Orlando -- The American Cable Association Tuesday gave small operators an advanced lesson on retransmission-consent negotiations, advising them to carefully read the fine print in contracts with broadcasters and pointing out that formal complaints to federal regulators haven’t established a track record of success.
Chris Cinnamon, outside counsel for the ACA, changed the name of his session at The Independent Show here to “Retransmission Consent 505,” not its original “Retransmission Consent 101,” because his audience has so much experience in the topic.
TV stations have until Oct. 1 to elect whether or not they are opting for retransmission consent or must-carry, which means negotiations are looming.
Cinnamon noted that the Federal Communications Commission mandates that both stations and cable operators must engage in “good faith” negotiations in retransmission-consent talks. If a broadcaster violates that duty, Cinnamon said, “You do have a right to file a complaint with the FCC.”
But there have only been 11 complaints that cable operators have lodged with the FCC on that issue, like the one Mediacom Communications filed against Sinclair Broadcast. And most of them have been withdrawn, or seemingly have not met with much success.
“What do these cases tell us?” Cinnamon said. “Not a whole lot.”
In addition, the ability to file such a complaint doesn’t pack much wallop when a station can pull is signal from a cable system in the interim.
During his session, Cinnamon also cautioned cable operators to be wary about five points regarding contracts. First, he said systems should carefully examine a station’s terms for carriage of its digital signals for the all-digital transition next February.
Secondly, Cinnamon suggested operators keep most-favored nations clauses out of their retransmission-consent deals. Those clauses could mean that a system has to pay the same cash compensation to all the stations in its market.
Thirdly, if the content a station is providing changes, there should be a change in the price an operator might be paying for that station.
Fourth, cable operators should demand that if a station is sold, their existing retransmission-consent deal must be honored by the station buyer.
And finally, Cinnamon suggested that cable operators negotiate carefully regarding non-disclosure terms, since they might want the right to tell subscribers how their programming costs have increased because of a new fee from a broadcaster.
During a question-and-answer session, one operator from Spanish Fork Community Network in Utah complained that his Univision TV station is electing to opt for retransmission-consent instead of must-carry.
“They said they’re going to charge me money for that, and I told them that I didn’t want to pay for that, and they can pound sand,” he said. “Is that a good faith negotiation?”