July 24, 2014 SIGN IN | REGISTER

Congress Is Tuning In to Revise TV Industry Rules

Scott J. Ferrell/CQ Roll Call File Photo
Eshoo circulated a draft bill 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, but broadcasters were not onboard.

The most obvious obstacle to any overhaul of retransmission consent is the highly consolidated nature of the TV industry as a whole. The six major media companies that control 90 percent of the U.S. media market include the parent companies of the four broadcasters (Comcast/NBCUniversal, News Corp., The Walt Disney Co. and CBS Corp./Viacom) as well as Time Warner, which previously controlled Time Warner Cable. All five of those companies own several cable channels and Comcast is also one of the country’s largest cable and broadband providers.

Because companies such as Comcast have a stake in both sides of the issue, the National Cable and Telecommunications Association, which typically represents the views of the cable industry on the Hill, is largely silent on retransmission consent. Instead, the leading voice for change is the American Television Alliance, whose members include the two major satellite providers (DISH Network and DirecTV), as well as Time Warner Cable.

Eshoo’s bill seems unlikely to gain steam for a variety of reasons, not least of which is the lingering influence that the broadcasters enjoy in Congress and with the public. A more likely vehicle for change would be the upcoming reauthorization of the 2010 Satellite Television Extension and Localism Act, portions of which are set to expire at the end of the year. That law allows satellite providers to carry out-of-market broadcast signals when they are unable to receive the local signal.

Subcommittee Chairman Greg Walden, R-Ore., has said he plans to circulate a draft reauthorization “no later than the first quarter of next year.” The cable and satellite industries have urged lawmakers to use the STELA reauthorization as a vehicle to overhaul retransmission consent. For that to happen, stakeholders must first overcome the primary factor governing telecom policy at present: lawmakers’ resistance to legislating in a dynamic and rapidly evolving market.

“Given these technological changes and the multitude of options available to American consumers, our laws should reflect the operation of the free market in a competitive environment,” Walden said at last week’s hearing. “Instead, we have a satellite law that finds its origins in ensuring access to content for a fledgling industry, a cable law that was passed when cable controlled over 90 percent of the video market, and broadcast rules that ignore the rise of alternatives to over-the-air reception.”

Most members agree with Walden’s stance that the Cable Act, STELA and other related laws are badly outdated.

To Republicans, that’s a reason to deregulate the video marketplace. To Democrats, the correct approach is to adjust regulations to ensure lower cost and greater flexibility for consumers. Both side are worried that any move they make will become immediately antiquated. That divide is perhaps even tougher to bridge than the chasm between pay-TV providers and the broadcasters.

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