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If at first you don't succeed, find an even bigger squeaky wheel

Wed, 04/13/2011 - 11:02am
Brian Santo

WASHINGTON, D.C. – The American Cable Association is plenty concerned about how its members will be able to afford to comply with the Commercial Advertisement Loudness Mitigation Act and the proposed AllVid scheme, but the organization's top priority is to push reform of retransmission consent rules.

The ACA has been complaining for almost a decade about how its members have been at a disadvantage in retrans negotiations, how they are forced to raise their rates so that their frequently rural customers have to pay more than their urban counterparts, but it might as well have been the buzzing of flies for all the attention Congress has paid the issue.

But now Congress cares.

A panelist at a Tuesday ACA Summit here yesterday was astonishingly blunt about why.

"Two things: The Oscars and the Super Bowl," said Matthew Hussey, telecommunications legislative assistant in the office of Sen. Olympia Snowe (R-Maine).

The reference was to several high-profile retrans arguments that broke out in the last year, some leading to channel blackouts, including one in which Fox blacked out Cablevision during the beginning of the Academy Awards telecast. Several similar spats, one involving DirecTV, were said to have been settled simply so that the service provider would not be blacked out of the Super Bowl, carried on Fox this year.

"We're seeing more stalemates," Hussey noted, almost unbelievably adding: "Now we're not talking about some small providers. Now we're talking about millions of customers."

One might expect an audience of "some small providers" to bristle a bit at that, but no. Small operators are nothing if not practical. Or maybe they've just learned to become stoic after getting jerked around for years by the programmers that keep raising their rates and threaten blackouts if their demands aren't met. Insult to injury, ops also can't talk about the rates they pay except in the most generic terms – the programmers insist on non-disclosure clauses. It's hard to take a complaint seriously if you can't substantiate it – or are prevented legally from doing so.

Nonetheless, Fox and some of its hardball-playing programmer brethren (e.g. Sinclair Broadcasting) have just dumped an opportunity into the ACA's lap by aggravating millions of urbanites, rather than just a few thousand yokels here and there.

So ACA members are going to be descending en masse on The Capitol today, all to meet their respective representatives and press their case. They'll be talking about retrans and asking their congressmen to do something that borders on the non-committal (because what politician can resist doing something without actually committing to anything much?); ACA members are going to ask their congressmen to forward a letter encouraging the FCC to investigate whether or not retrans rules that date to the 1992 Cable Act should be revised in any way through a Notice of Proposed Rule-Making (NPRM). Easy-peasy.

The ACA is hoping for the ability to enter arbitration when negotiations with a programmer break down. The Association is also looking to prevent separate stations from negotiating together as a bloc, and they would like to eliminate third-party meddling.

(As an example of third-party obstruction: Some ACA members have the legal right to get out-of-market channels because their putative in-market channel doesn't reach where they are. They can agree with the out-of-market channel, but then the networks sometimes step in and use their leverage with the station to kill the deal.)

As demonstrated by the House GOP's recent actions forcing the FCC to back off from imposing network neutrality rules, however, Republicans are in strict opposition to new federal rules. Of course, what the ACA and its members want are technically new rules, but they're not additional rules. There's some skepticism among the ACA crowd that the current GOP House crop is going to appreciate the distinction.

(BTW, the ACA is sort of at peace with those network neutrality rules, according to ACA President Matt Polka, who said the organization will refrain from commenting either way on the situation. No rules would be fine, but compared to some of the rules originally proposed, the ones the FCC wants to adopt are much, much better.)

On other matters
The ACA is looking for Universal Service Fund reform, just like just about everybody else. Of course, it's rare for any two suggested reforms to match. The general idea is to have a new version of the fund that would cover broadband.

ACA has members who are familiar with, and even reliant upon, USF funds, while other members eschew the USF system entirely. So the ACA had to carefully craft a proposal satisfactory to all of its members, which is to cap the fund at 2010 levels; make sure that competitors aren't created; and then support the elimination of waste, fraud and abuse of the system.

ACA vice president of governmental affairs Ross Lieberman said he'd love to see a system in which the NTIA publishes the technical specs for serving an unserved area, proposes a target for the fees to be charged and then accept bids from service providers on fulfilling those specs. "Winner is low bidder," he said. If an ACA member can provide the service, then fine, but if not, the system was at least fair.

"ACA won't stand for the beauty contest-like process that was conducted by the National Telecommunications and Information Administration and the Rural Utilities Service with broadband stimulus dollars," ACA President Matthew Polka said in an address earlier in the day.


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