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  • Scott Goodwin 1:28 pm on June 29, 2016 Permalink  

    The Art of Duplicity, as Perfected by DISH Network 

    Regulatory profiteer DISH Network is faithfully executing its apparent campaign to use carriage impasses to induce the Federal Communications Commission (FCC) to tip its retransmission consent rules in DISH’s favor. DISH has become the market leader in creating impasses, harnessing the resulting consumer frustration, and through its proxy the American Television Alliance, driving its customers to the Commission to demand a regulatory “fix.”

    While clever, DISH’s plan has one glaring blind spot: DISH itself.

    Those who have seen DISH in action over the years know that the company cannot be trusted. DISH will bend – and sometimes break – the rules to achieve its bottom line ends. The company has absolutely no problem jumping up and down about the behavior of others while it engages in tactics that go far beyond what it is complaining about. This no-shame playbook has become a DISH trademark.

    DISH’s dispute with Tribune is yet another excellent example of DISH’s tactics. Earlier this week, DISH filed a lawsuit against Tribune, alleging, among other things, that Tribune is interfering with “contractual relations” and DISH’s “prospective economic advantage.” Its primary complaint is that Tribune has run ads and operates websites that explain to viewers why they aren’t receiving Tribune programming on DISH and how it can access those stations if the impasse continues (use an over-the-air antenna or switch providers). DISH grouses that Tribune shouldn’t be encouraging consumers to switch providers and that Tribune cannot inform the public that a Consumer Reports survey found that DISH customers gave the company the worst rating for value (even though, as DISH acknowledges in its complaint, the allegation is completely true).

    The problem for DISH – in addition to the fact that Tribune’s actions are lawful – is that it doesn’t want the FCC to look behind the curtain. If it did, then the FCC would learn that not only is DISH informing viewers much like Tribune, but it also is going even further. DISH is of course running a rotating loop of videos on the channels typically occupied by Tribune stations complaining that the retrans impasse is exclusively the fault of greedy broadcasters. It also pushes viewers to its propaganda website (unrelated to

    But beyond the traditional exchange, DISH’s playbook includes a darker, more dastardly set of tactics. Even as DISH complains that broadcasters are damaging its “prospective economic advantage” by suggesting consumers switch providers, DISH routinely sets out to damage the relationship between local stations and their advertisers (which also could be DISH advertisers). DISH has sent, and continues to send, letters to advertisers of stations experiencing an impasse with DISH (see letter below) telling them that the value of their advertising has been reduced because of the impasse and encouraging those advertisers to contact that station and demand “the full value of [their] advertising dollars.” It even provides the direct contact number of the station’s manager.

    dishletter_062916(Click to enlarge.)

    The intended effect of this campaign is clear – punish stations for not acceding to DISH’s demands. As NAB has noted repeatedly, impasses already hurt local stations far more than they do pay-TV providers, especially major national pay-TV providers like DISH. When a station experiences an impasse with a pay-TV distributor, it can immediately lose up to 20-30 percent of its viewing audience (sometimes even more). Those lost eyeballs are lost dollars, and the toll adds up with each passing day, putting enormous pressure on stations to reach a deal. These DISH letters are designed to amplify that pain and force stations into submission.

    With these facts apparent, DISH can be seen for what it really is: villain and not victim. Its lawsuit against Tribune is nothing more than a publicity stunt – and a weak one at that. Indeed, the only thing that’s still confusing about this whole sordid affair is how DISH thinks it can continue to get away with it. With its well-known history as a regulatory schemer, you might think DISH would lay low and not take on such a public role as the poster child for pay TV’s attempt to change the retrans rules. But that’s not the DISH way. The DISH way is to push forward at any cost and hope that no one notices its hypocrisy. Well DISH, we’ve noticed and it won’t be long before the FCC does too.

  • Patrick McFadden 12:50 pm on June 24, 2016 Permalink
    Tags: DISH,   

    Dishceptive Advertising 

    It’s not at all uncommon for us to find ourselves marveling at DISH’s signature cocktail of chutzpah and hypocrisy. DISH is the common denominator in roughly three out of four service disruptions resulting from retransmission consent impasses, yet, when its customers lose access to programming they value because of DISH’s intransigence, DISH brazenly rolls out a carefully orchestrated campaign to blame broadcasters in an effort to secure regulatory favors from the FCC. In DISH’s latest broadcaster hold-up – this time with Tribune Broadcasting – it has taken things one step further and publicly announced it is suing its negotiating partner in federal district court. And, upon reading the complaint, we have to admit that DISH has really outdone itself this time.

