Fox, Cablevision Asked to Explain Themselves to Media Bureau by Monday Night
Fox and Cablevision are to describe how they've met a statutory obligation to negotiate in good faith during their retransmission consent dispute, FCC Media Bureau Chief William Lake wrote them Friday. He asked Chase Carey, President of Fox parent company News Corp., and Cablevision CEO James Dolan to explain how each is satisfying the “important statutory obligation” to conduct good-faith negotiations. Also asked: “If you are aware of any conduct by the other side that you believe violates the good faith requirement, please so indicate and provide supporting evidence.” The responses are due at the close of business Monday. Cablevision welcomed the letter. Fox declined to comment.
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The letter was necessary after FCC Chairman Julius Genachowski said the agency would be scrutinizing the actions of the two companies “very closely,” a communications attorney following the issue said. “They said they were going to scrutinize and nothing was coming in voluntarily, so they've got to ask.” The letter doesn’t necessarily mark a change in the agency’s hands-off approach to the dispute (CD Oct 21 p7), the lawyer said: “I don’t think anyone will react to this letter as a game changer."
The letter is indicative of the FCC’s authority under current retransmission consent rules, said Fletcher Heald attorney Frank Jazzo, who represents broadcasters. “They've got the bully pulpit, but that’s about the extent of what they can do,” he said. “Obviously there’s a great deal of pressure from consumers and legislators to do something, but the statutory design here is that the parties have good faith, arm’s length negotiations."
Little progress has been made in carriage talks, Fox said Friday as the dispute stretched into its second weekend. “Unfortunately it’s becoming clear that Cablevision believes FOX has very limited value to their customers.” Fox urged Cablevision subscribers who want Fox programming to switch pay-TV operators or watch over the air.
The commission should ask Fox “whom Fox thought it was blocking, and for what reason,” when it briefly limited Cablevision broadband subscribers’ access to its online programming last weekend (CD Oct 19 p5), Public Knowledge wrote Genachowski. Though the Fox-Cablevision blocking didn’t represent a traditional net neutrality concern, “network neutrality is not the end-all be-all of consumer protection, and these practices could threaten the integrity of the open Internet as much as anticompetitive behavior by telecommunications providers,” the group said. Further analysis depends on knowing whether its policy is to block online access to Fox content “to all but those who also subscribe to” pay-TV companies “that provide Fox content,” the letter said, or “to all but those who use ISPS that have cut special deals with Fox.
Fox should “call a cease fire” and restore carriage during the World Series if the companies haven’t worked out a deal by then, Insight Communications CEO Michael Willner wrote on his blog. “There is no question in my mind that Fox has a corporate responsibility to refrain from withholding such an important event from consumers,” he said. “If they don’t, they simply prove that Congress should consider these types of exclusive rights” that broadcasters have within markets. The Sports Fan Coalition, whose board includes former Dish Network attorney David Goodfriend, asked News Corp. in a letter Friday to put the games on Cablevision. “We ask you to please put these games back on and settle your disputes behind closed doors or with arbitration,” wrote Brian Frederick, the coalition’s executive director. The American TV Alliance -- which pushes changes to the retransmission consent rules at the commission and in Congress -- said it urged congressional colleagues to join Sen. John Kerry, D-Mass., in “giving this important issue their immediate attention.”