It has taken a while, but the FCC has finally realized that the Children’s Television Act (CTA or “Kidvid” as it is called in the industry) is more than somewhat out of date: The media world is not what it was when the CTA was passed by Congress 28 years ago. According to the FCC, among the other changes brought on by the advent of the Digital Age, children are engaging in less “appointment viewing” and in more on-demand, online and other non-broadcast content consumption. The FCC has concluded that the expansion of viewing outlets and the changes in children’s educational and entertainment options warrant a reexamination of some of its rules implementing the CTA. It has issued a Notice of Proposed Rulemaking (“NPRM”), has received comments and can be expected to act on the proposed changes in the next several months.

The NPRM advances several “tentative conclusions” related to the content that broadcasters may count toward satisfying the “Core Programming” requirement. Essentially, the FCC has defined Core Programming as programming that targets children under 13 as the intended audience. The definition will not be changed but the FCC has proposed eliminating several of the Core Programming criteria, specifically, the requirements that Core Programming be (1) at least 30 minutes in length; (2) regularly scheduled; and (3) identified as Core Programming within the content using the designation “E/I,” which stands for “Educational and Informational.” The NPRM is also seeking comments on whether to maintain or eliminate several other Core Programming and reporting requirements, including that (A) Core Programming be broadcast between 7:00 a.m. and 10:00 p.m.; (B) that broadcasters notify program guide publishers about Core Programming; and (C) that broadcasters file quarterly compliance reports with the FCC. Moving forward with the proposed reduction in paperwork associated with the CTA Rules should be a no-brainer; whether the prescriptive scheduling requirement will be changed is harder to predict.

Of particular potential importance to merchants and advertisers is the FCC’s proposal to permit broadcasters to satisfy the CTA requirements by broadcasting the Core Programming on multicast channels, as opposed to requiring Core Programming on a broadcaster’s primary station. The FCC’s use of the term “multicast” in the NPRM appears to refer broadly to all over-the-air broadcast stations operated by a particular broadcast licensee, including digital channels that are not carried by multichannel video programming distributors. Thus, the proposal’s reach appears to go beyond more traditional video streaming under which a Core Program is carried on the primary station to satisfy the requirement of the rules and, in some cases, is video streamed and hence available in digital mode as well.

The response to the FCC proposal to make the Kidvid rules more flexible has been generally favorable. Broadcasters generally support the proposals, which appear at least to free up time on the primary station for programming of broader appeal (and therefore of greater market value to advertisers) and to reduce the straightjacket effect of the 30-minute minimum program length. A few producers have expressed concern that removal of the Core Programming from the primary station channel may reduce the funds available to create new and innovative E/I programming. One Commissioner has asserted that the ability to meet the Core Programming requirement through multicasting threatens to exacerbate the digital divide for Americans who cannot afford access to, or who do not otherwise have digital service.

Perhaps equally important to advertisers is what the FCC does not propose to change. The NPRM does not address the CTA’s limits on commercials during content directed at children age 13 and younger. These limits will remain at 10.5 and 12 minutes per hour of children’s content on weekends and weekdays, respectively. This is significant: In its enactment of the CTA, Congress specifically allowed the FCC to reexamine the commercial limits at any time after 1993; it has never done so. It may be that the FCC felt that a relaxation of the time limits on advertising in Core Programming is not really necessary since much of children’s content targets children between 13 and 16 years old, and thereby avoid the more restrictive commercial limits of the CTA. The NPRM also does not address the CTA’s host-selling rules, which will continue to prohibit advertisements of products by characters featured in children’s content from appearing adjacent to that content, and will continue to restrict addresses for websites that use host-selling from being displayed during the applicable programs and commercial content. These rules were furiously controversial when adopted and led to several ultimately unsuccessful court challenges. We tend to draw two potential inferences from the fact that the FCC has not chosen to revisit these issues (even when Core Programming may not be aired on the primary station). First, and despite significant changes in the industry, the FCC continues to consider the commercial and host-selling limits valuable from a public policy perspective, and second, the FCC is not overly concerned that the limits materially affect the health of advertising support for children’s content programming.

The FCC is expected to act favorably on this initiative and to do so in the next several months. Although Big Bird is thus very likely to go digital, this is not an outright repeal of the CTA or its policies. Advertisers and programmers need to be aware of the rules and their underlying purposes in formulating their advertising plans. The Ad Law Group at Venable stands ready to assist.