    DISH’s suit concerns advertisements and websites Tribune has used to educate viewers as to why they can’t view Tribune’s programming on DISH. DISH accuses Tribune of tarnishing and diluting the value of DISH’s trademarks by using words like “dishgusting” and “dishturbing” to describe DISH’s conduct. So, from the outset, it’s clear that DISH’s suit is a very serious, credible attempt to enforce its rights and is totally worth a court’s time (and absolutely should not have been filed in Comic Sans font).

    DISH is also outraged that Tribune would suggest that DISH customers who are frustrated by their inability to receive Tribune programming consider switching to another service provider. According to DISH, urging customers to switch service providers causes real harm because, when customers do switch, DISH cannot get them back. Given how sensitive the company appears to be about dishparagement, someone should alert DISH that it just admitted that customers who try another service provider are a bit like Taylor Swift – they are never, ever, ever getting back together with DISH.

    Besides, isn’t trying to get customers to choose your service offerings instead of your competitors’ sort of the whole point of advertising? DISH itself uses advertising to try to convince customers of other service providers – including DirecTV, Comcast, Time Warner Cable, Charter and Verizon – to switch to DISH. The complaint seems dishingenuous, at best.

    But it’s not just that customers may leave. DISH is also extremely frustrated that customers call DISH to complain, or get more information. DISH is clearly dishappointed at the prospect of having to spend more time talking to dishgruntled customers who are frustrated by the dishruption in their service.

    DISH’s super serious, thoughtful complaint that you definitely should not take lightly or make fun of in any way also accuses Tribune of making dishceptive claims by asserting that customers gave DISH the lowest rating for value in a 2015 customer service survey. According to DISH, it didn’t really finish last for value in that survey; rather, the company finished tied for last. In effect, DISH is claiming that Tribune is off base because even though DISH received the lowest rating, it shared that honor with other companies. Put differently, DISH’s lawsuit is premised in part on the notion that, while its customers think DISH provides terrible value, they don’t think it provides uniquely terrible value. It’s more a run of the mill terrible value. This is such an important dishtinction that DISH adds in a footnote that the company again finished tied for last for value in a 2016 survey. Just so everyone knows this wasn’t an anomaly.

    At bottom, of course, this suit is nothing more than a dishtraction. DISH’s subscribers currently can’t access programming they value through DISH because DISH would rather pay below-market rates for programming. That’s what this dishpute boils down to. If the company really wanted to provide a dishincentive for customers to leave, it might consider engineering fewer service dishruptions that deprive customers of their desired programming.

  • Scott Goodwin 12:30 pm on June 15, 2016 Permalink  

    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.

  • Rick Kaplan 10:21 am on March 29, 2016 Permalink  

    It Begins 

    Today is an exciting day at the Federal Communications Commission (FCC), with the official start of the broadcast spectrum incentive auction. And much is at stake – a successful auction means that spectrum will be repurposed, a huge amount of money will change hands and technology and spectrum policy will be shaped for the future. All of these things hang on the outcome of a brave and untested idea dreamed up by economists and enabled by engineers.

    The FCC staff deserves considerable credit for getting us to this point. As the idea of an incentive auction was explored in detail, challenges arose and the Commission’s staff grappled with them in earnest. To be sure, not every solution can be elegant and there remains disagreement about whether each one will prove successful, but the FCC staff is now able to push the “start” button and the initial spectrum clearing target will be revealed.

    A good deal of credit also goes to former FCC Chairman Julius Genachowski, who first presented the incentive auction concept as part of the National Broadband Plan, to Chairman Tom Wheeler, who has led the charge to dot the auction’s i’s and cross its t’s, and to all of the commissioners who have engaged in a difficult process to bring to light the key policy decisions at stake along the way.

    Even on this momentous occasion, we should be mindful that our work is only partially complete. The dedicated FCC staff is now turning its attention to one of the most complex processes of relocating incumbent spectrum users in its history. We must also recognize that the auction will harm low power television and translator services. This will affect many viewers across the country who rely on those services for critical public safety news and information. Broadcasters will continue to work with the Commission to ensure that damage to these and other critical broadcasting operations is minimized.

