Cable Wants Clarity, but FCC Desire to Tackle 30-Day Notification Rule Is Hazy
Despite a spate of programming blackouts coming with claims of cable operators violating the FCC's rule on 30-day notices of cable lineup changes, and Charter Communications pushes for clarity on that rule, it's not clear whether there's appetite or interest at the FCC, experts and insiders told us.
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A cable operator outside counsel said clarification would be welcome, but one problem lies in what the agency can do, since changing the rule would require a rulemaking procedure, though the agency also could look at just reinterpreting its existing rule. The lawyer said the FCC, when faced with program distribution disputes, typically handles them by waiting it out, since the parties usually come to a resolution themselves. An eighth-floor aide was unaware of any conversations within the agency about revisiting the rule but said it's not surprising the issue came up, given the divergent reads on it by Altice and Starz. A lawyer with cable distributor clients and blackout experience said the FCC likely doesn't have an interest in the issue now. The FCC, NAB and NCTA didn't comment. So far this year, Starz claimed Altice USA was violating the rule in its recent carriage loggerheads (see 1801160058), and Northwest Broadcasting alleged the same against Charter (see 1802120044). Altice, Starz and Charter didn't comment.
There's no other way to read Charter's actions than that "they are just ignoring their own policy," said Northwest CEO Brian Brady, citing the annual customer notification policy on Charter's website. Charter's pulling programming from 450,000 homes when an extension was available "is just another example of the fact they don't care about their customers," he said.
Charter Vice President-Regulatory Affairs Maureen O'Connell met with Media Bureau Chief Michelle Carey last week to discuss the agency potentially clarifying the advance notice rule, according to a docket 17-105 ex parte filing posted Thursday. Charter said it pushed for the agency to make clear the 30-day rule doesn't apply when a cable operator and a broadcaster or programmer are in carriage negotiations, even during the final 30 days of an agreement. Such clarification would ensure carriage talks "are not unfairly skewed even more than they are currently," it said.
Charter said it doesn't dispute cable operators would still need to provide notice as soon as possible if those negotiations fail and the channel goes dark. Conversely, if a programmer or broadcaster offers a 30-day extension of an expiring agreement, the cable operator would have to require 30 days' advance notice running through the first 30 days of the extension period, Charter said. The company also said its understanding is that applies only if the extension is under the same terms as the expiring deal; an extension with new terms and conditions wouldn't trigger that notification requirement. A Charter letter posted in docket 17-317 Friday details its proposed clarifications to the Section 76.1603(b) rule.
In 2006, the Media Bureau, two days after Time Warner Cable dropped the NFL Network and before the MVPD had a chance to reply to the NFL petition, issued an order granting the channel temporary injunctive relief based on the NFL's claims of TWC violating that 30-day rule. Many in the cable industry find fault with a subsequent order reaffirming the first and saying the programming change was in TWC's control, the cable outside counsel said. The lawyer said having to notify subscribers about the possibility of a blackout due to an impending contract expiration seems needless given that the vast majority of talks conclude with new deals before those contracts end, though often just before. The rule also assumes cable operators have control over a station staying on its channel lineup when both sides in negotiations have to agree on that, the lawyer said.
The 30-day rule came up in the FCC's revisit of retransmission consent rules in 2010/2011, with several parties commenting on it (see 1102220078), though ultimately that proceeding fizzled out, the cable outside counsel said. After the NFL Network decision, some cable operators began publicizing contracts about to expire either on their websites or in legal ads as a means of giving advance notice. But those notices weren't readily accessible to subscribers and thus rarely read, and the practice has dwindled, the lawyer said.
Such Section 76.1603(b) complaints come up rarely -- occasionally in must-carry complaints -- and the agency rarely takes enforcement action regarding violations, broadcast lawyer Dan Kirkpatrick of Fletcher Heald said. He said broadcasters might not see a need for elaboration on the rules since it's not a frequent issue and because such issues often become moot when carriage deals are struck.