EchoStar Communications Corp. would likely cut 1 million subscribers off from local TV signals if federal regulators adopt a rule advocated by the broadcast industry, a satellite trade group said last Wednesday.
EchoStar offers local TV signals in 36 markets, but subscribers in 30 of those markets need a second dish to receive all available stations. The National Association of Broadcasters and the Association of Local TV Stations have asked the Federal Communications Commission to impose a one-dish rule, claiming EchoStar's second-dish option is discriminatory.
The Satellite Broadcasting and Communications Association, which represents direct-broadcast satellite carriers, said the NAB-ALTV plan would require EchoStar to cease service to some local markets in order to provide consumers in the remaining areas with a one-dish solution.
"Were the [FCC] to adopt the broadcasters' proposal, EchoStar would be forced to deny local broadcast service to up to a million subscribers," the SBCA said. EchoStar has about 6.4 million subscribers.
In its own comments opposing the NAB-ALTV plan, EchoStar confirmed that "many" markets would lose service, and up to 1 million subscribers could be affected.
As a result, SBCA said NAB and ALTV's one dish-rule requirement would "boomerang" on their members. Nevertheless, the SCBA said that the NAB and ALTV seem more interested in "scoring political points" than pursuing sound policy.
"Apparently, NAB and ALTV would rather shoot themselves and their members in the foot for political gain than allow satellite companies to bring local television signals to as many subscribers as possible," the SBCA said. It noted that the NAB opposes EchoStar's planned merger with Hughes Electronics Corp., corporate parent of DBS carrier DirecTV Inc.
Starting Jan. 1, EchoStar and DirecTV were required to carry all local, over-the-air TV stations in any market where they carried just one such signal. Although DirecTV provided a one-dish solution, EchoStar largely required two dishes, claiming the spot-beam satellites needed for a one-dish product were not delivered in time.
The NAB, the ALTV and some TV-station owners told the FCC that EchoStar put major-network affiliates on the main satellite that subscribers can view with existing equipment. But the DBS carrier decided to segregate independent stations on the second dish, they said.
Even though EchoStar does not charge for a second dish or installation, broadcasters said consumers would be reluctant to schedule an appointment just to pick up a few extra local stations. EchoStar's plan discriminated against some local broadcasters and should be banned, the broadcasters said.
Telemundo Group Inc. — which operates 11 stations in the U.S. and Puerto Rico — said EchoStar placed eight of its stations on the second dish.
"Requiring subscribers to install additional equipment to receive Spanish-language stations, but not local English-language stations is rank discrimination against alternative media — and this country's growing Hispanic population," Telemundo said.
EchoStar claimed its second-dish plan was an interim step that would conclude with the launch of the spot-beam satellites or the closing of the DirecTV merger.
The DBS firm also rejected the contention that the second-dish requirement would deter consumers from obtaining the equipment and from scheduling an installation at no charge.
"Tellingly, EchoStar's promotions have borne fruit: Already, after only a few weeks, thousands of subscribers have taken advantage of EchoStar's offer of a free dish," the company told the FCC.
In earlier rules, the FCC said DBS carriers could require a second dish for some local TV signals so long as they did not charge. They could charge for the second dish, the FCC said, if all local TV stations were received in that manner.
The NAB and ALTV want the FCC to clarify its rules to ensure that DBS carriers may not require a second dish to receive some, but not all, local-TV signals, irrespective of whether the equipment is provided for free.
In their comments, the NAB and ALTV said EchoStar should not respond to an FCC one-dish mandate by cutting off service entirely in some markets. Instead, it should seek a "limited and temporary waiver" from the from the "carry-one, carry-all mandate" until its spot-beam satellites are operational.
EchoStar said the FCC lacks the legal authority to ban a free second dish and the agency should not change rules the company relied upon to comply with full must-carry.