Commentary

Cable Companies Unite Against Broadcasting's Little Guys

by Wayne Friedman , Staff Writer, March 3, 2010

It's always been cable versus broadcast. And now Discovery Communications and Cablevision Systems are proving it.

Those two cable companies are not encumbered by any corporate parent with a conflicting broadcast network, film studio, or theme park. So it makes sense Discovery is siding with Cablevisions Systems when it comes to now old-fashioned-looking must-carry rules, which compel cable systems to carry TV stations in the market for no charge. Most stations would rather get money for their wares under retransmission agreement rules.

With retransmission deals, both parties get something. Cable system operators get to carry high-rated broadcast programming; TV stations get much-needed extra revenue.

Considering that for the last three decades cable operators have aired broadcast stations for free -- while charging their cable consumers for it -- it kind of makes sense now that they need to pay for this programming.

For the future, it means cable operators can at least share in some upside, perhaps a revenue advertising sharing agreement in a particular part of the TV station business.

For low-rated TV stations however, it's a different story. Cable systems are steadfast that low-rated stations shouldn't warrant carriage.

Discovery wants these stations out of the way -- freeing up these slots for its own growing networks' agendas. Discovery claims the current must-carry laws violate the First Amendent by taking "the right to speak from some speakers and giv[ing] it to others."

Of course, free speech also -- in theory -- gives the right of cable operators to choose what programming it wants to air. But here's another truth: Free speech doesn't mean free programming.

broadcasting, cable tv, tv

2 comments about "Cable Companies Unite Against Broadcasting's Little Guys".

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Michael Mcewen from Media Policy Strategy Ltd., March 3, 2010 at 2:04 p.m.
Good Article. Sometimes Cable and Satellite forget that the cornerstone of the Broadcasting system is free to air conventional tv allowing citizens (consumers?) to freely access these signals to be informed, enlightened and entertained. This is an act of public policy. By retransmitting these signals and charging for them and not sharing revenue is an act of piracy. By not carrying the low-rated stations it is an abrogation of a core responsibility. Geez!
Reply

Kevin Barry, March 9, 2010 at 12:14 p.m.

You are confusing Retransmission Consent and Must Carry. The 1994 Cable Act gave broadcasters the right to choose whether to insist that cable operators carry them for free (Must Carry), or to withhold the ability for cable operators to carry them unless they were compensated (Retransmission Consent). The result was, to put it bluntly, quality broadcasters required retransmission consent and weaker broadcasters invoked must carry. As far as cable operators not paying for broadcast stations, they chose instead to create cable networks that were guaranteed carriage (and affiliate fees) in exchange for carrying the broadcast signals. Food (Pro Jo), HGTV (Scripps), FX (Fox), ESPN2 (ABC/Disney) are just a few of the networks that exist because of compensation that cable operators have been paying. Now the broadcasters want to be paid for their stations as well. Okay, but don't pretend it's been a free ride for 20 years.
Regarding Discovery's contention--their beef is with the Must Carry provision of the cable bill. Here's the argument: why should a fifth broadcaster's copy-cat local weather loop be favored by statute over a new service developed by a television programmer who doesn't have a broadcasting license, and therefore, access to the public's spectrum. Doesn't this make the broadcaster a preferred speaker? And why should government be in the business of creating preferred speakers?