Grant Spellmeyer knows that he has some pretty big shoes to fill. 

Named CEO of ACA Connects in May, taking the helm from retiring CEO Matt Polka, Spellmeyer has extensive experience lobbying for the telecom industry: He comes from U.S. Cellular, the mobile arm of ACA member TDS Telecom. 

Polka officially ends his 25-year tenure representing smaller, independent cable operators at ACA Connects this month, culminating in The Independent Show July 24-27 in Orlando, Florida. In the meantime, Spellmeyer has been busy making the rounds, meeting with individual ACAC members and companies, as well as National Cable Television Cooperative CEO Lou Borrelli, learning more about the cable business and listening to what his members feel is most important to the industry. 

Spellmeyer took some time out earlier this week to speak with Multichannel News senior content producer – finance Mike Farrell. Here's an edited transcript of that conversation.  

MCN: What drew you to this job?

Grant Spellmeyer: There are a couple of factors. First, personally for me, it was a good time in my life to make a switch. But more importantly, I have always held ACA in the highest regard as the premier communications association for what I’ll call non-national providers. Many of them have their roots on the cable side, some of them from the telephone side, some from the cooperative side, some from municipalities. And it is certainly a changing industry. I’ve had the opportunity to know Matt Polka and to work with him quite a bit during the last 15 or 16 years that I’ve been active in the telecom scene in Washington. I’ve watched what Matt and the team have done, they’ve certainly had a long series of wins along the way. I came from U.S. Cellular, which [is] a non-national wireless carrier, midsized — they operate in 21 states — kind of a scrappy competitor. That’s what ACA is full of, a lot of small and medium-sized communications providers who are a little bit of the underdog in the world of Washington, D.C. It was a nice fit from who I get to represent at ACA Connects and the fact that they’re just really good at what they do. They’ve got a good team and I’m excited to be here.

Also: NCTC CEO Lou Borrelli Talks Connectivity Exchange MVNO Deals and the New Name 

MCN: It seems like a lot of the issues that are important to telecom companies are important to cable companies — broadband wireless and the like. So it seems that this job is right in your wheelhouse. 

GS: I think it is. I don’t come with an extensive cable background, although I’ve been busy learning and there are no concerns that I can’t get up to speed on those issues pretty quickly. At least right now, and for the next few years, this is all about broadband. That’s issue No. 1 and I have certainly spent a lot of the last 15 years working on broadband issues, universal service issues, government funding of the provision of broadband in hard-to-reach areas. Issues like mapping I was all over on the wireless side, so I’m pretty fluent in those things. The broadband guys want to get into the wireless business and the wireless guys want to get into the broadband business, and so I see it as a good opportunity to help the association navigate whatever is going to come in Washington and around the states in the coming years. 

ACA is working well. I’m not here to fix anything that is broken. I’m here to carry forward the legacy of success that Matt Polka has put in place over the past 25 years. I don’t think I’ll be lucky enough to break his longevity streak. But I certainly hope to take what he’s built and continue it and adapt it as the industry changes and the regulation landscape in Washington changes. Matt and I are friends, he’s been very gracious to me in the onboarding process, helping me get up to speed with learning the members and learning the issues. And of course, we have our show coming up next week, so that’ll be a new opportunity to go down and experience that. I’ve been to Kansas City to meet with Lou Borrelli and the team at NCTC. Those were good discussions and we’ve got our joint show, and I’m looking forward to what the future has to hold there.     

MCN: In your travels to meet the membership, what are the biggest issues on their minds?

GS: In terms of issues, there are a couple of things I have heard. Broadband would be the most important. There are concerns about how governors and federal agencies will distribute money both from an offensive and defensive perspective. Some members want to get a hold of money, other members are very concerned about being overbuilt in areas that already have coverage that meets the standards under the law. We’re going to be working with NTIA and the FCC and the governors and the state broadband authorities about that. 

The second thing I would flag is the issue of the broadband data collection maps that are due to the FCC by September 1. There was a lot of concern over the FCC requirement that a professional engineer certify the maps. We, along with some other associations, were pushing the FCC to produce some clarity to that and to relax the requirement that everybody go out and engage a certified professional engineer in the state, because in many states they’re not there and certified engineers don’t have the skill sets that are necessarily required for telecommunications. The FCC issued a bureau-level order clarifying that provision and we were very pleased with that, our members were very pleased with it. 

And thirdly, there is retransmission consent. It comes up everywhere I go. I don’t think that’s the No. 1 issue right out of the chute in the next couple of months at the FCC, but they do have some proceedings underway that are looking at certain issues related to retrans. 

MCN: Are you optimistic that you’ll get some traction on the retrans side after all these years?

GS: I think it's more of a long-term play. I think as the cable industry continues to evolve, there are going to be a lot of reasons for the FCC and potentially for Congress to revisit the rules associated with it.

MCN: Going into the show, what’s your take on the industry? Obviously things have changed a lot. 

GS: Keeping in mind that I am still learning the industry and I certainly haven’t talked in depth with a good number of the majority of members — although I have talked to companies that represent a majority of members — I think they have adapted well. They were fortuitous enough to see some of this coming and shift focus to broadband. I expect that to continue. Traditional video cable subscribership is dropping and is likely to continue for a while, but I think folks have adapted really well to it and we will see where it goes over the course of the next decade. But nobody has come to me and said “Grant, you’ve really got to fix this for us because we’re all going under otherwise.” 

People are optimistic, people are very excited to be coming together for the first time — this is the first time since 2019 that we’ve done The Independent Show in-person — so there is a lot of pent-up demand, and I think a lot of my members enjoy the opportunities to visit Orlando with their families. I think everybody is going to have a good time, and hopefully learn something about the state landscape at the moment. And we’re going to celebrate a little bit. It’s a farewell for Matt, and a lot of folks have spent the past 20, 25 years working with Matt, so it’s going to be special from that perspective.

Hopefully they will come away [from the show] going “that Spellmeyer guy seems like he’ll do a good job and let’s charge forward to the future.”

MCN: Is this your first Independent Show? One thing that has struck me about this show, in particular, is that there still seems to be a fair amount of business going on, and members see this as an opportunity to share ideas with other operators.  

GS: It will be my first one. I don't have the frame of reference that I wish I did. ACA used to do a Summit in Washington that was more Hill-oriented, and I’ve been to that a couple of times, but this will be my first time at the Independent Show. From everything I’ve heard, it’s a nice size, not as big as the Consumer Electronics Show, where you’ve got 100,000 people running around Las Vegas. I’ve been to 5,000-person and 10,000-person  trade shows and those are challenging to get any real business done because you can’t find anybody. This is different because it’s one hotel, it's a good size and if you want to track somebody down within the course of 48 hours it’s pretty easy to do so. And that facilitates lots of dialogue and I think that’s what Lou Borrelli and I are after, in terms of where we want to take this show in the future. There is a value to it that is significant, part of it is meeting with vendors and part of it is talking with other members and I think a lot of both of those will be going on. 

MCN: At the same time you’ve got to keep your eye on the historical issues in the industry, like retrans and there is talk of another net neutrality bill on the horizon. 

GS: We’re going to keep our eye on that and there are lots of potential changes coming to Washington after the elections this fall, one way or the other. There are a lot of members not seeking re-election, so I expect a new landscape there. I’ve spent a lot of time on Hill-related matters, and I’m not going to take my eye off that or the retrans ball. I’ve got a good team and we’re going to do good things with it. 

MCN: NCTC hired a new CEO in May 2021 [Borrelli], and you started this May. Do you see the relationship between ACA changing as leadership has changed? How do you see it evolving?

GS: I have spent time with Lou and he seems to be a very, very skilled industry veteran. I think he was the right choice to run NCTC. He’s got a 40-year background in the cable industry that I don’t and I think he is doing and will continue to do really good things at NCTC. We have talked about things like ways to work together additionally amongst our significantly-shared membership, educational opportunities, regional meetings. 

We’ve kind of agreed to get through the show in Orlando and have a more fulsome discussion about what 2023 looks like. But I am all in favor of finding ways to collaborate and they serve the members a whole lot from an operational purchasing perspective and I think we do a really good job on the educational policy side. It’s a good team. We’re going to have some fun together next week. ■

ACA Connects, whose membership ranks of smaller and midsized independent cable operators got more retransmission consent leverage from Congress, says that move has paid off in a bunch of group carriage deals with larger broadcast groups since the Television Viewer Protection Act of 2019 went into effect more than a year ago.

ACAC pushed for years to get the government to acknowledge the National Cable Television Cooperative as a recognized buying group for smaller multichannel video programming distributors (MVPDs), so the TVPA mandate was a victory for the association.

ACAC was reporting back to the Federal Communications Commission, which sought comment on how it had implemented the retransmission consent buying groups and truth-in-billing provisions in the TVPA. The buying-group provision “allows smaller MVPDs to negotiate collectively as a buying group for retransmission consent with large broadcast station groups, and requires large broadcast station groups to negotiate in good faith for retransmission consent with a qualified MVPD buying group.“

Also: Cable Retrans Blackouts Declined Sharply in 2021, But 2022 Could See an Uptick in Disputes

The qualified buying group at issue was the NCTC. ACAC told the FCC “the buying group provisions and related implementing rules have largely served their limited purpose.“

In the year and a half since the buying group provision became effective, ACA said, more than 600 MVPDs have relied on it to negotiate deals with E.W. Scripps, Tegna, Gray Television, Meredith, ViacomCBS and Sinclair Broadcast Group. Nexstar Media Group was the only broadcaster with whom NCTC tried, and failed, to negotiate an agreement.

Not only did deals get done, said ACA Connects, but they were struck with better terms and likely lower prices. ACAC said the provision “surely resulted in lower prices for some of the smallest cable system operators, whose lack of experience and expertise in negotiating with large, sophisticated broadcasters might otherwise have resulted in deals with exceptionally high rates or exceptionally disadvantageous terms.”

Still, ACAC said, while the deals got better, the provision didn't — and couldn't — “meaningfully narrow“ the gap between what large and small MVPDs pay for retrans, nor fix what ACAC described as a broken retrans market generally.

“Broadcasters, in other words, still have an incredible amount of leverage,” ACAC told the commission. “The terms and conditions entered into by NCTC were by no means great for the small cable operators opting into them. But those deals involved lower transaction costs than individual negotiations would have and provided other benefits to small providers and, to varying degrees, lower rates than individual negotiations would have produced.” ■

A federal appeals court has refused to block enforcement of California‘s network neutrality rules, which internet service providers are challenging.

Cable ISPs — including those represented by ACA Connects and NCTA-the Internet & Television Association — had asked the 9th U.S. Circuit Court of Appeals to overturn a District Court's decision not to grant a preliminary injunction against the California Internet Consumer Protection and Net Neutrality Act.

But the three-judge 9th Circuit panel (Judges Mary M. Schroeder, J. Clifford Wallace and Danielle J. Forrest) — one of the most liberal circuits in the federal appeals court system — instead upheld the lower court.

Also: ACA Connects Makes Its Case Against Calfornia Law

ISPs had argued the California law was pre-empted by the Federal Communications Commission's 2018 decision to eliminate rules against blocking, throttling and anticompetitive paid prioritization, a move that had prompted California to create rules of its own.

The appeals court agreed with the district court that the FCC lacked the authority to pre-empt the state law because in reclassifying internet access as an information service under Title I of the Communications Act, the FCC no longer had the authority to regulate the way it did when it was a Title II telecommunications service.

It pointed to the U.S. Court of Appeals for the D.C. Circuit upholding the FCC reclassification but striking down the accompanying order asserting pre-emption of state net neutrality rules.

Also: California Net Neutrality Law Victory Draws Crowd

The 9th Circuit panel also rejected the ISPs’ contention that the California law was pre-empted because it conflicted with the underlying FCC policy or because interstate service was the sole province of the federal law.

The underlying case against the California law has yet to be adjudicated. This ruling only settled whether enforcement should be delayed until the underlying ISP challenge is resolved.

“Like a lot of 9th Circuit decisions, it is arguable that the court got the law wrong regarding whether California's net neutrality law is pre-empted," Randolph May, president of the market-oriented think tank Free State Foundation. “Given the inherently interstate nature of today’s tightly integrated broadband internet networks, there’s a good chance that other circuits might reach a different conclusion regarding pre-emption. But the risks of Internet service providers being subjected to a legacy common carrier regulatory regime established initially to regulate railroads in the 19th century and then Ma Bell last century, and a patchwork of varying state regulatory regimes with different mandates, should prompt Congress to resolve the decades-old net neutrality controversy by adopting a new law that prevents consumer harm while recognizing the technologically dynamic nature of today’s Internet ecosystem." 

Also joining the ACA Connects appeal were CTIA, representing wireless ISPs, and USTelecom, representing telecom ISPs.

They can appeal the panel decision to the full court if they choose.

“Today is a great day for the free and open internet," said California Democrat Rep. Anna Eshoo (D-Calif.), a big supporter of net neutrality rules. "The Ninth Circuit Court of Appeals upheld California’s net neutrality law, the strongest in the nation, a major win for small businesses and internet users across my state,” said Eshoo. “A free and open internet is critical for innovation, free expression, and our economy. Now Congress and the FCC should follow California’s lead and expand net neutrality to all Americans as I’ve advocated for years.” ■ 

ACA Connects is telling the Treasury Department that it should direct the American Rescue Plan block broadband grants — it estimates those will total about $20 billion to $30 billion — to areas without broadband service of at least 25 Megabits per second upstream and 3 Mbps downstream. That‘s currently the FCC‘s minimum for high-speed data. 

But the trade group representing smaller, independent cable operators also said the regulator should not prioritize municipal broadband and co-ops over other providers.

The Treasury Department issued a proposed framework for handing out the money, including proposing that it prioritize buildouts by local governments, nonprofits and co-ops, that new builds should deliver symmetrical 100 Mbps (download and upload) speeds, and that the definition of unserved and underserved should be set at 25/3 Mbps.

