LAKEWOOD RANCH, FLA. — In a blow to one of the nation’s biggest broadcast television companies, the FCC‘s Media Bureau on Wednesday (4/21) in a memorandum opinion and order denied a “Good Faith” complaint against Frontier Communications in response to the discontinued distribution of the ABC affiliate focused on Sarasota and Manatee Counties of Florida.
Gray Television in late December 2020 moved forward with the submission to the Commission of a formal “Good Faith” complaint against Frontier in response to the MVPD’s failure to reach a new retransmission consent agreement tied to one of its legacy systems for WWSB-7, an ABC affiliate serving Sarasota and Manatee Counties along Florida’s Gulf Coast.
Two stations in South Carolina are also impacted, albeit to a much smaller extent.
The action by Gray followed the December 18, 2020 drop of WWSB, one of two ABC affiliates in the vast Tampa-St. Petersburg-Sarasota-Lakeland DMA, by Frontier in the absence of a fresh retransmission consent agreement.
Some 50,000 Frontier subscribers across Sarasota and Manatee Counties were immediately impacted. Frontier simply substituted WWSB with The E.W. Scripps Co.-owned WFTS-28. While it is an ABC affiliate, it largely focuses on Hillsborough, Pinellas, Pasco and Polk 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 is within the DMA, making the matter a tricky one for Gray.
Raycom paid $82 million for WWSB in a deal consummated in summer 2016 with Calkins Media. Since then, Gray has invested heavily in making “ABC7” and MySuncoast.com strong competitors to McClatchy-owned daily Bradenton Herald, the Gannett-owned Herald Tribune in Sarasota, and all Tampa Bay-centric media available in the Suncoast region of Florida.
While the impasse between Gray and Frontier also 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., the loss of WWSB is at the heart of the fight. And, with a recent near-environmental disaster at Piney Point a major local news story for WWSB, the battle reached a fever pitch as the Media Bureau decided how to rule.
That decision, courtesy of Media Burau Chief Michelle Carey, came Wednesday.
And, it wholly favors Frontier.
“We agree with Frontier that it complied with the obligation to negotiate retransmission consent in good faith, including its per se obligation to negotiate retransmission consent, its per se obligation to designate a representative with authority to make binding representations on retransmission consent, and compliance with the totality of the circumstances test,” Carey said. “We also find that Frontier fulfilled its customer notice obligations.”
In making the determination that a refusal to negotiate claim was invalid, Carey pointed to “extensive negotiations” noted by Frontier as correct. And, Carey ruled, “We find that a party is permitted to adjust its bargaining position as negotiations proceed and doing so is not bad faith. In this case, Frontier ascertained information causing it to conclude that a station was less valuable to it than previously thought.”
Thus, Carey concluded, “The record demonstrates that through the course of active negotiations, Frontier learned new information that caused its bargaining position to change, and ultimately the parties were unable to agree on mutually acceptable financial terms.”
The focal point of 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.
Research conducted by RBR+TVBR confirmed that this is a “discontinued” service, with new customers in communities such as Lakewood Ranch, where rock and roll legend Mick Jagger just purchased a home, now being offered bundled DirecTV and AT&T TV NOW packages. Further, while Frontier has a legacy video services package tied to Dish, it is not tied to this dispute.
For Frontier FiberOptic TV subscribers, a revised channel lineup obtained by RBR+TVBR shows WWSB replaced on its channel position by WFTS, while WFTS has also retained its own dial position — effectively giving it two homes as a sign Frontier wants its customers to realize ABC programming is “still there.” Carey says accurate notification to subscribers of this change was conducted by Frontier.
Her statement also supports the mindset that post-adjustment notification is suffice — even if a warning of an impending channel loss isn’t given.
WWSB VP/GM Jeff Benninghoff is a Frontier customer receiving Frontier FiberOptic TV services. In a declaration, he “does not recall receiving any customer notices or emails from Frontier regarding the loss of WWSB.”
But, that argument failed to pass muster with Carey.
In Gray’s Good Faith complaint, it claimed, “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.”
Carey, and the Media Bureau, disagree.
And, while the key issue to Gray is that Frontier gave no warning to its subscribers that the channels were in danger of being dropped, leading Gray to even suggest that Frontier could be liable for a Notice of Apparent Liability for Forfeiture in the amount of $562,500 for good faith violations, Carey couldn’t be swayed in her opposing view of the matter.
“In short, nothing in the record supports a finding that Frontier failed in its duty of good faith negotiation of retransmission consent with Gray,” she wrote. “We find that the record indicates that both parties negotiated in good faith but could not agree on the value of the stations … The parties simply failed to agree to financial terms, and we agree with Frontier that this type of business disagreement is not a proper basis for a complaint and should be rejected.”
Representatives from Gray did not respond to RBR+TVBR‘s request for comment prior to its 4:30pm Eastern daily news deadline on Wednesday.
