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MVPDs: Specific Gannett/Belo Spin-Offs Are Not In Public Interest

MVPDs seeking to block the spin-off TV
station sales in the Gannett/Belo merger told the FCC Tuesday that higher prices and blackouts are
transaction-specific harms that the FCC can and should address.

That came from the
American Cable Association, Time Warner Cable and DirecTV in reply comments on
their petition to deny or condition the deal on disallowing coordinated retrans

There are stations
in five markets--Phoenix; Louisville, Ky.; Tucson; Portland, Ore.; and St. Louis--that would violate
the FCC's newspaper/broadcast crossownership and local ownership cap rules if
Gannett were not turning around and selling them to operating companies headed
by former Belo group chief Jack Sander, and Ben Tucker, former head of the
Fisher station group.

ACA and company
argue that Gannett's plans to spin off, but still provide some services to, those
stations is not in the public interest and should not be allowed. "The
Applicants' efforts to sanitize the anticompetitive conduct at issue by
referring to Gannett as a mere "negotiating agent" doesn't cut it, the
MVPDs argue, pointing to FCC analysis that coordinated negotiations among more
than one top four station increases prices.

In their response to
the petition, Gannett and Belo had argued that the spin-offs were within FCC
rules and that the MVPDs were trying to hold a referendum on those rules and
coordinated retransmission consent negotiations via the FCC's deal review
process, a referendum they said belonged in the FCC's still-open retransproceeding.

But ACA and company
said they were not looking beyond the deal. Instead, they said, the
broadcasters were "seek[ing] to avoid scrutiny of their anticompetitive
agreements to coordinate retransmission consent negotiations by manufacturing
procedural objections to the Petition."

ACA says they are
not asking the FCC to address the broader issue of retrans reform, which they
acknowledge will be necessary for comprehensive reform. But that is a separate
issue from whether these specific Gannett/Belo station transfers are in the
public interest. "The sharing agreements at issue threaten concrete,
transaction-specific harms, as coordinated retransmission consent negotiations
between and among Gannett, Sander, and Tucker would harm competition and
consumers," they say.