The American Television Alliance (ATVA) – the pay-TV industry’s leading voice these days – needs our collective help. It appears that our friends are suffering from a serious case of Chicken Little Syndrome. You remember Chicken Little, right? That’s the poor little chicken who believed that the sky was falling after she was hit on the head by an acorn falling from a nearby tree. Chicken Little was so alarmed she spread panic throughout the town – all because of an acorn.
ATVA’s acorn is retransmission consent. When pay-TV companies seek to carry most local broadcast television stations, they have to negotiate with broadcasters for the right to do so. The overwhelming majority of these negotiations are uneventful and routine. They are business negotiations, conducted at arm’s length by sophisticated actors. As with any business negotiation, however, occasionally the parties struggle to come to terms. Infrequently, this results in a broadcast station’s removal from a particular pay-TV system until a deal can be reached.
ATVA’s actions – and indeed its entire purpose – would make even Chicken Little blush. Unlike the unwitting Chicken Little, ATVA spends day and night fervently hoping that one of the many thousands of retransmission consent negotiations between TV broadcasters and multichannel video programming distributors go south and hit ATVA squarely on its head.
You see, ATVA was conceived to create hysteria. ATVA’s strategy is to wait for an isolated example of a hiccup in negotiations – an acorn falling – and overreact in the most spectacular fashion possible. It’s as though ATVA has set up shop by the side of a busy road, just waiting for a car accident. Then, when an accident happens, ATVA sets off flares and air horns, and unfurls a banner triumphantly declaring, “SEE? I TOLD YOU THE HORSELESS CARRIAGE WOULD NEVER WORK!” ATVA wants you to ignore the hundreds of cars passing by without incident and focus only on that accident. If they make enough noise and sound scary enough, maybe someone will pay attention. That’s why, for ATVA, it’s not enough to turn a molehill into a mountain – the mountain always has to be Vesuvius and Pompeii always has to be on the cusp of being buried by ash.
There are countless examples of ATVA’s strategy, including the recent impasse between Nexstar Broadcasting and Cox Cable. As the extended agreement between the parties expired, ATVA fired up its outrage machine (patent pending) and penned a Chicken Little letter to the Federal Communications Commission (FCC). ATVA claimed that, even though Cox isn’t an ATVA member and ATVA has no specific knowledge about the parties’ negotiations, ATVA nevertheless knew “exactly what is going on here,” and that Nexstar was engaged in a “shakedown.” ATVA claimed that FCC intervention in the market was urgently needed to protect the poor, tiny, helpless, cable company (that happens to be the third largest cable provider in the country).
What ATVA doesn’t tell you is that Nexstar had, up to that point, successfully negotiated 1,200 retransmission consent agreements with pay-TV companies over the last 11 years. That’s right. 1,200 successful negotiations. But, when the 1,201st stumbles because a cable company holds out for lower rates or possibly even to trick regulators into action? The system is broken! Government intervention is desperately needed! The sky is falling!
ATVA’s hysteria reflexes have to be razor sharp because it generally has only a narrow window of opportunity to put out exaggerated and misleading claims regarding these exceedingly rare disputes. In this case, ATVA didn’t have a moment to waste to stage its very public case of the vapors. Nexstar and Cox resolved their contractual impasse without great fanfare, despite ATVA’s convulsions. The parties reached an agreement without new heavy-handed government regulations, despite ATVA’s grandstanding. Good thing ATVA didn’t wait a day to see what happened – they would have wasted a perfectly good acorn.
You might think that maintaining a constant, breathless stream of hyperbole would get exhausting after a while, but it’s the only real strategy ATVA has. After all, telling you the truth – that your cable company just doesn’t think it’s making enough money off of you – isn’t exactly a winner.