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Hearing of the Senate Commerce Subcommittee on Communications, Technology, and the Internet - On The Cable Act at 20

Hearing

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Location: Washington, DC

Senator John Kerry (D-Mass.), Chairman of the Commerce Subcommittee on Communications, Technology, and the Internet, today renewed the call to protect consumers, promote competition, and preserve the viability of local broadcasting at a hearing of the Senate Commerce Committee addressing "The Cable Act at 20."

"In extreme cases, pulling the signal may be a broadcaster's only choice. But good faith negotiations should first be exhausted and consumers should still have access during a temporary negotiating impasse to live events like the College Bowl games, the World Series, live debates for public office, or the Oscars," said Senator Kerry. "I want to preserve local broadcasting. As a result, I would not support radical proposals to eliminate retransmission consent rights or must carry requirements altogether. But I also want to shield consumers from unfair treatment or from being used as pawns in negotiations. The moderate tweaks to the retransmission consent process that I am suggesting would serve both of those ends. There's got to be a better way to deal with these challenges than a perpetual game of chicken."

Senator Kerry's full statement, as prepared for delivery, is below:

Mr. Chairman, thank you. To make the Cable Act law in 1992, we had to overturn a Presidential veto. We did it on a bipartisan basis in order to protect consumers, promote competition, and preserve the viability of local broadcasting. As we look to update the law, we should keep those goals in mind.

The 1992 Act, among many other things, created our current retransmission consent regime. And with Time Warner Cable and Hearst recently ending the latest retransmission consent dispute to disrupt service for millions of households, that subject will likely take up much of this hearing.

The station pulled from Time Warner Cable in the Boston area during this latest dispute, WCVB, was recently named as the Edward R. Murrow award winner for the nation's most outstanding news operation. I take pride in that. I want to see it succeed and receive fair compensation for the retransmission of its signal. But I don't want to see the pulling of signals become a repeatedly used tool for arriving at dispute resolution between distributors and broadcasters - it isn't fair to consumers.

This is not a new problem. I chaired a hearing on it in 2010 after disputes threatened viewer access to the Oscars and World Series that year. I asked the FCC to explore its authority to help protect consumers. But the FCC Chairman has concluded that he lacks the legal authority to intervene during an impasse in negotiations. As a result, disputes and standoffs continue with millions of consumers suffering collateral damage.

Some argue that these disruptions are ok because cable subscribers can simply switch to satellite service. But switching doesn't protect consumers from these disputes. In March 2011, DISH customers in 17 markets lost their CBS, FOX, NBC, and CW signals for six days. And earlier this year, DirecTV and Sunbeam Television reached an impasse in the weeks leading up to the Super Bowl causing consternation in Boston because the New England Patriots were playing. Fortunately, the signal was restored prior to the game. Unfortunately, we lost.

In extreme cases, pulling the signal may be a broadcaster's only choice. But good faith negotiations should first be exhausted and consumers should still have access during a temporary negotiating impasse to live events like the College Bowl games, the World Series, live debates for public office, or the Oscars.

I want to preserve local broadcasting. As a result, I would not support radical proposals to eliminate retransmission consent rights or must carry requirements altogether. But I also want to shield consumers from unfair treatment or from being used as pawns in negotiations. The moderate tweaks to the retransmission consent process that I am suggesting would serve both of those ends.

Disputes also occur between distributors and non-broadcast channel owners, including the recent disputes between Viacom and DirecTV, and AMC and DISH. But those disputes do not elicit the same level of concern because those station owners do not have public interest obligations. They do, however, raise questions about how to appropriately value bundled channels, where some stations in the bundle are dramatically more valuable than others.

Moving forward, I want industry to construct an alternative to the disruption of service during negotiations and I urge the FCC to complete its pending notice of proposed rulemaking on retransmission consent. I also want us to continue to explore the role of the Internet as an alternative vehicle for accessing video content. And I want us to think about the degree to which consumers can customize their consumption of media and in turn control their spending.

Mr. Chairman, these are important issues with social, civic, and economic implications for working families, citizens, and consumers. I look forward to working with you and others on this committee on a responsible update to the law in this and the coming Congress.


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