Move Would Promote Consolidation, Higher Retransmission Consent Fees
PITTSBURGH, April 19, 2018 – The American Cable Association said TV broadcasters’ latest attempt to relax national television ownership rules in an effort to enhance their market power over smaller multichannel video programming distributors (MVPDs) should be rejected as both unlawful and unwarranted.
“Broadcasters must shoulder the burden to demonstrate that any benefits of new consolidation permitted under their plan would outweigh the harms, including retransmission consent-related harms. ACA remains skeptical that such a case can be made, and the recent revelations that allegedly ‘local’ news anchors must read scripts delivered from Sinclair corporate headquarters have only deepened our skepticism,” ACA President and CEO Matthew M. Polka said.
ACA set forth its views in reply comments filed Wednesday with the Federal Communications Commission in connection with potential changes to the agency’s national ownership rule, which bans a TV station group from reaching more than 39% of TV households nationally. ACA focused in particular on the so-called “UHF discount,” which allows stations of this type to reduce by 50% the number of households their signals reach when calculating their total audience reach. The FCC created the UHF discount when analog UHF signals were weaker than analog VHF signals,
ACA’s newest comments pointed out that the National Association of Broadcasters (NAB) now wants to expand the UHF discount, based on a new rationale having nothing to do with signal propagation strength. NAB argues that because broadcast ratings have decreased in recent years, stations now “reach” a smaller audience than they did before — so all stations (UHF and VHF alike) should now receive a UHF discount.
ACA stressed that the FCC has no discretion to change the existing UHF discount from one based on signal propagation to one based on ratings. ACA added that if the FCC could lawfully adopt ratings-based discounts of some kind, it cannot rationally provide all stations with the same discount. Ratings have nothing to do with a station’s “reach,” at least as the FCC has always understood that term, and the FCC cannot now change that understanding, which, since at least 2004, has been Congress’ understanding too.
The FCC, ACA asserted, must justify this new ‘Everybody Discount’ in the same way that it must justify raising or eliminating the national 39% cap itself. If the FCC lacks authority to raise the ownership cap directly, it also lacks authority to circumvent the cap through creative changes to the UHF discount.
About the American Cable Association: Based in Pittsburgh, the American Cable Association is a trade organization representing nearly 800 smaller and medium-sized, independent cable companies who provide broadband services for nearly 7 million cable subscribers primarily located in rural and smaller suburban markets across America. Through active participation in the regulatory and legislative process in Washington, D.C., ACA’s members work together to advance the interests of their customers and ensure the future competitiveness and viability of their business. For more information, visit http://www.americancable.org/