ACA Chairman: Comcast/NBCU Would Have More Power Than Any Company Deserves - Broadcasting & Cable

ACA Chairman: Comcast/NBCU Would Have More Power Than Any Company Deserves

Argues proposed joint venture would reinforce discrimination against smaller operators
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Talking
to a roomful of small and medium-sized cable operators, American Cable
Association Chairman Steve Friedman said it was time for the discrimination
against smaller operators to stop, including arguing that a Comcast/NBCU merger
has more clout "than any one company deserves."

In
a speech at a Washington policy update session at the Independent Show in
Baltimore, Friedman said that whether the issue is network neutrality, retransmission
consent reform, broadband reclassification or the Comcast-NBCU merger, the
problem boils down to big vs. small.

"Our
members -- and your customers -- routinely pay a disproportionate amount in the
cost and impact of regulation and in the direct cost of broadcast and cable
programming. And it's just because we are smaller," he said.

The
Independent Show combines the American Cable Association and the National Cable
Television Cooperative, the latter which acts as a collective programming buying
consortium.

"It's
time for the discrimination to stop," he said, taking aim at local
marketing agreements (LMA's) and shared services agreements (SSA's),
as ACA has done in comments to the FCC on retransmission consent reform.
"The intent here is clear: Broadcasters are using LMAs and SSAs
to exercise even market power over ACA members in a manner that the
duopoly rule was established to prevent. And by doing so, they are
charging ACA members and your customers discriminatory retransmission
consent rates," he said.

ACA
President Matt Polka told the crowd that the American Television Alliance
(ATVA) has been helping drum up the "dear colleague" letters calling
on the FCC to open a rulemaking on retrans reform, and urged ACA
and NCTC members to contact their legislators as well. ACA joined
with Time Warner Cable, telcos, satellite companies and others to
form ATVA to push for FCC action.

On
the 800-pound Peacock in the room, Friedman said a combined Comcast
and NBCU would just increase the disparity in size and power between big
and small. "I'm sure every operator in this room wishes it had the size,
leverage and clout of each of these companies," he said. "But when
you put these two companies together, that's more clout than any one company
deserves, particularly when dealing with smaller companies like ours and our
customers who have to pay for the disparity in our size and leverage.

He
said that just as Comcast and NBCU have pledged to NBC stations to
maintain a barrier between broadcast affiliation contracts and retrans
deals, and not to discriminate against affiliates of the other Big Four nets,
it must "take the step further" to commit "ending
discrimination" against ACA members in retrans and programming
deals.

ACA has
yet to spell out exactly what conditions would make the deal acceptable, but
they will have to go beyond adhering to program access rules and/or agreeing to
independent arbitration.

In
a policy session following Friedman's speech, ACA VP of Public Affairs
Ross Lieberman said those rules do not keep broadcast signals on the air during
disputes and it is not clear whether they would apply to online video
distribution. He also said that outside arbitration can cost hundreds of
thousands or even millions of dollars that smaller operators simply cannot
afford.

Saying
nothing gets done in Washington without crisis and consensus, Rhod Shaw of
Alpine Group, a member of ACA's lobbying team, suggested that the
Comcast/NBCU merger's upside was that it gave ACA and NCTC members a
vehicle for articulating a host of problems, and that the
highly-publicized retrans battles at the end of last year could be the
crisis that a new consensus (like the eclectic ATVA) forms around.

The
advice of the lobbyist panel assembled included that Congress' telecom policy
role through the end of the year will be more likely in how it influences the
FCC rather than any legislation, given the dwindling days to get anything done
legislatively before the elections.

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