    What happens next is anyone’s guess, but the FCC staff can certainly be proud that they worked incredibly hard under tight timelines to bring us to the doorstep of this exciting auction.

  • Patrick McFadden 1:20 pm on March 23, 2016 Permalink
    Tags: , ,   

    Time to Stick to the Facts and Find the Right Answer 

    These are exciting times. The long-anticipated broadcast television spectrum incentive auction is scheduled to begin in less than one week. Designing the reverse and forward auctions has been a herculean task, and the Federal Communications Commission (FCC) staff deserves a great deal of credit for bringing the auction to this point in a timely fashion. But, unfortunately for the Commission, once the auction is complete, its work is only half done. That’s because the end of the auction brings perhaps the most challenging phase of all: repacking many hundreds – if not more than a thousand – broadcasters to new frequencies in the television band.

    As NAB has repeatedly documented, broadcasters have serious concerns about the arduous repacking process ahead. After all, it took the better part of a decade and three extensions of time to complete the digital television (DTV) transition, which involved relocating far fewer broadcasters, did not rely on flash cuts and was buttressed by tens of millions of dollars designed to help consumers make the switch to digital. Above all, however, the greatest worry with respect to the upcoming 600 MHz transition is the Commission’s current rule requiring every broadcaster to complete its involuntary relocation within only 39 months following the auction. If the FCC is serious about repacking as many as 1,300 broadcasters, anyone who has any understanding of the broadcast industry knows that it is impossible to accomplish that task in such a short period of time.

    Fortunately, the FCC commissioners have uniformly recognized the challenges associated with the repack and have indicated in testimony before Congress that – despite the current rules – they in no way want to see any broadcaster forced off the air for reasons beyond their control.

    On the other hand, the FCC’s chairman has continued to insist that the 39-month timeline is sound. When pressed by Congress to defend that deadline given that the FCC has not done any serious analysis of what it would actually take to conduct a nationwide repack, the chairman explained that 39 months was a reasonable timeline, because, after all, even NAB had originally suggested that 30 months would be sufficient. This answer is disingenuous, and given that it has been repeated on several occasions by Commission staff, it’s time to address and bury it once and for all.

    More than three years ago, NAB submitted its initial comments in the incentive auction proceeding (then under Chairman Julius Genachowski) recommending that the FCC extend its proposed timeline for moving stations to new channels following the upcoming broadcast spectrum incentive auction. The FCC had proposed a minuscule 18-month timeline, to which NAB responded, “[t]he 18-month construction time frame proposed in the Notice for relocating stations is unrealistically short.”[1] At the time, NAB assumed, as many did, that the Commission was considering relocating “approximately 400 to 500 stations.”[2] Thus, NAB recommended that the FCC extend the deadline to 30 months, which should be enough time to “allow most stations to complete” the transition.[3] In addition, to stretch that 30 months as long as possible, NAB also proposed that “the forward auction should not be deemed completed until, or after, the time at which stations file their construction permit applications,”[4] which the Commission did not adopt. And finally, NAB made clear that “based on television stations’ experiences in the DTV transition, stations in certain metropolitan areas (such as New York City and Denver) and stations in border areas requiring international coordination could require substantially longer than even three years to construct new facilities.”[5]

    Thus, not only did NAB rely on information at the time that suggested only 400 to 500 stations would move, and seek to push back the starting point for the timetable until after construction permits were issued, we also asserted that even repacking all of 400 to 500 of stations would require more than 30 months.

    Beyond those inconvenient details, there have been three important developments in the intervening three-plus years. First, the FCC released a set of sample repacking scenarios in the summer of 2014, suggesting that the Commission is likely to repack far more stations than NAB anticipated in our 2013 comments. Instead of moving perhaps 400 stations to new channels, the FCC’s publicly released simulations suggested that the FCC could require more than 1,300 stations to relocate. Second, once the FCC released this data, NAB commissioned a study – the first of its kind – to examine each of the challenging elements that make up a nationwide repack of many hundreds or more than 1,000 stations. Third, in May 2014, the FCC surprised everyone by adopting a “death penalty” repacking rule that would require stations unable to complete their transitions within 39 months – no matter what the reason – to go off the air. The rule did not contemplate any exceptions or extensions – a rigid and inflexible deadline that no one anticipated.

