Little FCC or Hill Interest Now on Retrans, Even With Blackout

The government should set the price of what MVPDs pay, unless rules favoring broadcasters are removed so there’s regulatory equilibrium between the sides, Commisso said. “No one more than [me] wants to get government off everybody’s back, as long as they do it for everybody,” he said. If that doesn’t happen, then “we would love the government to set the price: Let the government decide.” Commisso would be willing to pay the same carriage fee in markets with very different demographics, he said. Now, “different customers get treated differently,” depending on who their MVPD is and other factors, Commisso said: The FCC’s priority is to “take care of rural customers for broadband, and not for video.”

High-profile disputes tend to awaken interest on Capitol Hill and at the commission, said Commisso and TV executives. They said the LIN Media-Mediacom dispute in seven small and mid-sized markets hasn’t appeared to engender much widespread interest among Washington decision makers. That’s partly due to the size of the dispute, with a relatively small number of affected subscribers, who aren’t concentrated in any one market, Commisso said. Executives said Hill interest was higher around October 2010, when there was a blackout on Cablevision of several Fox stations owned by News Corp. (CD Oct 27 p1). “Mediacom appears to be much more interested in waging a PR battle to advance its political agenda in Washington than in closing a deal that would restore service to its subscribers,” LIN said.

There doesn’t appear to be much interest in retrans among congressional delegations in areas where Gray TV has stations, said President Robert Prather. “None of our managers have mentioned anything to me ... so it must not be much to it.” The company runs stations in 30 markets. “I think the cable guys have tried to stir up some interest” on the Hill, “but I don’t think they've been very successful,” Prather said. Cablevision-Fox was the only recent thing to “stir it up,” Prather added. He hopes to again have no blackouts this year, when contracts for 45 percent of pay-TV subscribers getting Gray stations expire. “We've had good relations with our cable operators, and I think we'll continue to have them."

"It takes more than me” to make it a front-burner issue among legislators, Commisso said of retrans. “Whether it is Democrats or Republicans, they may have different reasons for not getting involved. But if they truly care about the consumer, they should.” If there’s “all kinds of activity, blackouts related to this issue, it’s going to bring it to the front burner the way the Fox-Cablevision situation” did, he continued: “And then it’s going to be on the back burner later on,” something broadcasters hope will happen. An NAB spokesman declined to comment.

Mediacom sent a second letter to the FCC since the LIN blackout began, saying the agency should “take the same, active, public role in helping to end this shut-off as it has taken in past blackouts in large markets.” It cited Cablevision-Fox. There, and in disputes involving Disney, Sinclair Broadcast Group and Time Warner Cable where there were brief outages or brinkmanship, officials of the Media Bureau and commissioners’ offices kept closer tabs or encouraged resolution. The FCC “should make sure, and they have a bully pulpit to do that with, that blackouts are not an option when it comes to negotiating” retrans, Commisso told us. “Don’t let LIN do what they're doing, to create leverage for themselves by shutting me down and hurting my customers. Blackouts should be eliminated."

No FCC order is circulating on retrans, in a proceeding in which Mediacom and other pay-TV companies sought new rules to resolve disputes, a commission official said. No other commission action on retrans seems imminent, either, the official said. A bureau spokeswoman declined to comment. Mediacom’s letter, sent to bureau Chief Bill Lake, is in docket 10-71 (http://xrl.us/bmdeux).

LIN said it hasn’t used the “dilatory tactics” that Mediacom accuses it of. “We have not been ‘dilatory’ in any sense,” the broadcaster said. “We responded to Mediacom’s last proposal within seven days. Mediacom took ten days to respond to our prior offer, and Mediacom let the prior deal lapse without responding at all to the offer we had on the table.”

For Mediacom, there are issues of fairness. Commisso said he still wants to see TV stations have to charge the same per-subscriber fee to any MVPD within a market, no matter how many customers the MVPD has. It seems smaller markets are “targeted by broadcasters for use of shutoffs as a negotiating tactic, in part because broadcasters believe that the Commission is less likely to intervene when the affected consumers live outside big cities,” said the company’s letter. It was signed by cable lawyer Seth Davidson of Edwards Angell. “The Commission’s inaction” on LIN-Mediacom “is not only unfair to the citizens” in the small towns involved, but also doesn’t meet the intent of the 1992 Cable Act, Davidson wrote.

The FCC “clearly has the ability to intervene informally on behalf of consumers, as it has in other actual and threatened” retrans blackouts, Davidson wrote: “Mediacom urges the Commission to reconsider its decision to sit on the sidelines in the face of prolonged blackouts in the smaller markets affected by LIN’s strategy of holding consumers hostage” to get a triple-digit percentage fee increase. Mediacom didn’t file a complaint with the commission against LIN, alleging lack of good faith, because it would take several months to be resolved, Commisso said.