Coming NPRM Expected to Take Broad Look at Retrans, Propose Few Specific Remedies
A coming FCC rulemaking notice on retransmission consent deals may take a broad look at the contracts between subscription-video providers and TV stations, said agency and industry officials watching development of the draft. The notice may not propose many specific remedies to reduce the number of carriage disputes that lead to TV station blackouts on cable, DBS or telco-TV systems, they said. Although styled as a notice of proposed rulemaking (NPRM), the draft may read more like a notice of inquiry (NOI), in that it may ask many questions and not propose many specific rules, said agency and industry officials not involved in writing the item.
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Media Bureau officials are continuing their work on the rulemaking, and that will continue into early next year before the item is circulated for a vote, agency and industry officials said. The item may circulate in January or February, they said. It probably will be approved on circulation rather than at a commission meeting, the officials said. Bureau Chief Bill Lake recently disclosed that the notice will be circulated in the first quarter (CD Dec 9 p5). A bureau spokesman had no further comment. Lake’s comments suggest that the item may be broad in scope, said Vice President Thomas Larsen of Mediacom, among the pay-TV companies that petitioned the FCC to change its handling of carriage disputes.
"The FCC cannot act too soon,” said a spokesman for the American Television Alliance, whose members include the DBS providers, telcos and cable operators that petitioned the FCC on retrans. “Given the current blackout in Oregon and threatened blackouts around the country on Jan. 1,” broadcasters “clearly” haven’t “gotten the message that these blackouts have to stop,” he said. The Oregon dispute involves Dish Network and three ABC affiliates of Chambers Communications Corp.: KOHD Bend, KEZI Eugene and KDRV Medford. Chambers blocked feeds to Dish’s customers starting Dec. 16. NAB and NCTA representatives declined to comment on the coming item.
The proposal may ask about how various FCC rules affect retrans deals and whether they contribute to blackouts, predicted broadcast and cable executives. Arrangements such as local marketing agreements in which TV stations in a market can jointly negotiate retrans deals with pay-TV providers may be examined, they said. The notice may look at how syndicated exclusivity and network non-duplication rules affect retrans deals, they said.
It’s unclear whether the prospect of a rulemaking on retrans is affecting broadcasters’ behavior in the batch of carriage deals that were up for renewal by Dec. 31, said broadcast and cable lawyers. What does seem clear is that “the commission has a bigger stick” in tamping down disputes “if it has an NPRM out there than if it has an NOI,” said a cable official. The existence of an NPRM will in effect tell “parties that they better find an agreement,” the lawyer said. “By making the NPRM “broad, the FCC can use it against all parties involved” that may act in bad faith, he said.
"The notice comes as no real surprise to broadcasters, given the commission’s inclination to involve itself in what is a clearly a private, contractual matter between the cable and broadcast industries,” said lawyer Robert Rini of Rini Coran, which represents TV stations. “I don’t see it as a negative for broadcasters,” he said of the notice, “and I don’t think it will have any immediate impact” on retrans talks. “But clearly it’s a signal that the commission is interested in intervening in this area,” Rini said. “And frankly [it] raises serious questions about their authority to do so,” he said of the commission.