News

House Panel OKs SHVURA

9/19/2009 2:00 AM Eastern

It’s looking more and more like Dish Network will be allowed to again offer subscribers distant TV-station signals in certain markets.

By a 34-0 vote, the House Judiciary Committee approved a new version of SHVURA (the Satellite Home Viewer Update and Reauthorization Act, formerly known as SHVERA). The measure includes a pathway to distant-signal citizenship for the satellite operator on condition it deliver local TV stations to all 210 U.S. markets.

That was the deal worked out between Dish Network and broadcasters, pushed by Communications Subcommittee chairman Rick Boucher (D.-Va.). The arrangement allows Dish to offer distant TV signals in “short markets,” which don’t have a full complement of local stations.

Since 2006, Dish Network has been barred from importing distant broadcast-TV signals — for example, major-network affiliates in New York or Los Angeles — to local markets. That’s because broadcasters sued, saying Dish had illegally made those signals available, for a fee, to thousands of ineligible viewers. Distant signals are only supposed to be offered to viewers who can’t pick up local TV stations with an over-the-air antenna.

While there were some discouraging words from Republicans on the committee about stepping in to waive a court injunction against the satellite-TV provider, in the end even critics were ready to sign on, though not without sending a message about future reauthorizations.

“Thirty-four to zero is a stunning endorsement of what is in that bill,” a veteran satellite lobbyist said, asking not to be named. He thinks that unanimous vote means the bill could pass easily in the House.

That could change based on any amendments that emerge from Commerce Committee consideration of the bill, as Judiciary and Commerce split jurisdiction.

“Will something go on there that screws up the whole thing? Probably not, as long as Boucher is still involved,” the same lobbyist said. “He wants it to work.”

The National Cable & Telecommunications Association, Dish and its satellite-TV rival, DirecTV, all praised the bill.

The NCTA was particularly pleased that the so-called phantom signals issue had finally been resolved, which means cable operators no longer have to pay for TV-station signals that their subscribers aren’t getting.

One potential hurdle to smooth passage: a Senate version of the bill was introduced last week that does not include the local-into-local deal, though it does include the phantom signals fix.

The bills will have to be reconciled in Congress, or tailored along the way, before a bill could make it to the president’s desk, which must happen before the end of the year or the satellite operators’ compulsory license (enabling the importation of distant signals) sunsets.

Some Republican legislators last week were all but chanting “hurry sundown,” taking some of the “endorsement” off that 34-0 vote.

Ranking member Lamar Smith (R-Tex.), led the criticism of the bill at the committee markup, joined by Democrat Howard Berman of California.

Smith said he had serious reservations about restoring Dish Network’s ability to deliver distant signals, saying overturning a court order via legislation is something he didn’t understand.

He said the bill effectively relieves a lawbreaker of the consequences of unlawful conduct.

“Despite that provision,” Smith said, the bill overall was important enough to Americans to justify support.

Boucher responded that Dish Network made a generous offer and pointed out Dish was only getting back into the distant-signal business in short markets.

Berman’s support of the bill came with a pretty big caveat. He criticized what he said had become the habitual renewal and expansion of a copyright license that was no longer necessary.

Echoing arguments by some broadcasters, Berman said that the license was an artifact of a time when cable and satellite were nascent industries and that those companies now should negotiate retransmission compensation in the marketplace. He also said this should be the last time the bill was reauthorized.

Republican Rep. Darrel Issa, also of California, seconded Berman at every turn, and even introduced and withdrew an amendment that would have renewed the license for only two years. He said he was sending a warning to distributors: Get ready to negotiate in the marketplace for content.

“Today, if you are cable or satellite and you want to offer the programs on USA Network or History Channel, you send a businessperson to negotiate a deal with the channel,” said a lobbyist pushing for the opt-out proposal. “If you want to show the programs on a broadcast station, you send a lobbyist to negotiate with the Judiciary Committee.”

Issa said he took solace that the chairman of the Senate Judiciary Committee, Patrick Leahy (D-Vt.), supported an opt-out provision for stations that could line up a single-source license for their programming and would continue to push for it.

AT A GLANCE

The Satellite Home Viewer Update and Reauthorization Act that cleared the House Judiciary Committee last week (but still needs Commerce approval) would:

SOURCE: Multichannel News research
Fix the so-called phantom signal issue by clarifying that distant signals transmitted but not actually viewed by subscribers will not be included in royalty fees paid by cable operators and by slightly raising the fee.
Allow Dish Network to resume retransmitting distant signals so long as it provides local-into-local service to all 210 markets. The waiver will extend only so long as Dish continues to serve those markets. The FCC will be required to affirm that Dish is providing “a good quality signal to 90% of the households in each DMA.” Federal courts barred Dish from importing local signals in 2006 after broadcasters sued.
Extend the law beyond private homes to include commercial establishments, recreational vehicles and other venues.
Allow satellite carriers to import state public-TV networks from an out-of-area market.
Clarify that the copyright license requires payment for low-power signals transmitted beyond their over-the-air footprint.

September