Television has changed a lot over the past 30 years. Our nation’s TV laws have not.

October 5, 2022, marks the 30th anniversary of the 1992 Cable Act, and American consumers continue to pay the price for these outdated regulations still on the books.

Just as the 2020s are an era of transformational change, so were the early 1990s. The Hubble Space Telescope launched, the World Wide Web debuted, the Soviet Union fell, and the United States elected a new president with fresh ideas and a new approach. And Congress enacted new cable legislation.  The goal at the time was admirable — Congress wanted to protect consumers and promote localism. But what remains today of this outdated law does neither.

The Cable Act established retransmission consent fees or “retrans fees,” which are payments that TV providers make to local broadcasters to carry their TV channels. When broadcasters lobbied Congress to create retransmission consent, they told Congress the fees would cultivate localism and help local affiliates. Today, however, those fees mostly flow to network conglomerates and satisfy ever-increasing Wall Street demands.

• Today, the “Big Four” national broadcast networks have largely seized their local affiliates’ control over retransmission consent decisions. They often dictate the terms under which consent can be granted and demand a huge cut of the stations’ retrans fees — called reverse retrans.
• Retrans fees represent the fastest-rising portion of consumer pay TV bills. Over the last 30 years, big broadcast conglomerates have collected more than $74 billion in retrans fees.
• On recent earnings calls, broadcasters have trumpeted the success of their retrans cash hauls. America’s largest broadcast company, Nexstar Media Group, is twice the size of its nearest competitor and reported $4.6 billion in 2021 revenue — 52% of which is from retrans fees. Standard General and Tegna together reported $1.38 billion in retransmission fees from their 2021 revenue sum of $2.7 billion. Gray Television’s retrans revenue topped $1 billion in 2021, reporting total revenues of $2.6 billion. An increasing amount of these fees are going to hedge funds like Apollo Global Management and Standard General, who buy broadcast stations to collect these fees. 

Worse yet, if pay TV subscribers do not concede to these demands for higher fees, broadcast conglomerates pull their signals — again, something the broadcasters promised would never happen back in 1992. This leaves the pay TV provider a choice: to either pay up or go dark. Either way, consumers lose with increased prices or by suffering through broadcaster blackouts.

Retrans blackouts are near epidemic levels, with consumers enduring more than 1,500 blackouts since 2010. At the height of the COVID-19 pandemic in 2020, when consumers needed access to local news and information the most, there were more than 350 broadcaster blackouts — a record for a single year — affecting tens of millions of pay TV viewers. Broadcasters continuously weaponize TV blackouts, deliberately targeting live sports and other must-see TV, blacking out the Super Bowl, NFL and college football postseason games, the World Series, the Grammys, and network TV premieres. When blackouts finally end, consumers get their programming back, often at a higher cost.

As often happens when regulating any industry, it’s difficult to predict its future. In 1992, Congress couldn’t have envisioned the creation of Netflix or YouTube — or foresee watching TV on a cell phone or tablet. Congress couldn’t understand how this new framework would eventually fail consumers.

Today, we live in an instant, on-demand digital world. Consumers have unparalleled choice and competition for video content. The market has changed. Retrans is broken. The American Television Alliance looks forward to working with members of Congress to pass video marketplace reform that benefits consumers.

It’s time to modernize the rules that favor broadcasters at the expense of consumers. It’s time to bring America’s television laws into the 21st century. ▪️

Standard General, Apollo General and Tegna have pledged to the Federal Communications Commission that they will not jointly negotiate or share information on retransmission consent after their proposed merger-station swap, but that’s not enough for ACA Connects and the other members of the American Television Alliance (ATVA). They want conditions on the deal and an enforcement mechanism.

Standard General agreed to acquire Tegna in an $8.6 billion deal that includes the assumption of $3.2 billion in debt. Apollo Global Management (AGM) is providing some of the funding for the deal. AGM controls Cox Media Group (CMG), which will own some of the Tegna stations if the deal is approved.

In comments on that proposed deal, which is still being vetted by the FCC, ATVA said the parties are just trying to prevent conditions with a statement that has two big loopholes: “1) none of it applies to affiliates of the named parties, and 2) the part about joint negotiation does not apply to Cox.”

Also: Groups Say Tegna Deal Will Jack Up Cable Prices

The group also points out that the Justice Department has found, in another context, that CMG  and Tegna have “already” (emphasis ATVA's) unlawfully shared information. In 2019, the DOJ settled with CMG, Tegna and other broadcast groups over issues of sharing competitively sensitive information related to the ad market. Justice had alleged that the broadcasters — and, in the case of CMG, its CoxReps ad-rep firm — illegally shared information that harmed the spot ad market.

Given those issues, the FCC “cannot rely on a single-paragraph assurance about Applicants’ behavior,” ATVA asserted. Instead, it said the FCC should include a provision explicitly preventing the parties from “jointly negotiating retransmission-consent agreements for stations in the same market through collusive actions, such as by sharing retransmission consent terms and fees for any of their broadcast stations with each other.”

ATVA said the FCC “should also promulgate the kind of reasonable enforcement mechanism based on the Sinclair consent decree,” which the group proposed in its initial comments and it said should be no sweat if the applicants’ statement about their intentions regarding retransmission consent is believable. ▪️

The New Year rang in with a bit of a whimper on the retransmission consent front, with the American Television Alliance estimating that blackouts in 2021 — those periods when stations go dark as deals expire — were about one-third their number in the previous year. But distributors won’t have much time to celebrate, as the traditional deal cycle suggests that 2022 could be another record year for broadcast service disruptions.  

According to the ATVA, a trade group that represents satellite and cable companies, there were about 105 blackouts in 2021, less than one-third the record 336 stations that pulled their signal in the prior year and less than half the 278 stations that were blacked out in 2019. 

