The FCC original set-top proposal, as explained in its NPRM, “remains the most effective way” of creating a competitive set-top market, said Writer's Guild of America, West in a letter posted in docket 16-42 Thursday. IT said the apps-based proposals now being considered by the FCC should still contain many of the features outlined in the NPRM, including parity of content between pay-TV and third-party devices, universal search, over-the-top programming integrated with pay-TV programming, and DVR functionality. “These requirements will ensure a level playing field for navigation device competitors,” WGAW said. The FCC should also “recognize the critical role oversight and enforcement must play to ensure compliance under an app-based model,” WGAW said. Multichannel video programming distributors "have every incentive to undermine the effective operation of a competitive device market. It is therefore critical that, as an initial matter, the Commission deploy every regulatory and enforcement tool available at the outset,” WGAW said. Others want the proposal changed, citing copyright and other concerns (see 1609010084).
TVEyes acknowledges the public benefit of TV news, but is asking the court "to distort copyright law and ... reach a result that is anything but fair," Fox News said in a reply brief (in Pacer) entered Wednesday in the 2nd U.S. Circuit Court of Appeals. TVEyes failed to establish fair use because mass digitization that delivers unauthorized copies isn't fair use, Fox said. It said TVEyes' subscribers' uses of the service and their convenience doesn't equal transformative use, and the substantiveness of TVEyes' taking comes from what the Content Delivery Features make available and not what the company's customers actually accessed. It's TVEyes' burden to prove fair use, but it can't do so, Fox said: "Its response is merely smoke and mirrors, obscuring a simple case with legal and factual mumbo-jumbo." Fox said TVEyes argues subscribers use the service for research, which falls under fair use, but TVEyes itself doesn't do that research, it just provides content. The programmer said TVEyes users are predominantly PR professionals, that being a market the company targeted. Fox doesn't challenge the idea TVEyes engages in fair use capturing the text of its broadcasts for inclusion in a database or providing text to users for research, but somehow sees the same use of audiovisual components as infringing, TVEyes said in its reply brief (in Pacer) last month. Since research is a paradigmic fair-use purpose under copyright statute, letting users do meaningful research on Fox broadcasts requires audiovisual as well as text content, TVEyes said. The broadcaster raises red flags about potential misuse of the service that could hurt Fox's market for its content, but it hasn't shown any evidence of TVEyes users' misuse. Even if TVEyes uses weren't fair use, there's no justification for an injunction since Fox didn't show TVEyes had a volitional role in its users' conduct as would be needed for direct liability. Fox is appealing a U.S. District Court decision that TVEyes' archiving function is fair use, but emailing, downloading and date/time searches aren't, and TVEyes is appealing a subsequent injunction (see 1603180007).
New set-top box rules could put smaller pay-TV providers out of business, dozens of small multichannel video programming distributors told the FCC in similar filings in docket 16-42 in recent weeks. “We are troubled by the Commission's proposed rules,” said Panhandle Telephone Cooperative, a cable company with 4,000 subscribers in Oklahoma and Texas. Panhandle's letter uses similar and in some places the exact same language as the submissions from 7,000-subscriber Glasgow Electric Plant Board in Kentucky and 1,300-subscriber TrioTel in South Dakota, as do many of the other small MVPD filers. The American Cable Association assisted the MVPDs with making the filings, ACA told us. “Our company cannot afford the additional regulatory costs of the proposed Navigation Device rules, estimated to be at least $1 million per system, or any other proposals that require such substantial costs,” said 750-customer Nelson County Cablevision, of Lovingston, Virginia. “We could not offset or otherwise tolerate these costs even if we diverted our limited capital spending and spent our cash reserves.”
BMG's opposition to a stay on consideration of its fee petition and application for costs until after Cox Communications' appeal rests on the shaky assumption that a multimillion dollar fee award for BMG is a foregone conclusion, Cox said in a reply brief (in Pacer) Tuesday in U.S. District Court in Alexandria, Virginia. It supported Cox's motion (in Pacer) earlier this month to defer consideration of any motions for awards of fees and expenses until after the judgment is appealed by the cable ISP. "A fee award is never 'automatic' and requires more than the prevailing party's self-righteous assertions," Cox said, saying it plans to present "substantial questions" in its appeal of a torrent piracy ruling against it to the 4th U.S. Circuit Court of Appeals (see 1608190030), and those could be grounds for vacating and reversing the judgment. In its reply brief, Cox said the preponderance of novel issues justifies deferring consideration of fee issues until after its appeal, while the jury's willfulness finding can't be used as a proxy for finding malice or bad faith on the company's part and thus isn't a strong factor in any fee analysis. Cox said the $25 million jury award in statutory damages, and an additional award of fees for purposes of deterrence or compensation would be "a windfall double-recovery" and, contrary to BMG claims otherwise, "there is no such ‘standard practice’” for deciding claims for attorney's fees and costs promptly. BMG, in opposition (in Pacer) filed last week, said Cox's motion would stick the 4th Circuit "with piecemeal appeals and ... drag out this litigation for years." BMG said the case for attorney's fees "is overwhelming" due to Cox's willful infringement of BMG copyright, its "host of unreasonable litigation positions" and its having driven up the costs of the litigation "through massive discovery obstructionism.”
