Cable Programmers Respond To Martin’s A La Carte Ceiling Plan

Top Executives Send Letter Stating FCC Chief’s Proposal Would Be ‘Devastating’ For Consumers

By Mike Reynolds -- Multichannel News, 4/15/2008 5:45:00 PM

Responding to a recent proposal from Kevin Martin that would put a monthly license fee ceiling on networks positioned on expanded basic, top executives from five major cable programming groups fired off a letter expressing their concern about the Federal Communications Commission chairman’s latest call for a la carte action.

The April 15 missive, citing the FCC’s lack of authority in this arena, bipartisan Congressional rejection of past a la carte gambits and requests by Congressmen for the agency to focus on the digital TV transition, also states “how devastating” Martin’s latest proposal would be to consumers.

Last week, Martin, who has long pursued a la carte pricing options for consumers, floated a proposal under which cable operators would have the right to remove any network, with a monthly license fee of 75 cents or more, from expanded basic.

At a minimum, that pricing level could pertain to ESPN, regional sports networks, TNT and Disney Channel, all of which gather monthly license fees above that threshold, according to estimates from Kagan Associates.

The letter says that the proposal “would result in popular networks that consumers expect to be widely available being stripped out of the expanded basic service, thereby forcing consumers to pay an extra charge for them.”

The missive -- signed by Disney Media Networks co-chairman George Bodenheimer and Anne Sweeney, who serve as president of ESPN and ABC Sports and president of Disney ABC Television Group, respectively; Universal Television Group president and COO Jeff Gaspin; MTV Networks chairman and CEO Judy McGrath; Turner Broadcasting System chairman and CEO Phil Kent; and Fox Networks Group president and CEO Tony Vinciquerra -- also mentions that “consumers would be worse off because they would have fewer programming options under your proposal.”

It concludes by saying that “if your plan is ever adopted, consumers would be outraged. As we and all credible experts have consistently concluded, consumers will pay more and get less under government mandated a la carte.”

FCC commissioners Michael Copps, Jonathan Adelstein, Deborah Tate and Robert McDowell were cc’d on the letter.  

To read the full letter, click here.