The lack of heated disputes as the clock neared 12 on Dec. 31 was in line with what Kagan, a research arm of S&P Global Market Intelligence, had predicted nearly 11 months prior. Back in February, the researcher had estimated that retrans blackouts would be lessened simply because there were fewer deals set to expire. According to Kagan, about 22 retrans deals affecting 30.2 million subscribers were expected to expire in 2021. That compares to 2020, when retrans blackouts affected about 56 million homes. 

Kagan based its predictions on the usual three-year timeline from the last public retrans transaction announcement or from earnings calls and investor presentations. Typically, broadcasters and distributors don’t reveal when a deal is up until it is, citing non-disclosure agreements embedded in retrans contracts. 

With that in mind, 2022 could see a big resurgence in retrans battles, as more deals are expected to enter the expiration queue. 

AT&T, which spun off a minority stake in its DirecTV, AT&T TV and U-verse TV units to TPG in February, struck several big retrans agreements in 2019 that could come up for renewal this year. Included in that mix are Nexstar Media Group, Sinclair Broadcast Group, CBS, Hearst TV and others that involved more than 300 stations alone. While it is no guarantee that all of those stations will go dark for some period this year, it’s a good guess that many will.

Other distributors who reached large retrans deals in 2019 include Comcast (with Nexstar and Tegna), Charter Communications (Nexstar and Tegna), Verizon Communications (Tegna, Nexstar and Cox Media), Suddenlink Communications (Tegna) and Frontier Communications (Nexstar). Dish Network reached a retrans deal with Meredith (now part of Gray Television) and Cox Media Group in July 2019. It is unclear as to whether the Meredith stations will fall under Gray TV’s retrans schedule.    

Also: No Cigar 

While there were fewer actual blackouts in 2021, several disputes that began earlier continued into the New Year. The largest is Tegna’s dispute with Dish Network, involving stations in about 53 markets that went dark on Oct. 6. Both sides have accused the other of negotiating in bad faith, and there was no indication at press time that a resolution was near. 

Verizon Fios TV customers lost access to Tegna stations in about five markets on Jan. 4, after the parties couldn’t renew their retrans agreement, which was originally scheduled to expire on Dec. 31, 2021. 

Also: AT&T and TPG: There is No Why 

Many of the bigger retrans disputes in 2021 took place at the beginning of the year and were resolved in the subsequent weeks and months. Dish Network reached a long-term carriage deal with Sinclair Broadcast Group’s 144 stations in November, but the broadcaster failed to reach an agreement for its regional sports networks. The Sinclair stations never went dark to Dish customers during those negotiations — the original deal was set to expire in August — because of a series of short-term extensions offered by the broadcaster. 

Almost exactly one year ago, Cox Media Group resolved a 20-day retrans blackout of its stations to Suddenlink subscribers, and in February last year Cox Media settled a five-day blackout with AT&T, getting its stations back in front of DirecTV, U-verse TV and AT&T TV customers mere hours before the start of the Super Bowl.

Also: New Year Ushers End to Several Cable Networks 

On the streaming side, YouTubeTV avoided a prolonged blackout of Disney channels by hammering out a deal with the entertainment giant that brought back broadcaster ABC‘s owned stations and cable channels ESPN, FX, Disney Channel, National Geographic and Freeform after a 36-hour hiatus. YouTube had promised its subscribers a $15 one-time credit to their monthly bill if a Disney blackout occurred, a pledge the company said it would still honor.   

The Google-owned streaming service also reached a carriage deal with NBCUniversal in October, avoiding a blackout. 

In the meantime, YouTubeTV and Hulu Live+ TV are still locked in a carriage battle with Sinclair’s Bally Sports Network RSNs, which went dark to those streamers in October 2020. 

Regional sports channel MSG Network hammered out a deal with Verizon’s Fios service on October 6, while its ongoing fight with Comcast, which began earlier in the month, raged on. At press time, MSG was still off Comcast systems.   

Dish dropped RSNs Root Sports Network and AT&T Sports Network in September.  Three months later it dropped its final RSN -- New England Sports Network -- making Dish the only major MVPD without a regional sports network. 

In July, Dish and HBO ended their three-year carriage battle, while earlier that month ViacomCBS struck a carriage deal for its linear and streaming networks with Charter Communications. In June, Charter struck a separate carriage deal with Multicultural News Network while Verizon signed on Black News Channel that same month. 

In January 2021, CMG struck a retrans deal with Suddenlink, while Fios averted a blackout of Hearst TV channels by hammering out a deal at the beginning of last year. 

So it isn't all doom and gloom when distributors and broadcasters make their ways to the negotiating table, and it seems the likelihood of a deal getting done without a  disruption in service is increasing. At the same time, the threat of a blackout is sometimes a broadcaster's only negotiating leverage, and most aren't afraid to use it.   

Broadcasters and distributors have been playing the blackout game for years. And though the decline in pay TV subscribership and the increase of direct-to-consumer offerings that include broadcast fare could eventually eliminate the need for these disputes — or maybe someone will invent an antenna-like device that will allow consumers to capture broadcast signals over the air for free — chances are that’s going to take a few years to fully play out. Until then, consumers, distributors and programmers will just have to deal with their retrans agita. ■

Cable and satellite operators said they aren't looking to prevent broadcasters in "truly short" smaller markets--ones that lack a full complement of affiliated stations--from affiliating with two of the top four-rated TV networks in the market, but said broadcasters are stretching the definition of "short" to conceivably include markets like Boston. 

They also said it is a stretch to believe broadcasters need dereg to remain viable, but if they are in such straights that they need a government bailout in some form, they should get a government subsidy rather than bleed MVPDs via retransmission consent fees, and accept common carrier regs in the bargain.

