The Honorable John F. Kerry
United States Senate
218 Russell Senate Office Building
Washington, D.C. 20510
Dear Chairman Kerry:
The members of the American Cable Association (ACA) strongly support your effort to address ongoing disputes between broadcasters and MVPDs that have dominated the recent news. I share your conclusion that the current regulatory regime is broken and does not adequately protect consumers.
The nearly 900 smaller, independent cable operator members of the ACA have long been the "canary in the coal mine," demonstrating the harm of current retransmission consent rules in the hands of large broadcast conglomerates that have now pushed consumer retransmission consent fees into the billions, according to an industry trend analysis by SNL Kagan.
I share your belief that the time is right to review how the existing laws and regulations work, nearly 18 years after their first implementation, and to consider updating the underlying statute. Moreover, I agree with you that the FCC should move forward on the pending Petition for Rulemaking to reform the Commission's rules governing retransmission consent, which ACA and 14 other organizations from industry and consumer groups endorsed.
ACA and its members know firsthand that retransmission consent increasingly harms consumers via spiraling prices and bitter public showdowns with threatened or actual withdrawals of local network signals. Compounding this problem for smaller operators is the fact that broadcasters unjustifiably charge smaller operators and their customers significantly higher fees than larger operators for the rights to retransmit the same programming. Moreover, in numerous markets served by smaller operators, multiple broadcasters often enter into local pacts to collude on carriage fees, allowing these station owners to extract higher prices through anticompetitive behavior. All available evidence suggests the current regulatory structure results in significantly higher retransmission consent fees, generating higher costs for consumers and hindering our efforts to deploy broadband and other programming options.
I couldn't agree with you more than when I read your quote in Politico where you said: "The titans of the new economy often collide - with each other, with smaller firms, with consumers or with our values. When giants collide, someone or something almost always bears the brunt of it." ACA's members know all too well how right you are and that, in our case, it is our consumers that bear the brunt in a disproportionate manner.
I appreciate your leadership, strongly support your call for a legislative action on the matter, and agree with the call for a legislative solution to this problem. We look forward to working with you to fix this broken system. Please do not hesitate to call upon me, our members and our Association if I can help in any way.
Yours most respectfully,
Matthew M. Polka
President and CEO
American Cable Association
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