House Panel OKs STELA Bill With JSA Relief

The House Energy and Commerce Committee approved a satellite TV bill Thursday that includes a provision that would give broadcasters with joint sales agreements until the end of 2016 or later to unwind the agreements.

The JSA provision was part of a bipartisan congressional compromise that would give broadcasters more time to dissolve the sharing agreements than the FCC would allow under the JSA crackdown the agency adopted March 31.

Under the FCC’s March 31 action, the agency barred the formation of new JSAs immediately, and gave holders of existing agreements two years to end them, except when broadcasters could persuade the agency that a deal serves the public interest and warrants a waiver.

Under the compromise provision included in the satellite bill today, broadcasters with JSAs who apply for a waiver from the FCC will, assuming the measure is eventually signed into law, be able to keep their sharing agreements intact for 18 months after the agency ultimately rejects a waiver, or Dec. 31, 2016, whichever is later.

The compromise language was included in a bill reauthorizing the Satellite Television Extension and Localism Act, or STELA, for five years.

STELA, which clears the way for satellite TV companies to retransmit distant TV signals into some local markets, is widely expected to be reauthorized by federal lawmakers before it expires at the end of the year.

The STELA bill approved by the committee also includes a provision that would bar TV stations from jointly negotiating retransmission consent deals with independently owned stations in the same market-a provision that has raised some broadcaster concerns.

But even so, pay TV industry executives are continuing to lobby to include additional retransmission consent reforms in whatever STELA bill — which is subject to the oversight of both the Commerce and Judiciary committees in the House and Senate — may eventually be signed into law.

The House Energy and Commerce Committee is the only one of the four congressional committees with STELA oversight that has approved a STELA bill thus far. Assuming the House and Senate each approves their own version of the bill, a conference could be held to work out any differences between the measures.

The pay TV industry is continuing to lobby for retans reforms, despite rumblings from the National Association of Broadcasters that broadcasters may try to torpedo any STELA bill that seriously damages broadcasters’ ability to get retrans payments from pay TV operators.

“As it pertains to STELA, NAB prefers no bill to a harmful bill,” said Marci Burdick, NAB TV board chair and SVP of Schurz Communications, in the text of her testimony for a STELA hearing before a House Judiciary subcommittee on Thursday afternoon, shortly after the House Energy and Commerce Committee voted to approve its STELA bill.

During the same judiciary subcommittee hearing, pay TV executives made clear that they believed further retrans reforms are needed.

“The [House Energy and Commerce Committee] legislation … is an excellent start,” said R. Stanton Dodge, Dish Network EVP and general counsel, in the text of his testimony for the judiciary subcommittee hearing. “But more is necessary to accomplish the fundamental goal of ensuring that broadcast programming fulfills its public interest mandate and always stays up for consumers.”

Dodge said that Dish wants Congress to include a “standstill” provision in STELA that would require broadcasters to continue providing their signals during retrans disputes at the old rate, with retroactive payments for any increases due when a new deal is finally struck — perhaps with the assistance of baseball-style arbitration.

As an alternative, Dish wants Congress to allow pay TV companies to import distant network station signals when the local network affiliate withholds its signal.

Along with endorsing a standstill provision, the American Cable Association wants Congress to include a STELA amendment that would bar broadcasters and their networks from blocking cable and satellite subscriber access to their online content during retrans disputes, said Matt Polka, ACA president-CEO, in the text of his own testimony for the judiciary subcommittee hearing.

In addition, Polka wants Congress to include a provision in STELA that would eliminate the “must-buy” requirement that requires cable TV systems to include retrans signals in their basic tiers — tiers that all subscribers must pay for before getting other cable channels.

Said NAB’s Burdick, in her testimony, however: “The pay TV industry is lobbying for ‘reforms’ that would undermine local broadcasters’ right to be fairly compensated for programming. The committee should reject these proposals.”

While STELA offers no benefit to broadcasters, during the hearing Burdick said NAB would support a “narrow temporary reauthorization that does nothing to expand the scope of the license or undermine broadcasters’ ability to be compensated for our programming or to serve our local communities.”

“We intend to work with Congress to pass a bill that is in the best interests of broadcasters and preserves retransmission consent,” added Dennis Wharton, an NAB spokesman.

The STELA bill approved by the House Energy and Commerce Committee also would eliminate a rule that currently bars pay TV operators from dropping broadcasters during ratings sweeps periods.