 8K product would make it to market soon (see 1701090053).