Dish Customers Can Keep Getting Distant Signals From NPS
Dish Network customers can keep getting TV stations’ distant signals (CD Dec 1/06 p1), a three-judge appeals court panel ruled Monday. The decision of the 11th U.S. Appeals Court in Atlanta, written by Judge Charles Wilson, dismissed broadcasters’ challenge to a deal between the direct broadcast satellite company and program provider National Programming Service. Dish Network isn’t violating the 1998 Satellite Home Viewer Act by getting $150,000 monthly under a two-year agreement for NPS to provide the signals of network affiliates to satellite subscribers in other markets, Wilson wrote in CBS v. EchoStar.
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Fox, its affiliates and those of ABC, CBS and NBC supported CBS’s challenge to the last-minute deal for EchoStar customers to keep getting distant programming after a court barred the DBS company from providing the signals directly. The November 2006 deal -- announced two days before an injunction took effect -- doesn’t make EchoStar a satellite carrier, the type of entity precluded by the injunction from carrying distant network transmissions, Wilson wrote. To be a satellite carrier, a company must own or lease satellite capacity to provide point-to-multipoint distribution, agreed EchoStar and the broadcast networks. Wilson said the networks “fail to convince us” that EchoStar is providing such a service and also is using satellite facilities to operate a point-to-multipoint distribution service. A CBS spokeswoman declined to comment. Lawyers representing network affiliates didn’t respond to our messages seeking comment.
“The satellite carrier must be in the continuing enterprise of establishing and operating ’the channel of communications for point-to-multipoint distribution,'” Wilson wrote. “The networks, however, fail to provide any detail on the intricacies and scope of EchoStar’s operational control over the transmission infrastructure.” The lease agreement between that company and NPS shows EchoStar to have a “marginal role,” he wrote. Under their deal, EchoStar leases a satellite transponder to NPS. An NPS executive declined to comment right away. A Dish Networks spokeswoman didn’t respond to a message.
The DBS provider’s role at the programming reseller is small because NPS is responsible for maintaining the equipment to provide the distant signals, transports the signals and turns on and cuts off service to subscribers, Wilson wrote. “In light of these facts, we are convinced that NPS can fairly be viewed as establishing and operating the channel of communications,” he added. “The conclusion that only NPS qualifies as a satellite carrier engaged in the retransmission of distant network programming is all the more clear upon considering the broader, statutory framework.” He cited the Act’s definition of satellite carrier as contemplating a satellite owner leasing its capacity, and EchoStar’s comments that such deals are “common.”
A satellite carrier and a company leasing capacity can’t both engage in distant signal retransmissions, wrote Wilson, signaling NPS alone is the distant signal provider. If both it and EchoStar were distributing distant signals, the two companies would have to pay royalties to rights holders under compulsory licenses, he added. “But nowhere does the statutory language infer such duplicity of efforts and expense -- let alone a windfall to the copyright owners for twice the amount of royalty fees,” wrote Wilson. “Put simply, EchoStar is out of the distant network programming business.”