NAB's Smith: TV Station Value Is Tied to Retrans - Broadcasting & Cable

NAB's Smith: TV Station Value Is Tied to Retrans

Preserving fair compensation is key to future of nation's "go-to" medium
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National Association of Broadcasters president Gordon Smith
plans to tell his former Senate Commerce Committee colleagues that local TV has
"immense value," a value tied to their ability to negotiate "fair
value" for their signals via retransmission consent.

That is according to his written testimony for the
committee's Cable Act at 20 hearing July 24.

Smith says that broadcasting continues to be the "go to
choice for news, emergency service and entertainment."

He points out that while broadcast TV accounts or 35% of all
viewership, they only get 6.7% of carriage fees. He said that latter percentage
is projected for "slow growth."

He says the fact that the Cable Act is 20 years old does not
by itself justify change. "When some focus only on 1992, we should also
remember that for many years carriers refused to pay cash to local
broadcasters. The simple fact that the nature of the compensation for
retransmission consent has changed does not demonstrate a problem."

He says the laws are not ripe for a rewrite.

The hearing is expected to include discussion of S. 2008, a
sweeping deregulatory bill introduced by Sen. James  DeMint (R-S.C.) and
House companion bill HR 3675 from Rep. Steve Scalise (R-La.), that would scrap
both retrans must-carry and media ownership rules.

"In looking at S.2008, there are some provisions that
broadcast groups may look favorably upon and others that raise concerns and may
require more thoughtful consideration," said Smith in his testimony.

"Language that would eliminate carriage provisions like
retransmission consent and must-carry is a chief concern."

Smith suggests that suggestions it should go away provide
cable ops more reason not to negotiate retrans deals. "These suggestions
only fuel those carriers that would rather seek to change the law than engage
in meaningful negotiation."

The bills would also get rid of the compulsory license for
cable and satellite. Smith said he recognizes that the goal is to allow
broadcasters to negotiate directly for licensing of their programming, but
Smith said that programming is separate from the value of the broadcast signal,
and that many stations would not be able to undertake the "expensive and
cumbersome process of direct licensing."

He also took aim, indirectly, at the current battle between
broadcasters and Aereo and other over-the-top providers offering TV station
signals. "[B]roadcasters must continue to have the right to control the
distribution of their signals and to negotiate with broadband video service
providers seeking to retransmit such signals," he says. "If new
technologies are allowed to evade retransmission consent and exploit
broadcasters' signals without local stations' consent, the viability of those
stations -- and their ability to serve their local communities with high
quality programming -- will be lost."

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