AT&T Files Program-Access Complaint vs. Cox
AT&T claims Cox Communications denied it access to San Diego regional sports network, Padres games.
By John Eggerton -- Broadcasting & Cable, 9/11/2008 10:27:00 AM
AT&T filed a program-access complaint against Cox Communications at the Federal Communications Commission.
In the complaint, the phone company said Cox is denying it access to the cable operator's regional sports network in San Diego and the must-have programming -- San Diego Padres Major League Baseball games, in particular -- on that network.
Cox conceded that it is not making the programming available to AT&T, but it said it is within its rights and the phone company is trying to take a short-cut to proprietary content in order to boost its relatively recent multichannel-video offering.
AT&T argued that not having the network puts its U-Verse TV multichannel-video service at a competitive disadvantage to Cox, which owns both the network and a San Diego cable system.
The telco added that its failure to come to terms on carriage of the sports network is also affecting its competition with Cox for bundled services like broadband and telephony.
Sports programming is historically a programming category the FCC considers must-have, for which there are no adequate substitutes.
The FCC last year extended its program-access rules, which require vertically integrated programmers to make their networks available at nondiscriminatory prices to competitors. The FCC concluded that cable operators still had the ability and incentive to favor affiliated cable programmers by denying programming to competitors.
But the rules only apply to satellite-delivered networks, not terrestrially delivered sports networks like Cox's.
The FCC also asked for comment on whether it needs to extend the access rules to those terrestrially delivered networks, but it has taken no action on that issue.
“We just received a copy of the complaint and are still reviewing it," Cox said in a statement, “but one is thing clear already: AT&T is late to the game in developing a video offering, so they are looking for short-cuts, such as demanding access to our proprietary content."
Cox continued, “Channel 4 San Diego is a local product we created from the ground up more than 12 years ago. We negotiated and paid for the rights to distribute Padres content, so it is therefore our right to distribute it as we see fit."
Cox said it was within its legal right to deny the programming to AT&T. “Our distribution of the Padres content is entirely consistent with applicable law and regulations," the cable operator said. "We are not required to share the benefits of Channel 4 San Diego and its Padres content with AT&T."
As for the charges that denial is anti-competitive, Cox said it was instead the marketplace working as it was set up to do.
“AT&T’s claims of unfair competition are unjustified and directly contradict the marketplace reality of fair competition,” Cox added. “Video providers are allowed to compete based on this type of product differentiation -- for example, DirecTV has exclusive rights to NFL Sunday Ticket -- just as many other types of companies do. Likewise, AT&T is the exclusive carrier of Apple’s iPhone, which prohibits other wireless carriers to offer the iPhone.”
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