FCC PLEADING FILED LAST NIGHT

NBA IN STRONG SUPPORT OF TELEVISION INDUSTRY'S RETRANSMISSION CONSENT RIGHTS

Yesterday, the Nevada Broadcasters Association joined with many other State Broadcasters Associations in vigorously opposing the rulemaking effort by a number of cable and satellite television operators and others to persuade the FCC to radically change, through governmental fiat, the negotiating dynamics of the Congressionally-mandated, market-driven negotiating process by which television stations exercise their must carry/retransmission consent rights.  We pointed out that, not surprisingly, the "MVPDs" (Multi-channel Video Programming Distributors) want the FCC to change those dynamics in ways that will benefit them, and severely prejudice the television broadcast industry, in all future retransmission consent (“RTC”) negotiations.

The Associations stressed that the Petitioners are urging the FCC to grant every MVPD mandatory interim carriage—the equivalent of a “compulsory signal carriage license”—in circumstances where an MVPD and a television station are unable, for any reason, to reach agreement on the terms and conditions of a renewed or extended retransmission consent agreement before expiration/termination of the then current RTC agreement.  Under such “license,” the MVPD would have the right to continue carrying the station’s signal (and thus all of its programming), on the frozen terms and conditions of the former RTC agreement for as long as it took the FCC, and presumably the courts, to finally decide if one of the parties had acted in bad faith.  During that period, the television station could not charge the MVPD additional consideration for the right to retransmit the station’s signal even if the station, as is likely, was incurring higher and higher programming acquisition costs.  Such “licenses” would be automatically available to any MVPD that took the position that it was negotiating in good faith and would last as long as it took the FCC and the courts to decide if that was true.

The Associations demonstrated that neither the Communications Act nor the Copyright Act grants the FCC the statutory authority to impose either mandatory interim signal carriage or arbitration in connection with must carry or retransmission consent negotiations.  The Commission has repeatedly acknowledged that fact.  For good reason, a change in the law is not warranted.  We demonstrated that adoption of the Petitioners’ proposals would lead to (a) substantially fewer mutually successful, timely RTC negotiations; (b) substantially more FCC-based litigation; (c) the loss of RTC-related compensation that television stations need to continue to produce and otherwise acquire increasingly expensive and responsive local, syndicated, and network informational and entertainment programming, including sports and other types of compelling programming; (d) a weakening in the ability of television stations to compete and survive against the combined subscription/advertising-based model of cable and satellite MVPDs; and (e) as a  result of the diminished capacity of the television broadcast industry to compete vigorously in the marketplace for programming, an acceleration in the already strong trend of sports and other types of compelling programming migrating from free local over-the-air television to pay TV. 

The Associations also asserted that informed subscribers, not governmental intervention, is the only lawful and otherwise appropriate way to address potential MVPD service disruptions of the type complained of by the Petitioners.  Their wails of distress on behalf of MVPD subscribers are no more than cries of self-interest from MVPDs more worried about losing subscribers to over-the-air viewing or to competing MVPD providers than about arming their subscribers with timely information about RTC negotiations and informing those subscribers of their options for ensuring they will be unaffected by the MVPD’s loss of a particular station’s programming.  We pointed out that MVPDs are in the best position to eliminate subscriber uncertainty by beginning RTC negotiations well in advance of the RTC expiration date and by providing their subscribers with timely and truly helpful information the subscribers can use to prepare to implement an over-the-air antenna option and/or switch to an alternate MVPD provider if they wish.  In short, we make clear that if subscribers face programming disruption, it is caused by deliberate decisions on the part of MVPDs to keep their subscribers in the dark during negotiations, and not by television stations exercising their statutory rights in those negotiations.

In concluding, the Associations urged that, as the Petitioners have failed to demonstrate any need to “fix” the current retransmission consent process, much less addressed the harm that their proposals would create, the rulemaking sought by the Petitioners should not proceed, and their petition should be dismissed or denied in its entirety.  

EDITOR'S NOTE:

The "voice" of Nevada's free, over-the-air television and radio stations continues to be protected by an extraordinary triangle of proactive lobbying, led by the Nevada Broadcasters Association with strong assistance from the National Association of Broadcasters and the leadership of the National Alliance of State Broadcasters Associations.  To read the complete filing, click here.