Senate Panel to Probe Broadcast, Cable Programming Feud

Senate Commerce Committee chairman Sen. Jay Rockefeller says he wants to make sure consumers aren't "caught in the crossfire in programming disputes"

The Senate Commerce Committee has scheduled a hearing on the cable TV industry for July 24, and the committee’s chairman lashed out about programming carriage impasses that he says are hammering consumers.

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“In particular, I want to take a close look at how we make sure that consumers do not continue to get caught in the crossfire in programming disputes, facing dark screens and losing access to news, sports, and other entertainment programming,” committee chair Sen. Jay Rockefeller, D-W.Va. (pictured left), said in a statement Monday.

The hearing also will more generally look into what impact the Cable Television and Consumer Protection Act has had on the TV marketplace and consumers since it was adopted 20 years ago. Among the provisions in the act is one that established the retransmission consent rules.

Under the current guidelines, broadcasters have a right to try to negotiate payments with cable operators and satellite TV systems for retransmitting popular broadcast programming.

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A series of disputes over how much cable operators will have to pay for those rights has led to an escalating series of programming blackouts this year.

In one recent example, a negotiating impasse over retransmission consent led to Hearst Corp. pulling its local broadcast TV network affiliates from Time Warner cable systems.

Another ongoing high-profile programming dispute, this one unrelated to retransmission consent, led Viacom to pull its programming — including such channels as Comedy Central, Nickelodeon and MTV — from satellite distributor DirecTV.

Time Warner Cable and other major cable TV companies have been urging Congress to gut retransmission consent rules.

“The retransmission consent system is not working,” a TWC spokesman told TheWrap.

But the regulations have the support of the broadcast industry, which has thus far been able to deflect previous cable TV industry challenges to the rules.

“The reality is Time Warner Cable and Dish Networks are responsible for more than half of the disruptions in service, because they are aggressively encouraging Congress to change a law that has been working as intended,” National Association of Broadcasters spokesman Dennis Wharton told TheWrap.

“There’s a concerted effort by those two companies to manufacture a crisis that would not otherwise exist if they were to negotiate fairly for the most valuable programming on television.”

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TWC spokesman Alex Dudley said in response: “The bottom line is that Hearst is asking our customers through us to pay a 300% increase for the exact same programming that the customers currently have. In today’s economy, a 300% increase is simply way out of line.”

A spokesman for Dish Network said Charlie Ergen, the company's chairman, had addressed the blackout issue in his June 27 testimony before the House Communications and Technology Subcommittee.

“Broadcasters play the pay-TV providers against one another," the spokesman quoted Ergen as saying. "They cut off the most popular sports and entertainment programming if their demands for drastically higher rate increases are not met. Consumers lose because they cannot see the programming they paid for, they end up paying higher rates, or both."

Harold Feld, senior vice president of Public Knowledge, a consumer watchdog group, told TheWrap that the hearing’s aim was not to pass legislation but to warn the industry that legislation might be forthcoming if the disputing parties don’t work out their differences over programming carriage on their own.

“This is a chance for the members (of the Senate Commerce Committee) to wag their fingers and show their constituents back home that they care,” Feld told TheWrap. “If you don’t deal with this, we’re going to have to pass legislation,” is the rest of the message, according to Feld.