Stations to Washington: Let Us Handle Retransmission Consent

By Arthur Greenwald

It ain’t broke. Don’t fix it. Let us handle it. That was the message to the FCC and to Congress from a panel on the latest developments in retransmission consent and local-station exclusivity at the NAB Show in Las Vegas.

Moderated by Dow Lohnes communications attorney Kevin Latek, the panel included two other attorneys and two veteran broadcasters, each with special expertise on the subject of protecting station interests from regulatory and legislative encroachment and in direct negotiations.

The attorneys were Jennifer Johnson, a partner at Covington & Burling, and Robert Rini, of Rini Coran. The broadcasters were Alan Frank, Post Newsweek Stations group president (who also chairs the NAB’s retransmission consent committee), and Ben Tucker, GM of KGBT Harlingen, TX.

A year ago, a similar panel inspired trade-press headlines predicting “a retransmission train wreck” with mounting conflicts resulting in widespread carriage disruption.

The truth proved very different. Less than 1% (0.0087% to be exact) of station-carriage agreements were disrupted by retransmission negotiations, according to Frank. “Cable customers were 10 times more likely to lose local-station reception due to a service outage.”

The panel was unanimous that the retransmission-consent process worked exactly as intended, and worked well. “Neither side got everything they wanted, but both sides left the table satisfied with a fair agreement,” Frank said.

Rini wryly likened the process to the theory of mutually assured destruction, which kept the Cold War from going nuclear.

Asked whether the deal-making might have gone better with more-active FCC involvement, Tucker insisted the process proved that marketplace negotiations work best. Even the FCC appears to share this view, according to Rini, who said the agency “has wisely been humble about its ability to insert itself into these negotiations.”

The panel then turned its attention to the increasingly urgent topic of local-station exclusivity within each DMA — a status threatened by a variety of efforts to diminish or weaken SHVERA — the Satellite Home Viewer Extension and Reauthorization Act, which Congress must renew before it expires at the end of this year.

Here again, the NAB’s position is clear: Congress should update the bill’s language just enough to cover new digital technologies but not disturb any of the present protections of local broadcasters.

Johnson is optimistic this is just what will happen. “Congress and the FCC understand that exclusivity protects the profits that fortify local stations and make possible their community service.”

Frank extended this view to local news. “In other countries, news emanates from the nation’s capital. In our system, even national news gets a local perspective. And local TV news is how our legislators communicate with constituents.”

But members of Congress don’t always appear on the “local” news where there’s a mismatch between the geographic boundaries of a congressional district and a broadcast DMA, which is determined by actual consumer viewing patterns. According to Tucker, this occurs in as many as 70 broadcast markets.

As a result, some legislators have argued in favor of loosening SHVERA restrictions on importing signals from adjacent markets — an argument the entire panel viewed as specious. In fact, they consider it a thinly veiled scam by cable and satellite companies seeking to reduce broadcaster’s leverage in subsequent retransmission deals.

Rini was even more direct, saying it’s not exactly “shocking that some lawyers would create controversy in order to [drum up] more business. But Congress has a full plate right now and much more important issues than trying to redraw market boundaries. This is a non-problem that doesn’t require intervention.”

Asked by TVNewsday whether consumers, including members of Congress, should be allowed to pay to subscribe to a limited number of distant TV signals in addition to their local channels, Frank responded with a “No” so firm that it elicited audience laughter.

He continued to say, “There is already technology that allows viewers to stream newscasts and other video highlights. But streaming or importing a station’s entire signal would hurt over-the-air broadcasting in ways that aren’t anticipated.”

The panel concluded on two optimistic notes, as Rini reminded the audience that new digital channels are creating new outlets for programming and for minority ownership and partnerships. He added that such experiments also create new ways for broadcasters and cable and satellite carriers to work together to serve local communities.

NAB EVP of Television Marcellus Alexander stood to invite all NAB members to join in a special NAB Webcast on retransmission consent and related issues. The online event will take place on Wednesday May 6 at 3 p.m. ET. For more information, click here.