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FCC Votes To Close Terrestrial Exemption

Cable operators who do not share their owned
terrestrially-delivered regional sports networks with their competitors will be
presumed to be in violation of FCC rules against unfair acts or practices.

They get to rebut the presumption, but the FCC majority
made clear Wednesday (Jan. 20) it was taking action against what it saw as a
loophole for multichannel video providers to withhold must-have programming
from competitors.

As expected, the FCC voted to close, or at least narrow, the
exemption of terrestrially-delivered networks from program access rules.

The vote was 4-1, with FCC Commissioner Meredith Attwell
Baker joining the Democratic majority and Republican Robert McDowell dissenting
with the advice that he expected to see the decision challenged in court.

Media Bureau staffer David Konczal said there were three reasons for the FCC's action. He said cable continues to have incentive and ability to engage in unfair practices; that there is evidence of withholding programming, including must-have cable-affiliated regional sports nets in San Diego, New York.; and Philadelphia; and that there is evidence that such withholding depresses satellite subscribership, and thus reduces competition.

The commissioners voting for the order billed it as a consumer-friendly move to boost competition, while McDowell said that it was an overreach of authority whose ends might be laudable, but whose means were legally suspect. "The FCC is not Congress; we cannot rewrite statute," said McDowell.

Congress confined its access mandate to vertically integrated program nets to satellite-delivered programming, but the FCC Wednesday said it had authority under the "unfair acts and practices" section of its rules to create the complaint mechanism for terrestrially delivered nets.

MVPDs will not be able to deliver a standard-definition version of a regional sports network and withhold the HD version as a way of complying with access requirements. The HD version will be treated as a separate service for purposed of filing program access complaints.

The access conditions applied to Time Warner and Comcast in the Adelphia mergers continue in force.

Also as part of the order, the FCC adopted a "standstill" procedure for all program access complaints involving renewal of carrage that will allow for continuation of carriage during the complaint process. If granted, the temporary standstill will insure that consumers continue to receive programming pending resolution of a program access compaint.