FCC Enters The Retrans Fray With TV ‘Blackout’ Proceeding

WASHINGTON, D.C. — As expected, the FCC has moved ahead on a party-line 3-2 vote with a Notice of Proposed Rulemaking that will establish an agency regulatory policy requiring rebates for MVPD consumers who face programming “blackouts” due to a retransmission consent impasse.

With a comment period ahead, it sets up a battle between the cable TV service providers who have advocated for a wholesale abandonment of the retransmission fee and a broadcast TV industry that has vociferously argued that MVPDs should pony up bigger dollars for the right to carry their valued programming.

Specifically, the 21-page Notice of Proposed Rulemaking — agreed to on January 10 by the Commissioners but not released until Wednesday (1/17) seeks comment on whether and how to require cable and satellite providers to issue rebates to subscribers in the event of a blackout.

The Comment Date is to be 30 days after publication of the NPRM in the Federal Register, with a Reply Comment Date to be 45 days after such publication.

The NPRM was introduced by Jessica Rosenworcel, the FCC Chairwoman, who has seemingly, to some observers, done so under influence or lobbying from the NCTA, representing the cable television industry. However, one could argue that her true motives lie in ensuring consumers are not harmed, hence the reason for the NPRM being labeled “a consumer protection effort” from the FCC under Rosenworcel’s leadership.

In a statement explaining her reasons for the NPRM, Rosenworcel said, “You should get what you pay for. It’s a simple principle. But for too many consumers, this is not
happening. When they turn on the television to watch the local news, their favorite show, or the big game, the screen goes dark. Instead of the programming they were sold when they signed up for service, they get a message telling them that their cable or satellite company is in a dispute with a broadcast company and until these two battle it out, they are stuck with a blackout. It’s not right. And it’s happening too often, for longer periods of time.”

That’s why Rosenworcel is saying “Enough” to the impact retrans impasses and “blackouts,” by law, are having on paying cable TV customers. “When consumers are saddled with a blackout like this, I think they deserve a refund,” she said. “They should not be asked to shell out for programming that they were promised but are unable to watch. This rulemaking is about fairness. It asks questions about how our rules can make sure consumers get what they pay for and not have to spend for service they are not getting and screens that go dark.”

Democrat Geoffrey Starks not only agrees, but he added questions to the item he demands answers to: Why have blackouts increased? How has the availability of streaming
services, particularly live linear streaming services that consumers can sign up for and begin receiving immediately, impacted the amount and duration of blackouts? Are programmers with channels that have certain categories of programming – like sports – more likely to have negotiations that result in blackouts?

“I look forward to the record on these issues,” Starks says.

In contrast, Republican Brendan Carr “cannot support this effort,” and points fingers at the White House.

“At President Biden’s urging, the FCC launched a proceeding last month to regulate certain fees (or rates) charged by cable and DBS providers—even though today those providers are far from 800 pound gorillas when it comes to the modern video marketplace,” Carr says. “I dissented from that decision because I cannot support the Biden Administration’s inexorable march towards rate regulation and because the FCC plainly does not have the legal authority to impose those forms of rate regulation. Indeed, the FCC
purported to ground the decision in a statutory provision that Congress passed to address customer service issues, like wait times on calls to service centers, not rate regulation. Today, the FCC heads right back down this same path—proposing to impose another form of rate regulation using the agency’s limited authority to regulate customer service issues. And once again, this action comes at a time when consumer choice has never been greater and traditional MVPDs are bleeding market share to new, unregulated competitors.”

Nathan Simington, the second Republican on the FCC, offered a lengthy dissent, noting he cannot approve of the item “because it, at best, will create zero consumer welfare (and, likely, will harm consumer welfare) while simultaneously misreading the Act.

To view the NPRM and the Commissioner’s statements on the proposal, in full, please click here: FCC-24-2A1

The Commission also under Rosenworcel proposed requiring “all-in” pricing information in cable and satellite billing and promotional materials, and limiting “junk fees” – like early termination fees – on cable and satellite services.