Also Read: NAB, ATVA Renew Retrans Battle

In reply comments to the FCC's quadrennial ownership rule review, the American Television Alliance, whose members include ACA Connects and Dish, said that the FCC has no duty to subsidize broadcasters.

The FCC is charged with regularly reviewing its ownership rules, but given the legal back and forth over the rules, it is a little behind on the 2018 review, which it is currently working on.

Also Read: NAB Says FCC's Own Policies Hurt Media Diversity

ATVA members want the FCC to close loopholes that have allowed broadcasters to create duopolies, triopolies and even quadopolies, they said.

While broadcasters cite a local news "crisis" in pushing for broadcast deregulation, ATVA said no such crisis exists and, even if there were one, consolidation is not the answer.

Broadcasters said they need more regulatory flexibility to remain economically viable among a sea of unregulated and more lightly regulated video options; ATVA said the largest broadcasters continue to reap considerable profits.

Also Read: Supreme Court Overturns Smackdown of Broadcast Dereg

"If broadcasters now want the government to “ensure” their profitability in perpetuity as if they were a public utility, then they should seek funds from taxpayers generally (rather than from a shrinking base of MVPD subscribers)," ATVA told the FCC. "In exchange, they should accept public utility regulation, such as making their signals universally available on all platforms at regulated prices and without interruption."

The American Television Alliance said the FCC was right to propose fining Gray Television a half-million dollars for violating, as the FCC alleged, the commission's local ownership rules.

The commission, for the first time, has proposed fining an affiliation purchase for resulting in what it said was a violation of its prohibition on owning two of the top-four rated TV stations in a market.

Also Read: FCC Proposes Fining Gray Half Million Dollars

ATVA, whose members include cable and satellite MVPDs that negotiate retrans deals with broadcasters, said so, too.

“We agree with the FCC that Gray’s manipulation of the local ownership rules was an egregious ‘evasion’ that warrants this fine,” said ATVA spokesperson Jessica Kendust. She said the proposal should be just the beginning of a closer look at a variety of loopholes she says broadcasters use to evade FCC ownership rules.

“Gray’s attempt to cure its violation in Anchorage by then moving the CBS programming from its full power station to the low power station and another feed on its NBC station is just another workaround broadcasters employ to exploit the system,” said Kendust. “We urge the FCC to close these additional loopholes.”

The FCC prohibition on owning two of the top four stations only applies to full powers.

ATVA has long argued that the FCC's rules allow broadcasters to skirt ownership restrictions and unfairly bundle retrans negotiations.

Gray had not returned a request for comment at press time on the FCC's proposed fine. It still has the opportunity to challenge the fine, which remains proposed until it exercises that option, and the FCC either reverses or upholds the fine, or Gray chooses to pay rather than challenge it.

It may be a new, Democratic led FCC, but broadcasters and cable operators are fighting the same retrans and media ownership battles.

On March 16, representatives of the American Television Alliance met with a top FCC staffer to argue that the current media ownership rules allow broadcasters to skirt limits and create triopolies and even quadropolies, loopholes they argued should be eliminated.

Also Read: ATVA Says Retrans Is Market Competition Problem

They argued that consolidation leads to higher retrans fees, that are passed on to consumers, as well as reduced diversity of voices.

ATVA also took aim at the larger retransmission consent regime, saying that 20% annual fee increases and record numbers of retrans-related blackouts did not represent a functioning market.

Only a few days later, representatives of the National Association of Broadcasters met with a different FCC staffer to talk about the same issues, but from quite a different perspective.

NAB said broadcasters can't provide local news, weather, sports and emergency info if they are not competitively viable, which means getting fair value for its valuable local content and not being saddled with regulations not placed on its pay TV or over-the-top video or social media digital at platforms not similarly subject to "onerous" restrictions.

NAB called ATVA an "astro-turf group" trying to undermine Congress' will in establishing the retransmission consent/must-carry regime. 

As to the FCC's ownership regs, NAB said they were too strict, not too loose, as well as outdated and harmful. As for diversity of voices, it argues that the FCC has made "no progress" on encouraging diversity of ownership under the rules it claims are necessary to do that. 

Also Read: NAB Tells Supremes to Reinstate Ownership Dereg

"The Commission must face the reality that the very rules it has established to encourage diversity in fact make broadcast investment far less attractive for historically underrepresented groups," NAB told the commission. "Given that a potential investor can choose from many other related industries that are free from onerous ownership (and other) restrictions broadcasters face, the Commission’s own actions have made it even less likely its desired outcome will be achieved."

The FCC is required to review its broadcast regs every four years to determine if they are still necessary in the public interest.

 A new Federal Communications Commission took over on Jan. 20 and is already being pressed to resolve an issue that has been percolating for several years: How to give broadcasters the best chance of leveraging the new ATSC 3.0 broadcast transmission technology while making sure MVPDs are not disadvantaged in the process.

Those on both sides of the issue have been pressing their case with FCC staffers over the past few weeks.

In 2017, when the FCC first voted to advance the new broadcast standard, commissioner Jessica Rosenworcel, who became acting chair on Jan. 20, said: “[W]e had better make sure that the high-definition signals we are now accustomed to when we watch a football game or our favorite film are not downgraded to standard definition in order to ensure broadcasters experimenting with ATSC 3.0 can simulcast two signals — one of which we can’t even see.”

ALSO READ: Noncom TVs Back NextGen TV Multicast Flexibility

Her bottom line: “The next transition should leave no viewer worse off, and leave all of us better off.” 

That consumer/viewer focus is expected to carry over, regardless who is named chair of the new commission.

Driving the push for resolution of the issue is a broadcaster petition, backed by both commercial and noncommercial (public) broadcasters.

