Alarmed over several recent retransmission standoffs, Time Warner and 13 other cable satellite and telecommunications companies filed a petition Tuesday (March 9) with the Federal Communications Commission. The petitioners, claiming the 20-year-old rules governing retransmission consent are outdated, would like the FCC to establish a new framework for resolving disputes between broadcasters and subscription TV services.
The filing follows several high-profile retransmission spats, including the most recent one between ABC Disney's WABC-TV and Cablevision in the New York area. Time Warner, for one, might also still be smarting over its public retransmission negotiations with News Corp. at the end of the year, or might be more than a little worried about its upcoming retransmission negotiations with ABC Disney.
"Consumers are increasingly being put in the middle of disputes between programmers and distributors, including recurring threats of going dark, high-stakes public negotiations, and, in the case of ABC's recent withdrawal of programming from 3 million Cablevision subscribers, highly disruptive blackouts," said a Time Warner statement.
The 14 petitioners serving more than 67 million video subscribers are looking for the FCC to resolve such disputes via compulsory arbitration or an expert tribunal, while requiring continued carriage of broadcast signals during negotiations.
The National Association of Broadcasters argued that the free market–based retransmission consent model should not be tampered with, and in fact, helps support local programming.
"Modest retransmission consent revenues help local TV stations fund news operations, community service and life-saving weather information that viewers across America rely on every day. Vertically integrated cable operators routinely compensate each other for their own less-watched cable-owned networks, while raking in profit increases five times the amount of their programming costs. To see billion-dollar pay-TV companies asking for government intervention to protect their exorbitant profits is just plain wrong," said Dennis Wharton, evp of the NAB.
The current process for retransmission consent was established in the 1992 Cable Act, allowing the free market to determine agreements. In the past few years, broadcasters, seeking a second revenue stream, have demanded payment from cable to carry their signals. Cable companies, which charge subscribers for their packages of channels, would prefer to pay as little as possible. Both parties have a lot to gain coming to an agreement.
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