Walden Expecting ‘Clean’ STELA Reauthorization
House Communications Subcommittee Chairman Greg Walden, R-Ore., said Thursday he believes Congress will pass a “clean” reauthorization of the Satellite Television Extension and Localism Act (STELA), which is set to expire Dec. 31, 2014. “My hunch is that it ends up being a pretty clean act,” Walden said in an interview for C-SPAN’s The Communicators series scheduled to air this weekend. “I would prefer to do one thing at a time and not have all these other things hooked on,” he said. Walden said his subcommittee plans to hold a hearing on the video marketplace “fairly soon.” Industry sources recently told us the subcommittee was seeking to invite representatives from Time Warner Cable, DirecTV, NAB and Aereo to testify at a mid-June hearing (CD May 21 p13).
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"The video world is going through enormous change,” said Walden. “I think [there is] a huge paradigm change right before our eyes. With the 2-1 decision in the [2nd U.S. Circuit Court of Appeals] on the Aereo case, where they can basically download the [broadcast] signal off air, put it on the Internet and basically say ’that’s OK’ -- that has huge consequences potentially. So you have Aereo doing that just on a limited basis in one market but talking about expanding -- you have satellite operators thinking, ‘well huh, well you can get around retransmission here, maybe we'll do that’ -- you've got a cable company who said ‘we'll look at that too.’ All of a sudden the whole business model and marketplace is getting tossed around pretty rapidly.”
Walden said he was “surprised” by the Aereo decision: “I look at it and think that is a disruption in the marketplace. Disruptions aren’t bad, necessarily, but this one has bigger consequences as people are beginning to read into that,” he said. “I think at some point producers of a program are going to have to get paid.”
Walden said he’s unsure that the a la carte cable bill introduced by Sen. John McCain, R-Ariz., is “the panacea that many think it is.” McCain’s Television Consumer Freedom Act (S-912) aims to encourage video programmers and distributors to offer a la carte video to consumers, deter broadcasters from downgrading their over-the-air services and amend the sports blackout rules (CD May 10 p2). “You wonder what that does to the pricing model and to the wide range of programming out there,” Walden said. “There is a trade off that with the current system you get a lot more programming that frankly ... wouldn’t exist otherwise,” he said. “I think you have to be real careful, that would be a real interesting disrupter in the market.”
Walden complimented the business acumen of Tom Wheeler, President Barack Obama’s pick to be FCC chairman, but said he was troubled by an April 2011 entry (http://bit.ly/18b5fRr) from Wheeler’s “Mobile Musings” blog in which Wheeler advocated FCC approval of the AT&T/T-Mobile merger in return for new regulatory terms and conditions (CD May 1 p1). “He thinks it is fine to use merger conditions to affect and regulate the market, which I find offensive from a public policy standpoint,” said Walden.
If the FCC does not have the “underlying statutory and therefore the regulatory authority to affect the marketplace on its own it shouldn’t use the extraordinary power it has to approve or deny a merger to exercise market changes it can’t do through a regulatory environment,” Walden said. “Here’s why this is important -- because you have other players in the market that aren’t part of the merger that are going to be subject to whatever the condition is and that is not really fair to the other participants in the marketplace.” Wheeler has “written specifically on this topic that he thinks that’s a way to leverage more power to the FCC. If they don’t have the underlying authority and therefore regulatory authority, I think it is wrong to have three people -- in effect the majority of the commission -- to say ‘we are going to hold you to this because we can’t do it over here so we will do it though through your merger because we know you will give,'” Walden said. “Some people might call such a strategy extortion because who knows what they are giving up to get something bigger. It is just not good policy.”
Walden repeated his concerns that the FCC had expanded its authority under the leadership of former Chairman Julius Genachowski. “He pushed pretty hard on an agenda,” Walden said. “I would like to see them get back to being an expert agency and not a policymaking body. We are the policymaking body.” Walden said he will continue to push for FCC process reform legislation in the 113th Congress: “I'm passionate about this, having good public processes in government. ... All we are saying is have shot clocks that you set -- predictable timelines -- and then if you don’t meet them, tell us why you don’t meet them. Don’t do these enormous data dumps right at the end of a proceeding that nobody really has time to read, understand and comment on and then say you have a good public process.”