Are You Kidding???

Broadcasters Claim Record TV Blackouts and Exploding Consumer Prices Show the System is “Working”

“The 12 million Americans who got blacked out and browbeaten by broadcasters for more money don’t think it’s working,” said Duffy. 

Washington, D.C. – The National Association of Broadcasters (NAB) said in comments filed to the Federal Communications Commission (FCC) that “the retransmission consent market has finally begun to work.”  Since 2010, fees charged by broadcasters have increased by 22,400 percent.  The American Television Alliance (ATVA) pointed out recently that just this year, 1 out of 8 pay-TV providers has been affected by a broadcaster blackout.

The following statement can be attributed to Trent Duffy, ATVA National Spokesman:

“Once again, the NAB is trying to change the subject and distract policymakers and consumers in order to protect their monopolies. The fact is that there are at least 3 MVPDs in every market – and in many instances four providers – unlike the broadcast affiliates which operate as monopolies and hide behind government protections.

The 12 million Americans who got blacked out and browbeaten by broadcasters for more money don’t think it’s working.  It’s no surprise that broadcasters think the current system is working when fees have skyrocketed 22,400 percent in 10 years.  The current system is only working for broadcast executives who are lining their pockets with more cash while consumers are hit with higher costs and more blackouts. Congress asked the FCC to take a look at this issue for a reason: it’s broken.”

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The American Television Alliance (ATVA) brings together an unprecedented coalition of consumer groups, cable, satellite, telephone companies, and independent programmers to raise awareness about the risk TV viewers face as broadcasters increasingly threaten service disruptions that would deny viewers access to the programs they and their families enjoy.

For more information about ATVA, visit our website.  Follow us on Twitter @ATVAlliance.

 

 

 

Mediacom to FCC: Get Off the Sidelines

American Television Alliance Comments on Mediacom FCC Petition on Broken Retrans

Washington, D.C. – The American Television Alliance (ATVA) today reacted to a July 7 letter and petition from Mediacom Chairman and CEO Rocco B. Commisso to FCC Chairman Thomas Wheeler urging the FCC to protect consumers from broadcaster blackouts. Mediacom, a founding member of ATVA, is the eighth largest cable operator in the U.S. serving 1.3 million customers.

The following statement can be attributed to ATVA spokesman Trent Duffy:

“The retransmission consent system is broken and American consumers are paying the price. Mediacom’s letter and FCC petition make a very strong case for the FCC to act to prevent consumers from being harmed by the broadcast industry’s brass-knuckle tactics.

For years, the broadcast industry has tried to have it both ways – reaping enormous benefits from government handouts and government-protected monopolies while shirking its public interest obligation to serve everyone over the air. The Mediacom petition calls the broadcasters bluff, preventing consumer blackouts unless a broadcast signal is available to 90 percent of homes in the market it serves.

ATVA applauds Mediacom’s petition and urges the FCC to give it serious consideration. The FCC must ensure that broadcasters are meeting their public service obligations 100 percent of the time and truly serving their communities.”

The Facts on Retransmission Consent and TV Blackouts

Since 2010, millions of Americans have seen dark screens instead of their favorite channels due to at least 436 broadcaster blackouts. With 48 blackouts this year, 2015 is on pace to break blackout records. The menace of TV blackouts continues to grow:

  • 107 blackouts in 2014
  • 127 blackouts in 2013
  • 91 blackouts in 2012
  • 51 blackouts in 2011
  • 12 blackouts in 2010

When blackouts finally end, consumers get their programming back, but at a higher cost:

  • Retransmission consent fees have grown 8,600% between 2005 and 2012.
  • SNL Kagan projects retrans revenue of $6.3 billion in 2015, $7.2 billion in 2016, and $10.3 billion by 2021.
  • SNL Kagan projects that over time 50% of affiliates’ retrans payments will go to the networks rather than pay for local programming.
  • According to TVNewsCheck, broadcasters could increase TV fees by 500% in the near future.

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The American Television Alliance (ATVA) brings together an unprecedented coalition of consumer groups, cable, satellite, telephone companies, and independent programmers to raise awareness about the risk viewers face as broadcasters increasingly threaten service disruptions that would deny viewers access to the programs they and their families enjoy.

For more information about ATVA, visit our website. Follow us on Twitter @ATVAlliance.

 

WILL THE BROADCASTERS CONTINUE THEIR “FAIR VALUE” HYPOCRISY?

Yet again, the big broadcasters – ABC, CBS, NBC and FOX – have been shown to be hypocrites when it comes to paying “fair value” for content. Despite regularly lambasting pay-TV providers for supposedly inadequate compensation when retransmitting supposedly free television, broadcasters sing a different tune when it comes to paying for content they use.

