[opendtv] Re: Retrans consent and the pretend game
- From: Craig Birkmaier <brewmastercraig@xxxxxxxxxx>
- To: opendtv@xxxxxxxxxxxxx
- Date: Mon, 20 Mar 2017 08:53:02 -0400
On Mar 19, 2017, at 9:45 PM, Manfredi, Albert E <albert.e.manfredi@xxxxxxxxxx>
wrote:
This is the crux of the matter. This document describes the must-carry or
retrans consent choice that stations can elect, and it takes the issue beyond
1992, to other critical decisions made in the subsequent year or two:
https://www.gpo.gov/fdsys/pkg/FR-1994-12-05/html/94-29443.htm
Craig's allusion to "the realities that existed in 1992" only means that
**the FCC was playing just the pretend game I've been describing**. That is,
in 1992, whether and how an MVPD should carry TV network content PRETENDED
that the content belonged to that local station. With exception of public TV
and a few independent stations, this is usually just make-believe, Craig.
Aside from locally-produced news, weather, and local-interest shows, the
network-affiliated station does not produce the high value content of the TV
network. The 1992 Cable Act is only pretending, on this point.
No Bert. The 1992 Cable Act does not care about who owns any content that a
broadcaster distributes. This includes content from an affiliated network,
content licensed from a program syndicator, or content created by the station.
The FCC document you linked to discusses all of the previous rules related to
must carry and how to implement the retransmission consent alternative that
every broadcaster can elect in lieu of must carry.
The copyright questions here are only relevant as they relate to market
exclusivity. If a station is operating in a designated market, they have
exclusive MVPD carriage rights to the content they offer in that market. If
that content has significant market power - i.e. subscribers watch this channel
as evidenced by program ratings - they can elect retransmission consent and
negotiate a carriage fee. If the station does not have significant market power
they can elect must carry.
The relationship between the station and the owners of the content they carry
is not addressed by the 1992 Cable Act. It is negotiated between the content
owners and their affiliates.
Read paragraphs 61-65, in the link. The concept of "superstation" was
introduced. Superstations are "stations" that deliver content by other means,
such as satellite or microwave links, from distant locations outside a market
area, to MVPD systems in a given market. And these superstations ALSO have
the right to demand retrans consent from MVPDs.
Yup. It's called grandfathering. These superstations became networks of their
own, offering licensed and original content. As they still operate a local
station they are allowed to use retransmission consent.
This has NO RELEVANCE to HOW retransmission consent has been used by the owners
of the broadcast networks (and one mostly non broadcast conglom) to take
control of the content offered in the MVPD bundles. You won't find much useful
info about this at the FCC, as it is not within their purview to regulate the
content on MVPD systems.
The FCC has dealt with two major issues related to this:
1. Giving the DBS systems the right to license MVPD content under the same
terms and conditions as "wired" MVPDs;
2. Holding hearing about the tactics used by the broadcast networks and their
local affiliates to withhold content (pull their signals) to force MVPDs to
increase the retransmission consent fees and subscriber fees for the bundles of
channels each conglom licenses to individual MVPDs.
The FCC is now considering extending the program access rules to virtual MVPDs,
and it has never acted to limit the "greenmail" tactics used by the congloms
under retransmission consent to advantage their non-broadcast networks.
My contention, in spite of the pretend game, is that the FCC already allows
TV networks that want to, to operate as "superstations." The TV network can
demand compensation for content carried by local MVPDs, without using the
local broadcaster in the pretend game. Oh yeah, just as the TV networks do
with OTT sites!
Huh?
You have identified one carve out to protect a few legacy superstations with
every other TV station n the country. IRRELEVANT.
In EVERY case, the content qualifies for retransmission consent BECAUSE the
content is being delivered by a broadcast station is the market of license for
the station.
What you do not understand, or want to admit, is that the broadcast networks
DID NOT want to lose the advantages afforded to broadcasters on MVPD systems:
1. Guaranteed carriage (must carry) or retrans consent payments for their
signals;
2. Preferred placement on the low numbered channels on MVPD systems;
3. Inclusion in the low cost "lifeline bundles" that wired MVPDs must offer.
4. The guarantee of access to a large percentage of the capacity of every wired
MVPD system.