In comments to Treasury, ACAC agreed that 25/3 should be the definition of “unserved” areas eligible for the broadband buildout money. It also agreed that those getting the funds should be required to offer 100/100 Mbps, arguing that the government can afford to build to that standard, which would help future-proof the funding. “[F]unding anything less — and then having to fund it again in the near future — is a bad investment,“ it said.

As to prioritizing municipal or nonprofit buildouts — Treasury said those had “less pressure to turn profits and a commitment to serving entire communities” — ACAC was not on the same page. It said Treasury should not put the thumb on the scale for anyone, including the co-ops and municipal systems who are also members of ACAC.

“[W]e know first-hand that all have a deep commitment to serving their entire communities and take a long-term approach to building networks and providing services,” ACAC said. But ACAC was also hedging its bets. It said that if Treasury does prioritize, it should give the highest priority to “any small entity that is an experienced broadband provider.”

ACAC said it would prefer auctions to grants for handing out the money, and that given that there is an adoption as well as an availability problem, for every dollar spent on deployment, at least a third as much should be spent on adoption programs.

New President Joe Biden and Vice President Kamala Harris drew well wishes from the communications/tech industry as they took over the Executive Branch reins of government Wednesday (Jan. 20). The associations took the opportunity to promote themselves and their issues as well as praise the incoming Administration.

“Sincere congratulations to President Joe Biden and Vice President Kamala Harris on their historic inauguration," said National Association of Broadcasters president Gordon Smith, a former Republican senator who early on publicly acknowledged the new President's election victory. "As we celebrate this hallmark tradition of our democracy, broadcasters will do our part to encourage all Americans to come together to address the difficult challenges ahead. In that spirit, NAB looks forward to working with the new Administration and Congress on bipartisan policies to address the serious crises facing our nation, while helping keep our millions of listeners and viewers informed, safe and connected.” 

“Charter Communications congratulates President Joe Biden and Vice President Kamala Harris on their historic inauguration," said the cable operator. "Charter, which has 95,000 employees serving more than 30 million customers across our 41-state footprint, looks forward to working with the Biden-Harris Administration on our many shared priorities, including responding to the COVID-19 pandemic, building broadband infrastructure, investing in innovation and technology like 5G, expanding digital opportunities for all Americans, and creating good-paying jobs. Access to broadband is more important than ever, and Charter is committed to working with the Biden-Harris Administration to build stronger connections that will power opportunities, grow our economy, and spur the innovations of tomorrow.”

"@ACAConnects congratulates @POTUS Biden and @VP Harris on their #Inauguration, celebrating the peaceful transfer of power and the freedoms we share as Americans," tweeted association president Matt Polka. "Our Members look forward to working with you and your Administration on #broadband policies that connect America!"

“Amid an extraordinary period of unease brought about by a global health pandemic, civil unrest, and economic hardship, the Biden-Harris Administration brings the promise of a new chapter and renewed hope for the future," said Jason Oxman, president of tech association ITI. “Technology will continue to be an important tool in the administration’s efforts to overcome COVID-19 and spur economic recovery, and to maintain America’s global leadership and foster greater opportunity for individuals and families of all communities. From closing the digital divide to modernizing government services to a renewed collaboration with worldwide allies to treating all people with dignity, our industry is committed to working together with the Biden-Harris Administration to meaningfully advance American innovation and prosperity.”

"The Internet Innovation Alliance congratulates President Joe Biden and Vice President Kamala Harris on their inauguration as President and Vice President of the United States of America today," said the association. "We stand ready and eager to work with the new Administration on the extraordinary challenges facing our nation at this critical time. From COVID to climate change, economic recovery to social justice, universal broadband is an essential part of the solution. Partnership combining government resources and prioritization with private-sector innovation and management can overcome the digital divide and unleash the entrepreneurs, innovators and market leaders essential to long-term answers."

“America’s Public Television Stations welcome the inauguration of President Biden and Vice President Harris, and we look forward to working with them, the new Administration and the new Congress in a bipartisan partnership of public service," said APTS president Patrick Butler. “Public television stations have risen to the challenge of reimagining education in all 50 States, keeping our communities safe, providing trusted information to our viewers about issues of public concern, and offering a powerful forum in hundreds of American hometowns for healing our divisions and solving our most urgent problems.

“This is work that all of our fellow Americans can support, and we hope to build on this foundation of service in the critical years just ahead with increased resources from both federal and State governments and in ever-expanding alliances with those who share our commitment to education, public safety and civic leadership. As President Biden said, “Unity is the path forward,” and America’s public television stations look forward to playing our part.”

In a victory for NCTA-the Internet & Television Association, the FCC has voted in advance of Wednesday's public meeting on a report and order to eliminate the requirement that cable operators include in their online public file information on the nature and extent of their attributable interest in video programming services.

The item has been dropped from the Sept. 30 meeting agenda.

The 25-year-old rules date from when the FCC policed the channel occupancy limits on programming in which operators had a financial interest. Those limits have not been in effect since 2001, when a court remanded them back to the FCC.

Related: FCC Ponders Axing Cable Programming Interest Reporting Mandate

The issue had split cable operators. 

ACA Connects argued for retaining the requirement, saying it was needed to help the FCC enforce program access rules. NCTA, which backed eliminating the requirement, countered that ACAC's argument was self-serving and wrong, saying "entities seeking attributable interest information can retrieve it from a variety of readily available sources," including SEC filings SNL Kagan.

"Given that these requirements no longer serve their intended purpose and the information covered by the rule can be obtained from sources other than public inspection files," the Commission said, echoing NCTA, it "voted to remove this unnecessary and outdated regulatory burden on cable operators."

The order was the latest in FCC chairman Ajit Pai's media modernization effort to scrub outdated rules and regs.

FCC commissioner Michael O'Rielly, who had recommended looking into scrapping the requirement, has suggested it was ugly wallpaper left over from another era that was in need of removing.

It has now been scraped off the regulatory wall.

ACA Connects has told the FCC that because all its members co-mingle broadband with cable or telecommunications, they can avail themselves of the right to attach to poles, so the FCC's classification of broadband as an information service has no impact on their pole attachment rights.  

That came in reply comments to the FCC on the court remand of its Restoring Internet Freedom order for a better explanation of why the deregulation would not adversely impact pole attachments, public safety or broadband low-income subsidies.  

It also said the FCC has other authorities to help broadband-only providers secure pole attachment at reasonable and nondiscriminatory rates now that they are not covered by that requirement. 

ACA Connects also addressed the public safety issue. It says that the FCC's deregulation of ISPs and reclassification of broadband as a lightly regulated information service is promoting investment in broadband for all uses, including critical public safety uses. It said that any negative impacts are unfounded speculation. "The RIF Order is thus consistent with the Commission’s mandate under section 1 of the Communications Act to 'promote safety of life and property through the use of wire and radio communications,' " it said.  

Related: FCC Seeks Comment on Restoring Internet Freedom Remand 

The trade association also argues that ISPs have a "strong business incentive" to protect public safety -- not to mention a personal one, since their execs are part of the public that needs to be kept safe. But there is also the transparency requirement, that if ISPs did block or throttle or prioritize in ways that hurt public safety, they would have to disclose those to the Federal Trade Commission, which could take action.  

The U.S. Court of Appeals for the D.C. Circuit upheld the bulk of the agency's December 2017 decision to reclassify ISPs as Title I information service providers that aren’t subject to Title II common-carrier regulations and to eliminate the rules against blocking, throttling, paid prioritization, and a general conduct rule. But the court said the FCC needed to better explain the impact of those decisions on public safety, the regulation of pole attachments, and its Lifeline broadband/phone subsidy program.

ACA Connects did not weigh in on the Lifeline issue in its reply comments. 

Citing the pandemic and MVPD's crucial role, the FCC has decided to extend the deadline for MVPD compliance with new truth-in-billing regs mandated by Congress. 

Cable operators--NCTA-The Internet & Television Association and ACA Connects--had sought an emergency extension, also citing COVID-19, though some prominent Hill Democrats were calling for enforcement on schedule Friday (April 3) at about the same time the FCC's Media Bureau was explaining the extension. 

A source familiar with those Democrats' thinking said that they assumed the delay is because of the coronavirus emergency and are hopeful the companies and the FCC will implement it as soon as possible.

"As the nation tackles the COVID-19 pandemic, multichannel video programming distributors (MVPDs) and providers of fixed broadband Internet access service are among the entities that are integral to the Commission’s ongoing, nationwide effort to keep Americans informed and connected 

during this national emergency," said Media Bureau chief Michelle Carey. "So that these service providers may focus their resources on this critical effort, we provide appropriate flexibility for MVPDs and providers of fixed broadband Internet access service to fulfill their obligations under the Television Viewer Protection Act of 2019 (TVPA). Specifically, by this Order, we exercise our discretion under the TVPA to grant a blanket extension until December 20, 2020, of the effective date of new truth-in-billing requirements.

The mandate requires cable and satellite providers to disclose all fees before potential subs sign on the dotted line and allow for a 24-hour grace period for cancellations without penalty. The TVPA also requires more transparency in electronic billing and prohibits MVPDs from charging for equipment they don't provide. It was supposed to go into effect June 20, six months after the law's passage as the legislation specified. 

But saying its members need to focus their time and energies on fighting the pandemic and shouldering the additional broadband load of a surf-in-place populace, NCTA and ACA Connects told the FCC they would like the mandate date extended to Dec. 20. Actually, the FCC asked in a request for comment on whether it should extend it to that date and NCTA said yes, then added an exclamation mark with the virus-related request for an emergency extension. 

“ACA Connects welcomes the FCC Media Bureau’s decision today to extend by six months the deadline for compliance with new truth-in-billing requirements for MVPDs and broadband providers enacted last year as part of the Television Viewer Protection Act," said ACA Connects president Matt Polka. “As ACA Connects explained in a joint filing with NCTA and USTelecom, our members would have been hard-pressed to obtain necessary software upgrades from their billing vendors in time to meet the original June deadline, even in the absence of COVID-19.  

“We applaud the FCC for extending the compliance date of the Television Viewer Protection Act," said NCTA in a statement. "The Commission’s timely action will enable cable operators to focus on critical tasks to ensure that Americans remain connected during this unprecedented COVID-19 crisis.”

ACA Connects said it has decided to postpone its 2020 policy summit in Washington later this month.  

After careful consideration taking into account the most relevant new information, ACA Connects has decided to postpone its 27th Annual Summit on March 17-19 in Washington, D.C., doing its part to help the global health community combat the spread of the coronavirus," the association said. 

“It’s unfortunate the Summit will not happen in March after so much planning and the incredible interest of our members to again join us in Washington. We really thought we could make a go of it, even earlier this week,” said ACA Connects president Matt Polka. 

Polka informed attendees in an email Thursday (March 5), telling them that after two "non-stop" days reviewing development's in the virus' spread, they had concluded "– now is simply not the time to hold our Summit."

"[T]he last 48 hours have clearly and rapidly shown the spread of the virus was getting worse, our members and attendees were becoming increasingly concerned about travel, and Washington was preparing for swift action to prevent transmission of COVID-19 in lawmakers’ and regulators’ offices," Polka said. "Federal officials have already begun reducing access to their offices and preventing their employees from participating in large group functions."

The policy lineup had lined up a number of top government officials, including from the FCC.

The announcement came only a day after the FCC signaled it would be suspending staff appearances before large groups.

ACA Connects, which represents small and midsized cable operators, told the FCC this week it supports a National Association of Broadcasters petition that asks the FCC to "clarify" that state and local political ads not trigger enhanced disclosure just because they may mention an issue of national importance. 

The National Association of Broadcasters joined with Hearst Television, Graham Media Group, Nexstar, Fox, Tegna and Scripps to ask the FCC to narrow its definition of non-candidate ads on “any political matter of national importance" (i.e. "issue" ads) and the disclosure obligations on broadcasters to identify the issues in those ads. 

In reply comments in support of NAB, they told the FCC that in resolving political file complaints, the FCC's interpretation of statute would expand political file obligations for not only TV stations but cable operators also subject to political file requirements. 

Broadcasters and cable operators are required to report political ad buys to the FCC.  

"We share petitioners’ and other parties’ concerns with these interpretations, as well as with the process by which the Commission arrived at them," said ACA. "In particular, by announcing these interpretations in the context of narrow complaint proceedings, the Commission was not able to consider or address the impact of its rulings on cable operators, including the heightened burdens they create for smaller cable operators. ACA Connects thus urges the Commission to reconsider the Political File Orders, and to seek comment on reconsideration on how best to implement the statutory language at issue." 

ACA said that whether or not the FCC grants the broadcaster petition, it should make clear that it will "defer to the good-faith compliance efforts by cable operators and others subject to [the] requirements," particularly in the case of the smaller operators it represents. ACA said that is because the FCC has created "novel and highly context-sensitive disclosure obligations." 

CHICAGO — Broadband, OTT, the fight against onerous and outdated regulation and a pep talk from an unlikely source — a programmer — were all a part of the 2019 Independent Show, the yearly gathering of smaller, independent operators here.

This year’s theme was “Ignite” and the return to Chicago appeared to be a charm — the show was first launched 14 years ago in the city under the theme “Winds of Change” — with hundreds of operators, programmers, equipment vendors and their families making the trip to the Sheraton Grand Chicago hotel. The 2020 show will be held in San Antonio, Texas, July 26-29.

Viacom CEO Bob Bakish became the first major programming CEO to headline a keynote session at the show, and although he noted the sometimes contentious relationship his company has had with small cable in the past, came to mend fences with operators.

Fixing ‘Frayed’ Relations

Bakish admitted that Viacom’s past dealings with small cable operators have been “frayed:” Cable One and Suddenlink dropped the networks in 2014. (Only Suddenlink eventually renewed.) Since Bakish came on board in 2016 and focused the programmer on its six core brands, though, Viacom has worked hard to repair that relationship.

“[W]e stepped back, evaluated the situation to figure out how we could work with distributors in a more partnerly way,” Bakish said, which he determined would be to expand the scope of the distribution relationship, including licensing linear feeds and VOD content and exploring deeper relationships on the advanced advertising front.

