NCTA Notebook...
Sen. Conrad Burns (R-Mont.), chmn. of the Senate Communications Subcommittee, said in a National Show speech that he thought there was a chance his broadband tax credit bill would be revived before the end of the session. The original didn’t make it out of conference. “I think before the end of the year, we may get that,” Burns said, adding that govt. should be giving incentives to provide infrastructure, especially in rural places like his home state of Mont. House Telecom Subcommittee Chmn. Upton (R- Mich.) told 60 cable industry executives at the same event that he was working to pass a bill that would accelerate depreciation on equipment bought for business. Burns said his subcommittee would mark up an antispam bill next week and he expected “very fast” action on the floor, where he predicted it had a good chance of passing. Upton said he expected a similar measure would come up in his House subcommittee next month. On the DTV transition, Upton said he expected another industry meeting in July, as well as possibly a hearing on the subject. Asked afterward about the chance of moving a bill that would lower the broadcast ownership cap back to 35%, Burns said he thought that would make it out of committee, but after that he couldn’t predict what would happen to it.
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Retransmission consent negotiations are becoming more contentious, with some broadcasters “being particularly aggressive with small operators,” often asking for cash in exchange for carriage, attorney Christopher Cinnamon said: “What we think we're seeing is the collapse of retransmission consent.” Cinnamon said the aggregation of content by some broadcasters was making them more powerful, allowing them to leverage against the smaller operators. He pointed to Fox, Disney, Hearst and Gannett as companies that had been tough on cable operators, and said the idea of retransmission consent, once meant to give small broadcasters some power, was being “turned on its head.” Cinnamon said he expected the broadcasters to begin to “ratchet up” and try to exert similar influence over MSOs. Attorney Michael Hammer said he believed the FCC’s Media Bureau is working on a final draft of cable horizontal rules. Chmn. Powell has said he hoped to establish new cable ownership rules contemporaneously with the broadcast rules, which were announced last week (CD June 3 p1). “Based on the record before them, frankly, it’s hard to justify any limit,” Hammer said. He said he thought the broadcast rules would “have very little impact” in terms of substance on cable’s rules, but the political fallout from the broadcast proceeding could have some effect. “There’s been a lot of concern expressed about media consolidation,” he said, citing efforts in Congress, as well as possible court action: “In that sort of uncertain environment, one wouldn’t be shocked, I think, to see some delay in the FCC’s consideration of the cable horizontal proceeding.” Later, Hammer said he found it unusual that News Corp. would offer program access concessions in making its application to buy DirecTV. “For News Corp., it’s an acknowledgment that the merger really raises some serious competitive concerns,” he said, citing the fear that DirecTV would discriminate against unaffiliated program services to benefit News Corp. services or that that company’s program services would discriminate against unaffiliated distributors to benefit DirecTV. -- BG
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As of June 1, cable subscribers in 78 of the top designated market areas (DMAs) were passed by at least one cable operator that provided HDTV, NCTA announced at the opening of its National Show. That figure includes 18 of the top 20 DMAs, NCTA said, and 34 markets beyond the top-100 have access to HDTV, bringing the total number of DMAs in which at least one cable operator is offering a package of HD channels to 112 of the country’s 210 DMAs. That equates to about 55 million U.S. households passed by a cable system offering HD, a growth of nearly 50% since Jan. 1. NCTA also said cable operators were carrying 190 different broadcast stations that provided a digital signal. Cable program networks also have increased the amount of HD programming they're producing, NCTA said.
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TechTV produced a new TV special to support cable operators’ high-definition TV offerings. The half-hour program looking at HDTV will be available in July for cable operators to carry on various channels and promotional outlets. The special explains the benefits of going digital, looking at sports, movies and nature programming, and outlines the differences between analog and HDTV. The special also gives viewers information about equipment they need to watch HDTV, including sets.
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Oxygen Media’s Geoffrey Darby said that for TV to move forward, there must be room for failure: “That’s why we do 20 pilots, so that 19 will fail so we can find the one that resonates with viewers. But the extraordinary cost of producing shows is limiting our ability to fail,” which in turn is hurting the quality of programming. Darby said the cost-saving advantages of digital were an opportunity to invigorate the industry from both the production and consumer sides: “The real killer app of digital is all about time. Just as e-mail saves time and doing a Google search saves time, one man with a camera, instead of a crew of 4 or 5, saves time -- and allows you to fail more readily.”
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Over the last couple of years, conventions and conferences have struggled to reinvent themselves and shrink their bottom lines in the wake of corporate downsizing and financial cutbacks, but Carmel Group Chmn. Jimmy Schaeffer said the shadow of Sept. 11 also remained a factor. The day of the attacks, the Carmel Group was putting on a 2-day conference in Marina Del Rey, Cal., and, Schaeffer said, “ever since then, it has changed how small conferences do business. To this day, people remain hesitant about getting on a plane to travel to a conference. As a result, we have had to put on fewer conferences.” Schaeffer also said it had become a challenge to find fresh faces to participate on panels.
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Although satellite remains a viable competitor, telephony companies are emerging as the potentially greater threat to MSOs, officials said at the NCTA convention. At an opening night dinner hosted by Sony to announce its new line of set-top boxes, several cable executives expressed concern that while cable companies were busy focusing all their time and energy promoting the advantages of their services over DBS to consumers, telephony companies quietly were positioning themselves to be major delivery players. However, others questioned whether even big guns such as SBC, much less smaller regional telephony companies, could truly implement such a strategy to any appreciable degree. Also beginning to cloud the horizon, especially for MSO executives, is the future of the spectrum currently controlled by the 6 major broadcast networks once the transition to digital becomes a reality, which many believe finally will occur by the end of the decade. The uncertainty over who will be given the spectrum caused one Comcast executive to quip: “I just pray I'm fully vested in my pension before that happens.”