    Faced with this new information, NAB re-evaluated the timeline for the upcoming broadcaster transition. It became immediately clear that 39 months would not provide sufficient time to repack the number of stations the Commission was anticipating. As a result, NAB has asked the Commission to establish aggressive, but achievable, deadlines for repacked television stations after the auction, when more is known about many stations will move, where they are located and to which channels they will be moved.

    This evolution is certainly reasonable. New facts and circumstances demand new solutions. While it is concerning that some continue to hide behind comments NAB submitted more than three years ago under different circumstances, it’s frightening that these same officials are hiding at all. The point of the repacking conversation is not to prove who is right; rather it’s to get it right. As the FCC pivots to thinking about repacking – which is now likely less than a year away – rather than being cute about past comments, it should actually engage and wrestle with the enormously complex repacking problem ahead. Only that course will give the broadcasting and wireless industries confidence that the post-auction transition will be a success.

    [1] Comments of the National Association of Broadcasters at 50, GN Docket No. 12-268 (Jan. 25, 2013).

    [2] Id. at 50.

    [3] Id. (emphasis added).

    [4] Id.

    [5] Id. (emphasis added).

  • Bruce Franca 11:03 am on February 17, 2016 Permalink  

    Despite Not Knowing Where to Aim, CCA Thinks FCC Hit the Mark 

    Last week, the Competitive Carrier Association (CCA) released a paper arguing that the Federal Communications Commission’s (FCC) randomly selected timeline for completion of broadcaster relocation following the auction is right on the mark. Determining how to develop a timeline for a nationwide repack of broadcasters involves complex engineering challenges, so of course CCA hired . . . an economist(!) to conduct its assessment. At least with this approach, CCA could simply assume the repack will be just fine.

    Despite it being in their members’ interest to fully come to grips with how long it will take to clear broadcasters from their 600 MHz channels across the country, CCA’s approach is lackluster and misleading. Following the broadcast spectrum incentive auction, the FCC will require hundreds, if not more than a thousand, stations to move to new channels. No one knows, however, exactly how many stations will be forced to move or even the scope of what those moves will require. Very little preparation can occur in advance, as no station knows if and to where it will move, and in what order it may be required to change channels. While these questions should give any engineer or economist pause, CCA’s paper guarantees us all that it should be no problem to repack an entire nation in just 39 months.

    But in the real world, this is more than an academic exercise. Understanding this complex process is essential because, under the FCC’s current rules, every station assigned to a new channel must vacate that frequency within 39 months after the auction. The FCC’s rules provide no exceptions to this, other than the Commission’s general waiver authority. If the FCC forces more stations to change channels than can possibly be repacked in that timeframe, the FCC’s current rules require stations to go dark and viewers to lose television service.

    Rather than assume the outcome, NAB approached this problem with rigor. We worked with an engineering consultant, Digital Tech Consulting, Inc. (DTC), which has a staff with decades of experience in broadcasting and that conducted numerous interviews with service and equipment suppliers to determine what was and was not possible. DTC’s report remains the only analysis in the record of the time and resources needed to complete a nationwide repack of television stations, as safely and as quickly as possible.

    Given that NAB is most interested in the right, rather than the expedient, answer, we shared that information with stakeholders in the wireless industry, including CCA, long before it was made public. NAB and DTC spent time addressing any and all questions concerning the analysis in an effort to advance a conversation about how the FCC, broadcasters and winning forward auction bidders can accomplish an efficient, rational transition after the auction. NAB even offered to fund a second study overseen in part by the wireless industry to ensure that everyone was working with a diverse set of expert opinions.

    Rather than engage in a discussion regarding DTC’s work, CCA instead bought a seven-page paper shopped by an economics professor that contained the answer CCA wanted. The economics professor they hired is perhaps best known to auction followers as the $85 billion dollar man – a nod to his enthusiastic forward auction projections. What he is not known for is his engineering expertise. That helps explain why CCA’s paper contains a number of critical flaws. Here are just a few of the most obvious errors, for starters:

    First, CCA asserts that DTC’s estimate of the number of stations that might be repacked is substantially overstated. This is curious, because DTC’s estimate of 860-1,164 stations overlaps with CCA’s estimate of 756-888(sic)* stations. At a minimum, then, CCA’s study confirms that the lower end of the DTC estimate is a reasonable projection. Moreover, DTC based its numbers on publicly available information the FCC has released. CCA based its numbers on an optimization scheme its economics professor invented.

