The American Cable Association, Dish network and midsized telecom association ITTA have teamed up to petition the FCC to deny the merger of of Nexstar and Media General unless it imposes tough conditions.
In a filing Friday (March 18), they told the FCC the combo would increase the broadcasters' negotiating leverage, driving up retransmission consent fees to the detriment of consumers and using threats of "massive blackouts" and "after-acquired" clauses that allow a broadcaster to add acquired stations to existing retrans deals, which can trigger higher fees.
"If approved," they said, "this transaction would create a new broadcast ownership conglomerate of unprecedented size and scope, one which will control the highest number of the Big-4 local broadcast stations in the country and have the power to threaten service blackouts to millions of consumers if any pay-TV distributor tries to hold the line on retransmission consent fees, which have risen more than 22,000 percent since 2005."
They want the FCC to nix the deal, but if it doesn't, the say it should impose conditions. At a minimum, they said, those should include submitting to "baseball-style arbitration with interim carriage for any pay-TV operator that requests it when negotiating for retransmission consent." That means no blackouts during arbitration. They said the commission should also "require, as a condition of approval, that Nexstar refrain from exercising its right to have retransmission consent rates under existing MEG agreements reset to Nexstar rate levels as a result of its after-acquired station clauses with an MVPD until expiration of those agreements by their terms."
In January, Nexstar agreed to buy Media General for $4.6 billion after Meredith withdrew its offer.
ACA and Dish and ITTA are all members of the American Television Alliance, which has been pushing the FCC to reform the retrans regime, arguing broadcasters are abusing the rules to boost their bottom lines.