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Cablevision weighs in on retrans reform

Thu, 05/26/2011 - 8:30am
Brian Santo

Cablevision Systems has petitioned the Federal Communications Commission to introduce a rule that bars programmers from blacking out programming during retransmission consent negotiations.

It is also calling for an end to allowing programmers to bundle, or tie, channels, and also to dictate that pricing cannot be divulged.

"We are pleased the FCC has initiated this important proceeding and have proposed three simple market-based reforms to the good faith negotiations rules that will protect consumers from the threat of broadcaster blackouts," said Tom Rutledge, Cablevision's chief operating officer.

"As the FCC and Congress know, consumers are the ones who are harmed when broadcasters pull or threaten to pull their networks from cable systems."

Separately, SNL Kagan expects programmers to keep raising their rates. The analyst firm projects that total industry retrans fees could increase from $1.14 billion in 2010 to $3.61 billion by 2017, with average per-sub fees for cable MSOs potentially more than doubling over time from their 2010 levels through 2017.

The complaints filed by Cablevision are complaints frequently made by MVPDs over the years, but the FCC's Notice of Proposed Rulemaking (NPRM) on retransmission consent has opened the possibility that the Commission might actually, finally, adopt rules addressing those complaints.

Cablevision said that the practice of tying leads directly to rising prices for consumers. It forces carriage of channels of limited interest in exchange for access to major broadcast networks and "must see" programming.

Cablevision also recommended requiring transparency, which means ending the practice of allowing broadcasters to keep their prices for carrying broadcast stations secret.

"The days of secret pricing that, among other things, requires consumers to pay for additional cable channels before they can receive a broadcast channel, should come to an end," Rutledge added.

Finally, Cablevision recommended that the FCC forbid discrimination. In other words, the recommendation is to allow broadcasters to continue to set the price of carriage, but do not allow them to discriminate among cable and satellite providers based on size or other factors.

"Broadcasters should not be able to keep the prices they charge hidden or to discriminate between distributors in a given market. Our simple reforms would end these practices, and we urge the FCC to consider this consumer-friendly approach."

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