Broadcast and Cable Programming Negotiations Differ Significantly Due to the “Regulatory Thumb” For Broadcasters


Cable Programmers

Allocation of Facilities (Free Spectrum “if public convenience, interest or necessity will be served”) The Communications Act directs the Commission to grant broadcast licenses “if the public convenience, interest or necessity will be served” and to distribute broadcast licenses among local communities.  Broadcasters enjoy “free spectrum” in exchange for serving the public interest. (47 U.S.C. 307)

General Carriage of Broadcast Signals

Under the cable must carry rules, cable operators must carry the entire program schedule of broadcast television stations unless a station has elected retransmission consent during a particular election cycle.  Every three years broadcast stations elect (and notify MVPDs) whether they choose mandatory carriage under cable must carry (or carry one/carry all in the case of DBS) or retransmission consent.  Elections are required by October 1 prior to the beginning of a new cycle, and elections are for a three-year period.  Many large MSO and broadcast groups negotiate retransmission agreements off-cycle, but the election requirements still apply.  Note that DBS carry one/carry all and must carry differ significantly.  While cable operators must carry broadcast stations wherever they operate, DBS may choose not to provide local channels in a given DMA.  However, if they decide to offer one local station, they must offer all stations in the market. (47 U.S.C. §§ 325, 338-40, 534-35, 543, 548)

  • 47 C.F.R. § 76.55-62 Cable Must Carry
  • 47 C.F.R. § 76.64 Cable Retransmission Consent
  • 47 C.F.R. 76.66 DBS Signal Carriage

Good Faith Negotiations MVPDs and local broadcasters must negotiate retransmission consent agreements in good faith.  FCC rules outline a number of per se violations of good faith and allow for a totality of circumstances violation. (47 U.S.C. § 325(b)(3)(C))

Signal Quality Requirements (Nondegradation) cable operators prohibited from materially degrading broadcast television stations.  Per the Act, the FCC has adopted carriage standards ensuring that broadcast television stations and cable programming channels do not vary in technical quality. (47 U.S.C. § 534(b)(3)(B)(4))

Channel Placement Requirements a broadcast station must be carried on a cable system on the station’s current over-the-air channel number in most circumstances unless the cable operator and the broadcaster mutually agree on a substitute. (47 U.S.C. § 534(b)(3)(B)(6))

Remedies (Regulatory Complaint Process for Broadcast Stations)

If a broadcast station believes that a cable operator has failed to meet any of these carriage obligations, the Act provides a regulatory complaint process for the station and established remedies if there has been a violation. (47 U.S.C. § 534(d))

Must Buy The “must buy” provision of the Communications Act requires all broadcast signals to be carried on the basic, most widely distributed tier of cable service. (47 U.S.C. § 543(b)(7))

Territorial Exclusivity Rules

The territorial exclusivity rules are not a part of the Communications Act, but were adopted by the FCC.  The cable network non-duplication rule prohibits cable operators from carrying the same network in a local DMA unless another station meets the “significantly viewed” requirements.  Broadcasters must notify a cable operator within 60 days of entering into an agreement providing the station with network exclusivity rights.  The cable syndicated exclusivity rules offer stations local market protection of syndicated programming (except in “significantly viewed” circumstances).  There are also network non duplication and syndicated exclusivity rules that apply to DBS. (47 C.F.R. § 73.658)

  • 47 C.F.R. § 76.92-95 Cable Network Nonduplication Rule
  • 47 C.F.R. § 76.122 Satellite Network Nonduplication Rule
  • 47 C.F.R. § 101-110 Cable Syndicated Exclusivity
  • 47 C.F.R. § 123-125 Satellite Syndicated Exclusivity
Regulation of Carriage Agreements (Program Carriage) The Communications Act instructs the FCC to adopt regulations prohibiting all multi-channel programming distributors from requiring “a financial interest in any program service as a condition for carriage” of such service, from coercing a programmer to grant “exclusive” carriage rights, or from engaging in conduct that unreasonably restrains “the ability of an unaffiliated programming vendor to compete fairly” by discriminating against such vendor “on the basis of affiliation or nonaffiliation.” (47 U.S.C. § 536)
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