The House Subcommittee on Communications, Technology, and the Internet held a hearing titled, "Reauthorization of the Satellite Home Viewer Extension and Reauthorization Act" on Tuesday. Congress is required to reauthorize the law by the end of the year.
Subcommittee Chairman Rick Boucher (D-VA) said he wanted to proceed on a pretty much straight line and didn't want to get sidetracked on collateral issues, which he said included retransmission consent reform, an issue that covered all multichannel platforms, rather than the satellite delivery of TV stations--both distant signals and local signals--that is the subject of the act. That proved to be easier said than done, with retransmission consent reform raised frequently in the three-hour hearing.
Public Knowledge President Gigi B. Sohn suggested a series of changes to copyright law that would promote competition and do away with an antiquated series of rules that no longer make sense with today's technology. She said that the legal framework governing how cable and satellite TV services offer their programming is a patchwork of laws and regulations that unnecessarily differentiates between types of providers, restricts the availability of content to consumers, and sets the stage for discriminatory pricing." Sohn suggested replacing the current structure with one that would have cable and satellite follow the same rules for obtaining licenses to use copyrighted works, for broadcasting signals into local markets and for paying copyright royalty rates. In addition, Sohn said, services that carry video over the Internet could also be included in the unified regulatory structure. Congress should make retransmission consent deals transparent, Sohn said, possibly combined with a statutory retransmission consent license with standardized rates. Finally, Sohn said Congress should reform the "distant signal" protections for broadcasters which often prevent consumers from viewing nearby TV channels.
Dish Network Chairman Charlie Ergen proclaimed: "The digital age has arrived -- and the laws need to catch up." Ergen listed four SHVERA fixes (which essentially provides the rules of the road for satellite delivery of local TV station signals): 1) consumers unable to get local news and sports from their home state because of the way markets are configured (almost half cross state lines, according to one satellite lobbyist); 2) rural communities not having all four major nets; 3) retrans fights that deprive local consumers of station signals, and 4) must-carry stations with little or no local content, but which satellite operators are required to carry. Ergen argues that pay TV providers should be able to import neighboring broadcast stations, with consumers getting to make the call about what local means. Ergen said that if Congress institute his suggested broad reforms, that the marketplace would drive either his company, or competitor DirecTV to serve virtually all those 210 markets, and by as early as next year.
Local television stations with local content should be required to allow the retransmission for free, or for a fixed royalty rate, Ergen said. Stations without truly local content -- Ergen estimated that number at 15 to 20 percent -- should be excluded from retransmission requirements, he said.
DirecTV Senior Vice President Bob Gabrielli said some broadcast stations had been raising their rates. "Broadcasters now routinely demand fees three times those previously paid. And it does not appear that this additional money is being used to provide more or better local programing," he said. "Many broadcasters are producing less and less local news."
Rep Bart Stupak (D-MI) expressed frustration with satellite providers, saying residents of his town, Marquette, could not see local matters such as school closings despite promises from satellite companies that the situation would be fixed. "All these promises that we get from these guys, but you never seem to fulfill it," Rep Stupak said. He has introduced a bill to require satellite TV companies to carry local broadcasting in all markets, arguing that the companies ignore less populated regions.
Former Federal Communications Commission Media Bureau Chief Ken Ferree told Congress that it is time to make some changes to the rules of the road for satellite delivery of local station signals to recognize the "extremely competitive" video delivery market. Ferree, who now runs free market think tank the Progress and Freedom Foundation, argues that while competition has burgeoned, vertical integration is on the wane, saying that while the number of cable services has grown from 70 in 1990 to almost 600, the percentage of those channels owned by cable operators has dropped from 53% in 1992 to 10%, calling the free market a competitive success story. One of the changes he wants Congress to make is to allow satellite operators to provide signals from adjacent markets when a Nielsen-designated DMA (Nielsen Designated Market Areas) covers two states. Ferree also argues that any restrictions on important signals are being rendered meaningless by technology, particularly when the cream of those network affiliate shows are available almost immediately after airing online.
Reps Greg Walden (R-OR), John Shimkus (R-IL), and Lee Terry (R-NE) pointed out how smoothly the digital transition has gone for the hundreds of stations who went ahead and pulled the plug on analog on the original Feb. 17 date. Rep Walden, himself a former broadcaster, suggested that, given that relative dearth of outcry, Congress should consider rethinking the $90 million it was planning to spend on DTV outreach, or the $650 million in the economic stimulus package that is going to jump-start the DTV-to-analog converter box coupon program.
