American Television Alliance Calls on FCC to Protect Consumers from Broadcaster Abuses

Jul 17, 2015

National TV Viewer Advocate Urges FCC to Prevent Broadcasters from Holding Popular TV Events for Ransom

Washington, D.C. – The American Television Alliance (ATVA) urged the FCC to protect consumers from broadcast industry abuses and TV blackouts in an Ex Parte filing made public today. As the menace of broadcaster blackouts grows worse and TV viewers across the country suffer, ATVA representatives met with FCC staff as the Commission prepares to update rules defining what constitutes a breach of “good faith” in retransmission consent negotiations.

“The retransmission consent system is broken and the FCC must take action to protect consumers from broadcaster blackouts and broadcaster abuses,” said ATVA spokesman Trent Duffy. “Broadcaster blackouts are wreaking havoc for consumers across the country and TV fans are paying more and more for ‘free’ channels. The FCC must update its rules to prevent consumers from being exploited by the broadcast industry’s outrageous brass-knuckle tactics.”

Retransmission fees grew 8,600% between 2005 and 2012 and are the fastest rising component of pay TV consumers’ bills. An update to the outdated rules is critical, because they are insufficient to protect consumers from higher fees and blackouts.

“Earlier this week the NAB warned the FCC to expect more blackouts that harm consumers. Let’s be clear, when a blackout occurs, there is only one party responsible for depriving consumers of their signal – the broadcaster,” said Duffy. “The Commission should take the broadcasters at their word – if the FCC fails to reign in broadcaster abuses, the TV blackout crisis will grow worse.”

At the FCC meeting, ATVA detailed seven outrageous examples of how broadcaster exploit consumers. The worst of these abuses include:

  • Blacking Out Marquee Events: Broadcasters routinely threaten to black out a station in the run up to a popular sporting or entertainment event.
  • Online Blocking: Broadcasters block access to their publicly available online content following a negotiation impasse, which impacts not only the pay TV subscribers but all Internet access subscribers served by that provider – even if they have a different video provider.
  • Forced Bundling: Broadcasters frequently demand that pay TV providers agree to carry additional channels as a condition of obtaining retransmission consent for the broadcaster’s primary signal. This forces unwanted channels onto the system and raises programming costs for consumers.
  • Out-of-Market Signal Blocking: Broadcasters that pull their signals take advantage of outdated FCC rules that allow them to prevent pay TV companies from providing duplicate network programming for consumers during a blackout.

“Broadcasters wait until a popular TV event is on the horizon and then gives fans an ultimatum, pay higher fees or get blacked out,” said Duffy. “Just this week, a broadcaster pulled the plug on tens of thousands of kids in Norfolk, Portsmouth, Newport News, Terre Haute and Topeka on the eve of the Major League Baseball All Star Game. It’s not fair and it’s not pretty, but sadly, it is legal because holding popular shows for ransom isn’t currently a breach of ‘good faith’. It’s time for the FCC to act to protect consumers so TV fans can see their favorite shows instead of a black screen.”

The Facts on Retransmission Consent and TV Blackouts

Since 2010, millions of Americans have seen black screens instead of their favorite channels due to at least 455 broadcaster blackouts.   The menace of TV blackouts continues to grow:

  • 67 blackouts in 2015
  • 107 blackouts in 2014
  • 127 blackouts in 2013
  • 91 blackouts in 2012
  • 51 blackouts in 2011
  • 12 blackouts in 2010

When blackouts finally end, consumers get their programming back, but at a higher cost:

  • Retransmission consent fees have grown 8,600% between 2005 and 2012.
  • SNL Kagan projects retrans revenue of $6.3 billion in 2015, $7.2 billion in 2016, and $10.3 billion by 2021.
  • SNL Kagan projects that over time 50% of affiliates’ retrans payments will go to the networks rather than pay for local programming.

The American Television Alliance (ATVA) brings together an unprecedented coalition of consumer groups, cable, satellite, telephone companies, and independent programmers to raise awareness about the risk viewers face as broadcasters increasingly threaten service disruptions that would deny viewers access to the programs they and their families enjoy.