Lawmakers Urge Update to Laws Governing Video Marketplace
Lawmakers on the House Communications Subcommittee urged an update to laws regulating the video market to ensure protections for consumer access to content, as Congress looks to reauthorize the Satellite Television Extension and Localism Act, at a hearing Wednesday.
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Subcommittee Chairman Greg Walden, R-Ore., said current laws hinder providers of content, network investments and intellectual property in the video market from receiving fair compensation. The laws “should reflect the operation of the free market in a competitive environment,” he said. Instead, the satellite law has its origins in ensuring access to content for a fledgling industry, the cable law “was passed when cable controlled over 90 percent of the video market” and the broadcast rules “ignore the rise of alternatives to over-the-air reception,” he said.
Ranking member Anna Eshoo, D-Calif., Rep. Steve Scalise, R-La., and Vice Chairman Bob Latta, R-Ohio, agreed the current laws are outdated. What was written in the past “served us well for a long time, but obviously we need an update,” Eshoo said. Her draft legislation introduced this week calls for more FCC statutory authority in retransmission consent disputes (CD Sept 10 p6). NAB opposed the bill. Eshoo applauded Time Warner Cable and CBS for ending their dispute, which resulted in a consumer blackout of CBS channels last month. But “unfortunately this is not the first time such a dispute has occurred,” and it will not be the last, she said. The retrans mechanism isn’t working well, she said.
While laws should leave room for innovation and provide a business model “where players can pay the bills,” consumers must be a priority, said Rep. Peter Welch, D-Vt. “It’s really getting out of hand.” Consumers need their access to content “in whatever manner they get it in their homes,” he said. Rep. Joe Barton, R-Texas, also backed a review of telecom laws, and said he expects the discussion to result in “concrete legislative action."
Eshoo bemoaned the blocking of Internet content during the TWC-CBS dispute, saying in retrans disputes, “there’s a multiplicity of impacts.” Rep. Michael Doyle, D-Pa., agreed “new ground is being broken here."
Stanton Dodge, Dish Network general counsel, reiterated his company’s opposition to the retransmission regime, urging targeted reform of the retrans consent model. He cited the “increasing number of blackouts,” which are increasing in magnitude, he said. He said Dish supports Eshoo’s legislation and backed Walden’s decision to circulate a separate discussion draft.
Broadcasters’ signals are always being broadcast and they're always free, said Edward Munson, general manager of KPHO-TV Phoenix. No broadcaster has ever stopped broadcasting due to a retrans dispute it had with a pay-TV provider, he said. Broadcasters “must comply with many regulations that are not applicable to any other distribution platform,” he said. The state of video is strong for consumers, said David Rozelle, Suddenlink executive vice president. Consumers have access to higher-quality programs, and more variety and diversity in video content, he said. Policymakers should revamp retrans consent and the “integration ban” on navigation devices, he said. Changes in the video market have skewed retrans negotiations, he said. “While those changes have included the development of programming sources that compete with broadcasters, broadcasters still control marquee events.”
Retrans consent rules threaten consumer benefits of local facilities-based video provider choice, such as pricing options and broader deployment of high-speed broadband, said James Campbell, CenturyLink regional vice president-public policy. “The rules are used against us in myriad ways,” he said. “National content can be forced down our throat.” The FCC’s interpretation of the good-faith standard has rendered it meaningless, he said.
Walden asked about broadcast ownership caps and the difference between content bundles offered by multichannel video programming distributors and those offered by broadcasters. A customer who doesn’t want a CenturyLink bundle can call competitors, said Campbell. But “bundles are forced on us in agreements. … The real issue on the retrans side is a one-sided negotiation,” he said. Bundling cable channels with broadcast is a small part of negotiations, said Munson. Media ownership rules serve an important purpose, Senior Staff Attorney John Bergmayer of Public Knowledge told lawmakers. “They might need to be more technology neutral instead of singling out a particular service.”