March 12, 2010 Appeals Court Upholds Access Rules for Cable TV By EDWARD WYATT NY Times
http://www.nytimes.com/2010/03/13/business/13cable.html?ref=technology&pagewanted=print WASHINGTON — A United States appeals court on Friday upheld a Federal Communications Commission rule that forbids cable companies that also own programming channels from refusing to allow competitors to also offer those channels. The ruling, which consumer advocates hailed as a victory, strengthens the F.C.C.’s hand in trying to gain some leverage over the cable industry, which was largely deregulated in 1996 and has fought subsequent attempts by the commission to impose new regulations. The decision could also play a role in the pending acquisition by Comcast of a majority stake in NBC Universal. In a 2-1 ruling, a panel of the Court of Appeals for the District of Columbia Circuit said that while competition had increased in the cable business, the F.C.C. was still within its rights to extend a prohibition against exclusive contracts between a cable operator and its affiliated channels because it would limit competition. That means that satellite television providers, like DirecTV and Dish Network, and companies like Verizon and AT&T that also provide television programming, must be allowed to offer potential customers a regional sports channel, for example, that is owned by the local cable operator. In creating the rule, the F.C.C. cited its own economic analysis, which found that local cable companies could gain a significant competitive advantage over satellite providers and other competitors if allowed to withhold channels. Cablevision and Comcast, which had challenged the rule, expressed disappointment at the decision. Other court decisions on the commission’s rule-making authority are likely to come later this year, including in a case over whether Internet service providers can discriminate against certain Web sites in allowing access to their networks, an issue known as Net neutrality. Cablevision said that the F.C.C.’s exclusivity rule and the retransmission consent provisions, which were the source of a dispute last weekend between the company and ABC, were “outdated and obsolete.” “In today’s highly competitive video marketplace, these rules do nothing but tilt the playing field in favor of phone companies and broadcasters to the detriment of fair competition and consumers,” the company said in a statement. Comcast, which has been fighting F.C.C. rules at the same time that it is seeking its approval for its NBC merger, said DirecTV had its own exclusive content arrangements, including the sole right to distribute NFL Sunday Ticket. But that deal does not fall under the F.C.C. exclusivity rule because the owner of the network is an independent company, the National Football League, and not a regulated cable operator. At a Senate hearing on Thursday into the Comcast-NBC deal, Comcast grudgingly pledged to follow the rules, saying it was “prepared to discuss with the F.C.C.” having the disputed rules apply to it “if appropriate.” DirecTV called the court’s decision “a victory for consumers” and applauded the court’s acknowledgment that the cable operators “have the incentive and ability to withhold programming from competitors.” The F.C.C. and various consumer groups also said pay-television subscribers would benefit. “The commission’s program access rules have played a vital role in making diverse and attractive video programming available to cable and satellite TV viewers,” Julius Genachowski, the F.C.C. chairman, said in a statement. Corie Wright, policy counsel for Free Press, a nonprofit group that has generally opposed media consolidation, including the Comcast-NBC merger, pointed out that the F.C.C. rule upheld on Friday was scheduled to expire in two years. It was adopted in 1992 and has been extended twice. “If the merger is approved,” Ms. Wright said, “Comcast will control an extensive suite of popular channels, including MSNBC, USA and Bravo. Its ability to withhold that programming from competing video services would give it enormous market power and leverage,” a factor she cited in urging the commission to extend the exclusivity rule again in 2012. -- ================================ George Antunes, Political Science Dept University of Houston; Houston, TX 77204 Voice: 713-743-3923 Fax: 713-743-3927 Mail: antunes at uh dot edu _______________________________________________ Medianews mailing list [email protected] http://lists.etskywarn.net/mailman/listinfo/medianews
