Commission seeks proposals for changes to existing rule

The FCC has decided to move forward with its review of retransmission consent rules amid heightened tensions between broadcasters and cable, satellite and telco operators.

After a unanimous vote by the commission to proceed with a notice of rulemaking, FCC chairman Julius Genachowski said it is time to take a “fresh look” at ways to allow the nearly 20-year-old retransmission consent law to operate more smoothly and serve consumers and the marketplace. Echoing the view of his colleagues, he said that no one should interpret the initiative “as a signal or an excuse to drag their feet on reaching retransmission consent agreements.”

The commission said Thursday it is seeking proposals on how it can enforce the “good-faith negotiations” requirements, how to improve the level of advance notice to consumers of possible service disruptions due to retrans fights, and the possibility of eliminating the non-duplication and syndication exclusivity rules that prevent subscription TV providers from using out-of-market stations to replace local outlets in the event of a retrans blackout.

The FCC topper reminded attendees of the open meeting that federal law limits the commission’s ability to respond to retransmission consent impasses. For example, it lacks authority to order interim carriage of broadcast programming or mandatory arbitration, he noted.

The review comes after months of lobbying from cablers, sat-TV and telco providers in Congress and at the FCC to push for an overhaul of the retrans law established in 1992 when cable operators had no competition from satcasters and telcos. Broadcasters argue that the existing retrans law allows the market to set the going rate for local station carriage fees. The major O&Os and larger station groups have in the past two years started pushing hard for significant coin in exchange for retrans deals, which has led to more blackouts and public showdowns in key markets.

“The commission is clearly acknowledging that the current system is broken and that early 1990s rules must be updated,” the American Television Alliance, which reps major cablers, satcasters and telcos, said in a statement. Cablevision and Time Warner Cable weighed in with statements of support for the commission’s move.

Broadcasters, however, are readying to fight efforts to change the rule to make it harder for stations to pull their signals in a negotiations standoff — a major leverage point for station owners.

“NAB is pleased the FCC cor”NAB is pleased the FCC correctly concluded that the marketplace is best equipped to negotiate private business contracts, and that it lacks authority to impose the heavy-handed government tools that pay-TV providers desire,” said Gordon Smith, prexy of the National Assn. of Broadcasters. “We will actively engage in the commission’s new proceeding.”

Joel Kelsey, political advisor of public interest group Free Press, argued that the FCC needs to “do more to help consumers instead of just helping the cable companies and broadcasters.” He said the market is broken, and “so-called good-faith bargaining does little to prevent subscribers from losing access to channels they are paying for when a dispute arises.”

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