FCC Largely Sat Out Disney-TWC Talks That Near a Deal
The FCC largely sat out retransmission consent talks between Time Warner Cable and Disney-owned ABC TV stations and cable networks including ESPN that the companies said are close to reaching a successful conclusion, according to commission officials. The ongoing contract negotiations drew widespread attention, with a large number of stations, channels and cable subscribers involved. They didn’t seem to lead to overt worry inside the FCC that a deal wouldn’t be reached, agency officials said.
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The little perceived FCC involvement in Disney-Time Warner Cable contrasts with a more active stance taken by the regulator in observing broadcast carriage talks with Sinclair-Mediacom and News Corp.’s Fox network and Time Warner Cable at the end of 2009 and Disney-Cablevision earlier this year, commission officials said. Some broadcast officials pointed to the likely successful conclusion of the current retransmission consent negotiations between Disney and Time Warner Cable as proof that the market is working. “Thousands of retransmission consent agreements have been reached over the years, and this is just one more successful negotiation that serves to rebuke the pay-TV campaigners who seek a solution to a non-existent problem,” said an NAB spokesman.
Commissioners didn’t get frequent updates on Disney-Time Warner Cable from executives of either company, bureau officials or aides to FCC Chairman Julius Genachowski, agency officials said. That’s unlike the case with the earlier talks with the other six companies, which, like the current ones, went down to the wire, they said. Media Bureau Chief Bill Lake didn’t seem closely involved in monitoring the progress of Disney-Time Warner Cable efforts to reach an accord, as he was with the earlier negotiations, commission officials said. One said that executives at Disney and Time Warner Cable did keep some commission officials apprised that progress was being made, but there appeared to have been much less communication this time around. A bureau spokeswoman declined to comment.
That Time Warner Cable and Disney are close to a deal is more evidence that regulators don’t need to be further involved in retransmission consent talks between broadcasters and pay-TV distributors, said lawyer Robert Rini of Rini Coran, which represents radio and TV stations. The episode should help broadcasters make that case as the FCC considers a petition for rulemaking on retransmission consent by a group of distributors including Time Warner Cable, he said: “I haven’t seen a lot of blood on the floor to justify government intervention.”
Some FCC officials said it struck them as curious that Time Warner Cable wasn’t briefing commissioners’ offices and Genachowski more on the talks. Such updates could have provided the cable operator with an opportunity to portray Disney -- and broadcasters generally -- as not negotiating in good faith, but that doesn’t appear to have been the case here, commission officials said. “The potential Time Warner Cable/Disney agreement doesn’t address the underlying problem that the broadcasters have the ability to put customers in a no-win situation,” said a spokesman for the American TV Alliance, whose members include Time Warner Cable. “This is a real and growing problem, and one that should be reviewed by policymakers."
"Disney/ABC, ESPN and Time Warner Cable have made significant progress in our negotiations for continued distribution of ABC, Disney and ESPN networks and services,” the companies said. “A deal would also include carriage on Bright House Networks. We are now focusing all our attention on a successful conclusion of these efforts prior to the September 2 deadline.” Disney and Time Warner Cable spokespeople declined further comment.
The talks probably have more to do with carriage of ESPN than Disney’s ABC stations in Time Warner Cable markets, Rini said. “The biggest value in the deal is the ESPN component,” he said. “ESPN has always been a leader in terms of the fees they charge” multichannel video program distributors. Not all distributors may be able to reach fair deals with broadcasters, said President Bob Gessner of Massillon Cable, with about 45,000 video subscribers in Ohio. “We certainly hope Time Warner Cable and Disney reached good agreements and that they're going to use those agreements as a template for others,” he said. “But I would assume that whatever Time Warner Cable gained, ABC will seek to make up from smaller operators."
The upcoming contract with Disney shouldn’t affect how Time Warner Cable or other distributors approach lobbying for changes to the retrans consent rules, said Gessner, whose company is a coalition member but who wasn’t speaking on its behalf. “I was never under the impression that Time Warner Cable joined, and to a large part initiated the alliance simply because of current specific negotiations,” he said. “They had the larger, longer-term in mind of seeking responsible retransmission consent reconsideration.”