Consumer Groups Urge Regulators, Lawmakers to Stand Against Retransmission Blackouts
Public interest groups said Congress and the FCC should protect consumers from being affected by retransmission consent disputes, amid the current blackout of CBS programming on Time Warner Cable’s lineup. Blackouts result from broken markets, antiquated laws and regulatory neglect, said Michael Calabrese of the New America Foundation’s Wireless Future Project. CBS stations have a public obligation to make broadcasts freely available, but “they're demanding payment from cable providers, playing one off of the other and it’s leading to an increasing number of blackout situations that leaves consumers held hostage,” he said Thursday during a teleconference organized by American Television Alliance. ATVA members include the foundation and Time Warner Cable.
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Consumers are tired of paying for ever-increasing cable bills, said John Breyault, public policy vice president of the National Consumers League. Consumers are being asked to pay more and get less, he said. The ongoing dispute underscores that the regime is broken, he said. Broadband subscribers who may get their TV over the air, through a satellite provider or via an over-the-top video service can’t access the content they're paying to access, he added. “Regulators should step in and address this problem.” An NAB executive said separately Thursday that retrans is fair. CBS had no comment.
The blocking of Internet content on CBS.com is “ridiculous” and “outrageous,” said Senior Vice President Harold Feld of Public Knowledge, which also is an ATVA member. “The biggest thing that’s broken is not only are people not getting the TV they paid for, but CBS has expanded this out of the TV universe and into the Internet.” People who happen to subscribe to TWC for broadband service shouldn’t be punished as a means of putting business pressure on Time Warner Cable, he added. It should be illegal to take away sports during a retrans dispute, said David Goodfriend, Sports Fans Coalition (SFC) chairman. As a result of the dispute, New England Patriots fans in Boston, Pittsburgh Steelers fans and other NFL sports fans in Dallas and New York could lose pre-season NFL games over the next few days, he said.
The FCC has authority to act, said Feld, whose group is also an SFC member. The FCC is within its rights to issue a declaratory ruling saying “this conduct is out of bounds,” he said. Feld said PK is considering making a formal request to the commission. The commission can stand up for broadband subscribers and take this tactic off the table, which will be used repeatedly by other broadcasters, he said. Breyault agreed. “If CBS can get away with it, you're going to see this kind of blocking in subsequent retransmission fights,” he said. “The potential for consumer harm here is vast.” They should receive a refund from their cable provider instead of being forced to pay for content they aren’t receiving, he said.
New America Foundation supports the Television Consumer Freedom Act, introduced by Sen. John McCain, R-Ariz. (CD May 10 p3), said Calabrese. He said he hopes it will “break this logjam which is hurting consumers.” Broadcast programming offered by online streams should be offered a la carte, “so consumers can make a transparent choice between paying a higher cable bill,” using a streaming service like Aereo, or using their antenna to access programming, he said.
New York City council members urged CBS and Time Warner Cable to resolve the issue and restore networks to TWC’s lineup. “We don’t think either one of you is right,” said Daniel Garodnick, chairman of the subcommittee on zoning and franchises. “We know our constituents aren’t seeing what they want to see,” he told witnesses from CBS and Time Warner Cable who were at a hearing.
Retrans, which is fair, benefits viewers, said Marcellus Alexander, TV executive vice president for NAB. “Some companies attempt to break the process.” Since the beginning of 2012, 80 percent of the impasses reached involved Time Warner Cable, DirecTV and Dish Network, he testified. Compensation to local TV stations through retransmission fees isn’t responsible for higher pay-TV prices, he said. The New York State Broadcasters Association’s head offered suggestions at the hearing he said would protect consumers. Consumers should have the ability to use an antenna to obtain programming, said President David Donovan. There also should be rules adopted to allow consumers to switch services and avoid termination fees, he said.
The retrans process is broken, said Councilman Lewis Fidler. “I don’t believe the rabbit ears thing is viable. … It’s now the norm to have pay TV.” Consumers are paying the bill, he said. “You guys are lucky I'm not a member of Congress. … I would be all over the FCC. … You have no idea.”