Smith: Retrans Blackouts Are Political Ploy

The NAB president suggested today that the latest rash of retrans blackouts are calculated by AT&T and Dish to win support for pending STELAR satellite TV legislation.  The two satellite operators "seem to be purposefully withholding broadcast signals from viewers – making them pawns in a political game that aims to upend the retransmission consent system,” Smith said in Washington.

NAB President Gordon Smith suggested today that AT&T and Dish are causing retransmission consent blackouts to win congressional support for the renewal of the satellite TV law that broadcasters fear may weaken their hand in retrans negotiations.

“It’s unfortunate that at a time when this trusted information is so critical to our communities, some of our pay-TV partners, like AT&T and Dish, seem to be purposefully withholding broadcast signals from viewers – making them pawns in a political game that aims to upend the retransmission consent system,” Smith said in a Media Institute luncheon speech in Washington.

“Is their goal to manufacture the appearance of a ‘broken system’ to encourage Congress to intervene just as it deliberates the upcoming STELAR expiration? If so, that is a dangerous game and one that hurts viewers – their customers – the most.”

Rather than meet demands for retrans price hikes, AT&T this month has dropped all Nexstar and CBS stations from DirecTV, the nation’s largest MVPD. For the same reason, Dish dropped all the Meredith stations.

STELAR, which expires at the end of this year, grants satellite operators like DirecTV and Dish the ability to import distant broadcast network signals into markets where consumers cannot receive the local affiliates.

But what NAB fears is that the satellite operators and their cable allies will try, as they have in the past, to load the renewal legislation with provisions designed to make it hard for broadcasters to negotiate for retrans fees.

BRAND CONNECTIONS

It’s not surprising that the satellite carriers are triggering retrans blackouts, Smith said.

“After all, AT&T and Dish are the same companies that have been responsible for more than four out of five retransmission consent disruptions industry-wide over the past eight years.”

AT&T “is the same company asking for exorbitant fees for their own content offerings, while refusing to fairly compensate broadcasters’ highest-rated programming,” he said.

According to Smith, AT&T collects $6 billion in retrans-like affiliate fees from other MVPDs for its own WarnerMedia cable networks like TNT, TBC, CNN and Cartoon Network.

“Yet, these cable networks’ ratings pale in comparison to the ratings of local broadcast affiliates. Last year, the typical Big Four TV broadcast affiliate delivered on average nearly four times more viewers every night than even the most-watched Warner Media channel.”

Smith also called out AT&T for exploiting STELAR to import distant signals into some markets rather than offer subscribers within them local broadcast signals. There are 12 such markets.

“How does seeing the weather forecast from New York City help the viewer in Bowling Green, Kentucky, when a life-threatening storm is on its way to their town?” Smith asked.

“It’s time to let STELAR expire. Let’s stop subsidizing billion-dollar companies, like AT&T, and instead ensure all Americans have access to the most accurate and timely source of news, sporting events, weather and emergency information – their local TV broadcasters.

“The simple fact is, the retransmission consent process is a free-market system that works. Ninety-nine percent of all deals get done without interruption. And, my guess is that 100% would get reached if pay-TV companies do not purposefully try to create a problem simply so Congress attempts to ‘fix’ it to their benefit.”


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