The FCC under chairman Julius Genachowski has made a point of advertising the limits of its authority in retrans negotiations. Like an arbiter at a midnight negotiation, Genachowski urges resolution and points to consumer impact—an argument he reiterated last week in reference to the Hearst/Time Warner Cable dispute.
But a separate dispute, resulting in a $30,000 fine against a cable operator and the subsequent denial of a bad faith petition, demonstrates that the FCC clearly has a hand in spurring resolution and appears to be taking a more active role in establishing ground rules and enforcing existing ones.
The commission has yet to act on any of the suggestions in its open retrans docket after more than a year, and the chairman has talked the talk of staying out of the marketplace. “The commission’s authority under the old laws are limited,” Genachowski told Congress last week. But while the talk is one thing, the walk is suddenly a bit different.
The FCC has regularly monitored discussions and been in contact with parties in high-profi le standoffs. In the Cablevision/ Fox dustup in 2010, for example, the chairman said the FCC was actively working with the parties to get a deal done.
In a notice of apparent liability that preceded the $30,000 fine for a TV station carriage violation against Bailey Cable TV, the FCC said, “On February 3, 2012, following a telephone conference with Commission staff and the parties, Bailey and ComCorp executed an agreement extending the term of their retransmission consent agreement.”
Asked what role the FCC staffers had in producing that deal, Media Bureau representative Janice Wise maintained it was standard monitoring. “To the telephone conference call in the Bailey order and…about retransmission procedures, when the Bureau receives a retransmission complaint, it is standard procedure for us to have a status conference call with the parties.”
While the FCC avers that its role is essentially as cheerleader for successful negotiations and enforcer of requirements that parties negotiate in good faith, the agency does more than shake some pom-poms. Plus, the commission also carries the wild card of an open docket on retrans in which it suggested it might have to suspend exclusivity rules during retrans impasses. Those are the rules that prevent cable operators from striking deals with nearby, out-of-market affiliates. “
That proceeding has always been a sword of Damocles,” said one Washington attorney and retrans negotiations vet. “The body language when they adopted this was, ‘We’re opening this proceeding and we’ll just keep it hanging around.”
And through the Bailey decision and its denial of Allbritton’s bad faith petition regarding its retrans impasse with Shentel, the commission has used the authority it does have to send a signal to the marketplace. In the Allbritton decision, the FCC made it clear that a disagreement over price is not de facto negotiating in bad faith. And in fining Bailey Cable $30,000 for carrying TV station signals without permission after their retrans agreement had expired, the FCC indicated that this is not something it will let slide.
According to the Washington attorney: “For years you could file a complaint saying ‘they’re carrying us,’ and nothing would ever happen. Or you would get a call saying ‘Well, you settled it. You don’t really want us to do anything, do you?’”
The commission seems to be implying that those days are gone.
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