“Since we’ve done that, we haven’t gone dark with anyone, we’ve renewed or extended the vast majority of our traditional sub base, we’ve actually increased our distribution and we’ve gotten access to plant for advanced advertising,” he added.

Bakish expects that relationship to evolve to its new acquisition, with Pluto TV becoming a successful complement to cable broadband service.

“The reality is, all of you have footprints and markets all around the country in all different-sized markets,” Bakish said. “There is great power in that, because you have those local consumer connections. I don’t want to go build those. I would rather work with the people that have them and figure out how, working together, we can grow our businesses.”

Regulation, as always, was a big topic at the show, with former Bush White House press secretary Ari Fleischer urging operators to continue to pressure regulators on issues important to their businesses.

“If you’re not involved, you’re going to lose,” Fleischer said in a Q&A with ACA Connects president and CEO Matt Polka, adding that particularly with complex issues like net neutrality, few members in the House and Senate fully understand the issues weighing on the industry. “The only way they will believe in you is if they see you, they hear you and they feel you. Activism is at the heart of what you have to do.”

Former NCTC chairman and retired MCTV chief Bob Gessner kicked off the conference with a CEO panel featuring top executives in the small cable space — including his daughter, MCTV president Katherine Gessner, who pointed out just how powerful offering a compelling high-speed service can be.

Katherine Gessner said MCTV began overbuilding its network with fiber-to-the-home in 2014 or 2015 and last year began acquiring a few small properties near its traditional service territory. Upgrading those systems has resulted in strong broadband growth, she said.

“We shut off the analog plant in the first system in November and went from 0% internet penetration to about 20% in about seven months,” Katherine Gessner said. “It really opened our eyes to the need for rural broadband.”

OTT, SVOD in Spotlight

OTT and SVOD products also garnered some attention from small operators. In a panel session titled “Kindling and Sparks … Getting Your OTT & SVOD Strategies Blazing,” Vyve Broadband senior vice president of marketing and customer service Diane Quennoz said the days when every pay TV provider’s video packages were the same are over.

“The challenge is picking the right horse,” Quennoz said. “TV can’t be the same way it was three, five or even 10 years ago. Viewing habits change. The challenge is we have so many different carriers.”

Cincinnati Bell director, programming and content Jonathan Bond pointed out the difficulty that smaller operators have when dealing with mega-companies like Netflix.

“Netflix called us ‘cute’ when we had 300,000 video subscribers and 170,000 broadband subscribers,” Bond said. He was not optimistic that the SVOD pioneer’s recent subscriber losses — it shed 130,000 domestic customers in Q2, its first period of domestic subscriber losses — would make it more receptive to smaller operators.

“Probably not,” Bond said. “It would probably take multiple quarters [of declines].”

CHICAGO — Bridging the digital divide in small rural communities is still a top priority and one that can help operators drive sales growth even as video customers dwindle, a panel of top small cable CEOs said at The Independent Show’s Opening General Session.

“Providing that local connection, and not just driving the content of those customers, [is critical],” said Buckeye Broadband president and general manager Geoff Shook at the session titled Hot Topics, Cool Leaders. “Owning that relationship from the edge of the end user’s device all the way through the businesses.”

MCTV president Katherine Gessner added that just providing the service isn’t enough for success. Education is a key part of the puzzle.

Gessner told the audience that in MCTV’s initial moves to convert some newly acquired customers from fairly antiquated systems to fiber-to-the home, they were reluctant to switch, even though converting meant they would get data speeds four times faster than their old DSL service.

“They didn’t understand what you could do with it [higher speeds],” Gessner said. “We found out there was a waiting list for DSL. They didn’t want to switch because they were scared that if our service didn’t work they couldn’t go back.”

For Schurz Communications, president and CEO Todd Schurz said one solution has been to partner with other providers in building out broadband networks. Schurz is currently working with local governments, using some state grants in Vermont and Minnesota, working with telephone co-ops in Iowa, electric co-ops in Minnesota, and Native American nations in Minnesota and Arizona.

“What we have found, all of these are structured differently, there’s no one model that fits everything,” Schurz said. “But it’s something that everybody realizes they need to do.”

“If you can go to some of these local entities and say, ‘You don’t have to build a digital headend, you don’t have to worry about all of that infrastructure, and you can put your resources into upgrading the local network, and we will then take the handoff,’ that seems to work pretty well,” he said.

As the industry moves closer toward 5G wireless services, smaller operators are helping to lead the way. At Shentel, executive VP and chief operating officer David Heimbach said that while his company is moving forward on wireline initiatives like DOCSIS
3.1 — which should be completed by the end of the year — they are also making inroads with 5G.

Heimbach said Shentel is currently trialing a 5G service, but there is still plenty of time before that service becomes essential. Of the 5 billion discrete wireless customers worldwide, he said, only one-third are on a 4G network and only 15% of mobile customers are expected to have 5G by 2025.

“This has a long tail on it,” Heimbach said.

But small operators are forging ahead, building out their networks and providing state-of-the-art service to customers, largely funded by their own coffers.

Gessner said that although MCTV did look into obtaining federal grants to build its fiber network, it didn’t make sense in the long run. MCTV began overbuilding its network with fiber to the home in 2014 or 2015 and last year began acquiring a few small properties near its traditional territory. The upgrades have resulted in strong broadband growth, she said.

“We shut off the analog plant in the first system in November and went from 0% internet penetration to about 20% in about seven months,” Gessner said. “It really opened our eyes to the need for rural broadband.” 

CHICAGO — The Independent Show is really two shows in one for small cable operators — an opportunity to meet, reconnect and share ideas with other small operators from around the country, and an opportunity to bone up on regulatory issues and trends with the biggest small operator lobbying group in the country, ACA Connects. ACA Connects CEO Matt Polka spoke with Multichannel News about what attendees should expect to see and what sessions could be of particular interest. An edited transcript follows. 

MCN: Going into the show, what should small operators be expecting from ACA?

Matt Polka: There is a lot that we’ve been working on together with our friends at NCTC to make this show stellar and to stand out in our industry, which I think it does, now that there are basically fewer shows. It puts a lot more focus on our Independent Show and our members and what they are doing, which was ironically the goal when we introduced The Independent Show 14 years ago in Chicago.

In terms of the show itself, we expect this to be one of our largest ever for a couple of reasons. There are fewer shows, so you’re getting more participation from operator members, as well as vendor companies that want to come out to support it. The second reason is we’re in the middle of the country in Chicago, where if you draw a 400- to 500-mile circle around Chicago, you can draw a lot of people in who can drive. As we saw a couple of years ago in Indianapolis, a show like this in the breadbasket of the country helps to bring in members.

“Ignite” is a really good term for our theme. Fourteen years ago, it was “Winds of Change,” and that was appropriate then as we were introducing a brand-new show. Now, Ignite is just as appropriate, because so many things are hot, they’re moving, they’re important right now, whether it’s business, technology, policy, operations, over-the-top, 5G spectrum issues. [There is] a lot more that our members are involved in, day to day, than they ever were back in 2006.

MCN: Tell us about some of the speakers you’ve brought in. I see that former White House press secretary Ari Fleischer is scheduled for the Tuesday keynote.

MP: Ari Fleischer is nationally known, former key staff in the Bush White House, someone who has made his views felt on Twitter and in our industry. And while he speaks from a particular political point of view, the one thing that has always impressed me about Ari, particularly when I follow him on Twitter … throughout everything he says are two important elements that are sorely lacking in Washington today: common sense and fairness.

We’re bringing in another keynote on Wednesday, Bill Conner, the CEO of SonicWall. Bill’s been in cybersecurity posts and technology all of his life, from an association perspective and a business perspective. Beyond that, in addition to his work advising clients, he’s an international expert on the threats that today our nation, our government, our infrastructure, our business face from all across the world. After Bill is done, I think a lot of people are going to run out and start changing their passwords.

I’ve been happy to work with the development of our CEO leadership panel this year, which will be Monday morning after we have our kickoff. Bob Gessner, who is our current chairman at ACA Connects, is going to moderate that, along with his daughter Katherine, who is the president of MCTV; Dave Heimbach, who’s the COO of ShenTel; Todd Schurz, the CEO of Schurz Communications; and then Jeff Shook at Buckeye [Communications], who is the operational head of Buckeye in the Toledo [Ohio] area. This has become kind of a tradition for us, but it’s really great to benchmark from some of our top leaders.

MCN: I see there are sessions on the legal track and on state government issues.

MP: Our SVP of government affairs, Ross Lieberman, and our VP of regulatory affairs, Brian Hurley, have been working closely with Jeff Nourse [NCTC SVP regulatory and legal affairs] on developing this very very strong legal track that will certainly attract practicing lawyers, general counsels and legal staff for our members, as well as other interested parties.

MCN: The Independent Show always struck me as one where the members realized maybe more than most that talking to other people in the industry was good for their business. In this climate, is that more important than ever?

MP: Many people say that our show harkens back to what cable used to be like. It’s always one of the top reasons our members give us in surveys for coming to the event, and that is to be able to have lunch and dinner with another member to network, to ask how they’re handling this problem or that problem, to benchmark with each other. I think that’s one of the coolest things our show provides. 

ACA Connects and NCTA-The Internet & Television Association are backing GCI Communications' request for a limited waiver from the FCC's fiber mapping requirements.

The FCC last month denied a request from GCI, which serves Alaska, for a waiver from the requirement that it provide maps of more than 2,500 miles of its aerial and buried fiber to an accuracy of 7.6 meters throughout the state with a 95% level of confidence.

GCI had said it could provide maps of its fiber within 50 meters at 80% level of confidence, but to meet the FCC's requirement it would have to "physically walk the length of buried fiber and trace the signal above ground and record the accurate location of sufficient poles (for aerial fiber) to validate and supplement any other sources of aerial fiber location information," to achieve the requisite level of confidence.

GCI again sought the waiver, and NCTA and ACA are backing that effort.

"There is no public interest justification that would require GCI to expend excessive resources to achieve the 7.6-meter reporting requirement for buried and aerial fiber," they told the commission.

As part of the FCC's Connect America Fund broadband subsidy program's Alaska Plan, GCI said it has provided the information within the requisite 7.6/95% parameters on the "thousands of nodes on which it was required to report," including “cell sites, central offices, schools, clinics, libraries, internet peering points, and other locations.” But it said that having to report on the fiber between those nodes is a bridge too far.

Related: GCi Blames Job Cuts Partly on FCC Subsidy Cutback 

NCTA and ACA second that notion.

"The purpose of filing maps of middle mile fiber facility locations is to show where Alaska Plan funding recipients may have increased performance commitments, not to ensure that funding has been used to bring broadband to a specific location," they told the FCC.

The FCC, in denying the waiver the first time around, said that the 7.6 meter standard was to ensure that the maps jibed with census boundary data given that the Alaska plan was census-block based.

"This purpose can be adequately achieved through the filing of node locations at 7.6 meter accuracy and with a less stringent 50 meter accuracy reporting for the fiber facilities running between those nodes, as GCI proposes," the trade groups said.

The bureau also pointed out that other providers were able to supply data at the appropriately granular levels, but ACA and NCTA said that the fact that some could did not mean the waiver should not be granted to GCI, which couldn't without "tremendous burden and expense."

The Federal Communications Commission voted Friday to eliminate requirements that cable operators maintain at their local office a current listing of the cable television channels that each cable system delivers to its subscribers. The agency also dropped a rule that certain cable operators make their channel lineup available through their FCC-hosted online public inspection file.

Cable operator websites post channel lineups and the information is available through other sources, including program guides and paper listings, the agency said. Cable operators are still required to send channel lineup details to subscribers at least once per year and make the information available on their websites.

ACA Connects, representing small- to mid-sized operators, praised the change.

"Eliminating these requirements is a fine example of ‘clearing the regulatory underbrush,’ which the FCC’s Media Modernization proceedings are designed to promote," ACA president Matt Polka said in a statement.

The American Cable Association is asking the FCC to tweak a cable-broadcast compromise on carriage election notifications with which it generally agrees.

That came in reply comments on an FCC proposal, comments delayed due to the government shutdown.

According to the deal struck by NCTA-The Internet & Television Association and the National Association of Broadcasters, starting with the 2020 election cycle, "a commercial broadcast TV station would be required to send notice of its must carry or retransmission consent election to a cable operator only if the station changed its election status from its previous election. In those cases, the broadcaster would send its notice to an email address listed in the cable operator’s online public file or in the FCC’s Cable Operations and Licensing System (COALS) database, for cable operators that do not have an online public file."

Only a single notice has to be send to corporate rather than each system, and by e-mail rather than registered mail, though cable operators would have to respond by e-mail confirming receipt of the election.

NAB and NCTA say the compromise “would alleviate the burdens associated with the current notification process and meet the needs of both broadcasters and cable operators.”

ACA points out that the new system would create a new burden on smaller operators who would have to post an e-mail address to an FCC database. For larger systems that means only one e-mail address rather than one for each system. But for smaller operators it is a new requirement.

ACA says to balance the new rules, the FCC should allow cable operators who can't make the deadline for designating an e-mail address and sending confirmations to broadcasters to require broadcasters to continue to file elections by certified mail per current rules in the interim. And if the FCC allows to let DBS providers continue to receive election notices by certified mail, smaller operators should be able to do so as well.

Finally, says ACA, turnabout is fair play. The FCC should adopt comparable flexibility for notices cable operators are required to send to broadcasters by certified mail.

Those cable notices include repositioning or deletion of signals, changes in technical configurations, notices that a cable system is no longer exempt from the network nonduplication or syndicated exclusivity rules (once it has more than 1,000 subs).

The FCC in January ruled that satellite carrier Dish Network was within its rights to deny must-carry to a San Francisco noncommercial TV station because the station used Priority Express Mail rather than certified mail to make its carriage election, signaling that the station's letter was trumped by the letter of the law. That is the letter broadcasters and cable ops agree needs changing.

American Cable Association president and CEO Matthew Polka’s members — small cable operators — have an outsized role on the front lines of one of the biggest issues of the day: rural broadband deployment. It has been the subject of hearings, with Polka himself recently testifying; of letters from Congress to the Federal Communications Commission; and of President Donald Trump’s promise of connected agriculture for his between-the coasts constituency.