This is from the FCC web page on broadcast station carriage on MVPD systems (a
far more useful resource than the link you posted):
https://www.fcc.gov/media/cable-carriage-broadcast-stations
Q: Why must my cable system carry so many broadcast stations?
A: The Communications Act requires cable operators to set aside a specified
portion of their channels for local commercial and non-commercial television
stations. A cable operator with 12 or fewer channels must set aside up to
three channels for local commercial television stations and at least one
channel for a local noncommercial educational television broadcast station.
Cable operators with more than 12 channels must set aside one third of their
channel capacity for local commercial stations. Cable systems with between 13
and 36 channels must carry at least one, but need not carry more than three,
local noncommercial educational television stations. Cable systems with more
than 36 channels must carry all local noncommercial educational television
stations requesting carriage with some exceptions for duplication of signals.
Local television stations choosing the must-carry option and those that have
negotiated agreements for retransmission with the cable system count towards
this quota.
So nobody is forcing the congloms to keep creating and distributing their
content via their O&O and affiliated stations. They are USING THESE STATIONS to
advantage their NON-broadcast MVPD networks by using retransmission consent to
maximize the value of the bundles of networks they license to the MVPDs.
And this is the KEY POINT.
They used retrans consent initially to gain carriage of new non-broadcast
networks with preferred placement in the MVPD bundles. Then they kept creating
new rerun channels to fill up the increased capacity of these systems so that
the MVPDs could keep raising their rates.
With retransmission consent in hand, the broadcast industry had the
tool it needed to ....
No, Craig. With retrans consent, the content owner has the right to demand
compensation from MVPDs, who rake in revenues kept doing this byin part
because they carry this high value content. You consistently fall into this
trap. It makes NO DIFFERENCE whether the content may also be available FOTA.
The simple fact is, the MVPD subscribers scream bloody murder when this
content is not on the umbilical. And the umbilical charges monthly fees. The
high value content owners can request whatever they please, until the MVPD
subscribers' screaming stops. This is basic to microeconomics. End of story.
Thank you for making my case. You just described how monopolists use their
market power to advantage other assets. It is called TYING.
"Making purchase of goods conditional on purchase of other goods, if there is
sufficient market power."
This is the kind of monopoly power that the politicians have bestowed on the
content and distribution conglomerates.
Regards
Craig
Other related posts:
- » [opendtv] Retrans consent and the pretend game- Manfredi, Albert E
- » [opendtv] Re: Retrans consent and the pretend game - Craig Birkmaier
- » [opendtv] Re: Retrans consent and the pretend game- Manfredi, Albert E
- » [opendtv] Re: Retrans consent and the pretend game- Manfredi, Albert E
- » [opendtv] Re: Retrans consent and the pretend game- Craig Birkmaier
- » [opendtv] Re: Retrans consent and the pretend game- Craig Birkmaier
- » [opendtv] Re: Retrans consent and the pretend game- Manfredi, Albert E
- » [opendtv] Re: Retrans consent and the pretend game- Craig Birkmaier
- » [opendtv] Re: Retrans consent and the pretend game- Manfredi, Albert E
- » [opendtv] Re: Retrans consent and the pretend game- Craig Birkmaier
- » [opendtv] Re: Retrans consent and the pretend game- Manfredi, Albert E
- » [opendtv] Re: Retrans consent and the pretend game- Craig Birkmaier
- » [opendtv] Re: Retrans consent and the pretend game- Manfredi, Albert E
- » [opendtv] Re: Retrans consent and the pretend game- Craig Birkmaier
- » [opendtv] Re: Retrans consent and the pretend game- Manfredi, Albert E
- » [opendtv] Re: Retrans consent and the pretend game- Craig Birkmaier
- » [opendtv] Re: Retrans consent and the pretend game- Manfredi, Albert E
- » [opendtv] Re: Retrans consent and the pretend game- Craig Birkmaier
- » [opendtv] Re: Retrans consent and the pretend game- Manfredi, Albert E
- » [opendtv] Re: Retrans consent and the pretend game- Craig Birkmaier