Gray Television in late December 2020 moved forward with the submission to the FCC of a formal Good Faith Complaint against Frontier Communications in response to the MVPD’s failure to reach a new retransmission consent agreement tied to one of its legacy systems for an ABC affiliate serving Sarasota and Manatee Counties along Florida’s Gulf Coast, and two stations in South Carolina.
On Monday (1/11), Frontier filed its response with the Commission.
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The filing is tied to MB Docket No. 20-441, or Gray Television v. Frontier Communications, whose parent is Citizens Telecom Services Company.
And, it comes courtesy of their St. Louis-based legal counsel at Cinnamon Mueller.
The dispute centers on WWSB-TV in Sarasota, which uses PSIP Channel 40, is digital channel 24, and is branded as “ABC7” due to its heritage channel position on local MVPDs. It is one of two ABC affiliates in the vast Tampa-St. Petersburg-Sarasota-Lakeland-Sebring DMA, and was blocked as of 7pm on Dec. 18, 2020, from some 50,000 Frontier subscribers across Sarasota and Manatee Counties.
In Gray’s view, Frontier Communications “abruptly notified” WWSB that the MVPD “opted to delete” the station from its lineup, “and instead carry an out of town station after the cable provider walked away from retransmission consent negotiations.”
The “out of town” station Gray references is The E.W. Scripps Co.‘s WFTS-28 in Tampa — considered the primary ABC affiliate across the market and the network affiliate that Highlands County Xfinity subscribers receive on their local lineup.
That’s what makes the matter unique compared to other retransmission consent disputes.
RBR+TVBR also exclusively reported that the retransmission consent agreement impasse involves Gray’s NBC affiliate serving Myrtle Beach, S.C., WMBF-32, a station acquired in the Raycom Media merger; and WCSC-5, the CBS affiliate in Charleston, S.C.
However, a Gray representative said the number of impacted subscribers is “far smaller” than in Florida. The filing from Frontier to the FCC puts the number at “about 300.”
Gray’s complaint against Frontier focuses on the MVPD’s failure to reach a new retransmission consent agreement for its Frontier FiberOptic TV service, a.k.a. FiOS TV by Frontier.
The complaint opens with a retelling of the events that transpired on Dec. 18 in Florida and South Carolina, with Gray noting its “no-strings-attached” extension offer while claiming, “For weeks prior to the drop, Frontier gave the appearance of negotiating to extend its retransmission consent agreement with Gray to continue to retransmit the stations, yet as Frontier’s lead ‘negotiator’ candidly acknowledged less than an hour before that agreement expired, she had no authority to enter into an agreement on any of the terms she had been offering to Gray. In short, the negotiations were a sham.”
Gray did not reveal the name of the female negotiator representing Frontier.
The broadcast TV station owner continues, “As shown by documents available on Frontier’s own website, Frontier decided more than a month ago that it had no intention of extending its retransmission consent agreement with Gray. Rather than disclosing this plan to its subscribers or Gray, Frontier engaged in ‘Potemkin negotiations’ making offers that it would not accept for stations that it decided weeks ago it would drop. At the same time that Frontier was making fake offers to Gray, it was keeping its customers in the dark regarding its true intentions to drop all three stations as soon as its carriage agreement expired.”
Given these allegations, courtesy of Gray SVP/Government Relations & Distribution Robert J. Folliard and Assistant General Counsel Claire Magee Ferguson, believe “the Commission’s good faith rules and consumer notice rules demand more.”
The key issue: Frontier gave no warning to its subscribers that the channels were in danger of being dropped.
How does Frontier respond?
“The simple fact is that Frontier and Gray disagree over the value of Gray’s stations,” it says. “In its Complaint, Gray alleges that Frontier violated its duty to negotiate in good faith and its obligation to notify its customers ‘as soon as possible’ once Frontier knew it would no longer have Gray’s consent to retransmit the stations. Frontier denies these and all related allegations as lacking any basis in fact or law.”
It is Frontier’s belief that “after 25 days of negotiation and three offers put forth by Frontier, any of which Gray could have accepted, Gray now cries foul because Frontier did not agree with the financial terms that Gray wanted to force on Frontier and its customers.”
Further, Frontier assails Gray for making “unsupportable claims” that Frontier’s lead negotiator “had no authority to enter into an agreement,” and that Frontier “engaged in Potemkin negotiations” and “fake offers” because Frontier “decided more than a month ago” that it would not extend its retransmission consent agreement with Gray.
Additionally, Frontier takes issue with “the main premise of Gray’s specious argument,” as is it based on “the inaccurate assumption that Frontier removed Gray’s stations from its online channel guides several weeks before the agreement was due to expire and possibly prior to beginning negotiations.”
Frontier tells the FCC it did not update its customer-facing channel guides until shortly after the agreement had expired.
David Zanvettor, the Director for Digital Experience at Frontier’s parent, signed a sworn declaration asserting this as fact.
This sets up Frontier’s argument that the argument is all about rates. And, as the FCC has said, that’s not indicative of a lack of good faith.
Frontier continues, “The fact that Gray refused to accept the offers put forth by Frontier does not make them ‘fake offers’ but merely ‘unacceptable offers’ … Gray’s complaint is simply an attempt by a broadcaster to add additional leverage to the retransmission consent process – either accept our last offer or we will claim that all your offers we rejected were fake and you never meant to reach agreement. Ultimately, the parties could not reach an agreement on the value of the stations but that does not render the negotiations a façade on Frontier’s end. The Commission should deny the Complaint.”
Frontier also makes the argument that, because WWSB’s newscasts and original programming are available online for free, this “diminishes” its value and should be taken into account in their retransmission consent negotiations.
The Frontier TV service at the heart of the negotiations meltdown was acquired from Verizon in 2016. At the time, it introduced the service in several news markets, too — including South Carolina.
On October 12, 2016, a retransmission consent agreement was signed between Frontier and was amended on June 30, 2018. It covers all three TV stations and was approved by Raycom Media.
Gray merged with Raycom in 2019.