The ACA this week is hosting its annual ACA Summit in Washington, D.C., where some 350 small and midsized independent cable providers will talk shop and take their concerns in person to Capitol Hill and to FCC officials. On their collective mind: retransmission consent, C-band satellite spectrum management and more.

Polka said the ACA supports bipartisan legislation restoring bright-line net neutrality rules, a big priority, but only if those rules are applied to such edge providers as Netflix and Google as well as ISPs.

Polka paused in his pre-show adrenaline rush to talk with Multichannel News (a media partner of the conference) about the key issues motivating his members.

MCN: Your members are in the vanguard of one of the hot issues of the day, rural broadband deployment. What help do you need from the FCC on that front. Better maps? Improvements to the subsidy process?

Matthew Polka: The first thing I would say is that the FCC has already done the biggest thing for our members, which was to eliminate heavy-handed regulation under Title II, which has encouraged investment in deployment.

That single act by chairman Ajit Pai and the FCC in December 2017 has done more for our members’ ability to deploy broadband and seek and secure investment than anything I could ever ask for, which is why one of the things that we will be talking about with the Hill next Thursday is that the light-touch of regulation on ISPs [under Pai’s Restoring Internet Freedom order] has also worked for consumers, who are receiving greater service in smaller, rural, hard-to-reach areas than they have ever received before. So, “stay that course” would be the first thing.

MCN: And about mapping, which is another hot-button issue?

MP: I do think that better mapping will be helpful in many, many ways. Mapping today is better than when we started this national broadband effort in 2009 because of form 477 [with broadband deployment data], as well as that the challenge process in the Connect America Fund to is more precise about where broadband is. But ultimately, we believe that if broadband is to be included in an infrastructure package, mapping of wired broadband is essential. More of a geocoded map that, once and for all, finally tells us where homes are served and where they are not would be a big deal in helping serve the areas that need broadband the most.

The third thing is regarding funding, whether it is the FCC’s Connect America Fund or [USDA’s] Rural Utility Service programs, we need to continue the helpful trend of laws and regulations that target funds where broadband isn’t, including the most recent definition that funds will be targeted where 90% of an area doesn’t get at least 10 Mbps downstream, 1 Mbps upstream service. That is an unserved area that should receive priority-targeted funds.

MCN: Talk about your members’ unique issues when it comes to broadband deployment.

MP: Our member companies are broadband in every sense of the word. But they do have unique issues. You noted how Washington focuses its attention on rural broadband deployment, saying: “We need to get more out there.” We agree with that focus because of the unique circumstances our members have to deal with in terms of fewer customers per mile, higher cost of technology per customer, higher cost of compliance and regulation per customer, lack of availability of technology versus larger companies with access to technology.

That underscores why we say that what is really needed in Washington this year is a consensus [net neutrality] bill, which would help consumers as well as ISPs, and even extend certain protections and regulations over edge providers.

And we’re talking about a deal I think members of Congress could reach if there is political will to do so. Codifying net neutrality principles of no blocking, no throttling, no paid prioritization, things that our members do each and every day to support their customers, which I think is not a bridge too far.

I was very encouraged by the news of the [Senate] net neutrality working group that has been created. I think that is a very, very positive sign because it shows that Republicans and Democrats can work together to try and find solutions that aren’t necessarily politicized.

MCN: Last time we talked you thought bipartisan legislation would be a steep climb, and, frankly, our takeaway from last week’s House hearing is that there wasn’t a lot of bipartisanship there. Working groups are good, but we didn’t elsewhere see a lot of hope for a bipartisan bill. You do?

MP: I can’t say I disagree with you.

Let’s face it, we’ve been fighting this issue for a lot of years. So, it is certainly hard to reach consensus on such hot-button issues. But I maintain that if we are all interested in insuring consumers’ interests are protected but also insuring that we deploy more of the broadband that consumers want — to residences, businesses, hospitals, institutions — then we have to find a way that meets the needs of both consumer and provider and we can’t be: “It’s either one way or the other.” That just isn’t going to work.

MCN: Would you support restoring a general conduct standard along with the other bright-line rules? That seems to be one of the major issues with any new legislation.

MP: That is a hypothetical I can’t answer. But we know how the general-conduct standard was applied under the previous rules. That was not helpful. It was too vague and uncertain and that was demonstrated. Just the threat of that, as well as the imposition of Title II, even with the possibility of forbearance, was enough from our members’ perspectives to basically dry up their capital, their investors and their ability to deploy more.

So, that is a very difficult question and would have to be worked out together. We would really have to roll up our sleeves in those discussions. So we would be very concerned about a general-conduct standard, but we realize that these are issues that would be on the table that we would have to discuss to reach a deal.

MCN: Have your members all but abandoned traditional video and do you see them cutting that cord entirely soon?

MP: That’s a really interesting question and a shifting paradigm right now. I don’t see our members themselves simply saying: “we’re not in the video business any longer.” Even companies that have been very forthright about it, like Cable One, which will be Sparklight soon, “de-emphasize” video but are still more than happy to provide it to consumers who want it.

I think it just shows the shift in consumer behavior. Most of our members report to us today that it is not by their choice but their customers’ actions. Out of 10 new customers they have, six to eight of them are broadband-only subscribers. And that’s because of what broadband and our members provide that allow our customers to consume over-the-top. I am that way personally. I am a very loyal Comcast subscriber and have the full boat of services. But I watch most of the video I watch on an iPad on an over-the-top service or an integrated service with Xfinity. And I am not alone.

So consumers and their habits are migrating away from cable to more of a broadband dynamic, which I think has a lot to do with the demographics of the younger consumers. But there is still a need for video in many households. It’s just that it is diminishing over time.

MCN: Is that the reason you feel the need for Washington to start regulating the edge, since that is where the video will be coming from? You seem to have a hard enough time getting program-access attention in Washington with traditional video, which does have access regulations.

MP: That’s exactly right. We have always feared that simply because of size. We have fought consolidation on the content side for many years and have seen the ills that have happened when content companies come together and get bigger and own the programming or become vertically integrated.

Now, when you are talking about the Internet and literally two or three companies, maybe four, that control internet traffic and deal with consumer privacy data and access to content with no regulation whatsoever — these things we talked about a few years ago as the “cableization of the internet” — it’s not a stretch to envision that a Google could say to an ISP: “We know, because we have the data, that 92.783% of your customers use Google as a homepage. So, now we want you to pay us $3 or $5 per month per ISP subscriber or we will block access to Google as their homepage.” That is not farfetched.

Same with Facebook conditioning access to its network or Amazon conditioning access to its network. There are many concerns that we have shared, which is why we have said that any solution on open internet policies must include edge providers, given the massive control they have over internet traffic, data and access. If we are going to be talking about a solution that focuses on no blocking, no throttling, no discrimination, no paid prioritization, as well as protection of privacy, it makes no sense, and would not be supportable, if such a plan did not include the edge providers.

MCN: So, are you in the Sen. Elizabeth Warren “break up Big Tech” camp?

MP: It is not necessarily a dodge to say this, but I had [Public Knowledge president] Gene Kimmelman on a podcast recently where he said that breaking up the big companies might be more trouble than it was worth. He cited Ma Bell and an effort that took years to break up, only to eventually result in re-consolidation. So, I am not necessarily convinced a breakup is the best route simply because of the time it would take and the complexity. This is why I think sensible net neutrality/open internet legislation that protects consumers and applies reasonably to ISPs and edge providers is the preferred method.

MCN: What other major issues will your members be focusing on in discussions with Congress?

MP: There are two in particular. One is this year’s reauthorization of the STELAR satellite bill. We have been encouraged by people like Senate Commerce Committee Chairman Roger Wicker — despite broadcasters’ attempts to dismiss it — that there should be a reauthorization [of the compulsory license that allows satellite operators to import distant TV station signals without negotiation individually for them].

Other leaders have said this as well. So there is a recognition that the reauthorization is necessary and important to our members because it is an opportunity to reexamine existing broadcast carriage rules. I am very happy to see people like Congressman Steve Scalise and Congresswoman Anna Eshoo continue to support bills they have introduced before, whether it is Congressman Scalise’s Next Generation TV Marketplace act, which would eliminate outdated retrans and copyright regulations, or Congresswoman Anna Eshoo’s Video Choice bill, which would allow for tiering of broadcast channels and standstills during disputes. These are good ideas that won’t eliminate the retrans regime, but would provide for a meaningful update reflecting a changed marketplace.

MCN: But, traditionally, STELAR-delivered reforms start big, but wind up being more nibbling around the edges. Do you see a political difference this time?

MP: I would disagree with that. I look back five years ago [STELAR comes up for renewal every five years] and, because of ACA’s efforts, we were successful in winning bipartisan language that prohibited joint negotiations by broadcasters in a marketplace.

That was a big deal. At the time we also had limitations placed on some joint services agreements. And even that has been relaxed to some degree, there continues to be great skepticism that, when companies that are non-commonly-owned come together to share services, they could be violating antitrust principles.

So, we definitely believe there could be significant change this year. I think the time has come for bold ideas to be considered rather than living with outdated regulations in 2019.

The fact is that even broadcasters’ distribution world has fundamentally changed. We had members recently involved with retrans disputes, where for example Nexstar blacked them out for more than a month, where our members found ways to give alternative programming to their customers through the [broadcast] networks that allowed for streaming of their content and even sports.

MCN: You mentioned a second big Hill issue?

MP: Yes, we will be talking to Congress and the FCC about the move to 5G and using the C-band spectrum [which operators use to get cable nets from programers]. From a 5G perspective, all forms of broadband deployment to give consumers more choices are good, whether satellite, 5G, fixed wireless, wired, you name it.

As the FCC is looking at the C-band spectrum, there are a couple of things. First, just using C-band for 5G will create interference for our members in receiving programming signals they get using satellite, so there is that issue. The satellite companies say they have filters to fix this, but our members are saying the filters don’t work. So, you have to figure out how to get signals reliably without interference, and maybe one of the ways to do that is terrestrially, but there is a cost to that.

So, our view is that if the FCC, in order to further 5G, is going to auction off C-band spectrum and bring in some $60 billion to $70 billion, it seems reasonable — just as the broadcasters have been reimbursed for repacking — that MVPDs should be reimbursed to ameliorate the negative impact of 5G, whether that is through equipment for satellite delivery or for terrestrial delivery.

MCN: Are you talking about just covering costs, or something more?

MP: It is developing. We are working with the FCC on proposals that would cover out-of-pocket costs for transition to whatever technology means are necessary to avoid the harm. There are some other elements. Broadcasters, in typical fashion, maybe asked for more than they deserve [TV stations use the C-band to receive programming from their networks, too]. We are focused on what would make an MVPD whole for capital outlay to avoid interference.

MCN: What do you hope to hear from FCC chairman Ajit Pai at the summit and how would you handicap his first two years?

MP: I will say this first: we have really enjoyed working in association with chairman Pai because of his depth of experience at the commission and what he has put into practice with his policies. And we have not always agreed with him. I mean, we are not exactly enamored with greater broadcast-ownership relaxation that gives them more power to take advantage of outdated retransmission-consent rules.

But his approach has been one we have been able to trust, rely on, and work together on. I expect him to say: “Thank you for doing what you have been doing since the Restoring Internet Freedom Order.” We told him that if those rules were lifted our members would invest and deploy, and by gosh they did.

And they are working with or without federal funds to connect their communities. Certainly I think he will recognize that what we have done together has worked.

Second, I think he will be focused on how we reach the places that still need to be reached and how we can work together to do that.

ATLANTA -- With the Satellite Television Extension and Localism Act Reauthorization (STELAR) set to expire at the end of the year, the chief lobbying group for small cable operators was optimistic it could manage to eke out some retransmission consent reform in its renewal.

At a panel session during the National Cable Television Co-operative’s Winter Education Conference here moderated by American Cable Association president and CEO Matt Polka, ACA senior vice president of government affairs Ross Lieberman said the organization has had some luck in the past in including some modest retrans reform in the act. STELAR comes up for renewal every five years -- the last was in 2014. In 2014, some cable-friendly changes to the act included re-upping the FCC requirement for “good-faith” negotiations and the agency’s ban on stations without common ownership banding together to negotiate retrans deals in a market.

Lieberman said that one of the ideas that has re-entered the mix is that of local choice, which would allow a broadcaster to set a price for its channel, which cable operators then can offer a la carte to their subscribers.

“If broadcasters think their channel is worth $10, we’ll find out,” Lieberman said.

Alpine Group executive vice president Ansley Erdel said that broadcasters have been lobbying hard to let STELAR expire, an effort she believes will fall flat. But she urged small operators to continue to inform their legislators of their side of the issue.

Related: NAB Launches Fight Against STELAR Renewal 

“Broadcasters all have a relationship with members of Congress,” Erdel said. “The only way they hear the other side of the story is if you tell them.”

Lieberman also underscored the importance of Federal Communications Commission moves to allocate a portion of C-band spectrum currently earmarked for video transport for 5G wireless transmission. While the industry was reluctantly OK with early plans to allocate about 100 MHz of the 500 MHz C-band for 5G, recently some have advocated 200 MHz, 300 MHz or even 400 MHz to be used for 5G. That could be devastating for small operators, he said.

Related: Charter: CBA C-Band Proposal Equals Backroom Deals, Windfall Profits

“This should concern your greatly because you are highly dependent on that spectrum to deliver video programming,” Lieberman said. “Higher prices are likely to result, the programmers are going to pay more and those prices will be passed along to you.”

He added that some legislators recognize the danger, but that there is a question as to whether that is fully resonating with all members of Congress.

Related: ACA: FCC Must Protect C-Band Incumbents 

Erdel said that while noise around net neutrality has gotten louder after the Democrats took the House of Representatives after the midterm elections, there is a growing feeling that a bipartisan solution could be worked out before the 2020 presidential election.

“There are people who recognize if the administration changes in 2020, we could start all over again,” Erdel said “There are a lot of legislators who would like to see something in place.”

American Cable Association president Matt Polka has good news and bad news for Congress.

