Senate Commerce Clears STELA Reauthorization Bill With Little Fanfare

Consumers lose in the current video marketplace, said Commerce Chairman Jay Rockefeller, D-W.Va. “I'm disappointed that [Local Choice] is not a part of the legislation we're considering today.” He also lamented that loss of Local Choice to reporters earlier this week and described how much consumers would like the broadcast a la carte proposal. “It’s too big a change to be swallowed,” Rockefeller told reporters Tuesday of the Local Choice model. “They're going to so love that, it’s going to spread like wildfire.” If Rockefeller is so impassioned about Local Choice, why not introduce it last year instead of last month? one former FCC official asked us after the markup. The former official said something as major as Local Choice was never going to become part of STELA reauthorization with so little time.

"I hope this will continue as we head into the end of this year and next year,” said Commerce Committee ranking member John Thune, R-S.D., referring to the loss of Local Choice from STAVRA. He wants to continue video overhaul no matter what happens with the November midterm elections, he said.

The House approved a similar STELA reauthorization bill this summer. The Senate Judiciary Committee had approved a clean reauthorization bill around the same time, and Commerce and Judiciary must combine their two bills and advance one through the Senate. STELA expires Dec. 31 unless Congress reauthorizes it.

STAVRA was one among several items that Commerce considered in its Wednesday executive session. It also approved the E-Label Act (S-2583), which Rockefeller had introduced. The House approved companion legislation earlier this year.

Two amendments successfully included on STAVRA were the Let Our Communities Access Local TV Act amendment from Sens. Cory Booker, D-N.J., and Deb Fischer, R-Neb., and the amendment from Senate Communications Subcommittee Chairman Mark Pryor, D-Ark., “to make information about the market modification process available to consumers on [the FCC] website.” Booker issued a statement after passage saying, “New Jersey is one of only two states in the country without its own media market, depriving our residents of access to quality local news programming.”

One remaining point of contention going into STAVRA’s markup was its provision repealing the set-top box integration ban provision, which TiVo has opposed. Sen. Ed Markey, D-Mass., had filed and on Wednesday withdrew an amendment that would avoid the repeal. Consumers Union, Free Press and Public Knowledge sent Rockefeller a letter backing an amendment modifying that STAVRA provision. “The Competitive Device Availability section includes a provision that creates a gap in protections for consumers around choices in video devices, potentially driving up costs for consumers,” the groups told Rockefeller. “The section sets out a vision for the next generation of technical standards for device competition, but fails to ensure actual availability when the current CableCARD system is expired.” They said a new technical standard must precede repealing the CableCARD standards and that Commerce senators reject the STAVRA draft unless amended.

"You've got to have a new standard that still protects the innovators, otherwise you get stuck with the old,” Markey said Wednesday, describing his amendment. He asked to work with Rockefeller and Thune on this provision before any STELA reauthorization goes to the floor. “We tend to agree on virtually everything,” Rockefeller told Markey, also referring to Thune and his own “responsibility” to get a STELA reauthorization through. “I promise to work with you. ... Yours is a very principled position.”

Markey plans to object to any unanimous consent approval of STELA reauthorization on the Senate floor if it includes the set-top box provision as included in STAVRA, a Democratic aide told us following the markup.

Free State Foundation President Randolph May blasted Markey’s proposed amendment in a blog post Wednesday before the markup. “Sen. Markey’s invariable view equating continued regulation with ‘protecting competition’ is now woefully outdated, certainly including this instance,” May said (http://bit.ly/1s6Rccz). “Sen. Markey’s position may, in fact, provide some help in propping up particular competitors in some situations for some amount of time.” Public Knowledge Senior Staff Attorney John Bergmayer also penned a blog post lamenting the STAVRA provision. “Getting rid of the integration ban has been on the cable industry’s wishlist for a long time, and cable argues that it drives up costs,” Bergmayer said (http://bit.ly/1DkRrn9). “But even if you take these claims about the integration ban’s costs at face value there’s no reason to think cable companies would pass along any savings to consumers."

Several lawmakers also did not press their filed amendments. Commerce Consumer Protection Subcommittee Chairwoman Claire McCaskill, D-Mo., offered and withdrew her amendment, which addressed consumer protections in pay-TV billing practices. “People are spending a lot of money on pay-TV right now,” McCaskill said, backing fair protections for the billing. It’s “the subject for a very good hearing as we move forward,” Rockefeller said, expressing his desire that McCaskill lead one on the topic.

Sen. Roy Blunt, R-Mo., offered and withdrew his amendment about grandfathering joint sales agreements in light of the FCC’s March order limiting them. “We've seen them applied in helpful ways,” Blunt said of such agreements. Sens. Roger Wicker, R-Miss., and Tim Scott, R-S.C., joined Blunt in offering the amendment. Sen. Richard Blumenthal, D-Conn., introduced an amendment looking into the effects of sports programming on the broader video marketplace but was open to withdrawing it, he said. Rockefeller suggested Blumenthal ask the GAO rather than the FCC do the sports programming study and said he would join him in that letter. Sen. Dean Heller, R-Nev., proposed and withdrew his amendment, which would attach his FCC Consolidated Reporting Act. He cited concerns that others have that the legislation could affect the authority of Communications Act Section 706 and said he doesn’t want to drag the net neutrality concerns into it.

Pay-TV industry groups praised the STAVRA vote. The American Television Alliance, consisting of several pay-TV industry members, called STAVRA “a clear and convincing victory for those fighting to fix our broken retransmission consent system.” Some of the coalition’s members also praised the vote -- Dish and DirecTV issued a joint statement saying as much and so did the American Cable Association, saying STAVRA “represents a clear break with the status quo.” Broadcasters are pleased with the STAVRA approval and await the potential hearing on pay-TV billing issues later this year and resolution of the set-top box integration ban issue, a broadcast industry official told us after the markup. TVFreedom, a broadcaster coalition including NAB, said it’s “encouraged,” in a statement from its spokesman. TVFreedom members plan to continue talks with “lawmakers, policymakers, consumer advocacy groups and industry leaders to preserve the basic tier and protect consumers’ interests to preserve the basic tier and protect consumers’ interests,” he said, praising the sentiments of both McCaskill and Markey at the markup.

"We cannot allow STELA to die at the end of the year,” Rockefeller told Commerce members as one of the members considered the withdrawal of an amendment. “We do not have that option. ... I've got a larger responsibility to make sure we get that reauthorization.”