Washington – In a private meeting with Federal Communications Commission chairman Kevin Martin, public interest groups sought adoption of new rules designed to reduce the rates that third-party programmers pay to lease channel capacity from cable operators.
The call for a new leased access payment formula came from representatives of the Media Access Project and Public Knowledge in an Oct. 18 meeting with Martin, his media adviser Michelle Carey and Media Bureau chief Monica Desai, according to FCC records.
In the meeting, MAP senior vice president Harold Feld endorsed a rule that would determine a single, national leased access rate “using price information from Los Angeles and New York City, currently the two most competitive leased access markets.”
Leased access programmers may buy time from cable operators as required under federal law and FCC rules. As a concept, leased access has always been at odds with the pay-TV business model, which is predicated on programmers receiving payment from their distributors.
Leased access programmers have complained to the FCC that cable incumbents have been difficult negotiators in part because operators are allowed to fill unused leased access channels with their own programming.
Comcast, by contrast, has said no compelling arguments for improving the lot of leased access programmers, insisting that the FCC’s current leased access rate formula yields a below-market rate for cable operators.
In their discussion with Martin, the public interest groups said that if New York and Los Angeles were not adequate proxies for producing a new leased access rate, the FCC should consider using “the median rate paid by the lowest 25% of programmers to a set rate.”
They also urged Martin to block cable companies from requiring leased access programmers to pay fees based on the entire size of a particular cable system. The FCC, Feld said, should make cable operators “lease parts of large systems, perhaps by allowing zip code specific access targeting.