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Congressional Letter to Chairman Markey regarding the Retransmission Consent Quiet Period

Submission Date: 
06/09/2008

The Honorable Ed Markey
Chairman
Subcommittee on Telecommunications
& the Internet
Committee on Energy and Commerce
United States House of Representatives
Washington, DC 20515

The Honorable Cliff Stearns
Ranking Member
Subcommittee on Telecommunications
& the Internet
Committee on Energy and Commerce
United States House of Representatives
Washington, DC 20515

Dear Chairman Markey and Ranking Member Stearns:

As the Subcommittee reviews the progress of the upcoming digital television transition, the American Cable Association (ACA) wanted to alert Members of the Subcommittee about a potentially unforeseen factor that might further complicate the transition's impact on consumers. Specifically, ACA urges Members to inquire how retransmission consent negotiations conducted between broadcasters and cable operators in the months leading up to the DTV transition could impact the viewing public as the switch to digital is completed.

ACA represents small and medium-sized, independent cable operators. ACA is an active member of the DTV Transition Coalition, and ACA's members are committed to ensuring a successful digital transition. Unfortunately, the educational efforts of government, broadcasters and cable operators may be disrupted by broadcasters who will be negotiating retransmission consent deals with cable operators at roughly the same time.

Existing retransmission consent agreements between cable operators and broadcasters will generally expire by December 31, 2008, and ACA expects a significant number of its members to face difficult and potentially contentious negotiations with broadcasters. As you know, ACA believes federal retransmission consent and network non-duplication rules grant broadcasters unrestrained power in these negotiations, and broadcasters commonly leverage their power to demand unreasonable prices, terms and conditions. Broadcasters use this power most often to discriminate against small and medium-sized cable operators, including charging per subscriber fees that are two-fold, three-fold, even as much as ten-fold more than larger operators for the same signals without any rational justification. What you may not have heard or considered before, however, is how these pending one-sided negotiations occurring simultaneously with the DTV transition may adversely affect consumers and increase confusion.

During retransmission consent negotiations, broadcasters force small cable operators to drop their television signal if the broadcasters' disproportionately higher per subscriber fee demands are not met This is precisely what happened in early 2007 when 2 million television viewers in 700,000 households were disrupted by Sinclair Broadcast Group's unilateral decision to pull 22 broadcast stations from Mediacom cable systems in 12 states. This practice, which under the best of circumstances disrupts service with no regard for consumers, will cause mass confusion in the months before and after the transition because consumers will be unaware whether or not their lost channels are a result of the DTV transition, an unfulfilled personal responsibility such as buying the wrong converter box, or another issue entirely.

ACA believes that broadcasters, without regard to the fact that the DTV transition is concurrent with the current cycle of retransmission consent negotiations, will continue to pressure small and medium-sized cable operators to accept unreasonable terms compared to larger operators, and readily force operators to drop their signal when their terms are not accepted. In the June 5 issue of CableFAX, LIN TV stated that successful retransmission negotiations with Charter "appear unlikely," and that the MSO is expected to discontinue carriage of the stations when the current contract expires. These kinds of statements exemplify the view of the broadcast industry at large, and foretell a crisis that could interfere with the success of the DTV transition.

As the Members of the Subcommittee review the progress to date in the DTV transition and effectiveness of consumer education, ACA asks Members of the Subcommittee to be aware of upcoming retransmission consent negotiations and the potential for consumer impact around the DTV transition. In addition, we encourage all Members of Congress to play an active role in monitoring negotiations in their state or district to ensure broadcasters are not forcing small cable operators to accept unreasonable deals or drop signals in the months before and after the digital transition to ensure that the transition is seamless for constituents.

Sincerely,

 

Matthew M. Polka
President and CEO

 

cc: Members, Subcommittee on Telecommunications & the Internet, Committee on Energy and Commerce, United States House of Representatives

AttachmentSize
080609 Polka Letter to Reps Markey and Stearns.pdf39.42 KB

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