NAB Wants Price Regulations for Local Signals

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Washington-Broadcasters want federal regulators to set the retail price of local TV signals provided by direct-broadcast satellite carriers in order to prevent DBS firms from discriminating against TV stations that elect must-carry.

In comments filed with the Federal Communications Commission July 14, broadcasters made it clear that they are concerned that TV stations that gain DBS carriage through retransmission consent might be offered at a lower price to subscribers than stations that rely on must-carry.

Under federal law, DBS carriers are required in 2002 to carry all TV stations in a market if they elect to provide even one, whether through retransmission consent or must-carry. Until 2002, DBS firms can carry any local station they wish, provided that they have retransmission consent.

The National Association of Broadcasters is concerned that the "carry one, carry all" formulation could be used to discriminate against must-carry stations if DBS firms decide to charge consumers higher prices for those stations.

"Carriers can't charge a higher price for 'carry one, carry all' stations than for any other local station," the NAB said, according to a summary of its comments.

The association also urged the FCC to force DBS carriers to provide local signals in a market on a sequential series of channels in order to prevent some stations from being exiled to "a satellite Siberia."

All local TV stations, the NAB added, should be offered in a single, bundled package; should be given equal billing in DBS-programming guides; and should be available without the need for subscribers to obtain second dishes.

"This is not an academic issue: Carriers could easily place the most heavily [watched] local channels on their principal satellite, while placing 'carry one, carry all' stations on a different satellite that requires a second (or different) dish," the association said.

The NAB's comments came in the context of the FCC rulemaking ordered by Congress in the Satellite Home Viewer Improvement Act, which became law in November. The FCC has to issue rules by Nov. 29.

In something of a surprise, the NAB declined to ask the FCC to require DBS firms to carry TV stations' digital signals simultaneously with their analog feeds during the transition to all-digital broadcasting.

Citing rapid change in the DBS industry, the trade group said the prudent thing was for the FCC to postpone digital must-carry rules for another year.

Under the SHVIA, the FCC has no authority to relax or postpone analog must-carry on the DBS industry.

But that reality didn't stop the Satellite Broadcasting & Communications Association from excoriating DBS must-carry as "a constitutional white elephant that exacts exorbitant First Amendment costs with no tangible public-policy goal."

The SBCA pointed out that in 2002, full must carry will require the leading DBS firms-DirecTV Inc. and EchoStar Communications Corp.-to broadcast 18 stations in New York and 24 in Los Angeles, even though they preferred to carry just the affiliates of the major networks and popular independent stations.

From the SBCA's perspective, full must-carry mandates the carriage of marginal TV stations, which would take up scarce spectrum that could be used to invade additional markets with the local signals of ABC Inc., CBS Corp., NBC and Fox Broadcasting Co., boosting competition to cable.

"Many of these stations have very limited viewership, but they nonetheless will utilize national satellite-channel capacity," the SBCA said in July 14 FCC comments.

On digital must-carry during the transition, the satellite group said the burden on the DBS industry would double with no firm date as to when only digital signals would have to be carried. Under federal law, broadcasters can keep both licenses if fewer than 85 percent of households in a market have digital TVs or digital set-top boxes.

"Requiring dual carriage indefinitely while the timetables for the complete conversion of all broadcasters' signals to digital and the ultimate abandonment of analog signals are both still unsettled would create sheer chaos for satellite carriers," the SBCA said.

The cable and satellite industries are united on the dual must-carry issue.

The National Cable Television Association insisted that the law requires mandatory cable carriage of digital-TV signals only after TV stations have surrendered their analog licenses. The DBS industry can piggyback on cable's lobbying stance because the FCC is required to apply comparable must-carry regimes to cable and satellite.

"Since cable has no transitional digital must-carry obligation, [the FCC] cannot impose such a requirement on satellite carriers," the NCTA said in its July 14 FCC comments.

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