New rules needed for cable disputes Sunday, March 14, 2010
By KEVIN DEMARRAIS BERGAN COUNTY [NJ] RECORD COLUMNIST http://www.northjersey.com/news/business/87610442_Viewers_shouldn_t_be_left_in_the_dark.html Like many cable subscribers, Jayme Wolk was justifiably upset about the possibility of losing Channel 7 — and with it the Academy Awards broadcast — when negotiations between Cablevision and the Walt Disney Co. bogged down last weekend. The blackout of WABC/7 for almost 21 hours last Sunday came just weeks after Cablevision subscribers were cut off from the Food Network and HGTV for 21 days in January, and the Midland Park resident wondered what was next. "Is this the last station we’ll lose?" her daughter asked. It’s a question that goes beyond one company. Cablevision, Verizon’s FiOS and satellite services are locked in a titanic struggle with broadcasters over what stations are carried and how much they cost, and brinkmanship seems to be a popular negotiating tactic. That means consumers are likely to face more interruptions, or at least threats of them, as well as higher bills. We just don’t know when, where and how much. A similar dispute between Time Warner Cable and the Fox network was settled at the eleventh hour in December, so subscribers missed nothing, and many people — myself included — thought the same would happen with ABC. But Disney, which owns WABC, pulled the plug, leaving consumers scrambling for alternatives to watch the Oscar ceremonies. Still, some good came from Disney’s action in that it focused attention on the antiquated rules governing the relationship between stations and carriers. Fortunately, it also generated an idea for a sensible fix from Sen. John Kerry, who heads the Senate committee overseeing the industry. In a letter to the chairman of the Federal Communications Commission, he challenged regulators to come up with a process that would keep consumers from being pawns in future negotiations. A similar idea came in a petition filed last week with the FCC by a coalition of cable, satellite and telecommunications companies. The issue is "retransmission consent," a concept developed in the Cable Act of 1992 and the Telecommunications Act of 1996. The law prohibits cable operators and other distributors from retransmitting commercial television signals without the consent of the broadcaster. That "may involve some compensation from the cable company to the broadcaster for the use of the signal." Until recently, payment usually came through deals for advertising time or acceptance of other cable stations owned by the broadcaster. Now, faced with declining ad sales, the stations want cash, and if they can’t reach an agreement with a cable company — as almost happened with Fox in December, just before the major college bowl games, and did happen for 21 hours at ABC a week ago — the station can be dropped. "Today, a broadcaster can pull its signal from cable companies serving millions of people if it does not get paid what it wants for that signal," Kerry wrote. "I don’t believe they should be able to do that unless the cable company is negotiating in bad faith." Although the issue is similar, Cablevision’s negotiations with the Food Network and HGTV would not come under the retransmission rules because they are available only by cable or similar delivery system, not over the air. But cable stations should be included in any new rules. When the law was written, satellite and telephone delivery of television service was almost non-existent, Kerry said. That gave cable a near monopoly status and "immense power over broadcasters. As a result, the negotiating parameters were rightly set up to favor broadcasters." The landscape has changed, however, and broadcasters have the upper hand, able to pull the plug on popular programming if the cable company does not give in to demands. "This game of chicken being played again and again between cable companies and broadcasters with consumers in the cross hairs must come to an end," Kerry said. His solution is to require the station to submit a claim of bad faith negotiations and have the FCC determine its validity before the station can pull its signal. "But as long as there are good-faith negotiations," Kerry said, "all parties should stay at the table and signals should continue to be transmitted to consumers." Like many cable subscribers, Jayme Wolk was justifiably upset about the possibility of losing Channel 7 — and with it the Academy Awards broadcast — when negotiations between Cablevision and the Walt Disney Co. bogged down last weekend. The blackout of WABC/7 for almost 21 hours last Sunday came just weeks after Cablevision subscribers were cut off from the Food Network and HGTV for 21 days in January, and the Midland Park resident wondered what was next. "Is this the last station we’ll lose?" her daughter asked. It’s a question that goes beyond one company. Cablevision, Verizon’s FiOS and satellite services are locked in a titanic struggle with broadcasters over what stations are carried and how much they cost, and brinkmanship seems to be a popular negotiating tactic. That means consumers are likely to face more interruptions, or at least threats of them, as well as higher bills. We just don’t know when, where and how much. A similar dispute between Time Warner Cable and the Fox network was settled at the eleventh hour in December, so subscribers missed nothing, and many people — myself included — thought the same would happen with ABC. But Disney, which owns WABC, pulled the plug, leaving consumers scrambling for alternatives to watch the Oscar ceremonies. Still, some good came from Disney’s action in that it focused attention on the antiquated rules governing the relationship between stations and carriers. Fortunately, it also generated an idea for a sensible fix from Sen. John Kerry, who heads the Senate committee overseeing the industry. In a letter to the chairman of the Federal Communications Commission, he challenged regulators to come up with a process that would keep consumers from being pawns in future negotiations. A similar idea came in a petition filed last week with the FCC by a coalition of cable, satellite and telecommunications companies. The issue is "retransmission consent," a concept developed in the Cable Act of 1992 and the Telecommunications Act of 1996. The law prohibits cable operators and other distributors from retransmitting commercial television signals without the consent of the broadcaster. That "may involve some compensation from the cable company to the broadcaster for the use of the signal." Until recently, payment usually came through deals for advertising time or acceptance of other cable stations owned by the broadcaster. Now, faced with declining ad sales, the stations want cash, and if they can’t reach an agreement with a cable company — as almost happened with Fox in December, just before the major college bowl games, and did happen for 21 hours at ABC a week ago — the station can be dropped. "Today, a broadcaster can pull its signal from cable companies serving millions of people if it does not get paid what it wants for that signal," Kerry wrote. "I don’t believe they should be able to do that unless the cable company is negotiating in bad faith." Although the issue is similar, Cablevision’s negotiations with the Food Network and HGTV would not come under the retransmission rules because they are available only by cable or similar delivery system, not over the air. But cable stations should be included in any new rules. When the law was written, satellite and telephone delivery of television service was almost non-existent, Kerry said. That gave cable a near monopoly status and "immense power over broadcasters. As a result, the negotiating parameters were rightly set up to favor broadcasters." The landscape has changed, however, and broadcasters have the upper hand, able to pull the plug on popular programming if the cable company does not give in to demands. "This game of chicken being played again and again between cable companies and broadcasters with consumers in the cross hairs must come to an end," Kerry said. His solution is to require the station to submit a claim of bad faith negotiations and have the FCC determine its validity before the station can pull its signal. "But as long as there are good-faith negotiations," Kerry said, "all parties should stay at the table and signals should continue to be transmitted to consumers." -- ================================ 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
