Laybourne: Must-Carry Hurts Nets

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Washington-Oxygen Media chairman Geraldine Laybourne last week said she'd like to cut off the air supply to federal must-carry rules.

Laybourne also said last Tuesday that Oxygen cut a deal to launch on Adelphia Communications Corp. systems this fall, with a combination of analog and digital carriage.

The Adelphia deal raises Oxygen's carriage commitments by about 5 million homes, to nearly 32 million by 2003. The fledgling women's network reaches about 11.7 million subscribers.

Speaking at a Washington Cable Club luncheon sponsored by the National Cable Television Association, Laybourne attacked must-carry as an "unintended consequence" of television legislation.

Provisions that require cable systems to provide local channels were passed as part of the 1992 Cable Act. The Federal Communications Commission also proposed a rulemaking to consider how to apply those provisions to digital broadcasts in July, but has not issued any orders along those lines.

Laybourne claimed there is "absolute evidence" that Oxygen has been hurt by must-carry provisions, which force providers to carry local over-the-air TV stations, often at the expense of satellite-delivered national services. Had those rules been on the books two decades ago, there would be a far lesser variety of cable channels today, she said.

"Does the world need more recycled sports, more repackaged programming?" Laybourne asked.

Laybourne also attacked retransmission-consent rules that allow broadcasters to obtain compensation from cable operators that carry their signals. The major broadcast networks are now part of huge conglomerates now use those rules to get cable operators to set aside channel space for their cable networks or to extract higher compensation for services that MSOs already distribute.

In the past year, such disputes have led to temporary broadcast blackouts on many systems, including the hugely controversial blowup between Time Warner Cable and ABC's corporate owner, The Walt Disney Co.

"The cable operators, who are at a key point in their development, now get faced with companies that can exact rate increases," she said, Businesses that control local stations "leverage" operators to air their programming and charge noncompetitive rates, she noted.

"This is the most contentious atmosphere we've seen," she said. "We need to be working together to find program opportunities that represent big thinking."

Must-carry "does not protect consumers in any way," Laybourne said. Provisions "originally intended to protect small and independent local stations from being frozen out" now were about "protecting the interests of the largest carriers," she added.

Oxygen has collaborated with cable systems to incorporate Internet applications into the network's televised programming, she said.

There is "passion and a spirit of invention.where the government takes its fingers off the scales to give us a relatively free marketplace," she said.

States News Service

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