Washington

E&C Majority Staffers: Time to Revisit Must-Carry/Retrans Regs

Majority memo tees up issues for June 27 future of video hearing 6/26/2012 08:40:15 AM Eastern

Republican staffers on the House Energy & Commerce
Committee's Communications Subcommittee signaled in their memo on the June 27
Future of Video hearing that that future should be a deregulatory one,
including that if Congress rethinks any regs, they should be must-carry/retrans
and program access rules.

"The Communications Act is woefully out of step with
the state of competition and technology in video distribution and programming,"
they write, according to a copy of the memo teeing up issues that could be
addressed at the hearing.

That means, they argue, that retransmission consent deals
between MVPDs and broadcasters and program carriage deals between MVPDs and
programmers "are best left arranged by the respective parties and their
viewers, free from regulatory intervention."

That would be good news for broadcasters not looking for the
government to step in and mandate carriage or arbitration during impasses.
"Both sides should be able to withhold valuable assets," the staffers say,
otherwise no "true negotiation can take place."

The alternative, they say, is the "risky"
proposition of asking regulators to weigh the relative value of programming and
carriage.

But before broadcasters start breaking out the champagne,
the committee suggests the government's thumb is already on the scale to the
"detriment" of pay TV providers through regulations like must-carry
with its basic tier and must-buy requirements that require cable operators to
put must-carry stations on the most widely viewed tier and prevents subscribers
from buying premium channels without also having to buy that basic tier, which
"limit shelf space that might otherwise be available for non-broadcast
programming." Broadcasters have no interest in either the FCC or Congress
deep-sixing those requirements given the increasing revenue of cash for
carriage.

Then there are the program access conditions that restrict
the rates, terms and conditions on vertically integrated cable operators and
programmers. The staffers say that if any provisions should be revisited, it is
these retrans- and carriage-related regulations given the changes in the
competitive marketplace and technology since they were adopted.

They also suggest that network nonduplication and syndicated
exclusivity rules limit the ability of cable and satellite operators to
negotiate free of government, but add that those should not be revisited or
revamped unless it is done it concert with reviewing the compulsory copyright
license, which, in turn, limits the ability of programmers to negotiate
individually for programming rights. Most broadcasters are not looking for
network nondupe and syndex not go away, arguing those underpin their business
models.

Also on the list of possible topics for discussion is
satellite TV reauthorization, the networks' legal battle with Dish over the
Hopper recording and ad skipping service and the FCC's request for comment on
the definition of MVPD and whether over-the-top providers should be included.
"[T]his proceeding may have far-reaching consequences for the future of
video," they said. The staffers did not weigh in on way or the other on
either of those, simply framing the issues.

The hearing is the second in a series of hearings on the
future of audio, video and technology that Subcommittee Chairman Greg Walden
has planned.

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