In a ruling cheered by public TV stations, many of which had soug...

ad-supported ones, on their excess nonbroadcast digital spectrum. The court denied a petition for review of the FCC order filed jointly by the United Church of Christ, the Alliance for Community Media and the Center for Digital Democracy. The decision clears the legal uncertainty that kept many PTV stations from developing a business model for their proposed ancillary and supplementary services, revenue from which was expected to at least partly offset the steep cuts in state budgets and private funding. The petitioners contended the FCC’s order was contrary to both the plain language of Sec. 399b of the Communications Act and to Commission precedent. They said the FCC “inadequately explained” its departure from its precedent that prohibited broadcasting of ads by PTV stations and restricted the transmission of subscription services by those stations. Agreeing with the FCC that the only provision of Sec. 399b that prohibits advertising by public broadcasters refers simply to “the broadcasting of any advertisement,” the court said the distinction the agency made between broadcast and nonbroadcast was “grounded in the terms of the statute.” The statute, which defines advertising as material that is “broadcast or otherwise transmitted,” and then prohibits only advertising that is “broadcast,” supports the FCC’s distinction, the court said. As for the petitioners’ argument that the Commission hadn’t adequately explained its reversing its policy of 50 years to prohibit ad-supported programming on PTV or allowing PTV to offer subscription services, the court said the FCC had explained in its order that since digital technology allowed multiple channels, a flat ban on ads no longer was appropriate. It also said the Commission had justified its blanket approval of subscription services by PTV by its argument of technology change. “The Commission adequately articulated the ‘multiple channel’ argument in the 2001 order,” the court said, and to the extent that the petitioners’ position was that ad-supported services would completely supplant noncommercial services of PTV stations, “the Commission’s reasoning is sufficient.” The court also raised the issue of whether advertising on subscription TV was so “pernicious to public broadcasting” that it should be totally banned, as the agency’s position had been in the 1950s. The Commission did consider the tradeoff between allowing PTV stations to raise additional revenue to pay for the digital transition and the risk that ad-supported services would denigrate the noncommercial nature of PTV, the court said. It said the FCC had required that PTV stations maintain free over-the-air service with no ads and that they use their digital spectrum primarily for noncommercial uses, as well as restrictions as nonprofits, tax requirements and oversight by other bodies. Those conditions and restrictions reduced the risk that limited ads would fundamentally undermine the noncommercial nature of public broadcasters, it said. The Commission had reserved the right to act in case it found those constraints were inadequate, the court said. The FCC’s requirements on PTV stations would prevent the “wholesale conversion of public broadcasting to subscription TV,” it said. Expressing disappointment over the court decision, the Media Access Project said it would allow PTV stations to show commercials on their digital channels if they provided 1 commercial-free broadcast channel and offered the advertiser-supported channel on a subscription basis. “The public television station may also lease its additional channels to commercial broadcasters, like ABC, NBC, CBS or Fox, who may offer commercial broadcasts on public television spectrum on a subscription basis,” MAP Assoc. Dir. Harold Feld said.