    *Note: CCA states “in all cases the total number of stations that must change channels ranges from 756 to 888.” However, the actual values shown in the CCA paper range from 766 to 921 and contain arithmetic errors. Maybe they should have assumed a better calculator.

    Second, CCA asserts that the DTC study fails to account for “sources of efficiency found in the field,” such as the deployment of broadband antennas that can operate on a broad range of channels in the UHF band. Unfortunately, CCA did not consult an economics professor with any broadcast engineering experience. Had it found one (or simply hired a broadcast engineer), it would have learned that broadband antennas cannot realistically be used for broadcast TV station repacking in most cases. That is because the FCC is repacking stations specifically to preserve their coverage area and population served, which will necessitate antenna patterns that are specific to each station. A broadband antenna is usually limited to one single antenna pattern across all channels. Thus, a single broadband antenna usually cannot simultaneously replicate the coverage of multiple stations. Instead, most repacked broadcasters will need to rely on specifically manufactured directional antennas.

    Third, CCA asserts that DTC significantly understates the number of qualified tower crews available for repacking work. It claims that there are 41 qualified tower crews available right now. That’s interesting, because the FCC’s own Widelity Report concludes that no more than 14 qualified tower crews are available to work on complex and tall towers, and that “there is likely to be more work than these crews can handle in a timely fashion.” The Widelity Report also states that it would take 41 months to complete repacking at a complex site, under ideal conditions – with no unforeseen delays due to weather or zoning issues. As an engineer, I can confirm that 41 months is longer than 39 months. In fairness, CCA’s ivory tower exercise does reference an unpublished “engineering study” that will perhaps attempt to substantiate its claim that 41 qualified tower crews are available. I guess we’ll have to wait for that paper, because CCA apparently hasn’t finished cooking the numbers yet.

    Fourth, CCA claims that the repacking task is “modest relative to the DTV transition.” No one who has seriously studied this issue – or was even around during the DTV transition – could possibly come to that conclusion. During the DTV transition, most stations were not required to flash cut to a new channel for their primary signal within a tight timeframe. Nor did broadcasters have to worry whether other stations made the switch to their new channels at exactly the same time to avoid interference to their viewers. Rather, most stations operated simultaneously on two channels, one with a digital signal and one with an analog signal, sometimes for a decade or more. At the transition date, most stations simply turned their analog transmitters off – there was no tower work and little engineering required. That was a vastly simpler transition, yet it was conducted with significantly greater resources than are available now. This flaw could have been avoided by consulting anyone in the broadcasting industry, even economists who are familiar with it.

    Finally, the underlying premise of CCA’s “Don’t Worry, Be Happy” analysis is that the supply of necessary resources will simply rise to meet the demand during the FCC’s short repacking window. Apparently loads of new vendors, whom broadcasters are expected to trust despite their total lack of experience, will enter the tower rigging or equipment manufacturing business, drawn like moths to a flame by a business opportunity that will last no more than 39 months. This also begs the question – does CCA’s economics professor believe that supply will necessarily always rise to meet demand? If, instead of 756-888 (sic) stations, the FCC was repacking 1,500 stations, would 39 months still be enough? What if there were 3,000 stations that needed to be repacked? Or 5,000? Would supply just adapt to meet demand? CCA’s economics professor must have been lucky enough to never have ordered a product that had a wait list.

    Broadcasters have no desire to delay the post-auction transition. It will be painful and expensive for stations, as well as disruptive for their viewers. But we do not have the luxury of assuming away the problem (or shopping a paper for a hefty price with no consequences if we are completely wrong). The FCC’s policy decisions on this matter should be driven by facts and serious analysis – not by crossing our fingers.

  • Patrick McFadden 12:09 pm on February 16, 2016 Permalink  

    The Best Things in Life Are Free (Even When You’re Worth More Than Half a Trillion Dollars) 

    “I don’t care how much money you have, free stuff is always a good thing.”
    – Queen Latifah

    While I don’t believe that Queen Latifah had Google in mind when she uttered this well-known line, she might as well have.

    Google has a lot of money. Not just a lot of money, but A LOT of money. Sporting a market capitalization of $548 billion, Google has passed Apple as the most valuable company on the planet.

