Cable, Broadcasters Blaming Each Other in Spate of Retrans Disruptions
Cable and broadcast interests -- at odds in multiple retransmission consent talks breakdowns around the country -- are also at odds over the significance of those failed talks. The American TV Alliance (ATVA) pointed Tuesday to carriage disruptions in 48 markets nationally, calling it "a tidal wave of television blackouts." But Scott Flick of Pillsbury, who represents a number of broadcast stations, said: “In the grand scheme of things, [2016 was] probably one of the smoothest years” for retrans talks, and the fact so many deals expire at year’s end leads to a disproportionate bubble of talks that come to loggerheads. Separately, retrans may be one reason why Nexstar hasn't gotten the FCC OK to buy Media General for about $4.6 billion (see 1701030054).
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NAB said it expected the New Year’s impasses to end within days. The vast majority of retrans deals conclude without a disruption in service because both sides suffer in such cases, as broadcasters lose advertising revenue and viewership and multichannel video programming distributors lose subscribers who switch to another provider or install an over-the-air antenna, it said. NAB also said MVPDs hope to drive consumer complaints to regulators and lawmakers who might then tip negotiating power into pay-TV’s favor.
"This is a preview of what our members and consumers can expect at the end of 2017" when the vast majority of retrans deals expire, American Cable Association President Matt Polka said Tuesday. He said the carriage disruptions were examples of why the group lobbied regulators and lawmakers repeatedly on retrans reform.
Stalled carriage talks between Cable One and Northwest Broadcasting meant station carriage disruptions in Idaho and Mississippi. Hearst said 30 of its stations around the country are involved in a carriage talks impasse with DirecTV. Morgan Murphy Media’s KXLY-TV Spokane, Washington, went dark on Altice USA. ATVA also said Frontier dropped stations in six markets.
Multiple MVPDs blamed the blackouts on broadcasters' asks for retrans consent fees that skyrocketed over their previous contracts. "Rapidly increasing fees charged by broadcast stations and content companies are the greatest contributor to rising cable bills, and we are working hard to keep those costs as low as possible," Altice said in a statement. Cable One also said it resolved roughly half a dozen contracts that expired over the weekend with no disruption and reached an extension with Hearst through this week that lets it continue negotiations without any disruption. Northwest declined to agree to a similar extension, it said. Northwest and Morgan Murphy didn’t comment.
Thirteen Cox stations in 10 markets were temporarily dropped from AT&T’s DirecTV and U-verse local channel lineups over the weekend. "I don’t think there was anything unusual” about the spate of blackouts, a Cox spokesman said.
The FCC has authority only to make sure retrans talks are being done in good faith, and would be unlikely to get more heavily involved in broken-down talks in the next administration given general Republican antipathy to government involvement in market-based talks, Flick said. Congress, in any rewrite of the Communications Act, is unlikely to give the FCC more authority in retrans matters since the general trend has been toward reining in agency activities, he said.
The new Congress and/or FCC "must keep this issue on its plate," either as an updating of the Communications Act or through the FCC's still-open rulemaking on good-faith reform, Polka said. He said the new Congress has a deregulatory bent, but leaders of the Commerce committees understand communications laws are outdated.