Satellite Bill Picks Up Steam as It Heads for Markup

Broadcast and satellite industry discussions continue, Boucher said. “It is my hope these conversations will lead to an agreement” that would be reflected in a markup, he said. Boucher said he would prefer not to revamp the retransmission-consent rule, but industry is raising the issue and the matter may be explored when the Judiciary Committee weighs in. Ranking member Cliff Stearns, R-Fla., urged caution in trying to solve the problems of missing affiliates. “If we address this issue … we must do so in a way that clears existing regulatory obstacles, rather than creates a whole new set of rules.”

Meanwhile, House Judiciary Committee leaders said they plan to introduce a satellite TV bill before the August recess. “This timeline gives us the best opportunity to ensure that a satellite television bill is enacted before Congress adjourns this year,” said ranking member Lamar Smith, R-Texas. Judiciary leaders have qualms about some proposals floated, including adjacent market and market modification expansion of the compulsory licenses, Smith and Committee Chairman John Conyers, D-Mich., said in a written statement. “These issues affect policies that are central to the jurisdiction of the Judiciary Committee.”

Former telecommunications subcommittee chairman Ed Markey, D-Mass., said the problem of significantly viewed stations must be dealt with in the legislation. He promised to take up the issue. The discussion draft would allow satellite to offer “significantly viewed” stations in HD format only if it provides all of the station’s programming in HD whenever it’s available.

Satellite companies would like the bill to allow them to import “distant” signals, from outside markets, and to change the significantly-viewed rules so satellite is regulated the same as cable. Satellite strongly opposes any effort to require the industry to provide local service in all 210 TV markets, a mandate they call too expensive.

Boucher pressed broadcasters to give the subcommittee their opinion of a satellite industry proposal that broadcasters share some of the economic burden of providing local-into-local service everywhere, which some have estimated would cost $30 million. Broadcasters said they're reviewing the proposal and promised to get back to Boucher. There still isn’t enough information about the real costs of sharing the costs, said Paul Karpowicz, the president of Meredith Broadcasting Group, speaking for the NAB.

Broadcasters have hoped for a local-into-local requirement and have rallied behind HR-927 by Rep. Bart Stupak, D-Mich. Satellite should carry the local stations in all markets, he said. “Expense is always involved in providing program service to the American public,” Karpowicz said.

But satellite carriers say there are limits to the number of stations that “can be shoe-horned onto a national platform,” said Stanton Dodge, Dish Network executive vice president, adding that the cable industry has a cap on the amount of capacity that must be used for local broadcaster carriage. Satellite should be treated the same, Dodge said, particularly if policymakers want to ensure that hard-to-reach rural areas get service. And broadcasters should be required to provide local content to earn satellite carriage, he said. “Too many stations today have little or no local content or original programming.”

“The satellite industry is being singled out for a universal carriage mandate” that doesn’t apply to cable or broadcast, said Derek Chang, DirecTV executive vice president. If Congress is determined to impose a universal carriage mandate, it should ensure that satellite subscribers can receive competitive programming choices, a “burden” that satellite operators shouldn’t have to bear alone, Chang said.

Broadcasters strongly oppose imposition of any market modifications allowing satellite to import distant signals. The discussion draft doesn’t include market changes, but broadcasters have been lobbying heavily against a proposal by Rep. Mike Ross, D-Ark., to deal with so-called adjacent- market problems -- some markets missing some programming. Often the markets straddle state lines. Broadcasters condemn portrayal of this problem as shortchanging the localism principle, because cable and satellite can import programming through retransmission-consent deals, Karpowicz said. Without these arrangements, broadcasters’ advertising revenue could suffer, he said.

DirecTV said it would support a “limited” solution to the distant signal problem in adjacent markets by allowing service only to “orphan counties,” those in markets centered in the next state. The company thinks Congress should allow distant signals to all subscribers in markets where there’s no local affiliate.

Dodge criticized broadcasters as not offering “constructive” proposals to restructure markets. “Satellite TV providers and broadcasters have not been able to resolve this consumer issue through copyright agreements … underscoring the need for affirmative action by Congress to achieve this result now,” he said. Dodge said the subcommittee discussion draft provides a starting point for solving some public policy goals “but does not go far enough.”

The distant signal restriction no longer makes sense, and it puts satellite at a disadvantage with cable, said Mike Mountford, the CEO of the National Programming Service, adding that anyone with a broadband Internet connection can get online programming, including that available from network Web sites. “Lifting the distant signal restriction is unlikely to cause economic hardship to local broadcasters,” he said, adding that local broadcasters can take advantage of new revenues streams from the Internet and HDTV.

Disney, unhappy with government rules scaling back licensing fees, wants Congress to limit government involvement in satellite broadcast programming, said Executive Vice President Preston Padden. “Congress must never let the rights granted to one party under a statutory license trump the rights obtained by other parties through marketplace negotiations,” he said. The satellite license continues to supplant the rights of copyright owners and TV networks and affiliates, he said.

Most of the witnesses said Congress needs to include a technical fix proposed in the discussion draft to reflect that broadcasters no longer operate in an analog world. This would affect definitions for what constitutes an “unserved” household. Broadcasters suggest the rules be clarified to take into account that subscribers receiving programming through multicast channels are served, a change that would in effect prevent satellite from importing distant signals of stations that would include duplicative national programming.

Separately, Rep. Anna Eshoo, D-Calif., criticized Dish as “engaging in discriminatory behavior against public TV” by not carrying some stations. If capacity problems prevent carriage, Eshoo said, “drop the soft porn” pay-for-view programming. Dish promised an update on the issue. Anne Veigle