That is according to his testimony for a hearing on infrastructure Wednesday (Feb. 13) in the Senate Commerce Committee.

The hearing ranges over a number of transportation sectors--railroads, airports, trucking--with Polka the only witness on the transport of bits and bytes over broadband.

The good news is that broadband providers are investing $75 billion annually in infrastructure, fixed and mobile, with no end in sight to that investment. Suggesting a sort of Hippocratic Oath for broadband deployment, Polka said government first and foremost should do nothing to harm that investment. 

The bad news is that 1) unnecessary barriers still exist that hinders deployment and more needs to be done to remove those and 2) the digital divide still needs closing.

But even the bad news wasn't that bad. He said that Congress, the FCC and Rural Utilities Service have all made headway on closing the divide. 

But in the "more can be done," Polka offered up ACA's four principles for a broadband future:

"(1) respect private investment; (2) remove barriers to deployment; (3) before adopting additional programs to close the digital divide, account for additional deployments in unserved areas resulting from the removal of barriers, the recently enacted tax law, and existing federal and state support programs; and (4) provide broadband subsidies efficiently," which it says means in "unserved," "high-cost" areas.

The American Cable Association said a number of the FCC's legacy regs "frustrate the public interest by imposing anti-competitive burdens on smaller operators."

That came in comments to the FCC on its latest biennial review of telecom regulations, which it is charged with reviewing and modifying or jettison ones that are not, or no longer, in the public interest.

ACA is particularly focused on the regulations on implementing the Universal Service Fund, the FCC-administered subsidy for advanced telecommunications.

ACA said smaller operators wind up bearing unnecessary costs and contributing more than their fair share to the fund--telecoms pay into the fund, often passing that cost on to subs in the form of higher monthly bills.

ACA wants the FCC to modify the contribution factor so it would cut down on costs and leave those operators more money to invest and compete against more highly capitalized competitors.

That, says ACA, would bring the rules in line with the public interest.

One argument ACA arguably could make is that it would free up more money for a particularly key investment--building out rural broadband, where ACA's member are on the front lines and which the FCC and Trump Administration says is a priority in an increasingly "internet of everything" world.

After congratulating the New America think tank for running "the most unbalanced panel in the history of panels," C-Band Alliance lobbyist Preston Padden accused the American Cable Association of demanding a $200,000 per system payment to "go away" from the current FCC plan allowing private sale agreements for use of the C-band spectrum, especially for 5G wireless ventures.

Ross Lieberman, ACA's senior vice president of government affairs, dismissed Padden's charge.

"It's just a lie," Lieberman said. "You've never suggested any number. You weren't even in the room the last time we met. You said there was no harm. That was the end of the discussion. I have no idea what you're talking about."

The FCC is contemplating allowing wireless carriers to compensate incumbent satellite operators for giving up spectrum, as the C-Band Alliance has proposed, but ACA says cable ops should get a piece of that pie if that is the way the commission goes.

Charter Communications vice president of regulatory affairs Colleen King, another panelist at the Feb. 5 session, offered that, "We think the best way for us to get access to spectrum ... is through an FCC auction." She acknowledged that Charter "will continue to meet with you" because "we like 5G. We'll talk to everybody."

Veteran lobbyist and TV exec Padden is now executive VP, advocacy and government relations for the C-Band Alliance, a new association representing four European-based satellite carriers -- Intelsat, SES, Eutelsat and Telesat -- that control large swaths of the spectrum used to transmit network programming to cable headends and TV stations. Padden was the first to grab a microphone during the Q&A session after the panel presentation; he directed his comments to Lieberman.

"We have told you a hundred times that we'll cover all of your members' costs. We put it in writing," Padden said. "You came to see us and said you'd go away for $200,000 per cable system. "There's a word for that. It's 'shakedown,'" Padden said with a flourish.

His accusation triggered Lieberman's adamant reply.

In response to another question about a possible FCC auction, Lieberman added, "Parties involved in the process have made it incredibly difficult for the FCC to find a path forward. There has not been a coalescing of support for the private sale."

Incendiary Title But No Easy Solution

The New America program, provocatively titled "The Great Airwaves Robbery II," featured four speakers: Lieberman and King plus spokespersons for Google and Citizens Against Government Waste. All of them questioned the current FCC plan to reallocate the C-band spectrum in ways that could -- as New America's organizer put it -- send "$15 billion-40 billion" to the four companies that now control that spectrum.

Michael Calabrese, director of New America's Wireless Future Project and moderator of the panel session in Washington, explained that he put together the session because of growing attention to the underutilized C-Band (3700-4200 MHz), which is widely sought as a resource for emerging 5G wireless services. The FCC proposed last July to reallocate at least the bottom 200 MHz of C-Band for exclusive licensing to mobile carriers and others triggered a wave of criticism about who will benefit financially from the sale.

"The comment cycle is completed," Calabrese told Multichannel News. "Presumably an initial staff recommendation and Chairman’s input could occur soon [although] we don’t really expect an Order before May or June at the earliest."

"But now that they have a record, the Chairman will likely chart a course forward for the staff," he continued. "All the groups on stage (and others) are also encouraging Congress to get interested. ... That has been the case in parallel situations in the past when this much revenue is at stake."

During the panel discussion, Thomas Schatz, president of Citizens Against Government Waste, insisted that the carriage license "is not a property right" and that funds from any sale "belong to taxpayers, not broadcasters." He urged that, "Congress must decide where proceeds should go."

In his opening remarks, Lieberman opined that the situation requires FCC action soon to achieve "full optimization of capacity." He warned that the C-Band Alliance members "will act as if they are monopolists" if they control and benefit solely from the spectrum sale.

"Their only restraint is that they [could] drive prices so high that programmers go to terrestrial," that is to non-satellite distribution, Lieberman said. He noted, however, that high-capacity internet distribution is not currently an option to many rural and small-town cable headends, ACA's member base.

Charter's King concurred that the FCC should make a decision about spectrum sale. "Not the private satellite companies," she said. "The FCC should focus on the easiest, quickest way" to resolve the reallocation.

But Lieberman's last word was that, "It will take a lot longer than anyone expects."

The American Cable Association has taken issue with Nexstar's online effort to sell the importance of its signals to local government and the impact of their absence from Antietam Broadband, with which it is currently at a retrans impasse.

ACA president Matt Polka blogged that Nexstar was pressuring a local government (in Hagerstown, Md.) to take its side in the dispute. While he called the request preposterous, he added that government oversight was in order, specifically the Department of Justice, Federal Trade Commission and FCC attention to the proposed Nexstar-Tribune merger, which ACA has big problems with.

By citing the station's role in public safety in calling for local government help, says ACA, Nexstar "wants elected officials to pressure a private company to raise cable bills for their constituents."

For its part, Nexstar's WDVM Hagerstown has posted a series of short stories on its website pointing to the local news, sports, consumer and emergency info and other content Antietam subs are missing during the impasse, a variation on the more common theme of TV stations during impasses, which is that cable subs can access the signals over-the-air—with some stations even handing out over-the-air antennas to make the point.

In the story Polka was citing, WDVM staffers and execs attended a City Council meeting to demonstrate to the mayor and council the station's "commitment to the community." While the council did not appear prepared to weigh in, WDVM VP and GM Andrew Wyatt "wants the city to get involved," WDVM reported. "The city in general has an obligation and a duty here to try to keep the public safe. Our TV station does a great deal to keep this community safe," said Wyatt, according to the station website.

Calling for government intervention is not new. Both sides of retrans impasses have in the past sought FCC help, suggesting the other side was not negotiating in good faith. But as a general matter, broadcasters have fought government intervention in retrans disputes, arguing that it is a marketplace negotiation, while cable ops say that it is, instead, a thumb on the scale for broadcasters.

Polka used the opportunity to widen his criticism to the retrans regime writ large: "Nexstar’s actions confirm our longstanding view that something is fundamentally wrong in the retransmission consent marketplace more generally," said Polka. "As Congress renews key satellite television legislation this year, it should consider Nexstar’s behavior – and commonsense reform to protect the public from such behavior."

The FCC under previous management declined to make blackouts a de facto bad faith negotiation tactic.

The American Cable Association has called on the Justice Department to open an antitrust investigation into Comcast-NBCUniversal. It would be a way to keep Justice overseeing the company after the conditions it imposed on the merger expired earlier this year. ACA is saying the government still needs a leash on the company, rather than unleash. The ACA said the problems Justice saw in 2011 when it imposed the conditions are still problems.

Comcast-NBCU said the ACA's call is meritless and "constitutes an inappropriate attempt to gain leverage in the commercial marketplace."

But President Donald Trump, who is no fan of NBC News or most big media companies with news operations that have reported critically on him, took note of the ACA letter in a tweet:

[embed]https://twitter.com/realDonaldTrump/status/1062045654711713792[/embed]

ACA was not complaining about the additional spotlight, thanking the President for his input. A spokesman for the group said they did not know how the President became aware of the letter, though his Tweet came after it was reported by Multichannel News and others.

ACA wanted Justice to extend the conditions, but that didn't happen, though antitrust chief Makan Delrahim has signaled that one of the reasons he favors spin-offs over behavioral conditions like those put on the merger is that it is hard to enforce them. He also said Justice would keep an eye on the company now that the conditions have sunset. But ACA suggests it needs to do more than monitor to keep the company in line, plus monitoring alone may not be enough to protect the rivals who have information about the company's business practices that they want to share.

ACA also asked the FCC to toughen its program access rules given that the conditions were going away, but the FCC has not done so.

Related: ACA Says Deal Conditions Should Last Longer

ACA has long complained that large program suppliers force bundled carriage and impose unfair terms due to their size and market power on the smaller entities it represents.

"By opening a formal investigation, the DOJ will demonstrate seriousness of purpose and give it the ability to collect sufficient information to determine whether Comcast-NBC is acting anticompetitively," ACA said.

ACA's letter seeking the investigation was addressed to Delrahim and offered ACA's cooperation, including providing some info on Comcast-NBCU's business practices. ACA has long said the merged company has the incentive and opportunity, and willingness, to inflict anticompetitive harms given its size relative to the smaller cable and broadband operators ACA represents.

"NBCU has shown a willingness to harm rivals, even while being subject to the 2011 DOJ and FCC conditions," said ACA President Matt Polka. "In light of these concerns, which also have been expressed by members of Congress and a diverse array of stakeholders, the Antitrust Division should immediately open an investigation into the firm’s behavior."

"In 2011, the DOJ and FCC recognized that the combination of programming and distribution assets within Comcast-NBCU created such serious competitive problems that the transaction could only be approved with robust remedies. Since that time, as demonstrated herein, Comcast-NBCU’s dominant position in the market has not lessened, and in fact, it is even greater-and the 2011 remedies are no longer in effect. As a result, Comcast-NBCU is unleashed, and consumer and rivals are bound to suffer harm."

"The video programming and distribution markets are incredibly competitive," Comcast countered in a statement. "New programmers and distribution platforms are offering consumers increasing choices on what and where to watch. At Comcast NBCUniversal, we are competing in this dynamic environment the way we always have – by continuing to innovate and conducting our business in compliance with antitrust laws and other legal requirements. Among other things, Comcast Cable has brought Netflix and YouTube to our X1 platform. And NBCUniversal has provided content to Hulu, Netflix, and hundreds of other traditional and over-the-top providers."

One of Delrahim's big issues with the AT&T-Time Warner deal, which Justice sued to block because AT&T would not agree to spin-offs rather than behavioral conditions, is that he saw it as incentive and opportunity for that merged company to disadvantage over-the-top rivals by limiting their access to either the company's programming or distribution network.

The state of California as well as the Department of Justice and the ISP trade associations that sued the state over its net neutrality reg restoration bill  have agreed to put that lawsuit on hold until the resolution of challenges to the FCC's Restoring Internet Freedom net neutrality rule dereg order, according to sources familiar with the negotiations.

The state has also agreed not to enforce the law during deliberations in federal court over the underlying FCC reg rule rollback, which means not only through the D.C. appeals court decision but a potential Supreme Court challenge if it came to that. A D.C. circuit decision is not expected until sometime next year.

They have asked the court, A U.S. District Court for the Eastern District of California, to accept their agreement and delay the suits.

ISPs are hoping that before all that happens, Congress will get together on legislation to clarify the government's authority to regulate the internet of everything.

“The Internet is inherently an interstate information service, as the Supreme Court has recognized, which means that only the federal government can set policy in this area.  A patchwork of state laws only introduces uncertainty in the broadband marketplace that will slow investment and deployment of infrastructure and hurt consumers.  I am confident that the FCC’s authority to preempt such state laws will be upheld, along with our proven market-based framework for protecting Internet openness, investment, and innovation nationwide.”

"In filings with the U.S. District Court for the Eastern District of California, California has agreed not to enforce its new Internet regulation law pending the resolution of a petition for review of the FCC’s Restoring Internet Freedom Order in the U.S. Court of Appeals for the District of Columbia and any subsequent proceedings before the U.S. Supreme Court, the FCC confirmed. "All parties have requested that further proceedings in the District Court be stayed pending final resolution of that litigation.  The agreement must be approved by the District Court."FCC Chairman Ajit Pai applauded the pause in enforcement.

“I am pleased that California has agreed not to enforce its onerous Internet regulations," he said. "This substantial concession reflects the strength of the case made by the United States earlier this month.  It also demonstrates, contrary to the claims of the law’s supporters, that there is no urgent problem that these regulations are needed to address.  Indeed, California’s agreement not to enforce these regulations will allow Californians to continue to enjoy free-data plans that have proven to be popular among consumers."

Related: Amazon Slams California Privacy Law

Both the Trump Administration and, collectively, the NCTA-The Internet & Television Association, American Cable Association, CTIA and USTelecom filed suits against the new California law, which was signed by Gov. Jerry Brown Sept. 30—it passed Aug. 31.

The law essentially restored the bright-line rules against blocking, throttling and paid prioritization that the FCC under chairman Ajit Pai had eliminated in the Restoring Internet Freedom Order last fall. The California law went even further, extending them to interconnections, which the FCC's 2015 Open Internet order, which implemented the bright-line rules, didn't even do.

