AT&T officially filed its proposed DirecTV merger with the Federal Communications Commission, including public interest statements, saying the deal was all about the bundle.
"This transaction will unite two companies with uniquely complementary assets to create a strong, national competitor that delivers consumers an unparalleled combination of broadband, video, and wireless services," AT&T told the FCC.
AT&T said that the main reason for the meld was that they could achieve together what they could not separately: "A compelling bundle of video and broadband services" that neither company could offer individually.
AT&T pointed out that 97% of AT&T's current video customers already take at least a double-play of services, predominantly video and broadband. AT&T said the deal would allow it to expand its video footprint sufficiently to get more and better programming.
"As a result of its relatively limited video footprint, AT&T is far smaller than Comcast and Time Warner Cable, its principal competitors. Lack of scale particularly hinders AT&T with respect to content acquisition, which is by far the largest variable cost of MVPD service."
AT&T outlined the consumer benefits of the deal, which it summarized as being the stronger competitor to cable that bundling will allows. But it also talked about offering high speed broadband to an additional 15 million customer locations within four years.
Sen Marco Rubio (R-FL) outlined an ambitious agenda for spectrum reform, which includes plans to introduce three bills: The Wireless Innovation Act to free up government spectrum; a bill directing the Federal Communications Commission to conduct tests in the upper 5 GHz band and modify the rules to allow Wi-Fi so long as it doesn’t create harmful interference to vehicle-to-vehicle (V2V) communications; and a bill to promote wireless infrastructure.
Sen Rubio, a member of the Senate Communications Subcommittee, said that there were a lot of serious policy questions about advancements in high-speed wireless, but what was not debatable was that more spectrum was needed. He said the government should not wait until the current FCC spectrum auctions are over before taking steps to free up more.
His Wireless Innovation Act:
- Reallocates 200 MHz of government spectrum for commercial use;
- Establishes an auction pipeline with staggered auctions starting in 2018;
- Incentivizes federal agencies to reallocate spectrum by allowing portions of the proceeds to be used or conducting research and development, as well as cost and technical assessments on reallocating future spectrum bands;
- Requires an analysis of requests for new or modified frequency assignments to determine whether a commercial service could be used, whether federal users can share; and
- Requires [the National Telecommunications & Information Administration] to develop a framework to determine the commercial value of Federal spectrum.
Communications Subcommittee chairman Greg Walden (R-OR) made it clear what he thought of the Federal Communications Commission's recent activity, and inactivity, on media ownership rules.
"Pretending laws designed for an era before smartphones and the Internet will get the job done is an effective death sentence for many local media outlets," he said. That came in opening statements at a hearing on media ownership rules, part of the parent House Commerce Committee's ongoing review of communications regulations, as well as a response to some current events like the joint sales agreement (JSA) ruling and the decision to role the 2010 and 2014 quadrennial reviews into one targeted for mid-year 2016.
Rep Walden said everyone was committed to the core values promoting localism, diversity and competition, but his view was that was best served by not hampering broadcasters ability to compete.
The Federal Communications Commission got hammered by Democrats over diversity at the June 11 House Communications Subcommittee hearing on media ownership.
While most of the raised eyebrows over FCC action or inaction came from Republican members, the lack of diversity in broadcast ownership -- only four African American-owned TV stations, for example -- drew outright jeers from Rep Bobby Rush (D-IL).
Rep Rush said one of the reasons he had joined the Communications Subcommittee was to help increase media ownership diversity. He said he had been disappointed for a number of years, but that the current state of diversity was the worst it has been in his 21 years in Congress. He said he did not see a "vigorous commitment" from the FCC on diversity and that he was disappointed in the continual excuse-making.
Rep Rush questioned why FCC Chairman Tom Wheeler had pulled the plug on the critical needs study which was to help determine how ownership affected diversity of voices.
The National Conference of State Legislatures has asked the Federal Communications Commission not to eliminate its Sports Blackout Rule.
That rule backstops sports league broadcast blackout policies by preventing cable or satellite operators from carrying the blacked-out games to those local markets. The FCC has proposed scrapping the rule.
