Cable Networks Sue FCC Over Dual Carriage

Washington -- Major cable TV programmers, including C-SPAN, Discovery Communications and The Weather Channel, are suing to block the Federal Communications Commission from forcing cable systems to carry some local TV stations in analog and digital format for three years, beginning in early 2009.

The cable networks are objecting to the FCC's so-called dual must-carry rules, under which commercial TV stations that demand cable carriage are entitled to distribution in an analog and digital. The tiny number of cable systems that have gone all-digital, meaning they have reclaimed their analog bandwidth, are exempt from the dual carriage requirement adopted by the FCC in September 2007.

TV One, A&E Television Networks and Scripps Networks also sued in a joint appeal filed with the U.S. Court of Appeals for the D.C. Circuit. No cable operators are parties.

The legal maneuvering didn't sit well with National Association of Broadcasters. NAB executive vice president Dennis Wharton issued a statement, saying that the suit effectively broke a promise by the National Cable & Telecommunications Association ensuring that analog cable customers would not lose access to free programming provided by niche and minority TV stations after the digital television transition.

“Today's lawsuit by a handful of self-serving pay TV programmers represents yet another attempt by cable interests to block a successful digital television transition," he said. "By reneging on the NCTA commitment to preserve cable carriage of local broadcast stations to all cable customers after February 2009, these programmers threaten to block consumer access to scores of foreign language and religious TV stations all over America.

“NAB salutes FCC chairman Martin and his colleagues for adopting a rule preserving the viewability of diverse local broadcasting outlets,"Wharton continued, "and we will aggressively fight the pay TV programmers' attempt to dictate terms and conditions of the DTV transition.

TV stations won must-carry rights from Congress in 1992 and the Supreme Court sustained the law five years later in a 5-4 ruling. But the legal issues and market conditions then were much different from now.

"The 1992 Cable Act is very clear," said FCC spokeswoman Mary Diamond in a statement. "Cable operators must ensure that all local broadcast stations carried pursuant to this Act are 'viewable' by all cable subscribers.   The commission’s order made sure that the over 40 million cable subscribers with analog cable will continue to receive the same broadcast stations after the transition. 

"Ultimately, the American consumer is, and continues to be, our highest priority as we make this conversion to digital television," the statement continued. "All Americans with cable -- regardless of whether they are analog or digital subscribers -- should be able to watch the same broadcast stations the day after the digital transition that they were watching the day before the transition."  

The programmers offered a different perspective.

“The Supreme Court has made it very clear that cable programmers have First Amendment rights,” said C-SPAN chairman Brian Lamb, “so it is frustrating to us and the other companies involved in this appeal, that our audiences risk losing our programming and that we have to go to court just to get a fair shake from the FCC.”

The programmers claim that the FCC's rules violate the First Amendment, with the result being that cable networks will be pushed off cable systems to accommodate TV stations with unnecessary duplicative carriage rights.

"The companies claim the FCC’s favoritism to broadcasters not only ignores the public interest value of their programming, but it also violates their First Amendment right to ‘speak’ to cable subscribers when they are forced off, or kept off cable systems because the limited available channel space must be given to broadcasters under the dual must-carry rule," the companies said in a joint statement released on C-SPAN stationery.

The window to sue the FCC opened on Feb. 1 when the FCC’s rules were printed in the Federal Register -- 143 days after adoption by the agency.

NCTA isn’t planning to launch a legal challenge. Instead, it will lobby the FCC to issue a broad exemption for small systems, a move FCC chairman Kevin Martin has opposed because he believes small operators’ capacity crunch is being exaggerated.

“NCTA doesn’t intend to file an appeal of the order; however, we urge the commission to quickly approve a blanket exemption for small cable systems that do not have the capacity for dual carriage,” Brian Dietz, NCTA’s vice president of communications, said in a statement last Friday.

The dual-carriage mandate begins on Feb. 18 2009. Oral arguments in the programmers' case are not expected to be heard until autumn. Since courts take a few months to issue rulings, a ruling in this case might not come out until after cable operators have begun to comply.

FCC chairman Kevin Martin rejects calling the rules “dual carriage.” He calls them “viewability” rules, arguing that the exemption for all-digital systems proves that no dual-carriage requirement is being imposed.

Martin’s analysis underwent a market test of sorts a few weeks ago when Comcast tried to give every analog-only customer in Michigan a free digital set-top box for one year to ensure that public, educational and governmental channels would be viewable on analog TV sets.

Local governments rebelled, complained to House Energy and Commerce Committee chairman John Dingell (D-Mich.) and finally got a federal judge to enjoin Comcast from proceeding.