The National Association of Broadcasters, in a petition for declaratory rulemaking filed in November, asked the FCC to declare that various multi-station arrangements for hosting and originating multicast streams in ATSC 1.0 and 3.0 are OK. The NAB has not asked the FCC to extend carriage rights to multicast streams, which are not subject to mandatory cable carriage. But the petition does say the FCC should exempt the new arrangements from broadcast-ownership rules, something to which pay TV distributors object.

Noncommercial broadcasters weighed in supporting the NAB petition, saying “clarifications” over the ATSC 3.0 rollout are needed, or the uncertainty would “hamper full [public TV] participation in Next Generation broadcasting and could prevent [public TV] stations from achieving all the public-interest benefits of ATSC 3.0.” Broadcasters refer to ATSC 3.0 as NextGen TV.

America’s Public Television Stations and the Public Broadcasting System told the FCC that public stations should not have to choose between continuing to broadcast their existing multicast streams and participating in the key new deployments of NextGen TV broadcasting.

While broadcasters are pressing the FCC to make a decision so they have more certainty about how they can roll out ATSC 3.0, MVPDs are arguing for a slower roll so the FCC can vet issues they argue remain unclear. 

ALSO READ: CEO Chris Ripley Likes Sinclair’s Gamble on Local Content

“If the commission chooses to move forward [with the NAB proposal], the commission should instead issue a Notice of Inquiry rather than a Notice of Proposed Rulemaking,” the American Television Alliance, a distributor group, told the FCC in comments on the petition. “This would give NAB a chance to better articulate its proposal.”

Gray Television, which is in the Pearl TV consortium of NextGen TV backers, said there needs to be regulatory parity between broadcasters continuing to broadcast in ATSC 1.0 and those moving to 3.0. Gray powered up its first ATSC 3.0 station in January.

“ATSC 3.0 host stations could be at a disadvantage if they do not transition all of their legacy ATSC 1.0 streams to the new standard,” Gray told the FCC. 

The solution, it said, is the NAB’s clarification that “whatever programming an ATSC 3.0 station transmits through its ATSC 1.0 partner(s) — even if not simulcast — is covered by the ATSC 3.0 station’s license.”

Rather than provide clarification and clarity, ATVA said the NAB petition muddies the waters. “[W]e are not sure that we fully grasp the parameters of NAB’s proposed rulemaking,” ATVA told the FCC. “We remain uncertain as to exactly what sort of arrangements and combinations NAB is asking the FCC to bless and cannot identify the public interest justification behind any such arrangements and combinations.”

Skirting Ownership Rules

ATVA does appear to grasp one possible outcome — broadcaster control of multiple stations in a market despite local ownership rules. The consortium said NAB’s proposal would appear to give a single station the ability to control “many multiples of its assigned 6 MHz bandwidth … regardless of local ownership limitations,” up to and including controlling “the spectrum and programming of as many other stations in the market as it would like, creating Big Four duopolies, triopolies, and even quadropolies”  without having to seek FCC approval, it said.

ATVA said that would mean consolidated retransmission negotiations and higher fees that would ultimately be passed on to consumers.

ATVA has pushed to close what it sees as existing loopholes in the local ownership rules, and is certainly not looking for the FCC to create any ATSC 3.0-related new ones.

Granting NAB’s petition would disincentivize broadcast services in favor of ancillary ones “by allowing a station the benefit of both additional 1.0 spectrum for programming and the ability to use most of its 3.0 spectrum for other services,” ATVA also argued. 

The NAB is telling the commission that broadcasters will continue to place the “highest priority” on preserving over-the-air delivery of stations’ primary channels “to the maximum extent possible.”

But broadcasters also stress the need to “highlight” new features of ATSC 3.0, including interactivity and data delivery — so-called broadcast internet. Doing both will require stations to be creative, a creativity they argue their petition will further.  

The American Television Alliance, which represents satellite and cable companies, said it is launching an ad campaign criticizing Cox Media Group, whose stations have been blacked out to AT&T pay TV subscribers in a retransmission consent dispute since Tuesday.

The ATVA ad blames Wall Street--CMG is owned by Apollo Global Management--for holding Sunday’s Super Bowl hostage in order to get higher fees from AT&T’s DirecTV, U-verse and AT&T TV. 

Also Read: Top AT&T Exec ‘Demands’ Cox Return Station Signals

“Don’t let Wall Street Black Out Main Street. Call 212 515 3200 now. Tell Apollo to turn the game back on,” reads one of the ads. “You could see fuzz instead of football this weekend,” reads another.

Also Read: AT&T Makes Cox Retrans Impasse Pitch to Hill

The ads are running online in the five markets affected, including Seattle, and in Washington D.C., using social media as well as local sports, local news, politics and on trade and industry publications.

“ATVA’s campaign will help ensure consumers know this blackout is a contrived tactic being used by Wall Street giant Apollo Global Management to hold the Super Bowl hostage in order to boost their bottom line,” said ATVA spokeswoman Jessica Kendust. 

Also Read: Congressman Jared Huffman Calls on Cox to Restore Channels

“Our campaign asks consumers to help stop this egregious service interruption by telling Apollo and their Cox stations not to let Wall Street black out Main Street,” Kendust said. “We also hope policymakers in Washington are taking notice of Apollo and Cox’s behavior and will advance consumer-first television reforms to crack down on this type of egregious price-gouging.”

While the end of the year appeared to be pretty quiet on the retransmission-
consent front with only a few disputes ongoing in 2021’s first week, 2020 was another record year for blackouts, as 336 broadcast stations went dark to pay TV customers vs. 278 in the prior year, according to industry group the American Television Alliance. 