When customers buy a new service from their cable TV provider, that service is internet 50 percent of the time, with TV service second at 35 percent, and 84 percent of cable TV packages purchased in the first half of 2016 included internet, the Marchex Institute reported. TV service was part of the product mix 57 percent of the time in new cable orders, while voice service was bought 13 percent of the time and always as part of a bundle, Marchex said Wednesday. Among features new subscribers care about, DVRs, basic cable and HBO topped the list, Marchex said. The report was based on aggregation and analysis of inbound sales calls to pay-TV providers, including 1.6 million such calls in the first five months of 2016. Marchex is a mobile advertising analysis company.
Fact discovery in twin affiliation agreement lawsuits brought against Charter Communications by Fox News Network and Univision is to be complete by March 24, New York State Supreme Court Judge Peter Sherwood of Manhattan said in orders (see here and here) Tuesday. Expert discovery in the two cases is to close by May 26, he said.
International Brotherhood of Electrical Workers, AFL-CIO, Local Union No. 3 violated its contract with its 2014 work stoppage and "has been attempting to avoid the consequences of its mischief" by focusing on a technicality, Time Warner Cable said in a brief (in Pacer) Monday in the 2nd U.S. Circuit Court of Appeals. That technicality is the ostensible retroactive nullification by the National Labor Relations Board of Local 3's collective bargaining agreement with TWC to arbitrate disputes, the company said. The NLRB didn't invalidate the entire contract, but instead decided the parties failed to agree on a tangential issue, TWC said. Federal appellate precedent is that when a party repeatedly acknowledges its collective bargaining arbitration obligations and submits a dispute to arbitration without objection, that party is bound by the results of that arbitration, TWC said. Local 3 is appealing a U.S. District Court in Brooklyn ruling upholding an arbitrator's award of damages to TWC, and the company is cross-appealing the portion of the Brooklyn court's judgment that denied confirmation of part of a 2015 final arbitration award ordering the union to refrain from further violations. TWC said Brooklyn court was entitled to adjudicate the case and it should have confirmed the NLRB arbitrator's award in full or at the least confirmed the monetary portion. A union brief (in Pacer) earlier this month said there was no valid collective bargaining agreement when the arbitrator used that agreement as the basis for ruling Local 3 had violated it.
More pay-TV subscribers -- at 17.9 percent -- cut services such as premium channels or premium sports packages during Q2 than added such services (16.4 percent), Digitalsmiths reported Tuesday. Among pay-TV subscribers planning to make a change in their subscriptions over the next six months, roughly 7 percent plan to end the service -- roughly the same percentage as those who plan to switch to another provider, it said. Digitalsmiths said of those it surveyed planning to change their pay-TV subscriptions, another 3.7 percent plan to go to an online service or app and 31.8 percent are considering making some unspecified change. Digitalsmiths said about 50 percent of survey respondents planning to cut, change or switch pay-TV services in the next six months would stay if the provider added some functionality to make searches easier -- an increase of 8.8 percentage points year over year. Digitalsmiths said 77.2 percent of respondents are satisfied or very satisfied with their pay-TV service, relatively flat year over year. For those who are dissatisfied, the biggest reasons given were cost, followed at distant second and third by bad channel selection and poor service, it said. Nearly 77 percent of survey respondents said they wanted a la carte model, with the most-desired channels being Discovery, ABC, CBS, History Channel and NBC, Digitalsmiths said, saying average respondents' ideal bundles are made up of 19 channels. The average price that respondents want to pay is $3.60 per channel monthly, Digitalsmiths said. The amount of "cord cheating" -- pay-TV subscribers who seek on-demand video content from third party and over-the-top sources -- is growing, with 57.2 percent of respondents with pay-TV service going such routes, Digitalsmiths said. The biggest cord cheating option is with a subscription VOD service, it said. The survey was of 3,114 participants in the U.S. and Canada.
The 10th U.S. Circuit Court of Appeals upheld a U.S. District Court decision to send a pair of putative class-action complaints against Cox Communications regarding set-top box policies to arbitration. Citing "a strong presumption the dispute is arbitrable" due to the Federal Arbitration Act, the three-judge panel said in an opinion (in Pacer) Friday there's no basis for inferring that the plaintiffs must have believed the arbitration language in the subscriber agreements didn't encompass a set-top dispute or else they would have consulted counsel. The appellate court rejected plaintiffs' arguments Cox waived its right to arbitration, saying Cox actions in the two cases "were consistent with an intent to arbitrate." That waiver argument seems to be based on Cox's agreement to stay the litigation while the bellwether Healy v. Cox Communications case proceeded, the 10th Circuit said, adding that the preference to litigate one case "does not mean it will want to litigate a future case." The court also rejected the plaintiffs' argument the Cox arbitration clause was unenforceable because language in it seems to indicate Cox could change the agreement terms at any time, since that argument challenges the contract as a whole should be decided in arbitration. The twin lawsuits claimed Cox violated antitrust law by tying its premium cable service to set-top rental. The panel's judges were Harris Hartz, Gregory Phillips and Nancy Moritz, with Hartz writing the opinion.
Goshen is the first New York municipality to grant a video services franchise to Frontier Communications, the telco said in a news release Monday. Frontier said the franchise agreement now needs New York Public Service Commission review and approval before it can launch its IPTV Vantage TV platform in the Hudson Valley community.