Rockefeller-Thune Would Overhaul Retrans

Senate Commerce Committee Chairman Jay Rockefeller and Ranking Member John Thune on Friday announced a proposal called “Local Choice” they want to attach to the Satellite Television Extension and Localism Act (STELA) reauthorization bill.

The move is designed to end TV station blackouts and retransmission consent negotiations by letting subscribers decide if they want to pay the price stations would set for their signals.

The NAB was not ready to embrace the proposal. “While NAB appreciates Chairman Rockefeller and Ranking Member Thune’s careful consideration of video programming laws, this proposal represents a significant rewrite of the Communications Act,” said NAB spokesman Dennis Wharton. “Given the shortness of time between now and the end of the congressional session, we question whether there is sufficient time for key committees in Congress to give this proposal the thorough review that is warranted.

“NAB has always supported a clean reauthorization of STELA and we do not believe this bill is an appropriate vehicle for reviewing the retransmission consent process.”

But American Cable Association CEO Matthew M. Polka endorsed it: “ACA believes that Sen. Rockefeller and Sen. Thune, acting in a bipartisan fashion on an important consumer welfare issue, deserve the highest praise for offering a legislative proposal designed to advance the public interest in the receipt of over-the-air local broadcast stations from pay-TV providers.

“The approach taken by Sens. Rockefeller and Thune is to put consumers first. It will permanently remove consumers from retransmission consent disputes and provide consumers with more choice in the selection of TV station programming than they have seen in decades.

BRAND CONNECTIONS

“The independent cable community looks forward to giving Sens. Rockefeller and Thune feedback on their bold and necessary proposal to make it ready to become the law of the land this year.”

Comments (35)

Don Thompson says:

August 8, 2014 at 8:42 pm

NAB: “We’ll do a la carte if ESPN has to. Oh wait, Disney-ABC is on our board.”
NAB: “We’ll do a la carte if MSNBC and Golf Channel have to. Darn, Comcast-NBC is on our board.”
NAB: We’ll do a la carte if Fox News Channel has to. Shoot, 21st Century Fox TV is on our board.”
NAB: We’ll do a la carte if CBS Sports Network has to. Bummer, CBS is on our board.”

Please follow me on Twitter: @TedatACA

Wagner Pereira says:

August 9, 2014 at 4:30 pm

Pretty stupid and short term thinking response Ted. Why should I not be surprised? By separating out local broacast from the “catch all” bill – and considering that broadcast TV is 35% of TV viewing, people will see just how LITTLE of their $100 bill goes towards local channels and you cannot use that as an excuse for why Programming Costs are very high! Bottom line, more and more cut the cable to your systems! So short sighted – but I would not expect less from you!

August 10, 2014 at 8:32 am

Under Rockefeller-Thune, America is going to find out who really wants to pay “just a couple of pennies a day” to watch “local” TV channels. Please follow me on Twitter: @TedatACA

August 10, 2014 at 11:44 pm

Again, you manage to show your short term thinking. Why would anyone want to pay the current rate if 35% of their viewing is not available? Dream on!

Kelly Lyons says:

August 20, 2014 at 9:12 am

If we weren’t being raped by the broadcasters and other programmers, our rates would go down. You are making an assumption that if rates for programming went down or stabilized our retail costs would stay the same. In our system, we net about $10.00 per sub over cost of programming. 4 years ago, all broadcasters were free for us to carry under “must carry”, now they are all charging over $1.20 per month per sub. Our rates are a reflection of broadcaster prices and ESPN/FOX race to the top on price, not our greed.

Keith ONeal says:

August 9, 2014 at 11:51 am

There are 16 Broadcast Stations on Bright House (Orlando). if “Local Choice” happens, the only stations that will remain are the NBC, CBS, ABC, FOX, PBS, and (maybe) The CW stations.

August 10, 2014 at 8:39 am

By “stations,” are you including any Big 4 subchannels? How many of the 16 channels are collecting retrans today? The ones that aren’t can elect must carry under Rockefeller-Thune, So your point is? Also, where is it ordained that Orlando must have 16 TV stations today and forever? The Orlando market could easily give the FCC back 8 channels for wireless broadband and not lose a single service via spectrum-sharing that worked so well in L.A. and that Sinclair and some others are using with an eye toward evading the FCC’s 3/31/14 ban on retransmission consent bargaining collusion.

August 10, 2014 at 11:47 pm

Hey Ted – why not let everything go ala carte if that is your mantra?

