Bloomberg BNA - Competing Bills Would Revise Retransmission Consent Rules

January 30, 2014
In The News

By Bryce Baschuk

Some in Congress are clamoring to modernize the decades-old rules that govern the nation's rapidly changing video marketplace, targeting the broadcast retransmission consent regime in particular.

House lawmakers introduced competing bills Dec. 12 that seek to revise program carriage rules.

Reps. Anna Eshoo (D-Calif.) and Zoe Lofgren (D-Calif.) introduced the Consumers Have Options in Choosing Entertainment Act (H.R. 3719), which would provide the Federal Communications Commission with greater control over retransmission consent disputes.

Reps. Steve Scalise (R-La.) and Cory Gardner (R-Colo.) reintroduced the Next Generation Television Marketplace Act (H.R. 3720), which would repeal retransmission consent and compulsory license provisions.

Broadcasters and cable and satellite operators have sparred recently over the rising costs of retransmission consent fees, which has resulted in much-publicized TV blackouts for many U.S. markets this summer. Broadcasters have sought higher fees from distributors to retransmit their network programming as a means to offset declining advertising revenues and increased sports programming costs.

Under Section 325(b)(1)(A) of the Cable Television Consumer Protection and Competition Act of 1992, a local television station's signal may not be retransmitted by a multichannel video programming distributor, or MVPD, without the express authority of the originating station. The FCC cannot intervene in retransmission consent negotiations or force the parties into arbitration; the agency can only investigate allegations of parties not negotiating in good faith.

Bipartisan, Bicameral Urgency

Some senators are also seeking to revise the retransmission consent regime. Last month, Senate Commerce Committee Chairman John D. Rockefeller IV (D-W.Va.) introduced a bill (S. 1680) that would limit the use of provisions in video programming carriage contracts that could harm online video competition. This summer, Sens. John McCain (R-Ariz.) and Richard Blumenthal (D-Conn.) offered the Television Consumer Freedom Act of 2013 (S. 912), which includes a provision to increase the FCC's oversight of retransmission consent disputes.

On the House side, Eshoo said her bill would “put an end to broadcast television blackouts and ensure consumers aren't held hostage by a dispute they have no control over.”

“Recurring TV blackouts coupled with the rising cost of broadcast television programming has left consumers frustrated and looking to Congress and the FCC for answers,” she said in a news release.

H.R. 3719 would give the FCC the authority to grant TV broadcast carriage during a retransmission consent negotiation impasse. Under the legislation, consumers could exclude local TV stations that elect retransmission consent as part of their cable or satellite TV service. The bill would also prohibit TV broadcast stations from bundling their owned or affiliated cable programming in retransmission consent negotiations.

Scalise's H.R. 3720, meanwhile, seeks to repeal Communications Act rules on carriage and purchase of certain broadcast signals by cable and satellite companies, repeal retransmission consent and compulsory license provisions, and repeal media ownership rules. Last session the legislation failed to receive a markup in either the House or Senate Commerce committees.

“Decades-old broadcast, cable, and satellite laws dramatically restrict access and limit consumer choice,” Scalise said in a news release. “Instead, traditional copyright law should facilitate the distribution of [local affiliate] programming so that broadcasters are rightfully paid for their content, rather than for the use of a signal.”

Dim Prospects

It is unlikely that the chairman of the House Energy and Commerce Subcommittee on Communications and Technology, Rep. Greg Walden (R-Ore.), would schedule a markup of the bills or seek to incorporate them into the upcoming reauthorization of the 2010 Satellite Television Extension and Localism Act (STELA). Walden recently said STELA was the wrong legislative vehicle to update the nation's retransmission consent laws. STELA, which authorizes satellite providers to retransmit broadcast television signals, is set to expire on Dec. 31, 2014.

Walden has instead urged Congress to begin a multi-year effort to comprehensively revise the Communications Act of 1934 in order to address marketplace changes that have occurred since the last time the statute was revised in 1996.

At a subcommittee hearing Thursday, Eshoo bemoaned the amount of time it would take to complete such an effort. The 1996 rewrite of the Telecommunications Act lingered in several sessions of Congress before finally becoming law.