DISH Calls for Retransmission Reform as Raycom Treats Viewers as Negotiation Pawns

[Scott Greczkowski]

DISH Calls for Retransmission Reform as Raycom Treats Viewers as Negotiation Pawns

ENGLEWOOD, Colo.--(BUSINESS WIRE [3])--In its eighth day of an ongoing blackout by Raycom Media, and amidst the backdrop of a retransmission blackout by CBS on Time Warner Cable for the past week, DISH (NASDAQ: DISH) is calling for Congress to update the outdated local TV carriage rules and protect consumers.

“Since the beginning of the year, Raycom has told its viewers to switch providers no fewer than three times, including twice suggesting DISH as a great choice for consumers, as they play TV providers off of each other using viewers as pawns,” said Dave Shull, DISH executive vice president and chief commercial officer. “Raycom is the poster child of broadcaster manipulation, exploiting outdated retransmission rules to squeeze money from providers, and therefore viewers.”

In January, Raycom was involved in a retransmission blackout with Cox Cable and suggested to its viewers to switch to another provider, including DISH and its competitors. In July, a retransmission dispute with Mediacom led Raycom to again ask viewers to switch. Now, as Raycom speaks to DISH customers, the broadcaster is telling viewers to switch again, including back to Cox Cable.

“The impact of these tactics on consumers should be the focus of retransmission reform in Washington,” said R. Stanton Dodge, DISH executive vice president and general counsel. “The outdated carriage rules have resulted in an historic number of blackouts with millions of subscribers impacted. It is time for reform.”

DISH has introduced a plan to Congress, backed by Time Warner Cable and other video distributors that would protect consumers and reduce the number of blackouts.

“We are asking that pay-TV providers be allowed to temporarily import network content from another market if there are blackouts during retransmission negotiations,” explained Dodge. “This is not a perfect solution, but one that keeps the consumer’s interests at the forefront and prevents disrupting their lives. It partially levels the playing field. We aren’t asking for an advantage, just fair rules. Right now, programmers hold all of the power and they aren’t using it for the public interest, they are using it strictly for profit and to the detriment of the American consumer.”

According to data from SNL Kagen, a leading industry research firm, broadcast retransmission fees rose a estimated 372 percent from 2008 to 2012, and are anticipated to rise more than 1,100 percent by 2018, from $500 million in 2008 to $6.1 billion.

“As pay-TV providers across the board watch our subscriber base level off, we do not have the profit margins to absorb those costs and are forced to pass them on to consumers,” added Shull. “The people left in the dark are viewers. I think consumers are fed up, and I don’t blame them.”

To read Raycom’s suggestion to viewers to switch providers, see the following links:

January: Raycom asks Cox Cable viewers to switch
http://www.cleveland.com/business/index.ssf/2013/01/cox_raycom_fee_dispute_still_l.html [4]

July: Raycom asks Mediacom viewers to switch
http://www.walb.com/story/22489793/a-message-for-walb-subscribers [5]

August: Raycom asks DISH customers to switch
http://www.19actionnews.com/category/265597/attention-dish-subscribers [6]

 

[dare2be]

I think the best solution to retrans agreement negotiations going past the deadline is to either force the existing contract until an agreement can be reached, or default to must-carry rules.

 

[TNGTony]

Pie in the sky press release.

Calling for reform of retransmission fees is the wrong way to go about it. Being allowed to import networks is never going to happen.
Possible solutions:
--Statutory flat fee for everyone, or
--Eliminate all Retrans fees for providers retransmitting stations within the station's licensed TV market, but providers must have a flat service fee for locals that only covers the cost of retransmission and must have a tier available to all subscribers that includes only local channels regulated by the local PUCO or municipality (Cable cos used to have this restriction in the Telecom Act of 1981-- In Ohio it went away in 2012, the "lifeline tier" jumped from $10 a month to $25 a month that year)
--Statutory "market rate" mandate for local channels that refuse to negotiate within 150% of the current market rate.
--Independent binding arbitration scheduled for the date of contract expiration and extension of current contract until ruling

 

[Tampa8]

Charlie could say "I told you all so." That aside, seeing Time Warner and other video distributors on board with Charlie is something I did not think I would see and gives me hope changes will come. May or may not be exactly what is proposed, but you don't go into it asking for the minimum changes.

