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Industries battling over opposing policy goals is not uncommon in Washington. But few rivalries run deeper than the feud between the broadcasters and pay-TV providers over retransmission consent.
Raise the subject of retransmission consent and words such as “greed” and “collusion” are tossed around quickly. It is the most divisive policy issue within the TV industry — it’s also the most likely to shape a future where consumers can access the same video content through a variety of platforms.
Retransmission consent refers to the rates that cable or satellite companies pay local broadcast stations to carry their signals to subscribers. Under the 1992 Cable Act, broadcasters could elect to either force cable providers to carry their signal free of charge or enter into retransmission consent negotiations.
For more than a decade now, the “big four” broadcast stations (ABC, CBS, NBC and Fox) have chosen the negotiating table, and talks have grown increasingly contentious.
The most recent example came last month, when millions of Time Warner Cable subscribers in New York, Los Angeles and other markets lost access to local CBS-owned and -operated stations for 32 days. CBS had sought higher fees, and Time Warner yanked CBS stations from its lineup while the two sides struggled to reach a deal. When an accord was finally struck, most felt CBS had come out the winner.
To some experts, this was evidence that the pendulum of power had swung back toward the broadcasters. Such a shift would have been difficult to predict in 1992, when lawmakers created retransmission consent as a means to protect broadcasters from the perceived threat of the growing cable market, according to Jodie Griffin, a senior staff attorney at Public Knowledge, an open Internet and consumer advocacy group. To others, it was further evidence that the retransmission consent regime is broken.
“I applaud both companies for reaching an agreement, but unfortunately this is not the first time such a dispute has occurred, and it certainly won’t be the last,” Rep. Anna G. Eshoo, D-Calif., said at a House Energy and Commerce Subcommittee on Communications and Technology hearing last week.
“Some will say that legislating in this area is akin to picking sides or interferes with a retransmission consent mechanism that is working just fine,” she added. “The reality is that the data paints a very different picture.”
Eshoo, the panel’s senior Democrat, circulated a draft bill ahead of the hearing that would give the Federal Communications Commission explicit authority to step in during retransmission disputes to ensure that cable subscribers don’t lose access to broadcast stations.