Martin Calls DTV ‘Significant Challenge’ for Next FCC

“The obvious issue that’s in front of the commission now that is going to be a significant challenge for any commission in that time frame is the DTV transition,” Martin said. “It’s going to be a significant issue and that’s one of the reasons we are spending so much time on the issues surrounding it, so I think that’s the thing that should be on the forefront of people’s minds.”

A rulemaking notice circulated by Martin for a vote by the Dec. 18 meeting proposes to start what he described as a new type of TV service for broadcasters to provide DTV to the places they reached with analog signals. Digital TV translators would give industry the ability, though not the obligation, to replicate their analog coverage after Feb. 17, Martin said. “This is opening up a new opportunity.” During the rulemaking, stations could apply to the FCC for special temporary authority to start translators, Martin said.

DTV translators, along with distributed transmission systems approved by the FCC Nov. 3, will help broadcasters fill in coverage areas with digital signals, industry lawyers said. But hurdles remain, they said. There may not be enough spectrum in all markets, especially on the East Coast, for DTV translators, said President David Donovan of the Association for Maximum Service Television. “Most spectrum is already used, but that’s not to say this couldn’t be a tool,” he said. “It’s something that requires some engineering” study. “In many markets it may be an important tool.” Another industry lawyer said there may not be enough time for broadcasters to set up TV translators before Feb. 17. An NAB spokesman said the group has “always” supported “flexible rules for digital translators” but can’t comment further until it learns more about Martin’s proposal.

Martin confirmed that he’s also seeking votes by the commissioners on notices of apparent liability (CD Dec 3 p3) to companies found to have violated rules on DTV consumer education. The notices would go to seven companies and total slightly more than $11 million, he said. He declined to specify the accused or the accusations. Others have said those to be penalized include AT&T, Comcast, Time Warner Cable and Verizon.

Martin said he’s unsure if the FCC can require a so- called DTV quiet period, when broadcasters couldn’t pull their signals from cable operators in the periods before and after the analog cutoff. Noting that a quiet period item is before commissioners (CD Nov 17 p5), Martin said he has “concerns” about the commission’s authority. “I am still hopeful that the broadcasters and the cable operators might be able to come to a solution on their own on a reasonable date that they might be able to agree to.”

Martin confirmed that he has circulated for a vote a draft order on programmer complaints against cable operators and satellite TV companies and a further notice on wholesale video deals struck with pay-TV companies by broadcasters and cable channels. The proposed order would make the standard for a prima facie case made by an independent programmer alleging it was discriminated over a channel affiliated with a pay-TV company “mirror” what “the legal standard is in court cases,” he said. The further notice deals with proposals made in recent weeks by Cablevision and others, Martin said. He said he doesn’t know how his colleagues will respond to the items.

The draft order results from the complaints of “a lot of independent programmers” that they're having a hard time getting carriage deals with pay-TV companies and are “being squeezed out by other programming that is affiliated with the program operators,” Martin said. “It’s more difficult than it would be if they're owned by major cable operators.” The rulemaking notice would give operators “more flexibility to lower the retail rate” for cable because they could place expensive channels on programming tiers other than expanded basic, Martin said. “This is the very argument that several of the cable operators including the largest ones have made” in the context of sports negotiations like Comcast’s with the NFL Network, he added.

The American Cable Association is “intrigued” by the proposed order and notice, said Vice President Ross Lieberman, declining to comment further until he knows more about them. The NCTA slammed both items. “In addition to the fact that the marketplace is providing consumers with the most diverse programming and choice available, the commission doesn’t appear to have authority to intervene,” said a spokesman.

“The chairman’s purported concerns about the price of video service belie his own efforts to impose new regulation and carriage obligations on cable operators that have only resulted in higher costs for consumers,” the NCTA official said. Martin is “seemingly oblivious to the fact that forcing more channels into existing programming packages will result in higher prices,” he said. “The program carriage order certainly is another example of the chairman’s double- speak on the pricing issue, because it will effectively obligate cable operators to carry every programmer that demands carriage.”