The Grinches Who Stole Christmas Programming

Broadcasters and cable companies won't touch each other with a 39 and 1/2 foot pole.
National Journal
Dec. 12, 2013, 3:13 a.m.

It’s Christ­mas Eve in Montana. You turn on your TV for a time-honored view­ing of It’s A Won­der­ful Life. But you can’t find the Christ­mas clas­sic, or even the NBC af­fil­i­ate that’s sup­posed to be car­ry­ing it it. Or per­haps you’re in North Car­o­lina, hop­ing to watch some NBA bas­ket­ball after the Christ­mas feast. Or north­ern Cali­for­nia, set­tling in to watch your 49ers fin­ish out the reg­u­lar sea­son. And you can’t.

For view­ers in eight me­dia mar­kets, TV black­outs are com­ing at an un­for­tu­nate time. The real Grinch, say cable and satel­lite ad­voc­ates, is broad­cast con­glom­er­ates try­ing to steal con­sumers’ money by hik­ing up prices to carry their sta­tions. Sorry, Scrooge, broad­casters re­spond, but you’re to blame for your un­will­ing­ness to pay a fair amount for our ser­vice.

So, what’s the cause of all of this bick­er­ing? The dis­putes stem from an is­sue most people don’t give much thought — re­trans­mis­sion con­sent agree­ments. Cur­rent law re­quires cable and satel­lite pro­viders to meet every few years with loc­al TV sta­tions to de­term­ine how much they’ll pay to keep the af­fil­i­ate’s pro­gram­ming on their lineup. If they can’t settle on a num­ber, sub­scribers to that re­gion­al pro­vider lose ac­cess to the sta­tion un­til the ne­go­ti­ation is re­solved.

In Montana, for ex­ample, Bon­ten Me­dia Group — which owns NBC Montana — is at odds with DISH Net­work over pay­ment for its pro­gram­ming. DISH claims the group is try­ing to triple its prices; NBC Montana said that num­ber is mis­lead­ing and its de­mands are still be­low the prices some ma­jor cable chan­nels com­mand. In the mean­time, DISH cus­tom­ers in Mis­soula, Butte and Boze­man will be without Sunday Night Foot­ball, Parks and Re­cre­ation and all oth­er NBC pro­gram­ming.

“These black­outs are in­creas­ing rap­idly be­cause these broad­casters real­ize that they can play these TV com­pan­ies off of one an­oth­er,” said Bri­an Fre­d­er­ick, spokes­man for the Amer­ic­an Tele­vi­sion Al­li­ance. ATVA’s part­ners in­clude a num­ber of cable and satel­lite com­pan­ies, such as DISH, Dir­ecTV and Time Warner Cable.

The prob­lem, Fre­d­er­ick said, is when broad­cast com­pan­ies force price hikes by black­ing out sta­tions on one com­pany and telling cus­tom­ers to find a new pro­vider. The com­pany, lack­ing a pop­u­lar chan­nel and los­ing view­ers, is then pres­sured in­to a bad agree­ment to avoid los­ing mar­ket share. Then the same tac­tic is used on the next pro­vider when its re­trans­mis­sion con­sent agree­ment is re-ne­go­ti­ated.

Those claims are part of a man­u­fac­tured crisis, countered the Na­tion­al As­so­ci­ation of Broad­casters’ Den­nis Whar­ton. Satel­lite and cable com­pan­ies are un­will­ing to pay a fair price, he said, and are re­sort­ing to dis­rup­tions — NAB doesn’t like the term “black­out” — in hopes of pres­sur­ing Con­gress to in­ter­vene.

“Their mo­tiv­a­tion here is to try to get the TV view­ers who are pawns in their little game here to call Con­gress and say, ‘I want my TV back,’” Whar­ton said.

Will it work? That re­mains to be seen. Sources on both sides said they ex­pect Rep. Steve Scal­ise, R-La., to un­veil le­gis­la­tion soon that would elim­in­ate re­trans­mis­sion con­sent rules. Scal­ise pro­posed sim­il­ar le­gis­la­tion with then-Sen. Jim De­Mint, R-S.C., in 2011. Mean­while, Rep. Anna Eshoo, D-Cal­if., is push­ing a bill that would al­low the Fed­er­al Com­mu­nic­a­tions Com­mis­sion to grant in­ter­im car­riage of sta­tions while ne­go­ti­ations are on­go­ing. It would also give con­sumers choices on pur­chas­ing broad­cast sta­tions through cable and satel­lite pro­viders. It’s un­clear if either bill can gain trac­tion in the House.

ATVA has not en­dorsed any spe­cif­ic le­gis­la­tion — “There’s a lot of po­ten­tial solu­tions,” Fre­d­er­ick said — but the group sup­ports ef­forts by mem­bers of Con­gress to re­form the cur­rent law. It’s also call­ing on the FCC to do more to “pro­tect con­sumers.”

Whar­ton said that push for re­form has led to more view­ers get­ting blacked out so that satel­lite and cable com­pan­ies can use them as an ex­ample of why the rules are un­fair. He ad­vised blacked-out view­ers to find a new pro­vider or even use their an­tenna — whatever it takes to watch their Christ­mas spe­cials.

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