Every year the broadcasters demand billions in retransmission consent fees from cable and satellite providers. In fact, total retrans fees are projected to hit $9.3 billion in 2020, up from less than $2 billion only a few years ago. However, the same broadcasters refuse to pay “fair value” to musicians whose music is played on broadcast radio stations. CBS CEO Les Moonves summed up the industry’s stance: “The idea that we have to pay them to put their music on our radio stations is absurd.”

Mr. Moonves may find “fair value” absurd, but the real absurdity is the continued fleecing of American consumers by big broadcasters.

Today, Rep. Marsha Blackburn (R-TN) and Rep. Anna Eshoo (D-CA) reintroduced the “Protecting the Rights of Musicians Act,” which was brought to a standstill by broadcaster lobbyists last year. The Act will deny the right to grant retransmission consent to a television broadcast station if the owner of that station also owns an FM or AM radio station that is not compensating musicians for their work.

Congressional Democrats and Republicans have shown a willingness in recent weeks to work together to pass meaningful legislation. The “Protecting the Rights of Musicians Act” is another opportunity for bipartisan success. Let’s see if the broadcasters stand in the way or keep singing from their hymnbook of hypocrisy.

Ten Pressing Questions for Broadcasters

As broadcasters live it up in Las Vegas this week at the annual National Association of Broadcasters Show, here are ten questions about retransmission consent rules that they just don’t want to answer:

 
1.     With more than 230 blackouts since the beginning of 2013, how can broadcasters say the market isn’t broken?

2.     Wouldn’t consumers benefit if broadcasters were prohibited from blacking out must-see live sporting events during retransmission consent contract negotiations?

3.     Broadcasters will take in $9.3 billion in retransmission consent fees for broadcast channels by 2020, according to SNL Kagan projections. That’s almost double the estimated $4.9 billion they received in 2014. Why is such a huge increase justified?

4.     According to SNL Kagan, broadcasters are expected to pay the Big 4 Networks $1.53 billion in reverse retransmission consent in 2015. This figure is expected to reach $3.22 billion five years from now. How is funneling billions of dollars for Hollywood and New York produced entertainment and sports programming consistent with the congressionally intended purpose of retransmission consent: to support creation of local news and community programming content?

5.     How can outdated retransmission consent regulations be justified when — despite the dramatic increase in fees paid to broadcasters — local stations are scaling back their investment in local news, consolidating news gathering efforts and cutting newsroom staff?

6.   Given that there is only a 7% chance that a “local” television station is locally owned and that according to an FCC study 32% of local TV stations “did not air a single minute of news programming” why shouldn’t broadcast channels be treated like every other channel? Why do they deserve the regulatory advantages of must-buy and retrans that aren’t afforded other channel owners?

7.      Why are consumers forced to pay for the same broadcast channels that are offered free over the air?

8.     Why is CBS willing to make its local broadcast stations available online to broadband subscribers on an a la carte basis, but opposed along with other broadcasters to making it available to pay TV subscribers in same manner?

9.     Customers of online services are able to decide whether they want to pay for broadcast networks. Why do broadcasters oppose bipartisan proposals for “local choice” reform that would give pay-TV customers the same choice?

10.  Why is it acceptable for broadcasters to block their online services during retransmission consent disputes?  Isn’t the FCC opposed to the blocking of online content?

CBS Only Offers Choice When It Costs More for Consumers

Just two months ago, CBS tried to prevent Americans from learning about “local choice” by rejecting ATVA’s radio ads. “local choice” is a proposed law that would remove the regulations requiring pay-TV customers to subscribe to all broadcast networks as a condition of receiving pay-TV service.  Now, CBS is ready to offer online—but not pay-TV customers—a similar choice for their programming.

On October 16, CBS announced plans for its own live streaming service called “CBS All Access” The service gives consumers the choice to subscribe to CBS online without having to subscribe to other broadcast networks. This offer amounts to the same choice  Senator Rockefeller and  Senator Thune proposed for pay-TV customers through “local choice,” which CBS and its broadcast partners fought to prevent.

Local choice allows pay-TV companies to simply collect the money for broadcast networks in full from consumers and pass it through to the broadcasters without any mark-ups. And although CBS was vehemently opposed to this system for pay-TV customers, it is the same system CBS All Access would utilize by charging Internet customers directly, instead of going through Hulu+, as many networks currently do.

So why the sudden change of tune? Don’t let CBS fool you—CBS All Access is less about giving consumers choice, and more about finding another way to charge for something they falsely claim is free.

