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FCC Votes Unanimously To LaunchRetrans Rulemaking

The FCC voted unanimously Thursday to propose several
changes to its retransmission consent oversight rules meant to better clarify
what bargaining in good faith means, including possibly eliminating the
syndicated exclusivity and nonduplication rules.

The FCC has the authority to insure that broadcasters
and MVPD's negotiations meet a good-faith requirement, but FCC Media
Bureau Chief Bill Lake said that recent retrans disputes have become more
"contentious and more public." He did not say more frequent, which
broadcasters argue is not the case. Commissioners Meredith Attwell Baker
and Robert McDowell pointed out during the FCC's meeting to vote on the
proposed changes that most deals are done privately and quietly.

The Notice of Proposed Rulemaking voted on Thursday
essentially asks a lot of questions and comments on proposed changes. FCC Democratic
Chairman Julius Genachowski said at the meeting that those would require
statutory change. It issues from the starting point that the FCC does not
have the authority to mandate carriage or arbitration. But it does suggest a
number of possible changes, specifically to "Provide more guidance to the
negotiating parties on good-faith negotiation requirements; improve notice to
consumers in advance of possible service disruptions caused by impasses in
retransmission consent negotiations; and eliminate the Commission's network
non-duplication and syndicated exclusivity rules, which provide a means for
parties to enforce certain exclusive contractual rights to network or
syndicated programming through the Commission rather than through the

Other issues raised include the impact of early termination
fees on the ability to switch providers to avoid blackouts, whether networks
should be allowed to negotiate retrans for affiliates, and whether a
station should be able to negotiate for a station it operates under a
joint services agreement.

Genachowski and
Republican Robert McDowell both emphasized that parties currently
negotiating remain at the table. McDowell said he was concerned they would see
the FCC move as a sign the commission would be intervening. He said they should
not assume any particular action by the commission. The chairman echoed that in
his statement, saying "this is not a signal or excuse for
foot-dragging," and the FCC could view such foot-dragging as "bad
faith negotiation."

House Energy & Commerce Committee Chairman Fred Upton
(R-Mich.) cautioned the FCC against doing too much. "The government should not
be intervening in program carriage arrangements in this competitive
marketplace," he told B&C/Multi. "The parties should be free to
negotiate over compensation for programming or carriage, and to walk away from
the table if they do not reach mutually agreeable terms."