    Thus, it’s safe to assume that, if Google wanted or needed something, it could afford to buy it. For example, Google has expressed an interest in “low band” spectrum. Given its interest in spectrum, one would assume that Google would be a major player heading into the Federal Communications Commission’s (FCC) upcoming broadcast spectrum incentive auction. This auction will feature as much as 100 megahertz of prime low band spectrum. It would be a perfect opportunity for Google to acquire spectrum usage rights, and Google’s participation would have the added benefits of raising billions in auction revenues for the government and helping to ensure the auction’s success.

    However, despite its interest in using spectrum, Google isn’t going to play in the auction. Sorry, Congress. Sorry, FCC. No dice.

    Why did Google decide to sit out yet another spectrum auction? The smart money is on Google recognizing Queen Latifah was really on to something. Even if you’re worth well more than half a trillion dollars, free stuff is still a good thing.

    Rather than bid in the auction, Google believes it has found access to free spectrum it can monetize. For the past year, Google has helped lead the charge behind the scenes to push the FCC to simply reallocate spectrum during the auction process for Googley purposes. Reallocation has no price tag. It’s just a gift. In this instance, Google has managed to convince the FCC to consider taking even more channels away from free, over-the-air television after the auction, and designating them for companies like Google. Never mind that this would kill off more free, diverse and rural television service across the country. Never mind that it will hamper innovation by companies not named Google. And never mind that it will crush any hopes of new and diverse entrants into the broadcast industry. If Google sees an opportunity to throw its $548 billion weight around and wind up with some spectrum schwag, why not do it?

    It’s also not for Google to care whether or not this is the right outcome for the country. Let’s face it, Google and its interest-group contractors can’t articulate any tangible benefits for the government’s gift. If the FCC moves forward with its Google Channel proposal it would be asking us to simply give Google the benefit of the doubt. The FCC isn’t attaching any specific public interest obligations to users of this spectrum, or heck, even requiring the spectrum be used at all. It’s really all up to Google.

    I suppose we can’t really blame Google, though. It’s our fault, not Google’s. If Google can keep pulling favors from the government to add to its $548 billion bottom line, more power to it. It’s up to all of us – most of all the FCC – to not keep giving things to Google for free. It seems we’ve made a habit of it. The Commission should recognize that it created a disincentive for Google to participate in the auction and will continue to dissuade Google from investing in all kinds of things if it keeps handing over the keys to the kingdom.

    For as Google well knows, it doesn’t matter how much money you have, it’s still much better to get something for free.

  • Patrick McFadden 12:04 pm on February 5, 2016 Permalink  

    ATVA: What Acorn? 

    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.

  • Zamir Ahmed 9:01 am on December 22, 2015 Permalink  

    Local TV Stations: Bastions of Investigative Journalism 

    In her New York Times column, “The Search for Local Investigative Reporting’s Future” (Dec. 5), Margaret Sullivan bemoans the uncertainty surrounding newspapers’ future investment in enterprise reporting that roots out corruption and exposes illicit behavior in local communities. What Ms. Sullivan should not forget is that local television broadcasters are picking up the mantle of serious investigative journalism as resources become limited at newspapers.

    In recent years, local TV stations have invested significant resources into building and expanding their investigative news teams both on-air and online. Some stations have even employed former newspaper reporters with extensive backgrounds in investigative journalism, such as Dispatch Broadcast Group’s WTHR Indianapolis, Block Communications’ WDRB Louisville and Capitol Broadcasting Company’s WRAL Raleigh.

    A few examples of broadcasters’ investment in investigative reporting locally and nationwide include:

    • Atlanta: In November, Meredith Corporation’s WGCL introduced an investigative news initiative featuring a team of reporters with over 100 combined years of television news reporting experience, including former The Washington Post reporter Art Harris;
    • St. Paul: Hubbard Broadcasting-owned KSTP recently hired as an executive producer of investigations and special projects Paul McEnroe, who was formerly The Star-Tribune’s most prominent investigative reporter;
    • Chicago: In July, NBCUniversal’s WSNS became the ninth Telemundo station to launch a dedicated news team to help consumers who have been wronged by local businesses;
    • Asheville: In May, Asheville Citizen-Times reporter Jon Ostendorff left the newspaper to join Sinclair Broadcast Group’s WLOS as an investigative reporter;
    • Washington, D.C.: Last December, Sinclair Broadcast Group-owned WJLA create an investigative unit focusing on rooting out government waste;
    • New York: Last year, Tribune Broadcasting’s WPIX brought together several award-winning journalists to form an investigative news team “to bring fraud and injustice to light…while protecting our viewers and keeping their families safe from harm.”