In a statement, ATVA said the broadcast industry’s use of blackouts as a negotiating tool, especially during a pandemic, was outrageous and reiterated its call for regulatory reform. Whether that will come in a new administration with obviously bigger concerns is anyone’s guess. 

Retrans revenue has become an important part of broadcasters’ bottom lines, and the industry has long said its content has value to distributors that far exceeds the fees they pay for that content. 

Either way, retrans revenue is expected to continue to rise, albeit at a slower pace than in the past. According to Kagan, a unit of S&P Global Market Intelligence, retrans fees were expected to increase by about 2.5% to $12.2 billion in 2020, rising 5.7% to $12.9 billion by 2023.

Blackout periods in 2020 ranged from just two days (Hearst Television’s Jan. 3- 5 dispute with DirecTV involving about 25 stations) to the 59 days (Jan. 18 to March 16) that Dish Network customers were without 18 stations in New York, California, Louisiana, Mississippi, Idaho, Oregon and Washington owned by Northwest Broadcasting.

As far as ongoing disputes, most were limited to smaller pockets of the country.

At press time, Mediacom Communications, which negotiated a successful retrans deal with Gray TV stations in 35 markets on Dec. 28, was still in talks with Tegna, which darkened 16 stations in 19 markets including Davenport, Iowa, and Decatur, Alabama, to the cable company’s customers on Dec. 31. Three stations owned by GoCom Media in Central Illinois went dark to Cable One customers in that area on Dec. 31. Those stations, WSRP/WCCU (Fox) and WBUI (The CW) in Springfield, were still unavailable as of Jan. 7. 

Also on Dec. 31, Alaskan cable operator GCI lost access to ABC, Fox and The CW stations owned by Vision Alaska and Coastal Television. In a statement, GCI said it continues to negotiate with the stations for their return, but added the broadcasters are asking for “a 40% rate increase that is not the best outcome for GCI and our valued TV customers.” 

Capitol Broadcasting darkened three North Carolina stations — WRAL (NBC) and WRAZ (Fox) Raleigh-Durham and independent WILM Wilmington — to Dish customers on Dec. 31.

There are also a couple of deals pending. Cable One is facing a deadline of Jan. 11 to reach a retrans agreement for WICD, Sinclair Broadcast Group’s ABC affiliate
in Champaign/Urbana, Illinois; and Cox Media Group said six of its stations in
Tulsa, Oklahoma; Memphis, Tennessee; Spokane, Washington; Eureka, California; Greenville-Greenwood, Mississippi; and Alexandria, Louisiana could go dark to Suddenlink Communications customers “soon.” Talks between both parties were ongoing at press time. 

In a press release, Cox Media, owned by private-equity giant Apollo Global Asset Management, was pretty vague, but seemed to be setting the stage for a fight.

“Rather than reach a fair and reasonable deal with CMG, Suddenlink may instead choose to adversely impact their customers,” the broadcaster said in its release. “Now, more than ever, viewers need daily access to important and evolving information on the pandemic, and social and political issues.”

At press time, Suddenlink  parent Altice USA said it was in negotiations with Cox Media, adding that the broadcaster was demanding “higher rates than we pay any other broadcaster,” but seemed to hold out hope a deal could be reached. 

Charter-NBCU Deal Feathers Peacock 

Other larger retrans deals were made as the year progressed. Comcast’s NBCUniversal struck a comprehensive carriage agreement with Charter on Jan. 7 spanning its cable and broadcast networks, as well as an extended free trial for NBCU’s Peacock streaming service. Charter also agreed to distribute the Peacock app via its Spectrum guide in the future. 

Tegna darkened about 60 stations in 52 markets to AT&T’s DirecTV and U-verse TV customers on Dec. 1, but hammered out a deal with the satellite and IPTV services on Dec. 20. Dish Network weathered the loss of 164 Nexstar Media Group stations in 115 markets for about three weeks, eking out a deal Dec. 24.  The main sticking point of that negotiation, carriage of Nexstar’s WGN America cable channel, was settled, with Dish agreeing to carry the network on its Sling TV virtual MVPD in “early 2021.”

Comcast reached an agreement with Hearst on Dec. 15, a full 16 days before its deal officially expired, for stations in about 35 markets. Dish reached a retrans agreement with 14 Cox Media stations on Dec. 13, ending a blackout that had started back in July. Terms of all of these deals were not disclosed.  

Hearst TV also inked deals with Verizon Fios TV on Jan. 1 for stations in Baltimore; Boston; Harrisburg, Pennsylvania; and Pittsburgh. 

The American Television Alliance (ATVA) wants the FCC to require broadcasters using the new ATSC 3.0 broadcast transmission standard to deliver an HD version of their primary broadcast signal before using any of its spectrum for ancillary or supplementary services.

That came in comments to the FCC as it decides on the framework for "Promoting Broadcast Internet Innovation Through ATSC 3.0."

Related: APTS Urges FCC to Approve Broadcast Internet Item

ATVA, whose members include cable and satellite operators, also say the FCC should update, by which it means increase, the fees it charges for those ancillary broadband services, including by factoring "the value of the spectrum, the amount the spectrum would have generated via an auction, and the need to avoid unjust enrichment."

The FCC back in June voted unanimously to help promote broadcasting as a new ancillary/competitive broadband service by making it clear that legacy broadcast TV attribution and ownership regulations do not apply to broadcast-delivered internet services like over-the-top video and data made possible by the ATSC 3.0 broadcast transmission standard.

Related: FCC Says TV Stations Can Team Up for Broadcast Internet

That came in a unanimous vote via teleconference at the FCC's June 9 public meeting. The item includes a declaratory ruling on broadcast internet and a Notice of Proposed Rulemaking teeing up some questions.

