WASHINGTON (AP) – Federal regulators are adopting new rules intended to give cable viewers more channel choices.
The rules, approved by the Federal Communications Commission Monday, aim to make it easier for independent television programmers to get their channels carried in cable system lineups and to prevent cable companies from discriminating against independent channels that may compete with their own networks.
And the cable industry isn't too happy about it.
According to National Cable & Telecommunications Association President and CEO Michael Powell: "The FCC's program carriage decision represents an unfortunate trifecta: a flawed process that the FCC stubbornly refused to correct, substantive policy discussions that show little regard for the limits of agency authority or constitutional rights, and a disturbing lack of appreciation of the potential impact of government intervention on consumers or the marketplace. In other words, we are profoundly disappointed not only in what the FCC did, but how they did it. Regrettably, we must now explore other avenues for redress."
Program carriage disputes have pitted programmers against cable giants. Tennis Network and the NFL Network, for instance, filed complaints with the FCC in recent years accusing Comcast Corp. of discriminating against them by relegating them to a premium sports tier that reaches only a small number of subscribers.
Comcast, the nation's largest cable company, owns some of its own sports networks, including Golf Channel and Versus. The company also recently acquired NBC Universal, which owns popular cable channels such as CNBC, Bravo and Oxygen. While the NFL complaint was ultimately settled, the Tennis Channel case is still pending before the FCC.
"Modernizing these rules is essential to ensure that consumers have the ability to view a variety of diverse programming at the lowest possible cost, and hopefully to foster more independent production," FCC Commissioner Michael Copps said. Copps is one of the three Democrats on the five-seat commission.
The FCC's existing program carriage rules, which are rooted in a 1992 cable law, prohibit cable operators from discriminating against unaffiliated channels by refusing to carry them or placing them in premium tiers with fewer subscribers. The rules also prohibit cable companies from demanding a financial stake in a programmer in exchange for carriage or demanding exclusive access to channel.
Although programmers can file complaints with the FCC against cable companies that violate those rules, the complaint process has been "woefully ineffective," said Andrew Jay Schwartzman, senior vice president and policy director of Media Access Project, a public interest group. That's because program carriage complaints can take years to resolve and because programmers have limited leverage if a cable company wants to drop a channel once an existing carriage contract expires.
The new rules adopted by the FCC on Monday would impose deadlines to ensure that most program carriage complaints are resolved within about a year. The rules also allow the FCC to require a cable company to continue carrying a channel while it considers a complaint, even if the existing carriage contract has expired, if the programmer can show that it is likely to win the case and meet other requirements.
The agency is also seeking comment on a number of other possible changes to its program carriage rules, including permitting damage awards in disputes and clarifying that cable companies that retaliate against a programmer for filing a complaint with the FCC could face charges of discrimination.
Comcast said the new rules are "not justified by any record and will result in additional regulatory burdens."
"Today's video programming and distribution marketplace is highly competitive, and the vast majority of carriage deals are successfully negotiated without any need for government involvement," the company added.