FCC Launches Retrans Reform Proceeding

In opening a proceeding to review what it means for broadcasters and MVPDs to negotiate retrans deals in good faith, the FCC says its goal is to "benefit consumers of video programming service by facilitating successful negotiations and avoiding disruptions in service."

To the consternation of the NAB, the FCC today began a review of the obligation broadcasters and cable and satellite operators have to act in “good faith” in their often contentious retransmission consent negotiations.

Congress mandated the review last year.

“[O]ur goal in this proceeding is to provide further guidance to negotiating parties about the totality of the circumstances test, if necessary, to benefit consumers of video programming services by facilitating successful negotiations and avoiding disruptions in service,” the FCC said.

Broadcasters worry that any change in the good faith regulations might tip the negotiation balance in favor of the cable and satellite operators and hobble their ability to negotiate for retrans fees.

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In fact, many of the questions raised in the FCC notice are based on complaints made by cable and satellite operators.

“The notice, at first blush, appears to go much further than Congress directed,” said NAB EVP Dennis Wharton. “We were struck by the FCC’s admission that nothing in this proceeding will necessarily translate to lower cable prices for consumers.

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“We also question whether the FCC should be taking actions that benefit heavily consolidated companies that dominate the video landscape like Dish, AT&T/DirecTV, Time Warner Cable/Charter and Verizon.”

By contrast, the American Cable Association was delighted by the FCC initiative.

“ACA hopes the FCC will establish vigorous policies designed to stop TV station misconduct, including sudden TV signal blackouts as well as blocking MVPDs’ broadband subscribers from accessing otherwise free online content during or after a negotiating impasse,” said ACA President Matt Polka in a statement.

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“The FCC also ought to require broadcasters to provide information substantiating their reasons for bargaining positions taken when requested to in the course of their negotiations, and bring a halt to the practice of TV stations insisting on setting prices, terms, or conditions for broadcast stations they may later acquire or for programming networks they may launch in the future as part of current retransmission consent negotiations,”  Polka added.


Comments (4)

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Tim Darnell says:

September 2, 2015 at 9:40 pm

The truth of the matter is that big station groups have great leverage over the MVPDs and the big MVPDs have great leverage over us small market guys. I suspect that everything the ACA complains about the big groups is visited on us small market guys by the “heavily consolidated groups.”

Manuel Morales says:

September 2, 2015 at 10:27 pm

The big station groups don’t have leverage when it comes to the Top 5-7 or so MVPDs. The leverage starts with the 20+ MVPDs. But isn’t that what a negotiation is all about? Leverage…

Catherine Garcia says:

September 3, 2015 at 7:43 am

Non-broadcast channels like Discovery have no obligation to negotiate in “good faith” on their carriage deals because those deals are based on copyright. Might be a better model for broadcasters to consider before their Retrans rights get whittled down to nothing.

Gene Johnson says:

September 3, 2015 at 11:45 am

Preston is basically right, but retransmission consent essentially puts the negotiations between a TV station and MVPD on a similar footing. The MVPD arguments would seem to apply equally, if not more so, to negotiations with traditional cable networks, particularly those that have much higher carriage fees than any broadcast station. The cable position is hypocritical at best. of my approximate $110 monthly fee for bundled video and broadband service, my cable bill from Comcast shows a $3.25 charge for “Broadcast TV Fee.” That compares to the $10 per month charge for the DVR, and $9.95 Technology Fee, and $5.98 for two digital adapters that are required for my “cable ready” HDTV’s because Comcast now scrambles its signal.

Matt Polka’s comments are rich. TV station misconduct? How abut MVPD misconduct? Why doesn’t he assert the same provisions should apply to cable networks and other program suppliers? As for requiring broadcasters to provide information substantiating their reasons for bargaining positions, why not require the MVPD to do the same? Or any other program supplier? The idea that any MVPD has the consumers best interests in mind is ludicrous given how consistently bad such providers rank in customer service.


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