Per the declaratory ruling, TV stations can enter into lease agreements with any other station, or stations, in a single market to offer internet services without triggering the FCC's broadcast ownership and attribution rules. It does not eliminate the requirement that broadcasters have to deliver a TV signal on their primary channels.

Related: APTS Strongly Urges FCC to Approve Broadcast Internet Item

The NPRM seeks comment on whether other rules need to be changed or modified to deploy broadcast internet services, including asking "whether changes to our licensing structure would provide even better certainty of investment in Broadcast Internet offerings." It also asks for input on new technologies that can use the ancillary services.

WASHINGTON — Cable and satellite operators are pushing back on the Federal Communications Commission’s loosening of local broadcast ownership rules.

The pushback came in comments by the American Television Alliance on the regulator’s quadrennial regulatory review.

Under Republican chairman Ajit Pai, the FCC has loosened the restriction on owning two of the top four rated stations in a market, continuing to presume them to be off limits but giving a chance for broadcasters to argue for them on a case-by-case basis. Sinclair Broadcast Group tried to do that in its failed merger with Tribune Media, and Nexstar Media Group is trying to do it in its effort to buy the Tribune stations.

ATVA, whose members include ACA Connects, Dish, and DirecTV parent AT&T, has said that not only should the FCC not further loosen that top-four ownership rule, as some have called for, but it must also close what ATVA says are a couple of loopholes: owning network-affiliated low-power stations that don’t count against local limits and programming digital subchannels as affiliates.

ATVA said the “loopholes” lead to higher retransmission-consent prices, which is the chief beef cable and satellite operators have with allowing broadcast groups to get larger and more powerful.

Broadcasters say the FCC should simply drop the top-four station prohibition altogether as a “per se” ban that is unjustified, a pitch the National Association of Broadcasters has made to the FCC.

The deregulatory FCC is unlikely to reinstate the top-four prohibition or start counting subchannels or low-power TV stations (LPTVs) toward ownership limits. But that isn’t stopping ATVA from spotlighting the issues, or tying them to consumer pricing.

The FCC has to weigh the financial burden of increased consumer prices when deciding what to do about the top-four rule, increased prices that “rank among the principal public-interest harms the Commission seeks to avoid,” they said.

Pai has yet to signal when the FCC will complete its latest quadrennial review.

With the NFL regular season scheduled to kick off on Sept. 6 and Major League Baseball nearing a weeks-long round of playoffs beginning Oct. 2 and leading up to the World Series on Oct. 23, a top lobbying group for the pay TV distribution industry warned fans that they should brace themselves for a flurry of blackouts from local broadcasters.

The American Television Alliance (ATVA), a Washington lobbying group consisting of top distributors including Charter Communications and Dish Network, said consumers should prepare for a blackout blitz in what is threatening to become another record year for retransmission consent disputes.

According to ATVA, there were 213 blackouts in 2017, breaking the previous mark of 193 in 2015. So far this year, there have been 83 blackouts.

ATVA said college and professional football games are the most frequently targeted and blacked out programming category, used by broadcasters as deal leverage to gain higher fees.

Broadcasters have long argued increases are necessary in many cases to ensure the ability to provide high quality programming. Earlier this year, the American Cable Association, which represents small cable operators across the country, predicted that retransmission consent fees would rise 88% by 2020, with its membership bearing most of the burden. The National Association of Broadcasters has pointed to data from S&P Global's Kagan research unit that shows that overall retrans fee increases have been declining in recent years. 

“The irony of ATVA lamenting infrequent loss of broadcast sports programming is especially rich in light of Big Pay TV’s never-ending blackout of Los Angeles Dodger baseball games that’s lasted nearly five years," NAB said in a statement. "Broadcasters have every incentive to keep our programming on pay TV platforms, as evidenced by the fact that 99 percent of all retransmission consent deals end without a disruption in service.”

Some specific examples from last season, according to the ATVA include:

• Northwest Broadcasting’s blackout of Charter Spectrum customers for more than four months, a period that included the NFL Super Bowl and NHL Stanley Cup, the 2017 MLB Playoffs, including the 2017 World Series Between the Los Angeles Dodgers and the Houston Astros; NFL Divisional Round Playoff matchups between the Seattle Seahawks and Atlanta Falcons; Pittsburgh Steelers and Kansas City Chiefs; and Green Bay Packers and Dallas Cowboys; The NFL’s Annual Thanksgiving Day Game between the Minnesota Vikings and The Detroit Lions. 
• Capital Broadcasting’s blackout of hometown fans in Raleigh, NC during a game between the NFL's Carolina Panthers and New Orleans Saints; pivotal college football matchups including a highly anticipated contest between the University of Georgia and the University of Notre Dame. 

“The TV blackout, or even the threat of one, is becoming one of the ugliest traditions in spectator sports, and it should end. Sports fans in particular are some of the most frequent victims of broadcaster blackouts, and as this crisis grows we’re afraid this year could be the worst we’ve ever seen,” said ATVA spokesman Trent Duffy in a statement. 

The FCC under Democratic chairman Tom Wheeler declined to undertake retransmission consent reform, but the American Television Alliance appears to be looking for a new view from the new Administration.

ATVA comprises cable operators, satellite operators and others who have been pushing the FCC to make blackouts and program bundling bad faith retrans negotiating tactics, but the FCC closed its retrans review without doing that.

In a letter to the FCC Friday, ATVA cited stations in 46 markets whose signals had gone dark on cable systems New Year's Day. ATVA Director Mike Chappell urged the FCC to undertake reform.

He said that FCC Chairman Tom Wheeler's blog post--back when the FCC decided no new rules were needed --"suggesting that existing rules are sufficient to protect American viewers from abuses of the retransmission consent system" was belied by that figure. " The most recent evidence demonstrates what the American Television Alliance has always maintained —existing rules do not protect the viewing public from broadcaster blackout," he wrote.

