Add DirecTV, DISH Network and Insight Communications to the list of supporters of Mediacom in its retrans fight with Sinclair. They say that broadcasters negotiating for more than one Big Four network affiliate in a market are exercising undue leverage whether the station is co-owned, under a leveraged market agreement or other shared services agreement, or whether it is a single station with a second multicast affiliation.
Actually, the trio said they could not weigh in on the factual merits of the
allegations in the Mediacom complaint and made "no particular claims"
to such knowledge, however, they had a lot to say regardless including that such undue
leverage harms consumers.
In a letter dated Monday to the FCC, a copy of which was supplied to
B&C, they said they shared "public interest concerns" about
a single station negotiating "for more than one of the “Big Four” national
broadcast networks (i.e., ABC, CBS, Fox and NBC) in a particular market."
Those include that the combo could represent undue leverage.
The letter was guarded in its tone, saying only that the FCC should take into
account that fact, if it is a fact, when examining the complaint and determining
whether the broadcasters has negotiated in good faith.
Mediacom, with strong support from Time Warner Cable and the American Cable
Association, has asked the FCC to rule on whether a broadcaster's negotiation
for both its owned station and one with which it has a local marketing
agreement in the same market represents good faith bargaining, or instead a
bending of the FCC duopoly rules to its advantage to obtain undue leverage.
In their letter, the three companies point out they have negotiated thousands
of retrans deals and that unde leverage can mean
They say that while multichannel video providers like satellite and cable
companies "generally have" only one choice for network programming,
"network broadcasters now have multiple avenues for distribution. This is
an enormous 'structural market change' in the retransmission consent regime –
one unforeseen when Congress first created the regime," they argue.
They also point out that Justice has noted that "this situation is
exacerbated" when a station negotiates for another in a market, even more
so when they are both Big Four network affiliates.
"In our experience, stations possessing “duopoly” (or “triopoly” or
“quadropoly”) power over network programming exert enormous –and, in our view,
undue – leverage in retransmission consent negotiations," they wrote.
"Put another way, a station that controls the availability of NBC
programming in a market has market power, but a station that simultaneously
controls both NBC and Fox programming in that market has far greater market
power. This is true whether the station can exercise this control due to
ownership of two stations in a market, through a management, services or
marketing arrangement, or by multicasting the programming of two networks at once
from a single station."
They argued that the result was higher retrans fees than would otherwise be the
case, and a larger threat of service disruption if the their terms are not met
(Mediacom has asked the FCC to prevent Sinclair from pulling its signal while
the retrans complaint is being considered). "Both of these outcomes harm
consumers," said the companies.