Despicable DISH Is At It Again

Is anyone surprised that consumers are yet again faced with another conveniently timed retransmission consent dispute involving DISH Network, the communication industry’s ultimate regulatory profiteer? Sunday night, despite being offered an extension, DISH Network ceased carrying local TV stations owned by Tribune Broadcasting in markets across the country. Don’t feel sorry for our friends at DISH; the company – and its front group the American Television Alliance – couldn’t be happier. A high-profile impasse feeds the image of a retransmission consent “crisis” that DISH and the rest of the pay-TV industry have worked tirelessly to cultivate.

In reality, there was little chance that DISH was going to reach an agreement with Tribune before its existing contract expired and forego this opportunity to garner headlines, just as the Federal Communications Commission (FCC) is actively considering new retransmission consent “good faith” rules. Although Tribune reports it is offering DISH carriage terms similar to those it has with other pay TV operators, DISH balked, no doubt salivating when it saw a chance to create a big splashy dispute. As an actor in roughly half of all retransmission consent impasses, DISH’s playbook is now routine: allow an existing contract to expire; release statements that paint the broadcaster as greedy; call for FCC “reform”; let the dispute fester for a few days; agree to terms similar to those offered before the dispute; claim the hero role.

Rinse and repeat.

These kinds of very public disputes involving DISH have become so commonplace, it is impossible to ignore the obvious: DISH is trying to manipulate the regulatory process, as it has time and time again. Just look at the statements DISH executives had ready for the press. They complain about prices and bundled offers, and suggest the solution is to allow interim (i.e., forced) carriage – even as it rejected Tribune’s offer for an extension. These just happen to be exactly the same rule changes DISH and its pay-TV brethren have been pushing for at the FCC, rule changes that DISH hopes will effectively eviscerate any broadcaster leverage in retrans negotiations.

If you accept DISH’s claims, and believe that it is merely standing up against greedy broadcasters, ask yourself: who has more to gain from a short dispute? With an open proceeding at the FCC on new retransmission consent rules and its national footprint (which broadcasters are forbidden by rule to have), DISH can easily withstand a short dispute in exchange for more “this is a crisis” fodder. Its customers – facing draconian early termination fees and equipment costs – are unlikely to go through the hassle of switching to a different provider. Meanwhile, the broadcaster immediately loses access to eyeballs forcing them to rework compensation with its advertisers. DISH has claimed that broadcasters are using customers as “sacrificial pawns” in these disputes, but its customers are “pawns” only so much as DISH makes them so.

Enough is enough. The Commission cannot be a patsy for DISH’s regulatory arbitrage plans any longer. As long as the FCC has an open proceeding on retransmission consent, DISH will continue to create short, high-profile disputes. And if you think creating new good faith rules will quell DISH’s demands for regulatory advantages, think again. If the Commission demonizes certain substantive proposals broadcasters offer in retransmission consent negotiations – something it has avoided doing thus far – it will open the door to a flood of good faith complaints by DISH and others. By far the most sensible path – and the most likely to end disputes – is for the Commission to make clear once-and-for-all that retransmission consent negotiations are governed by the marketplace, that parties should hammer out deals the same way businesses do in every other industry, and that creating faux disputes will not be rewarded with regulatory spoils.

Only then will DISH recognize that its bargaining should be done with broadcasters, not with the FCC at consumers’ expense.