FCC Bureau Says ALJ Should Find For Cable in WealthTV Cases
The FCC Enforcement Bureau sided with four cable operators in program carriage complaint cases (CD July 9 p11) alleging favoring their own programming over that of an upstart channel. Chief Administrative Law Judge Richard Sippel, who heard the cases brought by WealthTV, should recommend that commissioners find none of the defendants discriminated against the channel on the basis of not owning it, said a Wednesday filing signed by Bureau Chief Kris Monteith. It said Sippel shouldn’t recommend that the commission require the cable operators carry WealthTV, as the programmer sought.
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ALJs doesn’t always heed bureau recommendations, but they carry much weight, said a cable lawyer uninvolved in the cases. Sippel hasn’t set a date by when he'll issue his decision, said attorney Kathleen Wallman, representing WealthTV. The defendants are Bright House Networks, Comcast, Cox Communications and Time Warner Cable. TWC is “pleased” with the bureau’s recommendation, a spokesman said. Comcast and Cox declined to comment, and spokespeople at Bright House didn’t reply to messages.
The bureau agreed with the operators that proof wasn’t offered that Mojo, a network the defendants owned and widely carried, was similar to WealthTV, as claimed by the plaintiff. At the hearing, the independent programmer portrayed itself as a network focused on young and rich men, but “virtually all of WealthTV’s marketing materials, affiliation agreements and its website held WealthTV out as a network targeted toward a broad audience” -- of both sexes -- said the filing. A TWC expert “persuasively characterizes WealthTV’s overall programming as having a calm, mature and sophisticated ‘look and feel’ about it, while MOJO’s presentation was considerably more edgy, hip, urban, and irreverent.”
“Disappointed” with the bureau’s comments, WealthTV still seeks a “just outcome,” and is “confident” Sippel will come to a “just decision,” CEO Robert Herring told us. If cable company owners of inDemand, which ran the now-defunct Mojo, “withhold 70 percent of a market from competition, which they did, that is obviously an unreasonable restraint on a programmer’s ability to compete fairly,” Herring added. “It is stunning that the Enforcement Bureau did not think so.” The bureau gave “no weight” to considering how consumers are hurt by higher cable bills when cable companies pay “themselves to carry their own programming,” he said.
WealthTV correctly said the defendants treated Mojo and inDemand differently than unaffiliated programmers, but commission rules don’t require otherwise, the bureau said. “The sine qua non for a carriage decision consistent with Section 76.1301(c), however, is not whether a vertically integrated cable operator has ignored the practical considerations and marketplace realities that come from having a financial stake in programming that it carries,” it added. The reasons defendants gave for not distributing WealthTV were similar to why other pay-TV companies said they declined, the bureau said: “Insufficiently compelling content, little or no track record in the programming business, no audience or consumer research data, lack of brand recognition.” The filing also was signed by bureau staffers who sat in on the hearings, part of a package of three cases heard by Sippel. The FCC under then-Acting Chairman Michael Copps sent back all the cases to him after the Media Bureau in the waning days of Kevin Martin’s chairmanship took back the cases from the ALJ.
The administration of FCC Chairman Julius Genachowski doesn’t seem inclined to get involved in cable deals by deciding who gets carried in the WealthTV cases, said Steve Effros, an industry consultant. “If the commission is smart -- and I think the Enforcement Bureau was smart -- they would back off all of this. This was a bit of the Martin legacy: Getting right in the middle of programming negotiations.”