August 11, 2014 at 2:10 pm

1) Not all stations are Licensed to Orlando, though all of them are in the Orlando DMA. The NBC station is liscensed to Daytona Beach, and has a secondary studio there (Their Main studio is in Maitland). There are stations liscensed to New Smyrna Beach, Leesburg, Cocoa, and Clermont. 2) As for subchannels, the policy at Bright House is that they only carry subchannels of stations that have retransmission Consent agreements, which is why Qubo Channel, Bounce TV, and Movies! are NOT on Bright House. We have Get TV, This TV, Antenna TV, Me TV, Estrella TV, Create, World, V-Me, Mega TV, and Live Well on our cable. 3) It is not ordained that Orlando DMA must have 16 stattions. As you know, stations can come and go when you have ownership changes and the financial situation changes. BTW, 16 is the number of the Full Power stations in this market; I did not count the Low Power stations.

Maria Black says:

August 11, 2014 at 8:39 am

If the ACA is on board with something, that means it’s probably bad for broadcasters.

Elaine Scharfenberg says:

August 11, 2014 at 8:55 am

I’m all for it…if that means I don’t have to pay for ; Bravo, TLC, FYI, Esquire, ESPN, Animal Planet, Weather Channel, ad naseum. And we know the chances of that are None. So why just pick on Broadcasters unless the agenda is to get rid of them?

Gene Johnson says:

August 11, 2014 at 9:25 am

Right. If what amounts to ala carte pricing/availability is good for the broadcast channels, why is it not also good for the non-broadcast channels (which make up a far higher percentage of subscribers’ monthly fees than do broadcast channels)? Then we would see just how “popular” many of these non-broadcast channels are, and how many can survive on their own in a “free market.”

John Bagwell says:

August 11, 2014 at 9:57 am

Exactly. I bet Ted Hearn (the head of Communications for the ACA) is not going to come back on here and answer that question. You can’t pick and choose who you want ala carte pricing for and who you don’t.

Joe Jaime says:

August 11, 2014 at 10:02 am

Over Regulation!!

Sandy Hinkle says:

August 11, 2014 at 10:35 am

Matt Polka with ACA here. Not only is @TEDatACA right about choice for consumers in the Rockefeller-Thune Bill, but if you have taken the time to follow ACA and its advocacy then you would know that ACA has also been for consumer choice when it comes to ALL programming — broadcast tv, regional sports, cable programming, etc. We’ve filed on the record about it, we’ve testified to it, and we’ve asked all of the programmers for it. Consumers are already moving to choice by what they watch online, and we want to give them more of it, both online and on cable and TV. You want to know why there ISN’T more choice for consumers? Because the TV station network overlords who own broadcast networks AND cable programming services WON’T allow it? These are the same network overlords who demand more and more in reverse compensation from TV stations. So, ironically, YOU are responsible for lack of choice for consumers because your network overlords won’t provide it, and you won’t allow it either as you desperately cling to outdated regulations that give you monopoly marketplace control. You fear choice more than we do, which is why you will do everything you can to deny consumers choice that the Rockefeller-Thune bill wants to give to them. You want to know why the Rockefeller-Thune bill exists? Because of YOU the broadcasters who have blacked out consumers in HISTORIC numbers. You have no one else to blame but yourselves and your network overlords. While I’m on it, I can never understand why broadcasters always highlight with glee when it is reported that consumers are cutting the cable cord. Do you think those cord-cutters are putting up antennas on their roofs? Hardly. They are subscribing to our broadband service, which we are more than happy to give to them. And if consumers do cut the cord, doesn’t that mean that YOU the TV stations LOSE retrains revenue? And you call us out of touch! Sheesh. I think broadcast TV stations would be better off thinking for themselves rather than drinking the NAB and network overlord koolaid. They don’t care about your interests or your future. They only care about theirs. Believe it or not, cable operators are not the enemies of local TV stations. The sooner you realize that, the better off you will be. MMP Follow me @MATTatACA.

Ellen Samrock says:

August 11, 2014 at 11:52 am

Poor, poor pitiful cable. I sure as hell don’t feel sorry for you. You guys have done your best to keep LPTV off of cable even though we have some of the most diverse programming out there, much of it locally oriented. So, yes, I’m thrilled when consumers realize that they’re being gouged by cable companies and what terrible bargain you are and cut the cord with an antenna. I have done everything I can to help local viewers see that they don’t need cable TV. In a sense, you have been helping me. I’m hearing more and more outrage from cable users over being charged a rental fee for mandatory digital set top boxes. That outrage is music to my ears.

August 11, 2014 at 3:23 pm

Hey Matt…guess what, when MTV2 gets blacked out, there is no outcry. However, as you note, when ABC/CBS/FOX/NBC gets blacked out there is a TREMENDOUS outcry. That in itself speaks volumes as to what your Customers want to watch!

