NCTC, ACA Eye a la Carte

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Orlando, Fla. -- Small cable operators threatened to turn up the heat on
programmers Monday, planning to lobby for the ability to offer networks a la
carte and to overturn confidentiality clauses that bar them from telling
consumers how much they pay for content.

The rallying cry came from the National Cable Television Cooperative and the
American Cable Association, which, for the second year in a row, are jointly
holding their annual meetings at the same venue, this year at Disney World
here.

During Monday's sessions for the two groups, which each represent small and
midsized independent cable operators, rising programming costs were cited as the
biggest problem and issue facing their membership.

'I'm going to describe what I call a train wreck,' Buford Media Group CEO Ben
Hooks said in describing how annual increases in program costs are shaving down
cash flow at smaller cable systems.

'Our partners do not look at the customer anymore,' Hooks said. 'They're
competing amongst each other, trying to get that ad revenue up as high as they
can. And the way to do it is to buy programming no matter what the cost is --
they'll buy it and put in on our backs.'

Hooks called for the NCTC and the ACA to create committees to study the issue
and what kind of legislation they can take to Washington, D.C., that would
permit the a la carte offering of networks -- which today's digital technology
now permits -- so consumers can pick and choose what they want.

He said that even if a la carte were permitted, he still envisioned
programmers that 'behave,' or don't seek large annual license-fee increases, to
be grouped together as a core offering to subscribers.

'We're going to write this bill,' Hooks said. 'A la carte is the avenue
they're leaving us ... I've got a partner that's forcing us to go there.'

During the ACA's meeting in the morning, both president Matt Polka and one of
the group's outside counsel, Rod Shaw, also described how they are looking into
legislation that will give operators the flexibility to offer cable networks a
la carte and that would permit them to discuss their programming costs.

'The underpinning is that there may be a need for legislation,' Shaw said.
'What kind of flexibility can we have for a la carte, as opposed to just being
handed the bundles from five programmers.'

The other issue the ACA is tackling is that currently, carriage deals with
programmers have confidentiality clauses that bar cable operators from
discussing how much they pay for programming. So cable systems can't tell local
franchise authorities, or the public, what kinds of price hikes cable networks
levy against them each year.

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