Hooked to his retrans impasse with LIN Media that has caused some TV stations to go dark in some Mediacom markets as of Aug. 31, the cable operator's chairman, Rocco Commisso, has written to the FCC to complain about its "inexplicable inaction" on a cable operator petition to revamp the retrans rules.
"Shortly after becoming Chairman, you said that protecting consumers was one of your goals, and you pledged that the Commission would 'strive to be smart' about how its decisions affect consumers' lives. We respectfully submit that you cannot hope to achieve that goal if you allow the Commission to continue to ignore the escalating wholesale costs for television programming," wrote Commisso in a letter dated Sept. 1.
Commisso is concerned that a new cycle or retrans deals is up Oct. 1, and that if there are no new rules to mitigate those price increases or limit the signal takedowns, the FCC will be partly to blame.
"When, as is inevitable, the retransmission consent cycle beginning this October 1 and recurring renewal negotiations for cable networks trigger a fresh round of actual and threatened service disruptions and yet another subscriber rate increase, the Commission must share responsibility with the content owners. In this regard, as of 5 p.m. [Wednesday], we were forced by LIN Television Corporation to stop retransmitting its television stations to tens of thousands of Mediacom subscribers in multiple DMAs simply because we refused to surrender to its exorbitant and discriminatory demands for triple-digit increases in retransmission consent payments."
Mediacom was among a number of cable and satellite operators and others who banded together as the American Television Alliance (ATVA) and filed a petition with the FCC for numerous changes to the retrans system, including standstills during impasses so stations would stay on cable systems and outside arbitration of disputes.
Another big issue for Mediacom and other small and mid-sized cable operators
The FCC released a Notice of Proposed Rulemaking in March that included a better definition of what constitutes as good-faith bargaining and possibly waiving program exclusivity rules (like network nonduplication and syndicated exclusivity) during such impasses so cable operators could seek deals with other stations. But the FCC signaled it does not have the authority to mandate standstills or arbitration. It has yet to vote on any of its proposed changes.
"There is no excuse for the Commission not to at least try to assert its vast authority with the goal of restoring a semblance of balance to the video programming marketplace," said Commisso, adding that he meant "no disrespect" in laying his grievances on the line.
"Mediacom's sudden conversion to consumer advocate strains the bounds of credibility," said National Assocaition of Broadcasters spokesman Dennis Wharton in a statement. "For years, cable operators have hiked subscription fees more than double the annual rate of inflation, yet programming costs account for only a fraction of their expenses. The truth is that retransmission consent fees account for only two-tenths of one percent of cable revenues today, and according to a recent study, analysts predict they will never rise above one percent."
"Broadcasters are committed to negotiating fair carriage rights reflective of the value of our most-watched programming, the proceeds of which will allow local station to continue delivering high-quality entertainment, news, sports and lifeline weather alerts that serve our diverse communities."