Related: Court Boosts FCC's Case in Net Neutrality Fight

The Restoring Internet Freedom order also made clear it preempted state efforts to re-regulate ISPs.

Mozilla joined by others sued the FCC over that net neutrality deregulation an effort to restore on the federal level the rules California restored in the state, with oral argument in that Mozilla V. FCC suit unlikely before early next year.

California law was to have gone into effect Jan. 1. 

As expected, the FCC has voted unanimously to eliminate an annual cable data reporting requirement, including on "network structure, system-wide capacity, programming, and number of subscribers."

The commission had voted unanimously to seek comment on the proposal back in November 2017. It had tentatively concluded that "marketplace, operational, and technological changes have overtaken the utility of Form 325 and rendered it increasingly obsolete, as reflected by the Commission’s extremely limited use of Form 325 data in recent years," and that the data could also he gleaned from other sources without burdening cable with the requirement.

It was just the latest in a serious of process "modernization of media regulation" reforms undertaken by FCC Chairman Ajit Pai.

The form 325 info had to be submitted by all cable systems with 20,000 or more subs and was required from a random sample of smaller systems.

"The record was unmistakably clear that the public benefits of Form 325's data collection no longer outweighed the significant burdens that the requirement imposes," said the American Cable Association. "Although cable operators expend considerable effort to provide the FCC the information collected by Form 325, the record shows that the value of this data to the FCC was fairly minimal and accessible to the FCC from alternative sources."

Smaller cable operators are clearly pleased with their association leadership.

MCTV president Bob Gessner has been re-elected chairman of the American Cable Association's board of directors and Patricia Jo Boyers was reelected vice chair. Both are two-year terms.

"With the hard work of our ACA members as our foundation, we look forward to working with the entire ACA Board to continue our leadership role in telecommunications policy debates in Washington, D.C.," Gessner said. 

"As always, ACA is ready to work with federal policymakers to encourage further investment in our communities," said Boyers.

Gessner and ACA have been at the forefront on tech policy issues in Washington, and even a bit ahead of the curve. Back in 2016, Gessner was warning that edge providers did not necessarily deserve the virtuous actor label they had in D.C., something that has come to the fore in recent months.

And just this past March, Gessner was tapped by the House Energy & Commerce Communications Subcommittee to regulatory relief for smaller operators, which is right in ACA's wheelhouse.

Also elected to new, three-year, terms on the board were Marie Censoplano, SVP and general counsel, Vyve Broadband; Matt Dosch, COO and EVP, Comporium; John Gdovin, EVP and chief administrative officer, Patriot Media Consulting (RCN, Grande, Wave); Jim Gleason, president and CEO, Vast Broadband; and Tina Pidgeon, general counsel and SVP of governmental affairs and chief compliance officer, GCI.

The American Cable Association is backing NCTA-The Internet & Television Association's call for revisiting, and preferably eliminating, the FCC's rules on part-time leased access programming.

That came in its reply comments on the FCC's review of the rules, which deal with cable operator requirements to lease channels to independent programmers and the rates they can charge.

"ACA agrees with NCTA that the Commission should consider eliminating or limiting part-time leases, and permitting cable operators to establish minimum per day purchase requirements," ACA told the commission.

Related: Pai Signals Leased Access Do-Over

ACA and NCTA both complain that the part-time rules are a regulatory invention that imposes added costs for which cable operators are not always sufficiently compensated and that the diverse programming that additional burden was meant to generate is being taken care of by forces in a market "which is more competitive and diverse than Congress or the Commission could ever have imagined," ACA told the commission, adding: "Given the immense variety of distribution outlets available to content creators today, it is no longer supportable for the Commission to force cable operators to accommodate requests for leased access that will never generate sufficient revenue to even cover administrative costs."

Charles Stogner, president of the Leased Access Programmers Association (LAPA), sees it differently.

"[C]able operators wailing about the time and expense of handling leased access are only shedding ‘crocodile tears,' he said. "With leased access being a law since 1984 it’s hard to imagine any cable operator not being aware of the requirements when developing or purchasing an existing system."

If the FCC does not deep-six the part time rules, ACA says it should at least exempt small cable systems. 

The FCC in June voted unanimously to "modernize" its leased access rules.

Related: Stogner Has Access to Grind Over Cable Treatment

Under the current rules, cable operators are required to set aside channels, including part-time use, for lease to unaffiliated third parties according to a set formula: Cable operators with fewer than 36 channels only have to set aside channels if it was part of their franchise agreement before the leased-access rules were enacted. Those with 36 to 54 channels have to set aside 10%. Operators with at least 55 channels have to set aside 15%.

The formula has numerous other elements, including set-asides for minority programming, minimum technical support to the lessees, prohibitions on indecent programming, and rates based on the average "implicit" fee non-leased access programmers pay for carriage, essentially enough to recover costs and turn a profit, and a maximum rate for a la carte.

"What began as connecting the country via telephone lines — which were, in those early days, sometimes fashioned from cattle wire — has evolved into the innovative broadband and fiber networks of the digital age." —Jonathan Spalter, USTelecom 

In a recent spending bill, Congress made $600 million available for additional broadband deployment to America’s rural areas. The U.S. Department of Agriculture’s Rural Utilities Service (RUS) has been tapped to administer these funds through a new pilot program.

Without question, this funding is a welcome and needed addition to the growing arsenal now aimed squarely at closing the digital divide to rural Americans once and for all. USTelecom members have led the way on connecting these communities for more than a century, through companies often run by generations of the same family. 

What began as connecting the country via telephone lines — which were, in those early days, sometimes fashioned from cattle wire — has evolved into the innovative broadband and fiber networks of the digital age.

Private investment from our nation’s broadband providers has placed them among the leading investors in the U.S. economy, putting, since 1996, more than $1.6 trillion of their own capital on the line to upgrade and expand the nation’s digital infrastructure. As a result, over the past 10 years, broadband in rural homes has risen 117%.

This private investment, paired with dedicated federal programs, will connect millions more in the coming years. That’s why great care must be taken to maximize the RUS program’s effectiveness.

Coordination Is Key

Unquestionably, coordination with existing rural broadband programs and guidance from agencies with a proven track record of supporting successful deployment are critical to ensuring broadband gets deployed to the communities and households that actually need it.

Related: FCC Rural Broadband Office Bill Introduced

I emphasize this point because some prior funding efforts have resulted in duplicative construction rather than maximizing coverage across truly unserved areas. Lack of coordination between agencies and existing programs not only led to the overbuilding of broadband networks, but also to the distortion of competition in the ongoing efforts to deploy broadband.

In a blog published in April, Federal Communications Commission member Michael O’Rielly made a reasoned argument for such collaboration, encouraging RUS to coordinate with the FCC and the National Telecommunications and Information Administration to ensure the funding prioritizes unserved areas and avoids overbuilding and duplicative construction.

Related: ISPs to Senate: Limit RUS Overbuilds

The smart coordination of RUS with existing programs we know already work, such as the Universal Service Fund, can best help providers extend and sustain broadband into our most rural communities. If this coordination doesn’t happen, projects selected by RUS could risk hollowing out the “Main Streets” of small communities, leaving another program, such as USF, to pick up the surrounding portions at much greater costs. 

New RUS funding should instead focus on areas not already reached, or not likely to be reached through programs such as the FCC’s High Cost and Remote Areas Funds, intended to bring service to many of the hardest-to-reach portions of the United States.

To that end, along with NCTA–The Internet & Television Association, the American Cable Association and ITTA (Independent Telephone and Telecommunications Alliance), we submitted a letter this week to the Senate Agriculture Committee which is considering the Farm Bill, asking them to modify the RUS Broadband Loan Program to better achieve its goal of helping truly unserved areas.

In a strapped budget climate, it is imperative that federal agencies work in lockstep to ensure that taxpayer dollars are stretched to their full potential. Rural Americans who are still waiting on fast and reliable broadband service to reach their front door can’t afford anything less.

Jonathan Spalter is president and CEO of USTelecom, the telecommunications industry trade association.

Cable operators and other broadband providers want to use the Farm Bill to remove a long-time thorn in their sides, broadband subsidies that allow for major overbuilding of existing providers.

In a letter to the chair and ranking members of the Senate Agriculture Committee, the heads of the National Cable & Telecommunications Association, the American Cable Association, USTelecom, and ITTA-The Voice of America's Broadband Providers, said that while they are considering the new Farm Bill, they should consider reducing the allowable overbuilding in the Rural Utility Service broadband loan program.

Helping light a fire under the push for change is that Congress, in the RAY BAUM's Act, made $600 million available for rural broadband deployment, which will be administered through RUS.

The RUS program only requires 15% of an applicants targeted service area to be unserved, meaning 85% of the funds could be used to build where therea are already up to two providers.

"This practice does nothing to help those in rural America who still don’t have broadband service. Additionally, this government subsidization of a competitor in a market already served by one or two providers is an inefficient use of scarce funding and puts a thumb on the competitive scale, undermining future efforts to sustain existing networks or to build out broadband networks in high-cost areas, especially when those networks are built with private risk capital," they told Sens. Pat Roberts and Debbie Stabenow, chair and ranking member, respectively, of the committee.

NCTA et al. want the Senators to use the bill to modify RUS to limit funding to areas where 100% of residents have no broadband service (defined as no service of at least 10 Mbps downstream, 1 Mbps upstream), or where at least 90% don't have such service.

The Department of Justice signaled it is OK with a D.C. district court accepting a brief from smaller cable operators offering a compromise resolution to the AT&T-Time Warner merger.

That wasn't a huge surprise given that DOJ, which sued in that court to block the deal, also said its antitrust division generally doesn't oppose amicus briefs in district courts.

DOJ also said it was not weighing in on whether the ACA/RCN proposal would be "helpful to the court at this time," beyond saying it disagreed that behavioral conditions, as ACA/RCN proposed, "were appropriate in this case."

But it at least gave the submission credit for being on point.

"Unlike the two prior motions for leave to file amicus briefs, which the Court denied, the proposed RCN/ACA filing does appear to be relevant to the issues to this case, as the Court requested input with respect to alternative remedies, DOJ told the court.

Earlier this week, smaller cable operators pitched the court on a hybrid structural/behavioral remedy that could make the AT&T-Time Warner merger palatable to them.

The brief, from the American Cable Association, RCN Telecom, Grande Communications Networks, and WaveDivision Holdings, was filed Monday (May 14).

That court is currently deciding whether to block or condition the proposed merger after the Justice Department filed suit to block the deal unless AT&T spins off Turner programming assets.

The Justice Department had asserted that without spinoffs of Turner networks, the merger would mean substantially less competition and thus higher prices for consumers.

The companies argued that to make their case, the government had to prove that the merger "will likely (not potentially or possibly) lessen competition substantially, in a video marketplace that is experiencing revolutionary, unstoppable transformation and growth in competition at all levels."

The operators are not taking either side in their amicus brief, though they say they are assuming, as does Justice, that the deal as structured violates antitrust laws by "enabling the merged entity to raise prices for its programming to ACA members in excess of those that would occur in a competitive market."

They argue that the case divides along all-or-nothing positions while their's is a "middle ground," and that the court has more flexibility than DOJ or AT&T-Time Warner suggest to strike such a compromise.

Justice says that if the court concludes the deal violates antitrust laws, it can only consider DOJ's structural remedies to fix it, while Turner has offered up behavioral conditions of outside arbitration and standstill agreements for any program access complaints.

ACA and company say both are wrong, that the Turner remedy is underwhelming, and that the court can fashion a remedy that employs a behavioral remedy in addition to or in lieu of structural conditions.

That remedy would be to apply the arbitration and standstill agreements to all programming of the post-merged company, including Time Warner's HBO, tweak the arbitration process, ensure the use of bargaining agents and fee-shifting, prevent retaliation against rivals' subs, and permit the remedy itself to be tweaked or extended.

The FCC has signaled the next spectrum band it is seriously eyeing to free up for advanced telecom.

The Wireless Telecommunications, International, Public Safety and Homeland Security bureaus said Thursday (April 19) that it was instituting a temporary freeze on applications for new or modified fixed satellite service earth stations and fixed microwave stations in the 3.7-4.2 GHz spectrum bands (C-band) to "preserve the current landscape" as it looks into possibly allowing mobile broadband and more "intensive" fixed use.

The fact that the public notice was issued by four different bureaus suggests the band's future is clearly in play. The freeze also will prevent speculators from trying to get in under the wire if the band is indeed opened up.

But in a nod to cable operators who use the band for thousands of receive-only earth stations, has also opened a 90-day window where for current users of earth stations to file or register or license those or modify their current registration or license. That will also give the FCC a better idea of who is in the band, and where as it explores opening it up to others. The notice suggests it may require "require all licenses [and] registrants … to file a certification that the earth station was operational as of the start of the freeze and remains operational at the time of the certification along with additional technical details regarding their operations to inform the Commission’s resolution of issues raised in the inquiry.”

The FCC freeze follows its Aug. 3, 2017, Notice of Inquiry on Expanding Flexible Use in Mid-Band Spectrum Between 3.7 and 24 GHz.

ACA was pleased with that window.

"ACA thanks the Bureaus for taking into account concerns raised by ACA that the cost of registering the thousands of earth stations operated by ACA members - upwards of $1,200

per station - is prohibitively expensive, particularly for the smallest providers, and unnecessary as a practical matter," said American Cable Association Matt Polka. "By providing a window in which multichannel video programming distributors (MVPDs) can register their earth stations without submitting an expensive spectrum coordination report, the FCC has lowered the cost of registration by roughly $700 or 60%. Today's action also greatly reduces the complexity of the process.

"As ACA previously explained to the FCC, this relief will motivate its members to register their stations for the first time, which will ultimately help the FCC understand where and how the C-Band is currently used, and how the band can best be made available for other uses," said Polka.

The American Cable Association supports allowing broadcasters to use email rather than certified mail to make their triennial carriage elections, but with some safeguards to make sure the email gets through.

That came in reply comments on the FCC's proposal to allow more electronic delivery of information, like subscriber notices and retrans/must carry elections, to save more trees.

