Rosenworcel: Viewers Should Get Refunds For Long Retrans Blackouts

Commissioner Says FCC Should Also Use Good Faith Authority about Extended Impasses

FCC commissioner Jessica Rosenworcel suggests that viewers who lose channels due to extended retrans blackouts should get refunds, and that the commission should use its authority to require good faith negotiations to do something about those extended blackouts.

That came in an interview for C-SPAN's Communicators series.

Asked by co-interviewer Howard Buskirk to comment on the state of retrans, she said: "The vast majority of retransmission consent negotiations...go on uneventfully. We never hear about them. But every now and again we do have these disputes, and when the disputes get heated, sometimes consumers will turn on the television set because they want to turn on the news, game, or their favorite show and they'll find they get a dark screen. Just like the consumers recently did in New York, Los Angeles and Dallas." Rosenworcel's reference was to the just-resolved dispute between CBS and Time Warner Cable.

"That's not a good thing by any measure," she said. "We shouldn't want that to happen for extended periods of time. I think the consumers, honestly, are deserved a refund if that happens for a long period of time, and I think that if it happens for an extended period of time, the FCC should look at its good faith authority under the Communications Act and help do something about it." She did not specify what that might be.

The FCC has authority to mandate good faith bargaining, but according to FCC lawyers' reading of that authority, it requires one of the parties to file a formal complaint alleging breach of good faith. Neither CBS nor TWC filed such a complaint, for example.

Roseworcel suggested that rather than happening more frequently, the impasses were getting more attention because they were getting more heated and complicated, which in turn stemmed from the introduction of online rights to the equation. CBS chief Les Moonves has said those online rights were a key issue--and sticking point--in the negotiations.

"Do I think these will occur with more frequency?" she said. "I think the honest answer is that they are getting more attention because the number of platforms we can use to watch video is expanding and the issue of digital rights for programmers to access those different platforms is much more complicated than it used to be, but it's also good for consumers because you are no longer limited to just sitting on your sofa in your living room. So I think that is one of the sources of making these disputes so heated."

Asked to weigh in on a la carte, Rosenworcel called it a perennial issue that she looked at as both a regulator and a consumer. As a consumer, she said, "it's hard not to notice that your bills for your channel lineup rise at almost twice the rate of inflation, nearly every year. It is also hard not to notice that I get lots and lots of channels but my family watches only a handful. At the same time, I know this is a system that has come to support some really great programming. But still I see that a la carte has some allure."

She thinks the market would have to start supplying more a la carte programming because consumers are demanding it.

Rosenworcel said she was confident she would be ready to do the broadcast incentive auctions in 2014--the FCC's current target--and that she "actually has some confidence in the agency's ability to do so, too."

Rosenworcel said she did not think Republican pushback on the potential price or government expansion of e-rate would derail the planned expansion and "rebooting" of that program, which subsidizes advanced telecommunications to schools and libraries. Rosenworcel has long advocated refocusing the program on capacity, and echoed her, and the Obama Administration's, goal of 1 Gbps to every school before the end of the decade. "Dream likely and dream big, she said."If we do that, we are going to send a signal to markets, device manufacturers and content creators, who are going to create more content and technology for our schools.

Rosenworcel put in a plug for revisiting the spectrum screen before the FCC holds the incentive auctions. That screen triggers further FCC scrutiny of spectrum consolidation in individual markets. She her hope is that the result of that would be opportunities for incumbants and new entrants alike. But she said that, in the end, no single carrier should walk away with all the spectrum.

She did not say whether she thought the FCC would create the kind of smaller license sizes independent carriers have sought in the incentive auctions, but said the understood the "simplicity" of using the larger "economic areas."

Rosenworcel, a former top staffer at the Senate Commerce Committee, which vets FCC nominees, would not predict when the Senate would confirm either FCC Chair nominee Tom Wheeler or Republican nominee Michael O'Rielly. "The Senate moves when the Senate moves."

Rosenworcel said she expected that the FCC would be looking at the Verizon and Vodafone transfer, saying she hoped it would do so expeditiously, but that the Microsoft/Nokia deal does not "squarely fall" within the FCC's jurisdiction.

In the interview, Rosenworcel gave C-SPAN a shout out for all the “great public service” work that it does and has “for decades.”