Cable firms seek FCC help in fee disputes

By Cecilia Kang
Washington Post Staff Writer
Wednesday, March 10, 2010

Several major cable companies and a public interest group asked the Federal Communications Commission on Tuesday to intervene in disputes over transmission fees to prevent broadcasters from withholding signals from subscribers.

In a petition filed with the FCC, Time Warner Cable, Verizon Communications, Cablevision and advocacy group Public Knowledge said that regulations governing transmissions from broadcasters to subscription-television providers are outdated and warned that last weekend's standoff between Cablevision and Walt Disney Co. will be repeated unless the FCC issues new rules. They also called on regulators to assign an arbitrator during stalled negotiations and to require broadcasters to maintain their signals if talks break down.

The FCC declined to comment on the petition. Other signers included Dish Network, Charter Communications, DirectTV and Bright House Networks.

The petition comes in the wake of a showdown between Cablevision and Disney that left roughly 3 million Cablevision subscribers in the New York area without access to their ABC station. Many subscribers missed the first 20 minutes of the Academy Awards broadcast by Disney-owned ABC.

Disney and Cablevision were criticized by lawmakers and FCC Chairman Julius Genachowski for involving consumers in their impasse. Cablevision had said it would not agree to a demand for an additional $40 million a year for the rights to air shows such as "Lost," "Good Morning America" and "Dancing With the Stars."

"There are a number of deals coming this year and you are going to see more of this, which is not good in any way for consumers," said Gail MacKinnon, chief government affairs officer for Time Warner Cable. The company had a bitter battle over retransmission fees with News Corp. late last year, resulting in last-minute negotiations on New Year's Eve to continue carrying Fox channels. Time Warner Cable plans to renegotiate the fees with Disney in August.

Broadcasters are struggling with falling viewership and advertising revenue as more consumers get television entertainment from cable, satellite and telecom service providers. Disney and other broadcasters say that they should be better compensated for their content and that lawmakers and regulators shouldn't get involved in cable company negotiations.

"The unintended consequences of pay-TV providers attacking the free-market-based retransmission consent model could be the demise of local programming," said Dennis Wharton, executive vice president of the National Association of Broadcasters. "To see billion-dollar pay-TV companies asking for government intervention to protect their exorbitant profits is just plain wrong."

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