III. THE DISTANT-SIGNAL COMPULSORY LICENSE HAS BEEN EGREGIOUSLY ABUSED BY SATELLITE CARRIERS, AND THE NEED FOR IT IS RAPIDLY DIMINISHING WITH THE GROWTH OF LOCAL-TO-LOCAL
America's free, over-the-air television system is based on local stations providing programming to local viewers. When satellite carriers began delivering television programming in the 1980's, however, retransmission of local television stations by satellite was not yet technologically feasible. In 1988, Congress therefore fashioned a stopgap remedy: a compulsory license that allows satellite carriers to retransmit distant network stations, but only to "unserved households." 17 U.S.C. § 119. The heart of the definition of "unserved household" is whether the residence can receive an over-the-air signal of a certain objective strength, called "Grade B intensity," from an affiliate of the relevant network. Id., § 119(d)(10) (definition of "unserved household"). In 1994, Congress extended the distant-signal license for another five years, although it expressly placed on satellite carriers the burden of proving that each of their customers is "unserved." 17 U.S.C. § 119(a)(5)(D).
In 1999, Congress again extended the distant-signal license as part of the SHVIA, and statutorily mandated use of the FCC-endorsed computer model (called the "Individual Location Longley-Rice" model, or "ILLR") for predicting which households are able to receive signals of Grade B intensity from local network stations. 17 U.S.C. § 119(a)(2)(B)(ii). In the SHVIA, Congress also classified certain very limited new categories of viewers as "unserved," including (1) certain subscribers who had been illegally served by satellite carriers but whom Congress elected to "grandfather" temporarily, see 17 U.S.C. § 119(e), and (2) qualified owners of recreational vehicles and commercial trucks, see id., § 119(a)(11).
By its terms, grandfathering will expire at the end of 2004. 17 U.S.C. § 119(e). Unlike in 1999, when Congress saw grandfathering as a way to reduce consumer complaints by allowing certain ineligible subscribers to continue receiving distant signals, the end of grandfathering will have little impact in the marketplace. This special exception should therefore be allowed to expire routinely.[12]/