"ATVA thus urges the Commission to revisit the conclusions expressed in Chairman Wheeler’s blog post and to engage in meaningful retransmission consent reform.  Only such reform will prevent millions of Americans from losing their local service next New Year’s Day."

The December-January time period is frequently a busy one on the retrans front as contracts expire and both sides try to get the best deal. Cable operators argue that blackouts give broadcasters an advantage at consumer's expense, while broadcasters argue they are the leverage they have in often tough negotiations.

The Hearst-DirecTV blackout--affecting 26 of those 46 markets--was cited in the Jan. 6 letter, but was resolved the next day. In fact, at least 37 of the 46 have been resolved.

But ATVA's point is more about their being allowed at all, rather than the duration.

It told the FCC that most of the blackouts came despite cable operators' willingness to "true up" rates retroactively if the signals stayed on, and on the even of must-have NFL playoff games.

ATVA members include the American Cable Association, Charter, CenturyLink, AT&T, Verizon, Parents Television Council, Starz and Discovery,

WASHINGTON — The American Television Alliance has opened up a new front in the battle with broadcasters over retransmission consent — or at least a new skirmish.

ATVA, whose members include cable and satellite operators and some others, has told the Federal Communications Commission not to hand broadcasters the keys to the new ATSC 3.0 advanced TV standard, saying it should put the broadcasters’ proposal out for comment first.

“By endorsing a nationwide change in the way we broadcast television, the FCC would be imposing an unfunded mandate on U.S. consumers, as well as cable and satellite providers, who are required by law to carry local broadcast-TV signals due to ‘must-carry’ or retransmission-consent agreements, regardless of how they’re delivered to them by broadcasters,” the group said.

ATVA gives a lot of reasons for not just endorsing the broadcaster petition without further study, but the one closest to its mission statement is that it could add a new fee to the broadcast retransmission-consent fees cable ops already argue are too high and getting higher.

What does the new interactive-TV standard have to do with retransmission consent? Potentially a lot, ATVA has argued — specifically tied to the new equipment that will be needed to retransmit broadcast signals.

ATVA representatives outlined their concerns in a meeting with FCC officials, including Media Bureau chief Bill Lake, though they will likely have to follow up when a new Trump administration takes over in a few weeks.

Among the ATVA members represented at the meeting were independent-operator trade group the American Cable Association, Charter Communications, AT&T and Dish Network.

The National Association of Broadcasters and technology companies have asked the FCC to let TV stations start rolling out the new standard on a voluntary basis in conjunction with the post-incentive auction repack of TV stations, pledging to simulcast while they did so. (The standard is not compatible with current sets.)

They wanted a decision by October, so they would likely argue the FCC has already not moved particularly rapidly.

ATVA members told the FCC that given the many issues involved and potential viewer dislocation, the agency should first issue a notice of inquiry, as it did with the 2009 transition to digital television.

The NAB responded to ATVA in a filing last week.

“Despite ATVA’s handwringing concerning forced carriage of Next Generation TV [ATSC 3.0] signals and the costs MVPDs might be forced to bear to carry such signals, petitioners have stated, again in unmistakably clear terms, that MVPDs will not be forced to carry Next Generation TV signals,” NAB said. “Just as simulcasting of broadcaster signals will protect viewers, so too will it protect those MVPDs that receive signals over the air and elect not to carry Next Generation TV signals. If MVPDs elect to carry Next Generation TV signals, there may be associated costs, but that choice be will theirs. “

ATVA said that what is not voluntary in the incentive auction is that MVPDs may have to pay new, per-subscriber patent royalties to retransmit station signals.

“While it appears that broadcasters may benefit from a blanket license covering their use of this technology, patent holders apparently intend to charge new, and potentially substantial, per-subscriber royalties for ‘subscription- based’ services. No such royalties apply to ATSC 1.0 retransmissions,” ATVA said. “This would mean that, for the first time, every MVPD will be burdened with new royalty payments — separate and apart from retransmission consent fees — for the retransmission of broadcast signals, resulting in even higher prices for consumers.”

In any event, ATVA wants to make sure the government-mandated standard is “reasonable and nondiscriminatory.”

ATVA also raised the issue of leveraging the new standard to increase broadcasters’ negotiating muscle in carriage deals. “Any station group with sufficient leverage to compel carriage of unwanted programming or to raise consumer prices by 40% per year, possesses sufficient leverage to compel carriage of ATSC 3.0 signals as well — either directly or through ‘standalone’ offers that represent an obviously unreasonable alternative (e.g., a choice between carriage of both formats at $1.00 per subscriber and carriage of only ATSC 1.0 at $10 per subscriber,” it said.

While broadcasters want the FCC’s green light, ATVA concludes a flashing yellow is the way to go.

“The commission should ensure that it fully understands the ramifications of these changes before it acts — especially in light of the ongoing work in ATSC itself,” they told Lake and company. “A notice of inquiry represents the best way forward.”

Broadcasters continued to eke out double-digit percentage increases in retransmission-consent revenue in the first quarter, despite mounting evidence that the pay TV universe is shrinking.

A look at some of the top broadcast station groups show that retrans revenue, while still rising at a healthy double-digit percentage clip, leveled off a bit from the triple-digit increases of a year ago. But overall growth at the top five publicly traded broadcasters rose a collective 25% in the period, slightly behind the 35% increases in the first quarter of 2015.

SCRIPPS LEADS THE CHARGE

Leading the charge was E.W. Scripps, which boosted its quarterly retrans haul 92% to $53.6 million, behind the 123.8% increase in the same period last year. Sinclair Broadcast Group — the largest station owner with 172 broadcast properties in 81 markets — maintained a high-single digit percentage increase in the period, although it told analysts those raises will taper off in the next three years as its deals mature.

