The House Judiciary Committee passed by voice vote last Wednesday a bill extending the Satellite Home Viewer Improvement Act of 1999 for another five years — without a provision that would provide a blanket anti-trust exemption for delivery of local TV stations in rural markets.
Instead of a broad exemption, the panel approved an amendment by voice vote that would give the Justice Department only 90 days to act on a request for an exemption. Failure to act within 90 days, however, would not automatically lead to a waiver.
The antitrust provision was added as an amendment sponsored by Rep. Rick Boucher (D-Va.) and Bob Goodlatte (R-Va.) in an effort to assist DirecTV Group Inc. and EchoStar Communications Corp. in sharing spectrum to provide local signals to the 90 smallest TV markets in the country.
The representatives fear that the satellite companies would not spend money on new satellites or utilize scarce spectrum in order to deliver local TV signals to about 15% of U.S. homes in rural America.
Boucher and Goodlatte initially proposed a broad exemption, but that was scaled back in the face of opposition from the American Cable Association, a small cable company trade group. It claimed a blanket exemption would hurt those companies competitively against the financially stronger DBS companies, which combined serve about 22 million subscribers.
“I think it was a good compromise,” ACA president Matt Polka said.
The bill (HR 4518) would allow satellite carriers to provide distant network stations and superstations under compulsory copyright licenses until Dec. 31, 2009.
Hundreds of thousands of DBS subscribers would lose access to ABC, NBC, CBS and Fox programming after Dec. 31, 2004, without an extension.
A House source said the SHVIA bill, which has already passed the House Energy and Commerce Committee, could reach the House floor within two weeks. The Senate Judiciary Committee has also passed a SHVIA renewal version, but action by the Senate Commerce Committee is pending.
“We’re pleased that the bill has now made its way through both the House Judiciary and House Commerce committees as well as the Senate Judiciary Committee. We look forward to working with the Senate Commerce Committee as it prepares to address the satellite TV legislation,” said Bob Marsocci, DirecTV’s vice president of communications.
According to Senate and industry sources, Sen. John Ensign (R-Nevada) is going to take the lead in the Commerce Committee on SHVIA. Ensign spokesman Jack Finn said he couldn’t comment because he was not aware that Senate Commerce Committee chairman John McCain had asked Ensign to prepare a bill. An industry source said it was likely the bill could be introduced and passed out of McCain’s panel within two weeks.
EchoStar is strongly opposed to an Energy and Commerce provision concerning the company’s sale of local TV signals. In about 40 markets, EchoStar requires subscribers to obtain, without charge, a second dish in order to view the market’s full slate of local TV stations.
At the request of the National Association of Broadcasters, Energy and Commerce decided to require EchoStar to discontinue its two-dish policy within one year. But two dishes would remain acceptable, provided consumers received all local stations on one of them.
EchoStar said the one-dish rule would force it to terminate local TV service in 40 markets and postpone entry into 40 more. DirecTV does not offer local signals in a two-dish manner. The one-dish rule could complicate final passage of the bill. Sen. Ted Stevens (R-Alaska), for example, has advocated support for a SHVIA renewal that included just the five-year extension of the distant signal and compulsory superstation license provisions.