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New Bill Would Kill Retrans Regime, Compulsory License

(Image credit: Future Media)

A bipartisan pair of legislators have introduced a bill that would eliminate some "outdated" regulations including the must carry-retransmission consent regime that broadcasters use to secure payments from MVPDs for their local programming/signals and the compulsory copyright license.

Broadcasters were not happy, while MVPDs were pleased with the prospect of must-carry going away, which they have long argued was a thumb on the scale for broadcasters, who can demand carriage, though it means they can't negotiate payment.

Also Read: Eshoo, Scalise Call On Nexstar, AT&T to End Blackout

Introducing the Modern Television Act of 2021 were Rep. Anna Eshoo (D-Calif.) and Republican Whip Steve Scalise (R-La.), both familiar retransmission consent regime critics.

The legislators signaled they would introducing legislation to fix the "broken" retrans system.

Also Read: Scalise Tries Again to Repeal Must Carry

“My constituents know all too well the frustrations caused by TV blackouts and rising cable prices. There were 327 blackouts in the country last year, including one as recently as December 2020 impacting my District," said Eshoo. "Until we modernize outdated video laws, blackouts will continue to happen while market prices surge."

"Congress needs to finally modernize the outdated 1992 video laws that no longer fit today’s technology. Our bill brings back basic copyright protection laws, so that everyone gets paid for their products, and consumers get to choose whatever they want to buy, wherever they want to buy it, and watch whatever they want on any device they choose," said Scalise.

According to the legislators, the bill:

1. "Protects consumers from experiencing broadcast blackouts when multichannel video programming distributors (MVPDs; i.e., cable and satellite carriers) and broadcasters fail to extend an agreement by requiring MVPDs [to] carry a broadcast signal while the parties continue negotiations for up to 60 days. Parties are retroactively paid for their content aired during this time. (Effective 90 days after enactment.)

 2. "Repeals retransmission consent, compulsory copyright licenses, and several other outdated statutory provisions and regulations. This would allow free-market contract negotiations to happen under traditional copyright law. (Effective 42 months after enactment.)

 3. "Establishes a mechanism by which the FCC may, but is not required to, compel parties to seek “baseball-style” binding arbitration through a neutral third-party arbitrator, following an extended impasse or a finding of bad faith. Consumers are protected from blackouts that otherwise would have occurred, and copyright holders are paid for their content during this process. (Effective 42 months after enactment.)

 4. "Preempts federal, state, and local authority to regulate rates of cable services. (Effective 42 months after enactment.)

 5. "Requires the Government Accountability Office to report specific metrics about the impact of this Act on consumer and the marketplace every two years. Based on the totality of these metrics the FCC must determine if this Act has had a net positive, net negative, or indeterminate impact on consumers and the marketplace. If the FCC finds a net negative impact, it must recommend specific policies for Congress to improve the marketplace.

 6. "Ensures consumers have access to local programming by retaining the ability of a local television broadcast station to require carriage on cable and satellite providers in their local market. (Effective immediately, no change in law.).

Broadcasters were definitely booing the bill. 

“NAB continues to oppose legislation that undermines the foundation of broadcast television," said National Association of Broadcasters senior VP of communications Ann Marie Cumming. "Every day, Americans rely on local broadcast TV stations for news, weather, investigative journalism, public affairs programming, sports, popular entertainment and emergency information – including critical lifeline coverage of the COVID-19 pandemic during the past year. We strongly urge policymakers to work with broadcasters on preserving and strengthening a local broadcasting system that provides immeasurable service to our communities.”

AT&T saw it quite differently.

“The bipartisan Modern Television Act, which was reintroduced today by Reps. Scalise and Eshoo, recognizes that the decades-old, outdated TV rules are harmful for consumers and desperately require modernization," the company said in a statement. The number of TV broadcaster blackouts have more than doubled over the past two years alone, from 165 in 2018 to 342 in 2020.  Since these rules were first adopted 30 years ago, the market has drastically shifted with the rise of streaming and changing consumer trends. We applaud Reps. Scalise and Eshoo for their leadership to protect consumers.”

USTelecom was popping the champagne.

“Consumers watch video in a completely different way than they did even just a year ago (saying nothing of how video habits have changed over the last generation), but the system governing retransmission remains outdated and broken. Congresswoman Eshoo and Congressman Scalise understand the need for a complete overhaul to reflect 2021 realities and have created a comprehensive solution that would be a win for consumers and video providers alike. Congress should pass this bipartisan plan and get the government back in tune with the 21st century video marketplace.”

“We applaud Representatives Scalise and Eshoo for their bipartisan leadership and commitment to modernizing the nation’s video laws,” said American Televisoin Alliance (ATVA) spokesperson Jessica Kendust. “The Modern Television Act of 2021 will bring badly outdated video laws into the 21st century and correct dysfunction in the marketplace that artificially inflates prices for consumers and causes service disruptions.”

ATVA members include ACA Connects, Charter and Dish. 

Contributing editor John Eggerton has been an editor and/or writer on media regulation, legislation and policy for over four decades, including covering the FCC, FTC, Congress, the major media trade associations, and the federal courts. In addition to Multichannel News and Broadcasting + Cable, his work has appeared in Radio World, TV Technology, TV Fax, This Week in Consumer Electronics, Variety and the Encyclopedia Britannica.