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Senate Judiciary Passes Satellite TV Modernization Act - Broadcasting & Cable

Senate Judiciary Passes Satellite TV Modernization Act

Includes provision instructing Copyright Office to produce study on phasing out compulsory copyright license for satellite distant network TV stations signals
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The Senate Judiciary Committee passed the Satellite TV
Modernization Act out of committee Sept. 24 with the additional provision
instructing the Copyright Office to produce a study on phasing out the
compulsory copyright license for satellite distant network TV stations signals.

The bill, like the version that passed the House Judiciary
Committee, would allow for the importation of distant signals into so-called
short markets that lack one of the network affiliates or a sufficiently strong
signal from a nearby affiliate. It also makes technical corrections to reflect
the advent of digital TV.

But left for another day was the issue of allowing satellite
operators to deliver the games of local sports teams to viewers in so-called
orphan markets, wherein viewers from Wisconsin,
for example, receive Minnesota TV stations because the market crosses state
lines.

National Cable & Telecommunications Association
President Kyle McSlarrow praised the passage, saying in a statement, "We
applaud the leadership of Chairman Leahy and Ranking Member Sessions and their
effort to gain committee approval of the Satellite Television Modernization
Act. We strongly support the bill's effort to promote continuity and to include
important language that resolves the so-called ‘phantom signal' issue.  We
greatly appreciate the Committee's support of the resolution which is fair to
both copyright owners and distributors, and look forward to working with the
Senate and House to enact the Satellite Television Modernization Act into law
this year."

The addition of the phase-out study amendment was introduced
by Committee Chairman Patrick Leahy (D-Vt.) and Jeff Sessions (R-Ala.). Leahy
had signaled when the bill was introduced that he
would revisit the issue of phasing out the license
. The Copyright Office
has already recommended doing so.

Left for more debate and possible reintroduction on the
floor was an amendment, introduced by Sen. Russ Feingold (D-Wis.), that would
have allowed Wisconsin viewers in out-of-state
DMAs to view Green Bay Packers games. The amendment would have allowed satellite
companies to import local news and weather--and Packers games--while blacking
out syndicated programming and protecting network non-duplication.

While withdrawing the amendment, Feingold urged the
satellite companies and broadcasters to work out an agreement themselves to
resolve the issue before the bill went to the floor. Ditto Sen. Tom Coburn
(R-Okla.), who had a similar amendment that he also did not introduce, adding
that his staffers had assured him an agreement between stations and satellite carriers
would be worked out before the bill hit the floor. But he added: "I have
every intent to solve it if they don't."

Feingold took a shot at DirecTV during the hearing, though
not by name. He said he understood one of the satellite companies opposed his
amendment because it would mean Packers fans would get to watch the games for
free instead of having to pay hundreds of dollars for the out-of-market Sunday
Ticket package. "I find it outrageous that a business would seek to block my amendment or take advantage of our die-hard--and I do mean die-hard fans."

Opposing the Feingold amendment were Minnesota Democratic
Senators Amy Klobuchar and Al Franken, though Franken said he would be willing
to take another look if it resurfaced on the floor, but hoped it would be
resolved before then.

Franken pointed out that the carve-out could hurt local Minnesota businesses.
That would include some of his home-state broadcasters.

Klobuchar pointed out that trying to deal with the issue in
committee would delay a bill that is must-pass, a point Leahy made at the
outset of the hearing. He said that some viewers' TV sets could go dark if the license
were allowed to sunset, which it does at the end of the year if Congress does
not reauthorize it.

Leahy also said that he didn't want to work out all of the
different parochial fixes in committee. He said one thing that should be on the
table for consideration was a suggestion by Coburn that the final bill contain
a two-year or three-year trigger, meaning that if private deals were not worked
out within that time, the local carriage carve-out would kick in.

Coburn said that he has been told that all these local
carriage issues can be worked out by the players, but he said that the reason
they weren't getting done so far is there was no deadline. He said the trigger
would "drive the players to come together to get the problem solved."

Leahy pointed out that the cable and content industries were
able to come to terms on fixing the so-called phantom signals issue, which is
where cable operators had been paying a fee for subscribers who weren't getting
the content. He praised that effort and said that, if past was prologue, these
issues could get worked out as well.

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