 

[Teehar]

It's way beyond time for retransmission reform!Charlie did tell them so years ago,it fell on deaf ears,or should I say lined pockets.I say let all subscribers have a vote in the matter.

 

[nelson61]

I think Senator McCain is pushing the this bill. I watched him talk about it on CSPAN a couple months ago

 

[Teehar]

I think Senator McCain is pushing the this bill. I watched him talk about it on CSPAN a couple months ago

Doesn't look too promising.
http://www.satelliteguys.us/threads...t-Proposed-A-La-Carte-Bill?highlight=la+carte

 

[TNGTony]

What really angers me is people insist on talking "a la cart OR bundles". Why is it no one ever thinks "a la cart AND bundles" You know, like in every other industry on the planet!

 

[gadgtfreek]

Yawn. Quit putting signs in your yards and start working with each other to keep our channels on the air.

 

[sam_gordon]

Pie in the sky press release.

Calling for reform of retransmission fees is the wrong way to go about it. Being allowed to import networks is never going to happen.
Possible solutions:
--Statutory flat fee for everyone, or
--Eliminate all Retrans fees for providers retransmitting stations within the station's licensed TV market, but providers must have a flat service fee for locals that only covers the cost of retransmission and must have a tier available to all subscribers that includes only local channels regulated by the local PUCO or municipality (Cable cos used to have this restriction in the Telecom Act of 1981-- In Ohio it went away in 2012, the "lifeline tier" jumped from $10 a month to $25 a month that year)
--Statutory "market rate" mandate for local channels that refuse to negotiate within 150% of the current market rate.
--Independent binding arbitration scheduled for the date of contract expiration and extension of current contract until ruling

Agree with everything!

 

[CK SatGuy]

What really angers me is people insist on talking "a la cart OR bundles". Why is it no one ever thinks "a la cart AND bundles" You know, like in every other industry on the planet!

THANK YOU!!!!! I agree because everyone's needs are different. Some people only want sports, some only want family channels while others have big families and probably NEED a bundle. That's why a TV provider should offer the most options as possible.

 

[ttomni6]

THANK YOU!!!!! I agree because everyone's needs are different. Some people only want sports, some only want family channels while others have big families and probably NEED a bundle. That's why a TV provider should offer the most options as possible.

First of all, I think the FCC needs to change policy so a company can own only 1 TV station in a market. This will prevent a situation like here in Hawaii where we lost 3 stations due to the Raycom dispute. Although Hurricane Henriette appears to continue on a southern trajectory at this time, losing two major news stations in a worse case scenario is a disservice. (And aren't the airwaves supposed to belong to the public?)

Second - as far as bundling vs ala carte, I consider this a microcosm of society in general. I accept paying for things I don't utilize because society exists for the good of all.

As an example, let's say you have kids. I don't. You get tax breaks because you have kids. I pay taxes to put your kids through school and pay for extra public services that your kids use above and beyond what my two person household uses .

Bringing it back to programming - yeah, I pay for things I don't usually watch. But I have also found some very interesting programming on those "other" channels that I or my wife do not usually watch and I'm glad we have access.

 

[KAB]

First of all, I think the FCC needs to change policy so a company can own only 1 TV station in a market. This will prevent a situation like here in Hawaii where we lost 3 stations due to the Raycom dispute. Although Hurricane Henriette appears to continue on a southern trajectory at this time, losing two major news stations in a worse case scenario is a disservice. (And aren't the airwaves supposed to belong to the public?)

Second - as far as bundling vs ala carte, I consider this a microcosm of society in general. I accept paying for things I don't utilize because society exists for the good of all.