For more than two decades, with the backing of government regulation, CBS and the broadcasters have been charging Americans retransmission consent fees for content that is freeover-the-air. In the last eight years, broadcasters have raised retrans rates for these “free” stations at 119 times the rate of inflation. By 2020, broadcasters will take $9.3 billion from consumers in retransmission consent fees.

As those fees have risen, so has discontent with the retransmission consent system—for viewers, consumer groups, civil rights groups and congressional leaders. Last month that discontent reached a tipping point for Congress, resulting in the introduction of the Satellite Television Access and Viewer Rights Act (STAVRA). The reforms proposed in STAVRA are the first step in beginning to curb skyrocketing retrains fees and programming blackouts by prohibiting joint retransmission consent negotiations, asking the FCC to reexamine its good faith negotiation rules and instructing the FCC to report retrans data as part of cable pricing reports.

However, as Les Moonves has made clear time and time again, broadcasters will continue to look for ways to raise retransmission consent fees as long as they have the security of government regulations that will force consumers to pay for it

To continue to bring our video rules into the 21st Century, Congress and the FCC need to ensure that ALL customers, including pay-TV customers, are not forced by regulation to subscribe to all broadcast networks as condition of receiving a service. If networks like CBS believe that consumers value their program enough to purchase online subscriptions, then they should allow pay-TV consumers to make the same vote of confidence with their purchases.

Even if STAVRA becomes law, broadcasters like CBS will continue to find ways to unfairly line their pockets. But let’s at least unshackle viewers from outdated rules and allow them to make their own choices on whether broadcast content is worth the heavy price.

Sens. Fischer, Blumenthal Ask CBS to Explain Blocking of ATVA Ads

In response to CBS’s blocking of ATVA’s advertisements on its radio stations, Sens. Deb Fischer (R-NE) and Richard Blumenthal (D-CT) sent a letter to CBS CEO Les Moonves today asking for further explanation of CBS’s actions. You can read the letter here.

We cannot thank Sens. Fischer and Blumenthal enough for their efforts to investigate this matter further. CBS has the right to disagree with us on the issue of retransmission consent, but by blocking our advertisements, they are stifling the debate and doing a tremendous disservice to the public.

Americans deserve video rules written in the 21st Century, and broadcasters will apparently stop at nothing to prevent that from happening.

Broadcasters Defend “Local” News by Running Same Story Nationwide

A Fox affiliate station in Baltimore, owned by the Sinclair Broadcast Group, released a news story on “retransmission consent.” It’s part of a campaign including ads falsely claiming “free TV” is in jeopardy. The story was a one-sided defense of the retransmission consent using numerous quotes from the National Association of Broadcasters and one from the American Television Alliance. It’s unsurprising broadcasters would pass self-serving content as “news.” They’re desperate to save the billions they charge for the “free” TV they claim to defend.

Here’s what’s even more telling: the broadcasters defended the importance of “local” news by running the same story nationwide. Indeed, the report being run on Sinclair stations illustrates how local TV news is far from local.

Sinclair is the largest TV group in the country. It owns and operates over 160 stations that reach 40% of American households. Sinclair gobbles up local TV stations and slashes jobs. The average number of employees at Sinclair stations has declined 20% since 2001. Last year Sinclair bought stations in Seattle and Portland, then fired 30 workers. (Yesterday, the FCC approved Sinclair’s purchase of eight more stations from Allbritton for nearly $1 billion…Sinclair’s march toward owning every local TV station in America continues.)

Sinclair also consolidates newsrooms in cities where it owns more than one station. Look at their list of news departments. In nearly all Sinclair’s markets with multiple outlets, the same news director manages the news operations of both.

Sinclair is not alone. All major TV groups scoop up local stations in pursuit of retransmission consent dollars. This has killed ownership and perspective diversity. Today, one out of two TV stations shows local news. A quarter of the stations that do get it from somewhere else.

With its attack on pay-TV, Sinclair illustrates the problem. Local news doesn’t focus on local issues. Why didn’t these stations run their own stories? Why repeat the same piece over and over?

Some stations couldn’t even repeat it correctly. This version on UpNorthLive.com, the website for the ABC/NBC duopoly in Traverse City, Michigan, attributed a quote from NAB to ATVA and vice versa. With duopolies, you get twice the errors!

Some stations eliminated ATVA’s quotes from the print version altogether, such as WHAM, the Rochester ABC affiliate, and WPDE, the Fox affiliate in Myrtle Beach, S.C. There’s not even an illusion of objectivity.

The absurdity is all too real. In the same breath, broadcasters claim they deserve to be paid for TV they also claim is “free.” They say this pays for local news, even though they’re running the same story nationwide. It’s time to eliminate retransmission consent, and give viewers the content they deserve.

