Washington

FCC: For Now, OVDs Don't Have to Show Comparables to Comcast

Media Bureau stays own three-month-old benchmark condition clarification for further review 3/11/2013 12:37:52 PM Eastern

The FCC's Media Bureau says that, at least for now and
perhaps for good, over-the-top video distributors who seek access to
Comcast/NBCU-owned programming don't have to make the terms of their agreements
with other programmers available to Comcast outside counsel of experts.

The bureau got a request from a bunch of those other
programmers, including CBS, News Corp., Sony, Time Warner, Viacom and Disney,
that it stay its own December 2012 decision that OVDs that invoke the FCC's
"benchmark" condition in the Comcast/NBCU deal have to make that info
available. But the bureau, instead, dismissed that stay request as well as
opposition to it by Comcast, and granted the stay on the Media Bureau's own
motion.

The benchmark condition requires that a Comcast/NBCU
programmer "provide a requesting OVD with [programming] if the OVD has an
agreement for comparable programming with a peer programmer. The programming
that a C-NBCU programmer is required to provide to the OVD must be on terms
that are economic[ally] equivalent" to the terms the OVD has received from the
peer programmer.

"The Content Companies raise significant issues, and we
believe that the public interest will be best served by staying the Benchmark
Condition Order to allow the Commission an opportunity to address those
issues," the bureau said. Those issues were primarily about
confidentiality. Comcast has countered that without access to the comparable
info, costly and otherwise unnecessary arbitration would become the norm in the
benchmarking condition. Comcast made that point in conversations with FCC
officials in the wake of that bureau decision late last week, according to FCC
documents.

In
the December decision,
  the bureau clarified that "OVDs that
invoke the Benchmark Condition must disclose the terms of comparable peer
programming agreements to the extent necessary to enable C-NBCU to carry out
its obligations under the condition."

That decision, which is now stayed, had been in response to
Comcast's request for clarification that if it were to provide similar terms,
it would have to know what the other terms were to avoid de fact lengthy
arbitration in every case. While Comcast had asked that the info be made
available to Comcast employees, the bureau decided that it should only go to an
outside entity.

Not wanting to make that info available to the competition, even
through outside counsel, CBS, News Corp. et al filed the stay request Dec. 18,
which was joined by Public Knowledge, asking for the stay and challenging the
condition. Comcast fired back that it was "self-evident" that it
could not comply with the comparable terms and conditions benchmark unless it
had the comparables.

Although the bureau agreed with Comcast about
making the info available, it is apparently rethinking that. The bureau said
the commission could decide that making the terms of other deals was not
necessary to fulfill the benchmark condition, or change its mind and conclude
that was not in the public interest.

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