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EchoStar: Tougher Arbitration for DirecTV/News Corp.

A combined News Corp./DirecTV Inc. must not be allowed to deny programming to competing cable and satellite carriers while contract disputes are in arbitration, EchoStar Communications Corp. told the Federal Communications Commission.

EchoStar officials said a proposal to require News Corp. to submit to arbitration when it can’t reach a deal with carriers trying to buy its programming must not allow the company to deny its networks to rivals even for a short time.

In a filing to the FCC, EchoStar said News Corp. would have great incentive to temporarily deny access to regional sports networks or local Fox owned-and-operated stations while the arbitrator crafts new carriage deals. Such denials would have "a debilitating effect on that distributor’s ability to compete in the region," the company added.

The commission is considering the arbitration requirement as a condition for approving News Corp.’s $6.6 billion bid to acquire control of DirecTV because it is concerned that combining News Corp.’s extensive cable and broadcast programming with a nationwide multichannel distributor would give it leverage to charge above-market prices for programming.