Fourth Circuit Upholds DBS Must-Carry

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A panel of the U.S. Court of Appeals for the Fourth Circuit upheld a
federal law Friday that requires direct-broadcast satellite carriers to carry
all local TV signals in markets where they elect to carry any local signals.

The three-judge panel, in a unanimous opinion by Judge M. Blane Michael, said
the DBS must-carry law was consistent with the First Amendment free-speech
protections of satellite carriers -- a decision reached earlier in the year by a
lower court.

'We hold, as did the district court, that the carry-one, carry-all rule does
not violate either the First Amendment or the other constitutional provisions
cited by the satellite carriers,' Michael wrote.

The ruling means that starting Jan. 1, EchoStar Communications Corp. and
DirecTV Inc. will be required to carry all local TV stations in the roughly 40
local markets they currently serve unless they opt not to continue serving those
markets.

In the 68-page opinion, the court also upheld a Federal Communications
Commission rule that allows DBS carriers to offer local TV signals on an a la
carte basis.

The FCC rule allows DBS carriers to offer all local TV stations on a single
tier or on an a la carte basis. The rule allows DBS carriers to let consumers to
pick between those two options.

The DBS must-carry law will take effect Jan. 1 also
because the court denied the satellite industry's request for an injunction
barring implementation until after the U.S. Supreme Court had ruled on an
appeal.

'We are extremely disappointed in the decision from the Fourth Circuit Court
of Appeals,' Satellite Broadcasting & Communications Association acting
president Andy Wright said in a prepared statement.

'This is a tremendous loss for consumers and competition in small and
midsized markets because it limits the ability of [Hughes Electronics Corp.'s]
DirecTV and EchoStar's Dish Network to roll out local broadcast service in
additional markets,' he added.

Wright continued, 'The SBCA, DirecTV, EchoStar and the
many programmers that support our legal challenge to satellite must-carry are
reviewing the details of the decision and will explore all of our legal
options.'

The decision cheered National Association of Broadcasters president Edward O.
Fritts.

'This is a New Year's Day gift for DBS subscribers -- on Jan. 1, they will
begin receiving all local stations in markets where 'local-to-local service is
being offered.' he said. 'We fully expect that EchoStar and DirecTV will now
follow the law and carry all television signals in markets where they are
charging customers for access to any local stations.'

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