Sinclair said its next big retrans negotiation will be at the end of the year, with Comcast, and it expects 2017 retrans increases to be in the mid-single digits, dipping to the low-single digits by 2018.

The company, which has been aggressively accumulating stations over the past five years — it had only 58 stations in January 2011 — will have some added leverage in retrans negotiations going forward. It agreed to purchase sports network Tennis Channel in January (the deal closed on March 1), adding to its growing stable of cable networks that include American Sports Network, Ring of Honor and Comet TV. While Tennis Channel had little impact on the first quarter — it had only been officially under the Sinclair umbrella for a month in the period — the network is expected to have influence in future negotiations.

The second-largest station owner — Nexstar Broadcast Group, with 104 properties in 54 markets — saw retrans revenue rise 46.2% to $97.3 million in the quarter, less than the 89.5% increase in the same period in 2015.

Of the top six station owners, all except Tegna, the former Gannett broadcasting group, reported a smaller percentage increase in Q1 2016 than in the prior year. That could be in part because of a declining pay TV subscriber base, as total pay TV customers fell by 1.2% in the quarter. But it is more likely tied to the timing of retrans renewals and overall market maturity. Tegna said it expected retrans to grow more than 30% for the rest of the year.

MVPDs reached several retrans deals with station owners in the first quarter, including Cox (with Nexstar), Time Warner Cable (with Scripps) and Dish (with Cordillera Communications), which likely had an impact on revenue growth. Most of those deals — except for TWC and Scripps — also included brief blackout periods, which one pay TV industry group believes has a huge impact on rates.

The American Television Alliance, a group that includes the traditional pay TV distributors such as Charter Communications, Cablevision Systems, DirecTV and Dish Network, said there were 193 blackouts in 2015 — a new record and more than twice the 94 blackouts in 2014. So far in 2016, 26 blackouts have occurred, and more are expected as deals come up for renewal, usually around major sporting and entertainment events.

The ATVA sees a direct correlation between blackouts and higher retrans fees, adding that oftentimes consumers are forced to pay higher rates after a dark period has ended.

“Each broadcaster’s quarterly earnings report is further confirmation that the retrans cash grab is driving the TV blackout crisis,” said ATVA spokesman Michael Hacker in a statement.

Back in July 2015, SNL Kagan raised its estimates for overall retrans revenue growth to $10.3 billion by 2021, a 63% increase from the $6.3 billion in 2015. CBS alone has said it will generate about $1 billion in retrans revenue in 2016, growing to $2.5 billion by 2020.

RETRANS TAKES UP THE SLACK

Retrans fees have been a savior for some broadcasters, taking up the slack in recent years as the advertising market has tanked. But even as ad sales have begun to rebound — Morgan Stanley media analyst Ben Swinburne said in a recent note that the first quarter was the strongest for national TV ads since Q3 2013, with broadcast advertising revenue up between 8% and 10% — retrans fees continue to rise.

While overall percentage growth appears to have slowed in the first quarter, Pivotal Research Group CEO and senior media and communications analyst Jeff Wlodarczak said it probably won’t last long, adding that it could simply be a result of the “law of large numbers.”

“As they keep getting bigger, the growth is going to slow,” Wlodarczak said. “I see broadcasters trying to push through higher fees on distributors to offset lost revenue from cord cutters/shavers, which will of course only exacerbate the problem.”

Pay-TV providers in a pitched battle with broadcasters over retrans fees latched on to a comment attributed to CBS CEO Les Moonves at the Code Conference on May 27. “We're programmers," Moonves said, according to reports. "The term 'broadcasting' doesn't mean anything anymore."

The American Television Alliance used the remark to hammer CBS, which has aggressively sought more retransmission compensation under Moonves, who wants what he considers fair value for TV stations that still provide the most popular programming viewed on cable.

"If CBS wants to be treated like every other channel, then by all means, they should surrender their spectrum back to the government and give up all their special government handouts like 'must carry' and other regulatory advantages,” ATVA spokesman Trent Duffy said.

ATVA members include Charter, Time Warner Cable, Dish, DirecTV, telcos and other multichannel video providers, united in their desire to obtain relief from existing must-carry and retransmission-consent regulations.

"A foundational principle of federal communications law is that in exchange for free use of the public airwaves broadcasters agree to take actions that benefit the public.  These principles are enshrined in the Radio Act of 1927 and the Communications Act of 1934, which mandate that broadcasters serve the public interest, convenience and necessity. 

Apparently, that’s news to CBS President and CEO Les Moonves."

But Duffy was just getting started.  

"As retransmission fees continue to skyrocket, local news and public interest programming is dying. Local stations are cutting back newsroom budgets and laying off reporters. There is only a 7% chance that a ‘local’ television station is actually locally owned. According to the FCC, 32% of local TV stations ‘did not air a single minute of news programming.’ 

CBS declined comment, but ATVA's opposite number in the retrans battle, the broadcaster-backed TV Freedom, whose members include the National Association of Broadcasters and the CBS affiliate association, fired back.

“U.S. laws that protect and advance free and local broadcast TV are the sole remaining safeguard guaranteeing consumer access to this highly valued content,” TVfreedom.org spokesman Robert Kenny said. “These laws not only guarantee consumers free access to the lifeline and investigative reporting produced by local TV stations via a digital antenna, but they help ensure that broadcast TV content, including network programming, is available to consumers through traditional pay-TV subscriptions.”

“If the American Television Alliance and its members were truly concerned about the best interests of consumers, they would refocus their efforts on lowering pay-TV customers’ bills and making all charges more transparent on monthly statements.”