The FCC in January ruled that satellite carrier Dish Network was within its rights to deny must-carry to a San Francisco noncommercial TV station because the station used Priority Express Mail rather than certified mail to make its carriage election, signaling that the station's letter was trumped by the letter of the law. The proposed change to an email election would prevent such TV station snafus, but ACA is looking more to the benefits to smaller cable ops.

"We support email delivery of TV station carriage elections because it can ease the burden on cable operators to process up to hundreds of such notices that they receive from broadcasters," said ACA president Matt Polka. "Use of email to make carriage elections is clearly less burdensome and a reform ACA urges the FCC to adopt."

Related: NAB Tells FCC Retrans Should Be Default Election

ACA supports a proposal by NCTA-The Internet & Television Association and Verizon that would allow TV stations to send their elections to a single email address provided by the MVPD, but ACA wants to tweak that proposal to further minimize burdens on MVPDs, particularly its smaller and midsized operators on whom such burden falls more heavily.

ACA proposes requiring stations to send a copy of the election to an FCC-hosted address that would generate a receipt to both the broadcaster and MVPD, creating an electronic paper trail, as it were.

For smaller systems, it also wants the FCC to allow for posting email addresses in the FCC's Cable Operators and Licensing System (COALS) database, rather than the systems having to set up their own online public folder for receiving carriage notices.

ACA agrees the email system for making elections should be an opt-out regime.

ACA does not support a broadcaster proposal that stations be allowed to post their elections in public files rather than having to send them to MVPDs. It also opposes making retransmission consent rather than must carry the default election if stations fail to make a choice, as some broadcasters have suggested, saying it would "unnecessarily insert uncertainty and confusion into a process that has existed for nearly 25 years."

San Antonio, Texas — Over the past few decades one of the worst insults you could hurl at a cable operator was that it sold nothing but a “dumb pipe,” a conduit through which vastly smarter content flowed to increasingly sophisticated hardware.

But today, as broadband has become the business of choice for large and small operators — every publicly traded cable operator has more high-speed data customers than video customers — being a dumb pipe, it seems, isn’t so bad after all.

“The trends in pay TV have been absolutely horrible,” New Street Research managing director Jonathan Chaplin said at the National Cable Television Cooperative’s Winter Educational Conference here. “We’ve seen traditional linear pay TV subscribers falling off a cliff over the course of the last few years at an accelerating rate, and we think this trend continues. We think the economics of pay TV for cable companies are marginal at best.”

Cash-Flow Benefits
He then pointed to Charter Communications and Comcast, which he estimated generate $15 and $24 per month per customer in free cash flow from video, respectively.

“When a household cuts the cord and goes broadband-only, the increase in broadband pricing more than offsets the loss in profitability from the video product,” Chaplin said.

NCTC president Rich Fickle said that while some of the co-op’s members have de-emphasized video, it will likely remain in the cable package for a while. “Video is going to be a part of the equation for a long time,” he said. “It’s an established business, customers like the fact that they’ve got a good local operator that they can trust. It’s going to erode slowly over time.”

And the more that base erodes, the more cable becomes a content conduit. According to Chaplin, that’s not such a bad thing. “There is nothing wrong with being a dumb pipe,” he said. “It’s a magnificent business if there are no other pipes and if everybody wants your pipe.”

That last part might seem like a key caveat, but cable has consistently come out on top in the ongoing broadband wars, accounting for more than 100% of high-speed data customer additions for more than a decade. It seems that barring some unforeseeable calamity — like widespread, reliable and affordable 5G wireless service from telcos — cable will indeed remain the broadband pipe of choice.

Preserving that leadership role will be crucial because Chaplin doesn’t see a lot of video growth for cable operators down the road. “The entire future value of cable is in broadband — 80% of EBITDA, 90% of the enterprise value of these companies over the next few years.”

Some operators have already taken the bold move to de-emphasize video all together. Cable One did it a few years ago, as broadband revenue finally exceeded video revenue for the first time in 2016 ($344.2 million vs. $294.8 million for video). And while the big MSOs still reap a big chunk of revenue from video, the gap is closing. Comcast, the largest cable operator in the country, reported video revenue of $21.5 billion in 2015 and broadband revenue of $12.5 billion. Last year that gap narrowed to $23.1 billion for video, and $14.8 billion for broadband.

Not Too Far to Travel
American Cable Association president and CEO Matt Polka said from that perspective, it isn’t a big leap to just providing access to apps or other content sources.

“What’s wrong with giving the consumer access to go wherever they want to go?” Polka said. “We’re trying to enable all of that, our members are trying to get that choice and control more to the consumer to the extent the content companies allow us to do it.”

Retransmission consent fees are expected to rise an average of 88% by 2020 for small cable operators, according to a survey by the American Cable Association.

ACA, long an opponent of retrans regulations, surveyed its own membership and found that on average, they paid about $11 per month per subscriber in retransmission consent fees in 2017. That amount is expected to rise to $19 per subscriber per month by 2020.

Nearly a quarter of those surveyed will see a drastic jump of at least 100% in fees in the next three years, and in one case that increase is expected to be 302%.

In response, the National Association of Broadcasters cited Kagan data that shows the pace of retrans increases have slowed significantly overall in the past several years from about 65% in 2010 to 10% in 2018. And they pointed to other Kagan data showing that retrans is still a small part – about one-sixth – of overall programming costs. In addition, broadcast ratings generally exceed that of cable channels, the NAB says.

But the gist of the ACA survey is that small operators copntinue to bear most of the burden of retrans increases. According to the organization, retrans fees are the fastest growing part of customers’ cable bills, adding that in some cases, cable subscribers across the country could see up to $15 in retrans fees added to their monthly cable bills by 2020.

“This is distressing,” said ACA president and CEO Matt Polka in a statement.  “Corporate broadcasters have become increasingly aggressive over the years in charging for retransmission consent, and it’s clear that they have no reservations taking escalating amounts of money from consumers to line their pockets.”

Related: FCC: Expanded Basic Cable Price Increased 3.4% in 2015

ACA included comments from some of its membership about the impact of retrans on their operations.

For example, Citizens Telephone & Cable president Brian Cornelius claimed under his current retrans agreements, charges will rise about 105% over the next three years, or about 50 times the rate of inflation. Citizens offers service in Higginsville, Corder and Mayview, Missouri.

“It’s crazy and unsustainable,” Cornelius said in a statement, “If gas prices did that, a tank of gas would go from about $30.00 to about $70.00.”

In December 2017, Citizens was paying $8.53 per subscriber per month in retransmission fees. This month broadcasters increased those fees to $14.65 per subscriber per month — a 72% increase.

They also refused to allow Citizens Telephone & Cablevision to offer a broadcast-free cable package, which would have allowed customers to opt to use an antenna in an effort to reduce their rates, according to the ACA.

Harrisonville Telephone Co., which operates in Monroe, Randolph and St. Clair counties in Illinois, said this year it has experienced retrans rate increases of more than 100%. In 2016, the company claims it was forced to carry multicast channels or be in direct violation of the local broadcast retransmission agreement.

“The corporate broadcasters are out of control,” Polka said in a statement. “No other industry operates this way.  No other sector would get away with such massive price increases in just three years.  Why is this okay?  Quite simply, it is not, and consumers should not have to pay the bill for something Washington should have changed years, if not decades, ago.”

In the wake of a tsunami of broadband infrastructure-related bills coming out of both the House, the Communications Subcommittee has scheduled a Jan. 30 hearing on "Closing the Digital Divide: Broadband Infrastructure Solutions.

Representing cable broadband providers will be Matt Polka, president of the American Cable Association, whose members are the smaller and midsized operators on the front lines of deploying plant in rural areas.

The subcommittee lists almost two dozen bills and resolutions that will (or at least could) be the subject of the hearing, including two added Friday (Jan. 26), the Connecting Broadband Deserts Act (H.R. 4287), and the Precision Agriculture Connectivity Act, which was also introduced in the House.

The bill referring to broadband "deserts" is from Democrats Yvette Clarke (D-N.Y.) and Bobby Rush (D-Ill.), is meant to target so-called digital red-lining by defining an urban area census block where less than a third of the residents have access to advanced telecommunications as a "desert" that the FCC must take immediate action to fix by removing barriers to infrastructure investment.

Also scheduled to testify are Brad Gillen of CTIA; Nancy White of North Central Telephone Cooperative, and Jonathan Spalter of USTelecom.

With the expiration of the program access conditions on the Comcast-NBCU merger, the American Cable Association has asked the FCC to toughen its program access rules.

Those rules still apply to Comcast-NBCU. It is just the added conditions tied to the deal that were sunsetting as scheduled, though some groups had pushed for extending them, citing the Justice Department issues with vertical integration and access to programming that prompted it to file suit against the AT&T/Time Warner merger proposal.

'[B]y all accounts, the programming controlled by Comcast-NBCU is at least as 'must have' as the programming that AT&T would acquire under its proposed merger with Time Warner.

ACA President Matt Polka signaled Monday (Jan. 22) that the harms a vertically integrated Comcast-NBCU still poses are "undiminished" and require "continued significant scrutiny."

ACA would have always preferred stronger conditions than were imposed on the merger, but wants, at the least, given the sunset of the conditions that were imposed, for the FCC to possibly reconstitute parts of them as general rules, including possibly making third-party arbitration and standstill provisions, which were conditions on the deal, part of the program access rules.

ACA is also pushing for its longstanding ask of giving the National Cable Television Cooperative, which represents smaller operators in program carriage negotiations, status to file program access complaints.

Media consolidation critic Public Knowledge has asked the Department of Justice to investigate Comcast-NBCU's compliance with the conditions of the consent decree under which the companies were allowed to merge.

Those were the conditions that expired this week.

Public Knowledge cited meetings between cable operator RCN and the FCC over what RCN said was anti-competitive conduct by Comcast-NBCU, as well as a letter from Sen. Richard Blumenthal (D-Conn.) seeking an investigation and an extension of the conditions while the investigation is underway.

Public Knowledge said that even if the investigation finds Comcast was in compliance, that would mean the consent decree worked and should be extended and even made tougher.

Asked for a comment on the Public Knowledge ask, Comcast reprised its response when Blumenthal first made the request.

“There is no credible basis to pursue an extension or modification of the consent decree or conditions," the company said at that time. "For nearly seven years, Comcast has met or exceeded all of the commitments and obligations under the NBCUniversal transaction. We have filed six annual compliance reports with the FCC setting forth in detail our exemplary compliance track record, none of which has been challenged or objected to by the Commission or any third parties, including by any member of Congress.

The Coalition to Save Local Media, which could as easily be called the "Coalition to Block the Sinclair-Tribune Merger," said it will be sending letters to attorneys general in every state that has a Sinclair or Tribune TV station, asking them to probe the deal.

The merger would result in the largest broadcast TV group at over 200 stations reaching over 70% of the country.

In the letter to California AG Xavier Becerra, for example (an example the coalition highlighted), the group said: "If the proposed merger goes through, Sinclair would own 14 stations across nine markets including acquiring new stations in Los Angeles, San Diego and Sacramento. In Reno, Eureka, and Chico, the combined company would own more than one 'Big Four' station."

FCC rules prevent owning two of the Big Four affiliates in any market but FCC chair Ajit Pai has proposed allowing it on a case-by-case basis, and in any event the coalition cites a Sinclair executive saying the company did not expect to have to sell any stations.

Related: FCC Takes Wraps Off Media Ownership Proposal

"There are very serious issues surrounding the competitive effects of the Sinclair-Tribune transaction, and we urge the state of California to join DOJ’s investigation into the merger," the letter said. 

The coalition's members include cable and satellite operators and programmers that don't want Sinclair's retrans muscle to get any stronger or its footprint any larger, plus those who criticize the conservative bent of its national programming offerings and commentary, or oppose more media consolidation in general.

The other states getting their own versions of the letter are Alabama, Arkansas, Colorado, Connecticut, District of Columbia, Delaware, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Montana, Nebraska, Nevada, New Jersey, New York, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, Texas, Washington, Tennessee, Virginia, West Virginia and Wisconsin.

Smaller cable operators have told the U.S. Trade representative not to include Canadian retrans payments into a renegotiated North American Free Trade Agreement (NAFTA).

That came in a letter Monday (Oct. 16) to USTR office trade policy staff committee chairman Edward Gresser from the American Cable Association.

That was a reference to comments last spring from broadcasters who argued that Canadian MVPDS should be paying border stations for carrying their signals.

ACA says requiring Canada's MVPDs would mean that Canadian TV stations would start charging American MVPDs carrying border Canadian stations in the U.S., further driving up the price of TV service to consumers.

ACA also says broadcasters have oversimplified the complex reciprocal copyright and communications provisions defining their respective rights.

ACA already argues the retrans system is an unfair advantage for broadcasters that leads to higher prices for consumers and not necessarily to the greater investment in programming and localism broadcasters claim.

On the other side, it argues, Canada would soon be subject to the same retrans blackouts ACA argues have been plaguing the U.S. Broadcasters counter that most carriage deals are struck without incident, and those where impasses occur are simply the expiration of contracts where the MVPD is not willing to pay the price broadcasters argue their must-have programming deserves.

"The harms outlined above would only be exacerbated if the USTR pursues changes to domestic Canadian law to establish a separate retransmission consent regime in that country under which United States broadcasters could demand payment from Canadian MVPDs," ACA concludes.

President Trump has long attacked NAFTA as a bad deal that needed renegotiating, a process currently underway.

The American Cable Association has taken what it hopes will be a parting shot at Title II classification its members.

In its comments to the FCC--the deadline for official comments was Aug. 30--ACA told the FCC that Title II reclassification had been costly; harmful, particularly to its members, and unnecessary.

Costly and harmful, it said, because of the "concrete economic harms" it has already inflicted as witness five member company declarations; unnecessary because 1) the industry is uniformly supportive of an open internet, because its smaller ISP members lack the ability to be the "gatekeepers" the FCC branded ISPs in defending reclassification; because 2) the commission has authority under Sec. 706 to adopt net neutrality rules and transparency requirements without Title II; and 3), and even if the FCC concludes it does not, Congress is the best place to resolve that.

