News Articles

ATSC 3.0: A New Retrans Pain Point

Emerging broadcast standard troubles MVPDs worried about new fees 6/06/2016 8:00 AM Eastern
TakeAway

Broadcasters’ push for the new ATSC 3.0 transmission standard has become the latest front in a battle with pay TV providers over the terms of retrans consent.

WASHINGTON — The retransmission-consent struggle between multichannel video-programming distributors (MVPDs) and broadcasters has gotten even uglier, and has extended to broadcasters’ push for the new ATSC 3.0 transmission standard.

 

Small- and medium-sized cable operators have told the Federal Communications Commission it should not let broadcasters start using the standard, in part because they say the commission needs to better gauge the impact of the transition to ATSC 3.0 on retransmission- consent fees.

 

And, elsewhere, broadcast and cable groups traded new punches over the ongoing FCC review of good faith negotiations.

 

MORE THAN A SWITCH FLIP

 

In comments to the FCC on the request by commercial and noncommercial TV stations to start broadcasting in the new format while simulcasting in the old — ATSC 3.0 is not compatible with current TV sets — the American Cable Association said the transition is more than simply turning a switch, pointing out that most viewers are watching TV stations on an MVPD rather than over the air.

 

“Depending on how ATSC 3.0 is implemented, the transition could have a dramatic effect on small cable operators, requiring significant new capital outlays and reducing capacity on cable systems that could have been used for other programming or for broadband Internet capacity,” the ACA, which represents smaller, independent cable operators, said.

 

The ACA also suggested that broadcasters would try to pass along the costs of the ATSC 3.0 transition via retransmission fees charged to MVPDs.

 

A coalition of commercial and noncommercial broadcasters and tech companies have asked the FCC to approve a voluntary, market-based rollout of the new TV-transmission standard.

 

Broadcasters want the FCC to move ASAP. The ACA has suggested proceeding with caution and collecting a lot more information on the impact first.

 

“It’s disappointing that ACA would use a retransmission-consent ruse to fight broadcaster efforts to adopt Next Generation Television,” NAB spokesman Dennis Wharton said. “We take Tom Wheeler at his word when he says he wants to move quickly on ATSC 3.0.”

 

While the National Association of Broadcasters and the MVPD-centric American Television Alliance have traded blows over retransmission consent for years, the rhetoric has gotten even more heated.

 

Satellite-TV provider Dish Network, in meetings with FCC chairman Tom Wheeler and other agency officials, accused broadcasters of using their viewers as “sacrificial pawns” in retransmission negotiations.

 

The NAB fired back, calling Dish the “ultimate regulatory profiteer,” with a “sordid” history of bending laws and rules, while simultaneously calling out ATVA.

 

There is no need to modify the good-faith standard for retransmission negotiations and that the regime is working fine, the NAB has argued. Dish and ATVA say the system is broken and broadcasters leverage their signals to strike unfair deals and hurt consumers.

 

They want the FCC to broaden its definition of what is not in good faith to include blackouts, joint retransmission deals and charging MVPDs based on all of their TV customers, including those who receive TV channels over the air.

 

“Dish and ATVA have implored the commission to craft a host of new good-faith rules that will quell what they characterize as a surfeit of broadcaster bad behavior,” the NAB said. “Never mind, says Dish, that it alone was involved in half of all retransmission-consent disputes in 2015. Only Dish has the gall to approach the commission seeking favors when it is the primary driver of disputes.”

 

The suggestion that Dish was a prime retransmission- consent offender did not sit well with the ATVA.

 

DISHING BACK AT CRITICS

 

The industry group fired back that broadcasters have a “shameful record of consumer exploitation” and that the NAB was trafficking in “shameful fabrications.”

 

“It is an indisputable fact that broadcasters are responsible for each and every one of the record-setting 193 consumer blackouts in 2015 and the 26 TV blackouts to date this year,” ATVA spokesperson Trent Duffy said. “Broadcasters alone have the power to take down — and restore — their broadcast signals; cable, satellite and IPTV providers are at the mercy of a ruthless broadcast industry that routinely holds programing for ransom in a naked ploy to get consumers to pay higher TV fees.”

 

There has been a lot of talk by both sides, but so far no action by the FCC on the retransmission review.

Want to read more stories like this?
Get our Free Newsletter Here!