A coalition of program distributors, representing the cable, satellite and telco facets of the business, are expected to tell the FCC that the retransmission process is broken and that the FCC needs to come up with a new way to set retrans rates.
According to the LA Times and Reuters, Time Warner, DirecTV and Verizon are among the group mounting the protest. It comes on the heels of a much-publicized showdown between Disney/ABC and Cablevision against the backdrop of the Oscars telecast on ABC Television Network.
Reuters said the complainants are planning to ask for arbitration and a ban on program withdrawal during negation periods. Broadcasters contend that the system works fine as is and does not need any tweaking.
NAB’s Dennis Wharton commented on the situation, saying, “The unintended consequences of pay TV providers attacking the free-market-based retransmission consent model could be the demise of local programming. Modest retransmission consent revenues help local TV stations fund news operations, community service, and life-saving weather information that viewers across America rely on every day. Vertically-integrated cable operators routinely compensate each other for their own less-watched cable-owned networks, while raking in profit increases five times the amount of their programming costs. To see billion dollar pay TV companies asking for government intervention to protect their exorbitant profits is just plain wrong.”
RBR-TVBR observation: MVPDs don’t mind paying top dollar for channels they own – they take the money out of one pocket and put it in the other, all while setting a price for other MVPDs who also need the channel. But they grouse about paying broadcasters a fraction of that, even though the broadcasters are providing must-have entertainment programming and even more critical local content that the MVPD can get nowhere else.
The MVPDs may not like retransmission negotiations, but the system rarely leads to service interruptions and it is not broken.
