Editorial: Common Sense

Cable operators have to put TV stations on a must-buy tier, and there will be some cases where broadcasters and cable operators can’t come to terms on contracts

By BCST Staff -- Broadcasting & Cable, 6/6/2011 12:01:00 AM

Let’s get real here. The FCC is not going to get rid of the must-carry rules. Cable operators are still going to have to put TV stations on a must-buy tier, and there are still going to be some cases where broadcasters and cable operators can’t come to terms on contracts, just as there is in virtually any category of negotiation.

And sorry, in those cases, which as the National Association of Broadcasters points out are the exception rather than the rule, losing access to a TV station signal is not the equivalent of cutting a lifeline—so long as the FCC leaves enough stations around after its spectrum reclamation push.

But with its vow to be a more consumer-focused agency, and the pressure from Congress to do something in response to a few high-profile retrans impasses, the FCC is going to take some action. It is under pressure to do so before the end of this year, which is when a bunch of retrans deals come up for renewal.

There was lots of tough talk traded in the FCC’s retransmission consent rule docket last week, as cable operators and broadcasters and satellite operators and phone companies and sports fans weighed in.

Broadcasters say they are just starting to get closer to full value for their valuable broadcast signals in a model that has morphed from launching and growing cable nets like ESPN or Disney Channel or FX to getting cash to fuel a dual revenue stream.

Cable operators counter that the retransmission consent marketplace is hardly free, with must-carry rules and the requirement that TV stations are a must-buy on cable systems feeling like a couple of proverbial big thumbs on the scale.

Both arguments have merit, and neither side is going to get all that they want. But this magazine wasn’t rechristened Broadcasting & Cable almost two decades ago because the ampersand was underemployed. The two services are inextricably linked.

Broadcasters need cable and satellite carriage to reach the majority of viewers now watching their TV on a pay service, while those services still need all that network and local TV fare that represents most of the top programming in terms of eyeballs.

The FCC should tread lightly. We have no problem with them clarifying what constitutes good faith bargaining so long as that does not become a vehicle for inserting itself too deeply into the process. For instance, the Sports Fan Coalition wants the FCC to find that a TV station pulling a signal just before the start of the big game should be a per se violation. We like sports as much as the next editorial page, perhaps even more. But that is the kind of hyper-specifi city the FCC should avoid.

Scrapping the exclusivity rules, as the FCC suggested it might do in its notice of proposed rulemaking, is not the way to go either

What is needed is toning down the rhetoric on both sides and recognizing that broadcasting & cable still have a lot to gain by working together after the tough retrans talk morphs into another round of deals.