As an example, let's say you have kids. I don't. You get tax breaks because you have kids. I pay taxes to put your kids through school and pay for extra public services that your kids use above and beyond what my two person household uses .

Bringing it back to programming - yeah, I pay for things I don't usually watch. But I have also found some very interesting programming on those "other" channels that I or my wife do not usually watch and I'm glad we have access.

Agree with MOST of above, Unfortunately, our current FCC is not going to lift a finger to change anything.

 

[whatchel1]

It's time that there was a set fee for each broadcast network feed. That every station no matter where in the USA gets the same fee that all other stations get. No more contract disputes. That should be taken completely out of both the broadcast station and the MVProvider. They all pay the same no matter where. I afraid though that the FCC doesn't have the nads to make that ruling.

 

[HDRoberts]

What really angers me is people insist on talking "a la cart OR bundles". Why is it no one ever thinks "a la cart AND bundles" You know, like in every other industry on the planet!

Indeed. They could make the a la carte prices outrageous if they wanted. For me, they could make the price $10/month per channel and I STILL would save money. (Heck, even if I didn't save, I'd be comforted knowing my money was supporting the programming I like, and not athlete salaries and bad reality shows.) But that does not mean that many could not be served by bundles.

The contract is simple. "Comedy Central shall be $0.35/month/subscriber when offered with MTV, MTV2, VH1, CMT, Nickelodeon, Nicktoons, Nick Jr, TV Land, and Spike, and as part of a package that includes major channels from Disney, NBC Universal, Turner, Fox, and Discovery Communications. If offered independently, Comedy Central shall be $4/month/subscriber."

In that hypothetical, they make the MORE money. But I'd save money as I would not be obligated to buy anything from Disney, NBCU, Fox, or Turner.

But on the subject of LiL retrans, a solutions needs to be found. How about this: if a channel chooses retransmission consent, and an agreement cannot be reached, providers should be permitted to import a channel from another DMA.

 

[yelraek]

I think the best solution to retrans agreement negotiations going past the deadline is to either force the existing contract until an agreement can be reached, or default to must-carry rules.

I would like to see Congress make the must-carry rule mandatory. Then there would be no more argueing over fees.

 

[TNGTony]

I have to point out that the FCC does not make law. The FCC creates regulations to enforce laws passed by Congress and signed into law by the President. At this moment, the FCC does not have the statutory authority to do most of the stuff being discussed here. The Telecom act of 1996 is the law that the FCC has to use for its framework in rule-making.

 

[Derwin0]

The satellite/cable companies should just give a big FU to the stations, setup an antenna near the towers, and "rent" a piece of that antenna to the customers, and thus pay no retrans fees to the stations.

 

[tomcrown1]

I have to point out that the FCC does not make law. The FCC creates regulations to enforce laws passed by Congress and signed into law by the President. At this moment, the FCC does not have the statutory authority to do most of the stuff being discussed here. The Telecom act of 1996 is the law that the FCC has to use for its framework in rule-making.

That is so true. It was congress that created this mess with the help of bribe money er political contribution from the members of NAB.

When dish pushed for this legislation they just wanted the same rights as cable company's.

It was the NAB lobbyist that got the retransmission fee into the bill.


Sent from my iPhone using Tapatalk

 

[MikeD-C05]

The satellite/cable companies should just give a big FU to the stations, setup an antenna near the towers, and "rent" a piece of that antenna to the customers, and thus pay no retrans fees to the stations.

IF DISH was smart they would of done that from the start or done just antenna installs at each home. Or make the antenna install part of the Satellite dish install. Provide the guide information that they pay for anyway to Tribune via software an you would have your local channels and no disputes with the local channels. The only problems would be in areas that have no access to the towers. But if DISH hadn't of broken the law and sold distants to everyone , they could of just sold them to people that couldn't use the antenna. Just imagine how much better the satellite channels would of looked in picture quality if they didn't have to have all those local channels up on the satellite? OF course the hopper Ptat feature wouldn't work like it is today,but you wouldn't of had to have all these disputes over local channels.