Policy

Affils Make Case to Commerce for Retaining Retrans

7/20/2012 12:44 PM Eastern

The NBC and CBS affiliates have both sent letters to the Senate Commerce Committee making their pitch for preserving the must-carry/retransmission consent regime.

 

NBC TV affiliate board vice chairman Ralph Oakley, in his letter to the committee in advance of a July 24 hearing on the 1992 Cable Act, which created that regime as well as program carriage and access obligations for cable operators, wrote that "Congress should not interfere with fair market negotiations, and it should not choose to subsidize cable and satellite distributors by disrupting basic property rights and exclusivity protections that are at the core of our unique broadcasting system."

He said that as the committee reviews the act, it should keep in mind that local broadcasters spend billions of dollars on news, sports and entertainment programming, that cable and satellite resell that content, that in order for broadcasters to pay for that content it needs and deserves compensation from those resellers, and that under the current system the vast number deals get done without incident.

In their letter, CBS TV Affiliate Association chair Chris Cornelius and vice chair Michael Fiorile wrote that retrans was needed in 1992 and it still needed today. To repeal it, according to the duo, would bring uncertainty and undercut localism.

They argued that broadcasters aren't asking for unfair compensation, pointing out cable systems pay 15 times more in fees for the four most expensive cable nets than for the Big Four broadcast network affiliates. As to the playing field being tilted toward broadcasters in those negotiations, they say broadcasters are usually the weaker party in terms of "people served, revenues, profits and asset values."

"Without fair compensation for the content broadcasters have created or acquired, local television stations will be fundamentally impaired in their efforts to innovate. Without the content that the public most needs and desires," wrote Cornelius and Fiorile, "the benefits of video innovation and the vibrancy of our country's media will suffer.... Broadcasters should be allowed to continue to participate in fair market negotiations with respect to the resale of their content by pay-TV providers, and the government should decline to subsidize broadcasters' pay-TV competitors by weakening the retransmission consent principle and the exclusivity rights that support it."

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