Washington— A program- access dispute has flared in Kansas City, Mo., where overbuilder Everest Connections Corp. says the dominant cable operators are blocking access to University of Missouri men's basketball games.
Everest, with 20,000 subscribers, is small in comparison to the cable giants it has decided to challenge, Time Warner Entertainment L.P. and Comcast Corp. And since Kansas City teems with college-hoops fanatics, Everest said, access to the Mizzou games drives growth and stands out as must-have programming in today's competitive pay TV world.
"We estimate that there are 1 to 2 percent of [potential] subscribers that won't come with us because they are die-hard Missouri basketball fans and they want to see those games," said Everest vice president of regulatory and governmental affairs Rachel Reiber.
Time Warner and Comcast control a 300,000-subscriber cluster in Kansas City under the corporate name Kansas City Cable Partners. Comcast joined the partnership late last year when it acquired AT&T Broadband.
KCCP's programming affiliate, Metro Sports, has cable exclusivity in Kansas City to some, but not all, Mizzou basketball games.
Fox Sports Midwest distributes the Mizzou games to several TV stations and cable operators scattered throughout the state. Even though Everest carries Fox Sports Midwest, the network blacks out the Mizzou hoop games in Kansas City to honor Metro Sports's exclusive deal.
Under federal law, a satellite-delivered programming network at least 5-percent owned by a cable operator is barred from signing exclusive deals. Last year, the FCC extended the exclusivity ban for another five years, partly as a reflection of the agency's concern about cable-operator control of regional sports networks.
In general, exclusive deals between cable operators and networks distributed by fiber or microwave are legal, regardless of the financial relationship between the cable operator and the programmer.
Time Warner and Comcast have at least two points of the law in their favor: Metro Sports uses terrestrial distribution to deliver Mizzou games to various cable headends, and its contract is with an unaffiliated company — Mizzou Sports Properties, which holds the TV rights contract with the university.
"We believe that there is no basis for their claim," said Keith Cocozza, Time Warner Cable's director of corporate communications.
Everest filed its complaint in January and KCCP filed its response last week. KCCP noted that Everest failed to mention that KCCP's exclusivity covered just 12 of 29 Mizzou pre-season and regular-season games. The other 17 games are carried by local TV stations, ESPN and ESPN2, and are available to Everest.
If the Missouri five made it to the National Collegiate Athletic Association Tournament, those games also would be available to Everest, KCCP said. (The CBS Television Network holds exclusive rights to the NCAA men's basketball tournament.)
Given the true scope of Everest's access to the games, "Everest cannot truly claim that it has suffered any damages in this case," KCCP told the FCC.
Nevertheless, Everest claims that Metro Sports is covered by the program-access law as a vertically integrated satellite network because it is intimately involved with Mizzou Sports Properties in key aspects of game telecast.
"Personnel from KCCP/Metro Sports travel to the site of the basketball game with a satellite uplink truck and assist with the airing of the game," Everest said in its FCC complaint. "Indeed, at the conclusion of each game, the announcers thank Metro Sports for their assistance in the production of the telecasts."
Further, Everest contends KCCP violated another provision of the program access law, barring "unfair methods of competition or unfair or deceptive acts or practices" by a cable operator and affiliated satellite-delivered network.
"We basically say that we believe that because Metro Sports plays such a big role in the production of those games, they are satellite programming distributors with the vertical integration that is attempting to thwart competition against another [cable operator]," Everest's Reiber said.
KCCP responded by saying that Metro's production assistance with some games did nothing to undermine the position that Metro's exclusive carriage of 12 games a season was legal under federal program-access rules.
"In short, Everest has filed a complaint that is not covered by the scope of the program-access rules," KCCP said.
Everest and KCCP have clashed before. A year ago, Everest filed an FCC complaint alleging the partnership was violating a rule that requires regulated cable operators to offer uniform rates within a franchise area. KCCP denied the allegation; the FCC has yet to rule on the complaint.