Skip to main content

FCC to Take Up Retransmission Reform

WASHINGTON: The call to reform retransmission consent has been heeded. The Federal Communications Commission intends to issue a Notice of Proposed Rulemaking on retransmission during the first quarter of next year, FCC Media Bureau Chief Bill Lake said today.

“The Media Bureau will prepare a notice that will take a broad look at what more we might do to advance the statutory objectives of allowing retrans fees to be set by market forces while protecting the interests of consumers,” Lake said in prepared remarks for a speech he delivered at a Media Institute Luncheon.

Retransmission refers to the negotiations between pay TV providers and the broadcasters whose signals they carry. TV stations started leveraging those signals for a fee a few years ago when cable and satellite operators started charging their subscribers extra for HD tiers. Broadcasters figured they ought to have a piece of that, since theirs were the predominant signals on those tiers.

Those negotiations have become so strident and divisive of late that three Fox TV stations were recently pulled from Cablevision systems during the World Series--which was carried by Fox. Sen. John Kerry (D-Mass.) responded by drafting legislation to prevent signals from being pulled during negotiations.

FCC Chairman Genachowski replied words to the effect of, “What you said, but we don’t have statutory authority to do so.”

The commission is currently charged with making sure private retransmission negotiations are conducted “in good faith,” and that they don’t inordinately increase cable TV rates.

Said Lake at the Media Institute: “So what we have is a form of regulated negotiation. Unfortunately, the good faith obligation does little to prevent impasses for negotiators and service disruptions for consumers.”

The NPRM will explore ways to further define “good faith,” and what constitutes per se violations thereof, Lake said. The commission also uses a “totality of circumstances” test by which a cable or satellite operator can present the facts of a given case without alleging a specific violation.

“We may be able to provide more specifics about the meaning and scope of the ‘totality of the circumstances’ test,” he said.

The commission’s main goal is to prevent broadcast signals from being pulled from pay TV platforms, thus inconveniencing consumers, who can get the same signals free over the air. In the name of protecting consumers, the FCC may “propose to strengthen our notice requirement and extend it to non-cable distributors and broadcasters,” Lake said.

“If some of our broadcast rules are thought to interfere with market negotiations, we may want to look at those rules,” Lake said. “We will pay close attention to the comments we receive and also to future developments in the marketplace. Are the disruptions of the last year an anomaly--perhaps just a sign of friction as prices move to a new level? Or will we see a continuing pattern of disputes that threaten viewers’ access to programming?

“We hope that a rulemaking will help us to find the most constructive role we can play to protect consumers under the retransmission law as it now exists.”
-- Deborah D. McAdams