FCC Hikes DBS Regulatory Fees, With Path Open to More
In addition to hiking regulatory fees charged to satellite-TV operators, the FCC left the door open to further DBS fee increases. Saying Media Bureau oversight and regulatory work over direct broadcast satellite and cable/IPTV is similar, the FCC order setting the 2016 regulatory fee structure said it "remain[s] committed as a goal to regulatory fee parity for all MVPDs paying into the cable television/IPTV fee category." One multichannel video programming distributor official told us that language indicates the agency is considering future DBS fee hikes. The FCC didn't comment Tuesday.
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The 2016 fees are due Sept. 27, the agency said in a series of fact sheets issued Tuesday (see here, here, here, here, here and here). The FCC also raised fees across all categories in what the agency said was a one-time adjustment of $44.2 million to offset costs of reducing its office space footprint or relocating. As a result, the FCC said, aggregate fees by category went up on average 11 to 13 percent for 2016.
A DBS fee hike was a point of contention between the cable industry and, particularly, Dish Network (see 1607060023, 1608110055 and 1606210021). AT&T's DirecTV and Dish Network didn't comment Tuesday. The order dismissed their arguments that increasing the fee from 12 to 27 cents per subscriber would cause "rate shock." The American Cable Association, which heavily lobbied for the DBS rate increase, in a statement Tuesday said it's "pleased to see the FCC remains firmly committed to establishing true regulatory fee parity between cable/IPTV providers and satellite TV's DirecTV and Dish. Achieving this goal will mean that the burden of supporting the FCC's Media Bureau is distributed fairly among all types of MVPDs. Fee parity is also essential because smaller MVPDs should not be put in a position, by government policy, of subsidizing their largest pay-TV competitors." Three cents of the fee is associated with facilities reduction costs, the FCC said.
The order also adjusted radio and TV broadcasters' fees and reminded participants in the broadcast incentive auction that non-payment of regulatory fees could delay payments resulting from the auction.
ITTA had proposed reassigning Wireline Bureau full-time equivalent (FTEs) employees to the Wireless Bureau, to combine commercial mobile radio service and interstate telecom service provider regulatory fee categories, or to create a new CMRS fee subcategory under ITSP. But the FCC said ITTA's proposal wasn't "reasonable and in compliance with section 9 of the [Communications] Act." The CMRS industry takes part in Lifeline and the Wireline Bureau oversees and regulates universal service mechanisms, the FCC said, but "We are not convinced at this time that this relationship is sufficient" for reassigning Wireline FTEs to the Wireless Bureau. The ITTA proposal also ignores that many FCC indirect FTEs outside the Wireline Bureau work on universal service and wireline issues, the agency said.
The FCC had sought comment on an EchoStar proposal that different types of earth station licenses be charged different regulatory fees -- a step the agency didn't take after the company subsequently said the streamlined reporting for earth stations reduced the administrative burdens. The agency also ended up charging smaller submarine cable fees than proposed in the 2016 regulatory fee NPRM, citing updated data regarding the units used to calculate fees.