WASHINGTON — Calling for all-out battle, the major network affiliates on Thursday asked the Federal Communications Commission to investigate allegations that the nets, bolstered by consolidation, are strong-arming them on programming and in crucial business decisions.
The Network Affiliated Stations Alliance (NASA) brought the 43-page petition on behalf of more than 600 ABC, CBS and NBC affils. Some of those groups also own Fox affiliated stations.
Action could well mean the resumption of affiliate/network strife. Relatively speaking, nets and affils have enjoyed a period of detente over the past year.
NASA alleges that in exercising undue influence over affils, the four major nets have violated specific FCC rules, as well as disrupted the historic affiliate-network balance.
“We are partners with the networks, but we cannot stand by and let them control our local stations. We know what works best for our local communities, and by law those decisions cannot be made in Hollywood or New York,” Post-Newsweek Stations prexy and NASA chair Alan Frank said.
“Both Congress and the FCC have long cared about localism and diversity, and this petition establishes that those core values of our nation’s broadcasting system are at risk,” he said.
NASA’s filing came less than a week after a federal appeals court threw out a host a crucial cable ownership caps, including a rule that no one cabler could reach more than 30% of the national market. TV industry execs predict that the same court is thus likely to also throw out the 35% ownership cap for broadcasters.
Smaller station owners say the major nets would have even more control if the cap is struck down by the court.
Timed as it was, the NASA filing could turn out to be posturing to argue why the 35% cap is needed.
NASA said that the deregulation of the last decade — which included the overthrow of fin-syn rules — has allowed the nets to own more TV stations, as well as produce their programming. Nets are becoming bullies, the org said in effect.
A NASA spokesman said the org represents virtually all non-O&O network affils and that all signed off on the filing. Nowhere in the filing, however, are the affils listed.
Net execs expressed dismay at the filing and stressed that they continue to have good working relationships with their respective affiliates.
“This is an ill-advised and extremely disappointing action, particularly given CBS’ strong, ongoing commitment to the network affiliate relationship,” said CBS senior veep for corporate communications Gil Schwartz. “CBS categorically denies taking part in any unlawful activity whatsoever, and we are confident that the FCC will find no merit in these baseless and irresponsible charges.”
The NASA filing made a point to say that CBS is the least of the offenders.
NASA was particularly tough on Fox, saying the net pushes the envelope with regard to the affiliate-network relationship, setting a precedent for ABC, CBS and NBC. Document often grouped NBC with Fox in terms of practices.
NBC and Fox last month confirmed that they had canceled their summer 2001 affil meetings.
Fox sez it’ll study
“We have just received a copy of the filing by NASA to the FCC and we will need to thoroughly review it before commenting further,” said Fox prexy for network distribution Robert Quicksilver.
“It’s a shame this organization filed this request,” an NBC spokeswoman said. “We’ve made so much progress in terms of our relationship with our affiliates. It’s as good as it has been for many years. We’re confident that the FCC won’t find any merit to their claims.”
Likewise, an ABC spokeswoman said NASA’s allegations were wholly without merit, and that the new Republican FCC would continue on a course of less regulation, letting the marketplace duke it out.
“The public would be best served by deregulating the broadcasting industry to reflect today’s highly competitive environment, not by the sweeping and unjustifiable governmental intrusion that NASA demands,” the ABC spokeswoman said.
Little FCC history
Over its history, the FCC has conducted only a handful of inquiries into the affiliate-network relationship. Reg agency declined comment Thursday on the latest request.
Specifically, NASA’s filing alleges the following FCC rule violations:
- Under virtually every current affiliation agreement, an affil risks losing its affiliation if it preempts more than a few hours of net programming without approval, violating the FCC’s localism principle.
- Fox has violated a second set of rules by demanding that affiliates give up all control over their digital capacity, precluding the development and delivery of local digital services.
- ABC, Fox and NBC are allegedly using affil agreements to unlawfully manipulate or take advantage of proposed stations sales, thereby subverting local license independence. Recent ABC and Fox affiliation agreements gave nets veto power over the sale of an affil to a particular purchaser. NBC allegedly sought to manipulate the price in purchasing a major market affiliate.
NASA also asked the FCC to investigate net conduct that, while not violating a specific FCC rule, raises public interest concerns. Alleged conduct includes the following:
- Recent network collaboration in collection and distribution of news through Network News Service and exit polling Voter News Service. Such collaboration threatens to “diminish diversity, competition and consumer choice.” Affils shouldn’t be “coerced” into participating, NASA said.
- Nets have become reluctant to ensure programming exclusivity as they invest in other media, such as the Internet, satellite and cable. In some instances, nets have suggested viewers switch to a nonbroadcast, yet network-owned, outlet at the conclusion of a network program. Local stations thus lose audience and advertising, NASA asserted.
- FCC should study the extent to which nets are using their own major-market station groups to control the distribution of programming, shutting out independently owned net affils.