In a letter to FCC chairman Tom Wheeler, the conference said the rule "serve[s] the interests of states as well as the public by [helping to promote] economic activity, civic pride and the broadcast of professional football on free, over-the-air television."
The FCC rule helps promote attendance, the conference points out, and the stadiums, whose economic activity is boosted by getting fans in the seats, are often built partly with taxpayer dollars, they point out. "Thus, states share a stake in the continued use, success and vitality of sports facilities."
Former Time Warner Cable chairman and CEO Glenn Britt died of cancer on June 11 at his home in New York. He was 65.
“Glenn left us with a legacy of innovation, integrity and inclusion," said Time Warner Cable chairman Rob Marcus.
The newspaper unions and ownership are definitely of different minds on lifting the ban on newspaper-broadcast cross-ownership. That is according to testimony for a June 11 House Communications Subcommittee hearing on the Federal Communications Commission's media ownership rules.
While Newspaper Association of America (NAA) senior VP Paul Boyle tells the subcommittee that the ban is outdated and hurts investment in local journalism, Bernard Lunzer, president of the NewsGuild-CWA, asks Congress to "maintain the status quo on Cross Ownership between print and broadcast" and says that claims that combinations will allow for more coverage is "just not the case."
House Commerce Committee Democratic leaders have asked their Republican counterparts, who control the agenda, to hold hearings on the proposed Comcast/Time Warner Cable and AT&T/DirecTV mergers, and a Sprint/T-Mobile deal if that ever materializes.
That request came in a letter from Reps Henry Waxman (D-CA) and Anna Eshoo (D-CA), the ranking members of the full committee and Communications Subcommittee, respectively, and Rep Doris Matsui (D-CA), to full committee Chairman Fred Upton (R-MI) and Subcommittee Chairman Greg Walden (R-OR).
The Federal Communications Commission has told the US Court of Appeals for the DC Circuit that it must dismiss the National Association of Broadcasters petition for review of the FCC's "staff-level" public on how the Media Bureau will vet TV station deals involving sharing arrangements.
NAB says the guidance functions as a "categorical presumption" against such deals -- shared services agreements, joint sales agreements, and others -- which "adversely affects" NAB and its members by rendering such previously allowed deals invalid.
The FCC says the guidance is to give broadcasters notice that TV station sales involving sharing agreements with associated financial arrangements like an option to purchase a station or guaranteed financing would get heightened and likely time-consuming reviews in case they wanted to rethink those given that guidance. Commission lawyers argue that the Media Bureau guidance issued in the March 12 public notice is not a final order -- NAB argues it is a final agency action -- and since the court's jurisdiction over FCC decisions extend "only to final orders," the court does not have jurisdiction to review it.
“Congress did not intend that the court review a staff decision that has not been adopted by the Commission itself," the FCC said, quoting the DC court itself from a previous opinion. They also point out the appeals court has previously found that petitions for review filed after a bureau decision but before a final commission resolution are "incurably premature."
Federal Communications Commission Media Bureau chief Bill Lake says that the FCC has granted the sale of 36 full-power TV stations, representing 12 different deals, since mid-March, which it issued guidelines about deals with associated sharing arrangements.
That is according to Lake in prepared testimony for the June 11 media ownership hearing in the House Communications Subcommittee. Lake outlined various steps the FCC has taken regarding media ownership rules, including making TV joint sales agreements (JSAs) over 15% of ad time attributable as ownership interest, new processing guidance from the Media Bureau on processing TV station license transfers involving JSAs and other sharing agreements (broadcasters have sued the FCC over both those), and the decision to combine the congressionally mandated 2010 and 2014 media ownership quadrennial reviews into what will become a 2016 review -- June 30, 2016 is the target date for completion.
As to why the FCC has yet to produce a quadrennial review report to Congress years past the initial deadline, Lake pointed out that the FCC, under a previous chairman, had a media ownership item responsive to the review teed up in 2012 that could never get three votes needed for approval -- Republicans opposed it and some Democrats were concerned that the FCC had taken the action without sufficiently gauging its impact on ownership diversity. He said that the new timetable of June 2016 will allow for more input on how the market has changed since then.