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FCC rolls out new rule on cable disputes

'Standstill' rule would freeze terms while carriage deals are resolved

The FCC is setting up a new rule aimed at preventing cable operators from removing channels from their lineups during contract disputes with cable networks.

Under the “standstill” rule, as it is called, cable operators could be required to carry a cable network under the same “price, terms and other conditions of contracts of an existing programming contract” while disputes are being resolved or a ruling is issued by a regulator. Past disputes have seen channels dropped from cable lineups as fights led to an impasse.

The rules changes are part of a series of steps the FCC is taking to streamline the process for dealing with complaints regarding program carriage rules, which were included in the 1992 Cable Act to prevent operators from discriminating against channels in which they do not have an ownership stake or interest.

The cable industry reacted strongly against the FCC’s changes.

Michael Powell, the former FCC chairman who is now CEO of the National Cable & Telecommunications Assn., said in a statement that the rules represent “an unfortunate trifecta: a flawed process that the FCC stubbornly refused to correct, substantive policy discussions that show little regard for the limits of agency authority or constitutional rights and a disturbing lack of appreciation of the potential impact of government intervention on consumers or the marketplace.”

“Regrettably, we must now explore other avenues for redress,” Powell added.

Andrew Jay Schwartzman, senior VP and policy director of the Media Access Project, said the series of changes “will promote diversity in cable TV offerings by ensuring that independent cable channels have a shot at getting carried on large cable systems.”

He added that the changes “will not, by themselves, fix all the problems with a system dominated by a handful of cable operators, but it is certainly a welcome change all the same.”

Two high-profile cases are currently pending before the FCC, although the new rules will not apply. The Tennis Channel is awaiting an administrative ruling in its complaint that Comcast placed channels in which it has a stake, like the Golf Channel, in a better position on the cable lineup while refusing to put Tennis on the same tier. Bloomberg filed a complaint against Comcast claiming that the cable operator has refused to place it in the same neighborhood as other news and business channels even though it agreed to such a condition as part of its acquisition of a controlling interest in NBCUniversal.

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