August 20, 2014 at 9:16 am

Wrong assumption again. We get an outcry when ANY programming is withheld. A few years ago our contract expired with HSN, so we dropped it to add other programming. I was nearly run out of town by the ladies in our community. This past spring Viacom threatened to pull the plug and we got complaints related to all networks. What you fail to comprehend is that broadcasters ended up on Cable TV not because the Cable company wanted them, rather it was FCC mandated. What blows my mind is that a person in NYC can put up an antenna and get every broadcaster for free, but it we deliver that same signal over a wire, then somehow the broadcaster thinks the customer needs to pay $1.50 per month for it. Again, Cable didn’t put the networks on the systems, the FCC and the broadcaster did.

August 11, 2014 at 11:28 am

NAB: “We’ll do a la carte if ESPN has to. Oh wait, Disney-ABC is on our board.”
NAB: “We’ll do a la carte if MSNBC and Golf Channel have to. Darn, Comcast-NBC is on our board.”
NAB: “We’ll do a la carte if Fox News Channel has to. Shoot, 21st Century Fox TV is on our board.”
NAB: “We’ll do a la carte if CBS Sports Network has to. Bummer, CBS is on our board.”

August 11, 2014 at 12:05 pm

Truth of the matter, D BP, is that our ACA members typically WANT to carry LPTV because of just what you mentioned — locally oriented programming for the community. Problem is, again, the network overlords and big cable programmers take away channels and require MVPDs to carry channels our customers don’t want. But like I said before, if you are sick of rising cable bills, then blame your broadcast and network overlords. THEY are the ones who are causing more cord-cutting AND retrans losses AND loss of LPTV carriage. You blame us for everything just because we are cable operators, but the truth is we are fighting for some of the same choice you would like to see too. Follow me @MATTatACA.

August 11, 2014 at 4:25 pm

I’m going to have to print out your reply and paste it on my master control room wall because that certainly was not the case back in 2008 when then chairman Kevin Martin wanted to make LPTV a mandatory must-carry for cable. The NCTA, Cablevision Systems Corp. and TWC all vigorously opposed the idea while the NAB sat on the fence. I’m glad to hear that the ACA feels differently. But be warned: this proposal may well come up again…soon.

August 11, 2014 at 12:16 pm

Under Rockefeller-Thune Retrans Overhaul, here are things you will never hear again:

“We are now at war with Time Warner Cable,” said CBS CEO Leslie Moonves.
“The FCC is disappointed that the respective parties could not reach a retransmission agreement,” said Neil Grace, an FCC spokesman.

August 11, 2014 at 3:28 pm

Hey Ted, how do you feel about TWC forcing a $5 fee for SportsNet LA on all MVPD providers who want to carry the Dodgers? Why isn’t ala carte good for TWC, Comcast, DirecTV and other MVPD providers with ALL programming – but it is only good for OTA Broadcast TV, who has 35% of your viewing?

August 11, 2014 at 12:56 pm

So Matt/Ted…answer the question. Are you for or against the ala carte model for everyone (not just the broadcast stations, as put out in this bill)?

August 11, 2014 at 3:41 pm

We did answer it. We are FOR a model that gives consumers choice through a la carte, tiering, online viewing, etc., whether broadcast TV, regional sports, cable programming, etc. We are AGAINST the forced carriage of broadcast TV, network, and cable programming that is bundled because of retransmission consent, must-buy regulations, network non-duplication, and forced cable programming bundling.

August 11, 2014 at 7:43 pm

Then why does this bill only include the broadcast stations and not everyone?

August 20, 2014 at 9:23 am

Because the broadcasters have enjoyed special dispensations under the law that don’t apply to Cable TV networks. For instance, our Cable TV system sits between two metro areas. We can receive all broadcast networks from either area. So, from a technical perspective, we have the choice of two channels for each network. However, the current laws state that the broadcaster in the DMA can block us from carrying the other network. So, if our people want Fox programming, we can’t negotiate with different Fox affiliates and choose the lower cost one, we are stuck only negotiating with the one in the DMA and if we can’t agree on a price, then no Fox programming for our customers. So, Cable is only trying to get the monopoly part of this neutralized, not picking on the broadcasters. What is really funny is, on these types of forums and on Capitol Hill, broadcasters cry poor about needing their protections from Cable, then read the transcripts of their industry meetings where they brag about all the new revenue they brought in from retransmission consents and laugh all the way to the bank. Broadcasters are relying on special laws that protect their monopoly to harm the customers of Cable companies while they continue to distribute for free, the same programming to customers on the same street if they have an antenna. Crazy!

