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A primer on retrans and must-carry

The terms "retransmission consent" and "must carry" became part of the permanent lexicon of the television business through the Cable Act of 1992, when broadcasters assured themselves of carriage on all cable systems.

Here, for the bewildered, is how it works: TV stations can avail themselves of either must-carry or a retransmission consent when dealing with their local cable operator. If they choose retransmission consent, they must negotiate a contract for carriage with cable systems.

As a result of retransmission consent, the major broadcast networks developed cable networks, including FX and CNBC, to use as bargaining chips in negotiations. Cash for carriage of broadcast networks rarely happens, but the big companies that own broadcast networks routinely hold out for sweeter deals on carriage of their homegrown networks. In the latest instance, Disney demanded that Time Warner carry the Disney Channel on its expanded basic tier (rather than as a premium service).

If a station does not feel it has enough value to get a retransmission-consent deal, it can invoke must-carry, which means the cable system in question is obligated to carry it according to the law.