Welcome to the first Issue of Volume 74 of the Federal Communications Law Journal, the nation’s premier communications law journal and the official journal of the Federal Communications Bar Association (FCBA). We are excited to present the first Issue of this Volume showcasing the diverse range of issues encompassed by technology and communications law. This Issue provides analysis and insight on topics ranging from cable regulations to biometric privacy, cryptocurrency tax, and digital political advertising.
This Issue begins with a feature from Joel Timmer, an associate professor in Texas Christian University’s Department of Film, Television & Digital Media. In his Article, Timmer discusses the viability of the Cable Communications Policy Act of 1984’s leased access requirement, which mandates cable operators reserve channel capacity for lease by programmers unaffiliated with the cable operator, given the changes in today’s modern media marketplace. Timmer argues that the leased access requirement should be found unconstitutional because the law has not meaningfully achieved Congress’ purpose for the provision, which was meant to provide diversity and competition in television programming. Timmer points to the proliferation of access to online video programming, such as Netflix, YouTube, and Hulu with Live TV, as examples of how the modern marketplace reduced the need for a leased access requirement.
This Issue also features three student Notes written by Journal members. The first Note, written by William Elman, discusses the Internal Revenue Service’s (IRS) approach to taxing hard fork cryptocurrency. Elman challenges the IRS’s current classification of hard forked cryptocurrency as gross income, and instead proposes that hard forked cryptocurrency is more comparable to corporate spin-offs. He then suggests that hard forked cryptocurrency should be taxed strictly upon disposition, at capital gains rates, with a cost basis of zero.
The second Note, written by Elisa Cardano Perez, addresses the inconsistencies in biometric privacy regulations promulgated at the state-level. Perez argues that Congress should provide a federal legislative solution that grants individuals greater control over their biometric data and provides clarity for businesses and consumers.
The third Note, written by Merrill Weber, discusses online political advertising and the need for federal regulations to promote uniform disclosure requirements and limit political advertisers’ ability to microtarget hyper-specific audiences. Weber argues that the recent federal proposition for reform, the Honest Ads Act, fails to adequately address these concerns.
The Editorial Board would like to thank the FCBA and The George Washington University Law School for their support of the Journal. Furthermore, the Board would like to thank all the authors and editors who contributed to this Issue.
The Journal is committed to providing its readership with scholarly analysis and thought leadership on topics relevant to communications and information technology law and related policy issues. The Journal thus welcomes any submissions for publication, which may be directed to firstname.lastname@example.org for consideration. Any further questions or comments may be directed to email@example.com. This Issue and our archives are available at http://www.fclj.org.
By Joel Timmer
Congress enacted the leased access rule as part of the Cable Communications Policy Act of 1984 at a time when most communities were served by only a single cable operator, and before the development of other means of distributing television programming to consumers, such as via satellite or the Internet. The rule requires cable operators to make up to 15% of their channel capacity available to lease by programmers who are unaffiliated with the operator. In doing so, the leased access rule provides programmers with a way to reach a cable operator’s subscribers even if the operator refuses to offer their programming to subscribers. With the rule, Congress intended to promote a diversity of program sources for consumers. Since the rule’s enactment, there has been tremendous growth in the number and types of platforms which programmers can use to reach consumers. This appears to have reduced, if not eliminated, the need for the rule to promote a diversity of program sources. Further, the rule appears to have done little to promote program source diversity in the years it has been in effect, meaning it has failed to promote its intended interests as required by intermediate scrutiny, the constitutional standard that should apply to this content neutral rule. Consequently, the rule should be found unconstitutional.
By Elisa Cardano Perez
The use of biometric technology and biometric data are spreading rapidly in the private sector. As a result, individuals are losing control over their data, particularly data that is uniquely capable of identifying them. Taken collectively with other data, biometric information creates shareable digital identities for individuals. Nevertheless, this data collection and processing remains largely unregulated in the United States. This Note argues that four common features in current biometric legislation can provide a lessons-learned approach for future regulation. These four elements can inform how to create more robust and protective biometric legislation at the federal level; it highlights how inconsistencies in current statutes are not granting enough individual control over data which leaves companies to navigate different regulatory regimes across states.
By William Elman
Cryptocurrencies play an increasingly important role in the modern financial landscape, serving as vehicles for transactions, wealth storage, and more. Currently, there are at least eight thousand cryptocurrencies in existence, of which at least sixty-seven were created from a hard fork—when an existing cryptocurrency splits because participants irreconcilably disagree over the protocols governing the cryptocurrency network.
When a hard fork occurs, owners of the legacy cryptocurrency automatically receive claim to an equal number of units of the newly forked cryptocurrency, seemingly like “free money” delivered “out of thin air.” This peculiar property of hard forks—which have collectively delivered billions of dollars’ worth of new cryptocurrency—raises difficult taxation questions.
In the absence of congressional action, the Internal Revenue Service (IRS) has provided interpretive guidance to taxpayers. There, the agency assumes that newly forked cryptocurrency provides a windfall to recipients. This Note argues that this assumption is dubious and probably incorrect. Hard forks do not present a windfall to recipients of forked cryptocurrency because forks do not necessarily create new cumulative value. Rather, they merely reallocate or reorganize value. Forked cryptocurrency thus does not present recipients with an “undeniable accession to wealth”—a necessary element of the legal test for gross income. Accordingly, taxing it as gross income is altogether inappropriate.
Moreover, this Note maintains that the analogy between hard forks and corporate spin-offs—where a corporation divides into multiple entities—is accurate. Despite having been dismissed by others, the analogy is useful for thinking about how hard forks should be taxed.
This Note concludes that the forked cryptocurrency should be taxed strictly upon disposition, at capital gains rates, and with a cost basis of zero. Not only does this approach better accord with the nature of hard forks, but it avoids certain administrative problems, and, with proper regulatory guidelines, can satisfy compliance concerns.
By Merrill Weber
This paper examines the current regulatory scheme surrounding disclosure requirements for broadcaster networks selling airtime for political advertisements and argues that online platforms that host political advertising should be regulated to increase public transparency and facilitate democratic discourse. While the proposed Honest Ads Act addresses the importance of disclosure requirements, this legislation fails to address all the problems online political advertising brings. Microtargeting, an advertising tactic that allows advertisers to target specific audiences based on platforms’ detailed user data, has facilitated the spread of political misinformation and reduced opportunities for counterspeech. This paper suggests that to be successful in the 117th Congress, the Honest Ads Act should add a provision requiring online platforms to restrict political advertisers’ ability to target users on factors other than age, location, and gender.