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FCC Backs More Flexible MVPD Retrans Notices

The FCC has voted unanimously to propose eliminating the requirement that cable operators provide their subs at least 30 days notice of a TV station channel coming off their systems, changing it to notice "as soon as possible" given that retrans deals are often struck in the 11th hour.

It must still collect comment on the proposal and vote on a final order, but that will almost certainly happen.

Under the FCC's current rules cable ops have to provide that 30-day notice before a channel comes off if that change "is within the provider's control."

The problem is that most disputes wind up being resolved in that 30-day window, so the notifications wind up being for takedowns that never happen. "[W]e don't want consumers to be inundated by premature and inaccurate notices about channel changes that never come to pass," FCC chair Ajit Pai said last month in announcing the vote.

The item also seeks comment on whether "to require that notice of rate or service
changes—regardless of whether those changes are due to failed carriage negotiations be
provided by cable operators to LFAs (Local Franchising Authorities) only if required by an LFA."

"To be truly meaningful, notice must be relevant, timely, and actionable," said commissioner Brendan Carr. "And, most of all, accurate. If our subscriber notice requirements for cable service changes are not providing customers with meaningful information, then the notices may be doing more harm than good."

Commissioner Geoffrey Starks supported the item, but with some reservation.

"I firmly believe that transparency is key and our regulators should communicate early and often with customers about any changes to their rates or service," he said. "This NPRM proposes to amend our statutorily mandated cable consumer protection rules in a way that, I fear, could result in less information being shared with consumers and more unwelcome surprises in the form of blacked out channels and lost service."

But he said that after the chairman agreed to add questions about what consumer harm could stem from noticing a blackout after it had already begun and how notices should be conveyed, among others, he would vote for the item and review the record that develops.

Commissioner Michael O'Rielly called it an important update up the FCC's rules, which has become a monthly ritual. He said the FCC needed to proceed judiciously given that even the slightest change can impact the bargaining power of one side or the other. But he also said there was a need for wholesale reform given the existential threat traditional broadcasters and MVPDs from "virtually unregulated over-the-top and streaming video providers."

Commissioner Jessica Rosenworcel said the purpose behind the 30-day advance notice rule is clear--viewers need notice--but it needs to work in the real world. She said it makes sense to take a fresh look, but also not forget to put consumer interests first. She applauded the removal of tentative conclusions and added questions she asked for, and so she, too, supported the item.

Pai said that most retrans disputes are resolved shortly before such deadlines and the FCC rules "simply don't reflect that reality."

"We commend the FCC's unanimous vote launching this proceeding. Consumers would be ill-served by requiring operators to send confusing and unnecessary notices about potential channel line-up changes, where parties are engaged in active negotiations at the end of a contract term," said NCTA-the Internet & Television Association. As we have seen in the marketplace, the vast majority of such negotiations end successfully without any direct consumer impact. We look forward to working with the FCC to bring this bipartisan proposal to a swift conclusion."