Cable distributor interests and independent programmers are on opposite sides on the FCC's proposed amendments to program carriage dispute rules, in docket 20-70 comments posted Tuesday. An NPRM and Further NPRM were adopted in March (see 2003310066). The proposed program carriage and good faith negotiation complaint procedural rules changes would give more certainty to parties and a more consistent framework to adjudications, NCTA said. Clarifying statute of limitations language for program access, open video system and good faith negotiation complaints will encourage timely dispute resolution, it said. Having administrative law judge decisions in MVPD cases follow the same guidelines as other ALJ cases, such as when they take effect and automatic stays, will give due weight to the First Amendment implications of the decisions, it said. Also backing the FCC was Comcast (see here). AMC Networks said it's still important indie programmers get fair and nondiscriminatory carriage opportunities compared with competitors that may be affiliated with MVPDs. The programmer said the statute of limitations language should include a provision allowing complaints to be filed within a year of the content provider learning a distributor exercised a contractual right in a discriminatory manner. It said ALJ decision rules should include a six-month timeline for FCC review of those decisions once it's been appealed. And it urged a prohibition on retaliation against program carriage complainants. Ride TV, Newsmax, HDNet, KSE Outdoor Sportsman Group and WeatherNation TV said the current program carriage framework is woeful protection when dealing with MVPDs with all the leverage, and the FNPRM would curtail that protection further. Instead, promulgate good faith rules for MVPDs and programmers that prevent use of most-favored nation clauses, they asked. The statute of instantiations language in the FNPRM ignores that pay TV providers generally don't decline or refuse carriage proposals but never answer until indies acquiesce to one-sided terms, they said. Program carriage rules "have ... lost almost all of their deterrent effect," with an MVPD's claimed business justification becoming a major obstacle at the prima facie stage, said beIN Sports. It said the FCC needs to codify an anti-retaliation provision, good faith negotiation obligations and the automatic production of certain documents upon making a prima facie case, and clarify that the defendant holds the burden of proof and production after the complainant makes a prima facie case. It opposed adopting the ALJ proposal, saying immediate enforcement of a favorable ALJ decision is needed to avoid economic and reputational harm of not being carried.
Matt Daneman
Matt Daneman, Senior Editor, covers pay TV, cable broadband, satellite, and video issues and the Federal Communications Commission for Communications Daily. He joined Warren Communications in 2015 after more than 15 years at the Rochester Democrat & Chronicle, where he covered business among other issues. He also was a correspondent for USA Today. You can follow Daneman on Twitter: @mdaneman
Small satellite operators (SSO) challenging the FCC's C-band clearing order (see 2005050047) asked the agency to delay acting further pending judicial review before the U.S. Court of Appeals for the D.C. Circuit. Proceeding watchers said the agency is unlikely to accede. The commission didn't comment.
The FCC was close but not spot-on in its preliminary cost category schedule for C-band relocation expenses, said numerous interested parties in docket 18-122 filings posted Friday, suggesting additions and changes. There was some opposition to reimbursements for gold-plated upgrades and support for not finalizing the cost category schedule until after the FCC has filed, reviewed and approved satellite operator transition plans.
Scrambling to fill programming hours amid canceled community events and having to train public officials on the use of videoconferencing platforms are among challenges public, educational and government channels face during the pandemic, operators and officials told us. The smallest operations had the toughest time, and there are funding concerns the longer the pandemic goes on, said Alliance for Community Media President Mike Wassenaar.