August 11, 2014 at 5:25 pm

Matt, cable tiering is not the same as ala carte, and requires subscribers to purchase a particular tier that almost certainly includes channels in which they have no interest. Could you please clarify whether or not ACA supports full ala carte for cable subscribers and program services? This would mean no cable tiers forced on subscribers, who could pick and choose from among all the various channel offerings to obtain only those program services they want. I would note that if there is full ala carte for all program services it likely would make individual program channels more expensive given that they would no longer be able to rely on income from a system’s entire subscriber base, but only those who actually take the service (I know your comments did not go to this, but thought I would include it to make the general point that going ala carte for all program services may or may not lead to an actual reduction of subscribers’ cable bills, depending on what and how many program services they take, and the increased fees that likely would result for individual program services). By the way, I too am no fan of the required bundles of program services that the producers impose on cable systems. They are similar to the “tying” arrangements they impose on broadcasters (i.e., in order to get a popular syndicated program a station often is required to also take a less popular program, movie package, or something else). One would think that such arrangements (in cable or broadcast) are in violation of antitrust laws that prohibit tying arrangements, but either nobody has the “guts” to take the suppliers to court to challenge it (admittedly a very expensive and long-term proposition), or court decisions have found these arrangements are not sufficiently unreasonable to constitute an illegal arrangement (I’m no antitrust lawyer, so don’t know what the answer is).

August 11, 2014 at 10:41 pm

No “likely” about it. Cable bills will either remain the same or go up with customers only receiving 10-15 stations. Easily expect a 10x increase in the cost of a channel ala carte.

August 20, 2014 at 9:30 am

No doubt that the cost of individual networks would go up, but at least the customer would be making a conscious choice about adding a network and paying that fee. What frustrates customers now is that they pay this one fee and have no clue why it is what it is, and then the Cable Nets and Broadcasters tell them that Cable TV is the one raping them. Our content contracts all have language forbidding us to share the cost of the networks. I think a customer that wants ESPN and knows they have to pay $12 per month for it will be fine with that price, since that is what they want. However, if Grandma doesn’t have to pay for it because she doesn’t watch it, then she wins. I’m not sure that the technology is here now for full a al carte, but if we were permitted to go in that direction, I think you would see the marketplace scrambling to get solutions in place fairly quickly. Again, it is the monopoly advantage ACA wants to eliminate, not bring broadcasters to their knees.

Tim Darnell says:

August 11, 2014 at 5:58 pm

If cable went “truly” ala carte, I think it would be harder for we broadcasters to object. What is unfair about this is that it gives cable customers only one mechanism for lowering their cable bill — kill the local channels, as opposed to finding other ways to lower the bill by getting rid of cable channels no one wants. If it is a balanced proposal to let customers pick and choose, we local stations would fare well. I think cable companies would be surprised at the retention rate vis-Ã -vis other channels. ACA, offer us an across the board solution that doesn’t pre-select winners and losers and we could go along. I am not a big group or network guy. I realize that they might have other interests. Also, I would like to see fair treatment of our digicasts and even decent LPTVs in the market. You should carry them (if they are offered for free). Cable companies are better at this than the satellite companies.

August 11, 2014 at 6:37 pm

While I can’t speak for all those LPTV stations that are affiliated with a network or dignet (such as Luken) I do know a lot of low power stations that would gladly provide their signal to a cable op for free.

August 20, 2014 at 9:34 am

Small TV guy, I think you have it right. If we were able to offer customers the choice of their local broadcast station as an a al carte and could publish the price for it, I think 95% of our subscribers would keep the networks and pay the fee. What sucks now is that we can’t negotiate with another NBC or ABC broadcaster for a lower retrains price and bring them into our market. We are stuck negotiating with the one NBC or ABC broadcaster in our market who can basically say, “Take it or leave it” on their price in retransmission. The issue today is that broadcasters are jacking the retransmission fees, restricting our ability to disclose the price they are charging us, so we have to increase our bills to keep our margins in line, which raises the cable bills, then we’re the ones that get the black eye for Cable TV rates. I think a lot would change if the stations simply picked a rate for all Cable Companies and published their retransmission rate on their website so customers would know where the prices were coming from.

August 11, 2014 at 7:56 pm

Ted is basically copying and pasting comments without answering any real questions and Matt is more coherent, but giving broad statements and not really addressing any specifics and then just making statements about how right he is and how wrong we all are. I get it…it is your “job” to do so, but so far, I am not impressed with the aca.

August 11, 2014 at 10:38 pm

That’s all they ever do….cut and paste.