Citizens Against Government Waste Calls on Senate to Include Retrans Reforms within STELA

The Council for Citizens Against Government Waste has written a letter to Senate Judiciary Chairman Patrick Leahy and Ranking Member Charles Grassley asking that retransmission consent reform be included during the markup of the Satellite Television Extension and Localism Act (STELA). “These changes to the legislation would reflect the current, competitive marketplace, which includes satellite TV, and are therefore appropriate to be included in any reauthorization of STELA,” wrote the group’s president, Thomas Schatz. He added: “Government rules and regulations should drive businesses into the twenty-first century, not hold them back. In retransmission consent negotiations, consumers lose viewing time and pay increased costs.”

The group is among several other consumer groups and think tanks from both sides of the spectrum calling for retransmission consent reform. You can read the letter here.

BROADCASTERS TRY TO DISTRACT FROM OVERWHELMING CONSERVATIVE SUPPORT FOR RETRANS REFORM

CIVIL RIGHTS LEADERS, GROUPS SPEAK UP

Upset about High Cable Bills? Blame TV Broadcasters

TV broadcasters are touting an FCC report showing cable bills are rising, hoping nobody notices they’re the reason.

The four major broadcast networks own much of the national television programming, which includes local TV stations and the most expensive cable networks. In fact, half of the top 50 most expensive cable channels are owned by the Big Four broadcast networks.

The average consumer will pay $37.30 for the top 50, and nearly half — $18.60 – will go to the Big Four. And that’s only for the broadcasters-owned cable networks.

Cable customers are also required by the government to pay for local TV stations that are “free” over-the-air. In the last eight years, broadcasters have raised retrans rates for these “free” stations at 119 times the rate of inflation. Over the next five years, they will take in nearly $25 billion for these stations.

It’s troubling that government requires carriage of anything in a free market. And it’s problematic that broadcasters aren’t prohibited from “tying” expensive cable networks to the local TV stations that cable companies must buy.

This combination of government-mandated local TV stations and tying to cable networks is driving up rates. It will continue until Congress updates our video rules.

Here’s how retransmission consent works:

1) The national networks spend more money on programming, primarily sports.

2) Local TV stations, usually owned by large TV groups, demand higher retransmission consent rates from pay-TV operators to foot the bill, known as “reverse retransmission consent.” Retrans revenues are supposed to be used on local content and public affairs rather than network programming.

3) Pay-TV companies have no choice but to pay these exorbitant increases, or risk a blackout that angers customers.

4) Broadcasters tout mammoth retrans revenue increases in their earnings reports, boosting their stock price. This finances the acquisition of more local TV stations, diminishing truly local content.

TV broadcasters are never held responsible for raising rates on their local TV stations or cable channels.

Consumers don’t blame the local gas station when oil prices drive up gasoline. They shouldn’t blame the local cable company when the fault lies with the companies who control programming.

If you’re frustrated by high prices of cable, simply contact Congress here and ask them to fix “retransmission consent.” Tell them consumers deserve TV laws that don’t lead to blackouts and high prices.

NAB’s Mixed Messages on STELA

Which of these positions best reflects the National Association of Broadcasters’ position on the Satellite Television Extension and Localism Act (STELA)?

a)      Sunset STELA!

b)      Pass a clean STELA!

c)       We support the House-passed version!

d)      All of the above

The truth is that the NAB and its members are currently advocating for all of the above positions.

Sometimes, the NAB takes two of these positions at once.

In his April 1 testimony before the Senate Subcommittee on Communications, Technology and the Internet, NAB Gordon Smith stated: “STELA and its predecessors have achieved their intended goal of fostering satellite competition to cable monopolies and NAB feels STELA should be allowed to sunset, as Congress originally intended. However, if this Committee determines that STELA should be reauthorized for another term, we support a clean bill free of controversial and unrelated provisions harmful to America’s broadcasters.”

But broadcasters aren’t simply claiming they want STELA to sunset and that STELA should be clean. They’re also supporting the House-passed version of STELA.

Following the March 25 markup by the House Subcommittee on Communications and Technology, the NAB issued the following statement: “From the outset, NAB has supported passage of a STELA bill that remains free of amendments that are designed to benefit behemoth pay TV companies at the expense of local broadcasters and our tens of millions of viewers. We believe the bill passed today strikes that balance.”

To be clear, the House bill is anything but “clean.” (Nor should it be, given the immediate need for updates to our antiquated video laws.)

So broadcasters are currently supporting three very different positions on STELA. It’s easy to claim you’re winning when you have three positions!