New satellites and other C-band clearing expenses -- an estimated $1.2 billion worth through the end of 2021 and $1.6 billion in total -- helped prompt Intelsat to file for Chapter 11 bankruptcy Wednesday, said in its application with U.S. Bankruptcy Court in Richmond. Chief Financial Officer David Tolley said in a declaration (in Pacer, case 20-32299) the company intends to clear the lowest 120 MHz of the band by the Dec. 21, 2021, deadline to be eligible for $4.87 billion in accelerated clearing payments. Tolley said Intelsat has close to $15 billion in debt, but "business prospects remain healthy." He said it also has "materially lower revenues" due to COVID-19's effect on such key customers as airlines and cruise ships, and on its business carrying broadcast signals of sports and other live events. Tolley said the company has a commitment for financing that needs court approval but would give it enough working capital to clear the C band, fund the bankruptcy case and let Intelsat operate. An accompanying motion asked for permission to incur obligations for the clearing. It said its three-part clearance plan involves building and launching multiple satellites over the next 30 months to replace the capacity lost from the C-band compression upgrades and relocating teleport sites from urban to rural locations to mitigate 5G interference. The company asked the court to authorize it to implement the clearance on an accelerated schedule. The FCC emailed Thursday that it "appreciates Intelsat's statement that '[o]ne of the primary catalysts' for its voluntary filing for bankruptcy is a 'desire to participate in the accelerated clearing of C-band spectrum.' We will continue to move forward with the C-band auction process and look forward to working with satellite operators, wireless companies, and others toward that goal." Senate Appropriations Financial Services Subcommittee Chairman John Kennedy, R-La., said Intelsat’s bankruptcy announcement “reveals what many suspected all along: Intelsat had no intention of accepting the FCC’s deal” on the C-band auction. The FCC “should withdraw its offer, take control of America’s spectrum and save taxpayers billions of dollars instead of shelling out that money to foreign companies,” Kennedy said. He has repeatedly raised concerns about the FCC’s C-band auction plan, including its proposal for $9.7 billion in incentive payments to Intelsat and other satellite incumbents (see 2003100022). SES also said it plans to make the accelerated C-band clearing deadlines (see 2005140055).
The earth stations in motion order approved at Wednesday's FCC meeting (see 2005130057) and released Thursday (see here) includes a Further NPRM with more questions about potential ESIM out-of-band emission (OOBE) interference into the adjacent 28.35-28.6 GHz band used by upper microwave flexible use service (UMFUS), according to our side-by-side comparison of it and the draft. Verizon and U.S. Cellular raised concerns about such potential interference (see 2005050034). The order said the agency will still take and process ESIM applications using the 28.4-28.6 GHz band to avoid holding up potential ESIM operations, but approval will be conditioned on compliance with future determinations in the proceeding. The FNPRM asks if such steps as a guard band provide adequate protection if there's excessive interference with UMFUS. The approved order deferred consideration of allowing ESIMs operate in the 28.35-28.4 GHz band while the FCC studies the potential for ESIM OOBE interference in the adjacent 27.5-28.35 GHz band.
COVID-19 effects this fiscal year should be "limited," Eutelsat CEO Rodolphe Belmer said Thursday as the company announced Q3 results. Revenue of about $348 million in the quarter ended March 31, down from about $364 million last year, was in line with expectations. It said it's "confident" it will meet the 2021 and 2023 C-band clearing deadlines that would make it eligible for $507 million in acceleration payments. It said the planned launch this year of its Eutelsat Quantum satellite likely will be delayed by the pandemic's effect on satellite manufacturers and launchers. The company said its Konnect satellite, launched in January, should start providing service by year's end, but deployment of ground gateways will likely be partially delayed due to the pandemic. Intelsat, in its Chapter 11 bankruptcy filing Wednesday, aimed for the C-band accelerated deadlines (see 2005140028).
Some telecom companies taking part in the FCC Keep Americans Connected pledge are warning of mounting KAC costs -- hundreds of millions of dollars so far -- from not disconnecting subscribers for unpaid bills during the pandemic. Analysts said in interviews this month they don't expect expenses to be material -- for now. Chairman Ajit Pai asked telecom providers to extend their pledges through June (see 2004300044).
Broadband-only providers' statutory right to pole attachments isn't a significant issue because there are so few such providers and it's easy enough for them to expand their offerings beyond that to get pole attachment rights. That's according to a Federalist Society panel Monday about the U.S. Court of Appeals for the D.C. Circuit's Mozilla remand. There were no pro-Title II panelists, and such allies didn’t comment immediately. That title is part of the Telecom Act.
New language in the FCC's draft regulatory fees order on the agenda for when commissioners meet Wednesday (see 2004220048) might provide some rate relief for VHF satellites and foreign satellites that ping U.S. customers but don't have U.S. market access, but still would broadly levy U.S. regulatory fees on foreign-flagged satellites. That's according to satellite experts and an FCC official interviewed last week. Some consider 5-0 commissioner approval likely. Foreign satellite operators resisted the fee (see 2003240047), saying the issue needs more study.