Policy

Comcast Sets a Template

5/23/2011 12:01 AM Eastern

NBC’s blanket retransmission consent
agreement for its affiliate stations,
unveiled last week, could serve as a model
for more civil negotiations
between broadcasters and
distributors — if adopted.

The agreement — the first
reached under the Comcastcontrolled
NBCUniversal joint
venture, and optional for all
NBC affiliate stations — would
give the network proxy power in
retrans negotiations.

At an event in Washington,
D.C. on May 18, Comcast executive
vice president David Cohen
called the proposal a template
for the industry.

“We think the model that we
are trying to work through with our affiliates
could be part of the solution,” Cohen said at a
Media Institute lunch last week. “It certainly is
for our company and for the pay TV providers
who are doing business with us.”

The proposal echoes public comments last
year by Comcast chairman and CEO Brian
Roberts, who said on several occasions that he
hoped the NBCUniversal JV would have a constructive
influence on the retrans debate. Comcast
owns a 51% interest in the joint venture.

NBC and its affiliate board said the arrangement
would help the network and stations develop
new revenue streams and minimize
conflicts that resut in programming outages.

Blanket agreements are nothing new. Fox
convinced its affiliates to let it act as proxy in retrans
negotiations in 1993, only to scrap the process
in later years. But that was before affiliate
stations began to aggressively negotiate for cash
for retransmission consent, and prior to the networks
themselves asking for a cut of their affiliates’
deals.

Recently, Fox has tried to go down the proxy
path again, but has met resistance from some
stations that objected to the network’s terms.

What separates the two proxy proposals
is that NBC is suggesting that it split retrans
proceeds about 50-50 with the affiliates. Fox,
according to reports, has demanded a specific
dollar amount from each station.

NBC affiliates board chairman Brian Lawlor
said last week after the network’s upfront
presentation that at least 80% of affiliates
would have to agree to the deal for it to work.

Anecdotally, Lawlor said, reaction from
the stations has been positive.

“We’ve had good conversations, and people
are intrigued by the concept and intrigued
by the innovation of the idea,” said
Lawlor, who also heads up
the Scripps TV group. “They
see it as a true partnership.”

Many NBC affiliates are
letting Lawlor speak for them
for the moment, but privately
believe the proposal is advantageous
to both sides.

For now, Comcast’s fellow
cable operators are standing
firmly on the sidelines on
the issue. Cox Communications
and Charter Communications
declined comment,
while Cablevision Systems
and Time Warner Cable did
not return a request for comment. National
Cable & Telecommunications Association
spokesman Rob Stoddard said the organization
did not have a position on the proposal
at this time.

NBC hasn’t been involved in high profile
retransmission battles recently like its counterparts
CBS, Fox and ABC, partly because
it didn’t want to ruffle government feathers
during the NBCUniversal deal’s 13-month
approval process.

Wunderlich Securities media analyst Matt
Harrigan said banding could be beneficial
for both the network and the stations.

“It makes sense to me to work with the affiliates,”
Harrigan said. “It maximizes leverage.”

Miller Tabak media analyst David Joyce
said that a 50-50 split seems fair to help pay
for entertainment and sports programming
for the network, but wondered how the government
will look on a possible scenario
when every affiliate stations’ retrans deal
expires at the same time.


Michael Malone is deputy editor of Broadcasting
& Cable.
March