"Title II reclassification was harmful because it was a classic case of government overreach, unnecessary as a matter of economics, and incorrect as a matter of law," ACA told the commission. "It was especially harmful to smaller ISPs, their customers and communities because it increased smaller ISP costs while decreasing their incentive and ability to invest in broadband Internet infrastructure and offer innovative or beneficial new features and services to consumers."

Most ISPs have begun adopting the "end the regulatory ping-pong game" approach to advocating for Congress to step in, though in the current Congress that is a tough ask.

ACA called on the FCC to preempt state and local broadband regs, to declare broadband access to be an interstate service, establish regulator parity between mobile and fixed--which the 2015 Open Internet order did, and, just to make sure the Title II rollback sticks, forbear from "all" Title II common carrier regulation of internet access.

While theoretically FCC Chairman Ajit Pai could schedule a public vote on a new framework as early as the Sept. 28 meeting, that is unlikely given the volume of comments and attention on the issue.

ACA says it will schedule meetings with the FCC to press its case and make sure that, "whatever happens," its members, smaller and midsized ISPs, will be sufficiently protected.

While broadcasters were pushing back hard on Microsoft's request that the FCC reserve channels for unlicensed wireless, saying that would threaten viewers' access to important broadcast service, the American Cable Association was hammering broadcasters for what it said was a potential shortchanging of their own viewers.

In an ex parte filing with the FCC, the ACA said broadcasters' proposal for transitioning to the new ATSC 3.0 transmission standard also represents potential service losses.

Broadcasters have said they have every reason, without mandates, to ensure their viewers get a signal, including that they do not have a dual revenue stream and have to rely solely on the eyeballs-to-ads model, but the ACA sees it differently.

"In recent weeks, in two separate contexts, broadcasters have suggested that any commission activity that reduces viewership of any television station in any respect would harm the American people," the ACA told the commission, pointing to broadcasters objections to the Microsoft white spaces proposal.

Given that, it said, "one might reasonably have assumed that broadcasters would show similar concern about potential service loss caused by their own actions."

But the ACA said that is not the case, given broadcasters' pitch for a flexible approach to ATSC 3.0 that would not include coverage mandates.

The ACA noted broadcasters' request for no simulcasting mandate or viewers outside of a station's contour if their simulcasts do not match up.

"Broadcasters like to claim that 'there is no substitute for broadcasters’ service to their local communities,'" the ACA said. "To the extent this is true, the rules governing the ATSC 3.0 transition must reflect this claim and protect viewers from losing this irreplaceable service."

Cable operator ISPs have been pushing hard against an opt-in regime for sharing user data with third parties, but there is another opt-in regime they are concerned about avoiding.

In a phone call with office of Democratic Commissioner Mignon Clyburn, NCTA-The Internet & Television Association VP and Deputy General Counsel Diane Burstein argued against applying that regime to how broadband operators provide required notifications to their customers.

The FCC signaled this week it would be voting on a request for declaratory ruling by NCTA and the American Cable Association that they be allowed to e-mail those notifications rather than have to send out paper.

FCC Chairman Ajit Pai has signaled support for that ruling, so it is expected to pass, but how it is implemented is also important to ISPs.

Burstein told Clyburn staffers that operators would continue to offer paper notices to customers who wanted them, the default should be electronic unless a sub opts out and chooses paper. "[R]equiring opt-in consent before permitting cable operators to send the notices via electronic means would essentially negate the intended benefits of the Petition." Those include "reducing waste and energy consumption, as well conserving water."

"The record indicates that customers increasingly prefer electronic communications to “snail mail," NCTA and ACA said last year in asking for the change. They said they would only use the electronic option with customers for which they have a verified e-mail address. 

A group of nonprofit municipal broadband providers--all members of the American Cable Association--support FCC Chairman Ajit Pai's proposal to reverse the classification of ISPs as common carriers under Title II, and told him so in a letter dated May 11. The letter drew a swift and lengthy thank you from the chairman.

"By returning to light-touch regulation of broadband service, the Commission will give Muni ISPs incentives to invest in enhancing our networks and our deployment of innovative services at affordable prices while still ensuring consumers have unfettered access to the Internet," they wrote.

They also said the FCC's "overly broad and vague" general conduct standard rule and other parts of the Open Internet order was based on the "unwarranted assumption" that they have the incentive or ability to be anticompetitive.

They said the FCC, in adopting the 2015 Open Internet Order--over the dissent of Pai and fellow Republican Michael O’Rielly--ignored the evidence that they don't block or throttle or engage in paid prioritization and put them in the "straight jacket" of utility regulation and the constant threat of action under the "unknown and unknowable" general conduct standard.

Pai is also no fan of the standard, with which the FCC can look on a case-by-case basis at conduct that might not fall under the no blocking, throttling or paid prioritization "bright line" rules if the commission majority concludes it impedes an open Internet.

But they did not only talk about the negatives of the current regime. They said there will be definite benefits to reversing Title II, including a decrease in compliance costs and an increase in investment without the regulatory overhang of possible arbitrary actions or rate regulation.

The FCC is planning to vote May 18 on Pai's Notice of Proposed Rulemaking, which would reclassify ISPs, wired and wireless, as information services not subject to common carrier regs; eliminate the general conduct standard; remove interconnections from net neutrality rules, and reconsider whether the Open Internet order rules and enhanced transparency requirements were necessary.

Pai has the votes to pass the NPRM, though Commissioner Mignon Clyburn could block a vote by not attending the May 18 meeting and denying him a quorum. She has vowed to fight the rule rollback, and called on others to do so, but has not said whether or not that resistance extends to denying the quorum.

The muni ISPs were from all over the map, Massachusetts to Alabama, Iowa to the Eastern shore of Maryland.

Calling it an "exceptionally important contribution to the debate over restoring Internet freedom," Pai's response to the letter was unusually swift, and came in a lengthy statement, reprinted below.

"Nineteen non-profit, government-owned Internet service providers expressed their support for my proposal to end utility-style regulation of ISPs based on Title II. These non-profit ISPs serve small towns across America, from Bagley, Minnesota to Tullahoma, Tennessee.  They told us that the FCC’s heavy-handed rules have led them to ‘often delay or hold off from rolling out a new feature or service.  As a result, [their] customers lose out on having access to innovation and new capabilities.’  They also explained that ‘these rules are so complex and so difficult to fathom [that] we must pay lawyers and consultants to provide advice and direction to minimize any risk that we will be judged after-the-fact to be out of compliance.’

“On the other hand, these non-profit municipal ISPs explain that my proposal to restore Internet freedom ‘will provide real benefits to [their] customer-owners with no downside.’  Among other things, they say that ‘[t]he cost of regulatory compliance will go down’ and they ‘will have greater certainty that [their] investments and development of new services and features will pay off.’  In sum, a return to light-touch regulation will enable them ‘to invest in enhancing [their] networks and [their] deployment of innovative services at affordable prices while still ensuring consumers have unfettered access to the Internet.’

“I thank these non-profit ISPs for sharing their perspective on this important issue.  The fact that ISPs lacking any profit motive agree that eliminating Title II regulation will benefit consumers and promote innovation and investment is a powerful endorsement of reversing the FCC’s 2015 Title II Order.” 

Washington — The policy-driven ACA Summit in the nation’s capital March 28-30 will feature the new Federal Communications Committee chairman Ajit Pai as a speaker before cable and telecom operators spread out over the city to take their message to the agency and the Hill.

In some ways, they will be preaching to the converted.

The American Cable Association is coming off a string of victories at the FCC, most notably Pai and fellow Republican Michael O’Rielly’s successful effort to renew and expand the small business waiver from the FCC’s enhanced transparency rules that kicked in in January.

The ACA, which represents smaller, independent cable operators, had been pushing for the extension and expanding the carveout from systems of 100,000 subscribers or fewer to 250,000 or fewer. It got bipartisan support in Congress, and then Pai and O’Rielly delivered.

The chairman has also circulated an order granting the ACA’s petition that it modify the Charter Communications- Time Warner Cable overbuild condition so that the mandatory buildouts don’t have to include 1 million high-speed overbuilds.

ACA members in the potential path of those overbuilds were not happy about the condition, and the ACA let the FCC know it.

While at press time the item had not been adopted, that may only be because all three commissioners have to vote an item on circulation. Pai is clearly on board, and O’Rielly dissented from that and other conditions when the deal was approved — his office would not confirm his vote, but it almost certainly will be to jettison the condition.

Asked what the ACA will be pushing for in the new administration, Matt Polka, the association’s president, signaled the group would be pushing for “Congress to address government and private-sector barriers that hinder broadband deployment, apply light-touch regulation to the provision of broadband Internet access service and provide targeted support to encourage broadband deployment in unserved areas.”

The ACA would also like to see “new policies that modernize video regulations that also serve to spur broadband investment and deployment.” The ACA has argued for retrans reforms and preventing what it sees as unfair carriage contract provisions, like bundling, but that will be a much tougher ask from the Pai FCC, given the chairman’s past issues with stepping into contract issues.

The FCC’s new majority members will both be in the speakers’ lineup at the ACA event. O’Rielly is scheduled to speak March 29 at 1:15 p.m. and Pai March 30 at 8 a.m.

Also scheduled to be on the dais: Sen. Shelley Moore Capito (R-W. Va.), March 29 at 8:30 a.m.; Rep. Kurt Schrader (D-Ore.), March 29 at 10 a.m.; and House Republican Conference chair Rep. Cathy McMorris Rodgers (R-Wash.), March 29 at noon.

FCC chairman Ajit Pai will address the American Cable Association annual policy summit in Washington, according to ACA.

Pai will speak on the morning of March 30, before the attendees fan out to the FCC and Hill to carry their message of keeping the needs of smaller and midsized operators top of mind.

"Chairman Pai has long recognized and appreciated the important role that smaller providers play in deploying high-performance broadband networks in small communities and rural areas and in bringing competition to urban areas," said ACA president Matt Polka. "Moreover, he understands that regulations can be disproportionately costly for smaller providers and deter them from investing to meet their customers' needs.

"ACA members have spent billions on their networks over the past decade, and, as these smaller providers prepare to continue upgrading and expanding their networks, they are eager to hear from chairman Pai about his plans for the FCC to remove barriers to growth and ensure broadband service is provided to all Americans as efficiently as possible," Polka added.

Pai joins the other FCC Republican, Michael O'Rielly, who is already scheduled to speak. The summit is taking place at the Grand Hyatt Hotel March 28-30.

FCC chairman Ajit Pai says that he thinks closing the digital divide can be something that bridges the current political divide as well.

American Cable Association President Matt Polka got in the final question for the chairman following Pai's speech at Carnegie Mellon University in Pittsburgh, where ACA is based.

Polka asked whether, given the politically divided country, it would be possible to navigate between consumers needing services and the private networks that will be providing it.

Pai conceded the political divisions, but said he hoped closing the digital divide could be "an oasis from that."

He had yet to hear that people wanted better networks because they were Republicans or Democrats. He said it does not matter who gets credit for closing the divide, which is why before the election back in September he proposed Gigabit Empowerment Zones--providing tax breaks to ISPs to deliver high-speed to low-income neighborhoods. He said it was not about who won the election or who was going to head the FCC, but instead a about a blueprint for digital empowerment.

He also said that was why early on in his tenure he approved letting New York State direct some Universal Service Fund money, saying he had worked with Democratic Sen. Chuck Schumer on that effort.

This is an area where we can come together and share the credit, whether public or private, Democrat or Republican.

Pai was asked following the speech why he had not scheduled his appearance a earlier, which would have been March 14, or 3/14, or Pi Day. He joked that it was so he could warn them about the Ides of March (March 15).

The American Cable Association has filed a letter with the FCC on behalf of 38 small and mid-sized ISPs asking the FCC remove the overbuild condition in the Charter-Time Warner Cable merger.

"[W]e all have plans to invest in improved network technologies to offer greater performance or to expand our networks into unserved areas. Unfortunately, the merger condition requiring Charter to overbuild other providers has undermined those plans to provide improved services and reach new customers," the ISPs told the FCC. "We write to encourage the Commission to act in the best interests of millions of unserved and underserved customers by eliminating the overbuild condition."

The letter went to all three commissioners, but ACA is definitely preaching to the choir when it comes to FCC Chairman Ajit Pai and likely commissioner Michael O'Rielly, which would be a majority of the commission at the moment.

FCC sources have told Multichannel News that Pai circulated an item last month to adjust the Charter-Time Warner Cable deal buildout condition so that it would no longer require Charter to overbuild where a million homes were already getting broadband service.

The 2 million buildout requirement remains, but according to the item that could now all be buildouts to currently unserved homes, with no overbuilding, though Charter could still choose to overbuild those one million. They are just no longer required to do so. (Charter last year said it intended to focus its overbuild activity on telco broadband providers, not other cable companies.)

What was being circulated was, in fact, the granting of a petition for reconsideration of the deal condition by the ACA, which had asked that the overbuild requirement be removed.

ACA members serve 7 million subscribers that could theoretically be targets for overbuilds.

An FCC source said Pai's motivation for scrapping the overbuild condition is that it is more important to build to unserved houses to close the digital divide than to provide high-speed service where there is already high-speed service. He does not want the overbuild condition to be a disincentive for Charter to serve those unserved homes.

FCC officials were not available at press time to comment on the status of the chairman's grant of the petition.

If all three voted it, then the two Republicans could make it happen. But if Democrat Mignon Clyburn does not vote, it the majority would need to schedule the item for a public meeting and vote it there.

Last May, when the Charter-Time Warner Cable order was released, then-commissioner Pai blasted the overbuilld condition, and the buildout condition as well. "Charter’s increased broadband market share will come at the expense of smaller competitors," he said, adding that the order moved the FCC "one more step down the path of micromanaging where, when, and how ISPs deploy infrastructure."

Pai actually dissented from the order, but not because he thought the deal was not in the public interest, but because he thought the conditions the FCC majority extracted from the companies in what he signaled was an effort to micromanage the wider Internet economy, were not.