News

Boats in Backyards Aren't SHVIA Trivia

3/02/2003 7:00 PM Eastern

Washington— Local broadcasters and direct-broadcast satellite carriers are prepping for more legislative tumult over the next year or so.

And as to what might stand out in the upcoming struggle: How about landlocked boats?

By Dec. 31, 2004, Congress is expected to reauthorize the Satellite Home Viewer Improvement Act, which allows EchoStar Communications Corp. and DirecTV Inc. to access an assortment of local broadcast signals and resell them to millions of paying subscribers around the country.

One provision in SHVIA — often pronounced as if it were "shivah" — is a copyright license that allows the 19 million-subscriber DBS industry to take the network signals from stations in New York and Los Angeles and sell them to dish owners located in "unserved households." Those are defined as homes that can't pick up local network affiliates with an off-air antenna.

Trucks and recreational vehicles, while not technically households, are considered "unserved households" under SHVIA.

Sen. John Breaux (D-La.), looking out for Gulf of Mexico pleasure craft, wants to add boats to the list of "unserved households."

The National Association of Broadcasters, which represents hundreds of network affiliates who feel it in the pocketbook when invaded by out-of-market copycats, went along with trucks and RVs in 1999, when SHVIA was last reauthorized.

Yachts in the yard

An NAB source last week said the trade group would draw a line at boats and try to sink Breaux's proposal.

Why the hard line? An source at the NAB said the group fears that EchoStar Communications Corp. chairman and CEO Charlie Ergen would try to attract business by telling anyone with a leaky vessel in the backyard that he or she is eligible to buy distant network signals.

A DBS industry source, told about the effort to torpedo the boat plan, suggested that the NAB was being a bit paranoid.

Apart from the quirky boat issue, the NAB and the DBS industry have a few big disputes to settle.

While EchoStar and its DBS competitor, DirecTV Inc., favor a simple extension of SHVIA for at least another five years, the NAB has a broader agenda.

It might take the NAB a little longer than normal to warm to a compromise. That's because the trade group was less than thrilled that it had to incur substantial costs to defend the DBS must-carry rules all the way up to the U.S. Supreme Court, in a case pushed hard by EchoStar's Ergen.

When told the NAB planned to seek major changes to SHVIA, a DBS industry source said it was in no one's interest to repeat the protracted battle that took place in 1999.

"Do you want to get in another food fight, or just an open-and-shut case?" the DBS source said.

Senate Judiciary Committee chairman Orrin Hatch (R-Utah) said last week that he wanted to begin the reauthorization of SHVIA within a month, though unrelated committee business could derail that plan.

Hatch was noncommittal as to substance, except that he wanted to keep the bickering to a minimum.

House allies needed

"We learned our lessons on the food fights," Hatch said. "If I can keep it simple, I would. If I can do more, I would. We'll just have to explore it and see if we can get the support for making the changes that need to be made."

Over in the House, a new SHVIA is going to require cooperation between House Judiciary Committee chairman James Sensenbrenner (R-Wisc.) and House Energy and Commerce Committee chairman Billy Tauzin (R-La.).

Johanna Mikes, an aide to Rep. Richard Boucher (D-Va.), who serves on both House panels, told an NAB audience last week that she did not believe SHVIA reauthorization would be contentious. Boucher's goal was to ensure the new law enabled DBS carriers to deliver local stations to all 210 markets. Boucher represents rural markets in southwest Virginia.

"That always been his top priority. That, I assume, is the top priority of everybody in this room. We need to get it done," Mikes said.

Hatch's panel has jurisdiction over copyright law. But changes in copyright law often have an impact on communications law, which is the domain of Senate Commerce Committee chairman John McCain (R-Ariz.).

In 1999, McCain lost his battle with Hatch over key SHVIA provisions.

Atop NAB's agenda is a proposal that would narrow who may legally receive distant network signals.

In 1999, Congress for the first time authorized EchoStar and DirecTV to provide local TV signals to subscribers within the same market.

Although EchoStar serves about 40 local markets, DirecTV is planning to ramp up to 100 markets by the end of the year.

The NAB wants a new SHVIA law to read so that DBS subscribers in markets where local TV signals are offered are precluded from buying distant network signals.

The broadcast trade group is still working on issues concerning local markets where only one DBS carrier has initiated local signal service.

Under the DBS must-carry rules that took effect Jan. 1, 2002, EchoStar and DirecTV are required to carry every local TV station in a market where they have elected to carry even one station.

A controversy erupted last year when broadcasters complained that the vast majority of EchoStar subscribers in local-to-local markets would need a second dish to view all their local stations.

Double-dish dilemma

In a ruling now on appeal before the five FCC members, the agency's Media Bureau did not completely ban a two-dish solution.

The NAB and public TV stations maintain that because the primary dish receives NBC, ABC, CBS, and Fox affiliates, while the second dish picks up public, independent, religious and minority stations, EchoStar is not living up to the intent of the "carry-one, carry-all" regime.

"The two-dish rule has got to go. It's discriminatory," said Marilyn Mohrman-Gillis, vice president of policy and legal affairs for the Association of Public Television Stations.

EchoStar won't have DirecTV by its side in this fight. No DirecTV subscriber needs a second dish to view all local TV signals.

Also likely to figure into the debate is SHVIA's ban on exclusive retransmission-consent agreements between broadcasters and any multichannel video-programming distributor, including cable and DBS.

It was unclear how the industries would align on modification or repeal of the exclusivity provision. But Congress has some time to consider the options: the ban does not expire until Jan. 1, 2006.

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