    Broadcasters’ investment in enterprise journalism has not gone unnoticed. Last July, Broadcasting & Cable ran a cover story about the increase in new and expanding investigative news teams at local TV stations. The article noted that attendance at the recent Investigative Reporters and Editors convention exceeded 1,650, significantly more than the 1,250 from the 2013 convention and a new record.

    Local TV stations’ investigations have also paid numerous dividends for viewers by uncovering corruption and illegality in local communities, carrying out broadcasters’ mission of serving the public interest. These investigations have also garnered prestigious national and local awards for their in-depth reporting, and prompted local governments to take action to correct the wrongs exposed. Just a small handful of the many investigations that broadcasters have undertaken include:

    • Tampa: Following a year-round investigation, in September TEGNA’s WTSP aired a five-minute news broadcast examining the influence wielded by a private PR consultant in local politics, potentially in violation of local and state ethics laws. The station supplemented that broadcast with a 6,000-word online article, extensive links to public records and online-only videos, a convergence of elements that earned the project kudos from the Columbia Journalism Review.
    • St. Louis: Meredith Corporation’s KMOV earned a 2016 Alfred I. duPont-Columbia University Award after launching an investigation of the area’s criminal justice system in wake of the shooting death of Michael Brown and subsequent civil unrest. Through more than 40 stories, the investigation revealed a system of mandated ticket quotas, speed traps, and fines to help small municipal courts make money. The reports prompted one local police department to end its ticket quota system, a judge being forced to resign and the firing of a police officer.
    • Baltimore: Hearst Television-owned WBAL received a 2016 Alfred I. duPont-Columbia University Award for its in-depth, breaking news reporting on what happened to Freddie Gray, the Baltimore man who was critically injured while in police custody and subsequently died a week later. The investigation into his death raised questions about police procedure and prompted major protests in the city and around the country.
    • Raleigh: Capitol Broadcasting Company’s WRAL produced a documentary from the Rio Grande Valley on the tens of thousands of unaccompanied minors illegally immigrating into the U.S. from Mexico and its impact on North Carolina. The report was credited as an “excellent example of local reporting” when it was cited for a 2016 Alfred I. duPont-Columbia University Award.
    • Dallas: NBCUniversal-owned KXAS, which partnered with the Dallas Morning News, was honored with the 2015 Gannett Foundation Al Neuharth Award for Investigative Journalism. The station looked into claims by injured U.S. Army soldiers, particularly those with mental wounds, that they were often mistreated, belittled and even ordered to do things that jeopardized their medical care by commanders. The report prompted changes to the Army Warrior Transition Units and sparked investigations and hearings by the U.S. House of Representatives.
    • “Full Measure”: Debuting in October, this Sinclair Broadcast Group-produced half-hour news program airs every Sunday on 162 television stations in 79 markets. The show focuses on investigative, original and accountability reporting and is hosted by Sharyl Attkisson, a five-time Emmy Award winner and Edward R. Murrow award winner for investigative reporting at CBS News.
    • New Orleans: Hearst Television’s WDSU continues to investigate questionable hiring practices by the district attorney in one of Louisiana’s most populous parishes, who recently brought onboard two employees that raised ethical questions. One new employee was tied to a federal corruption case involving a kickback scheme at the parish courthouse, while the other retired in order to collect a pension and was subsequently rehired in a part-time position.
    • Louisiana: An investigation by TEGNA’s WWL, in partnership with USA Today and other TEGNA newspapers, found that the state’s backlog of untested sexual assault kits may have only accounted for a fraction of outstanding kits. The investigation found that while a new state law requires law enforcement agencies to report how many untested sexual assault kits they had, only half of the agencies did and others reported lower numbers than was actually the case.
    • Rochester: Nexstar Broadcasting Group’s WROC aired a special report in February that exposed how teachers under investigation for misconduct were sent to the Alternative Work Location, dubbed “The Rubber Room.” In the spring of 2014, the 15 teachers and administrators sent to the Alternative Work Location received their salary but were not given any work assignments, the report revealed.
    • Arizona: In January, all Arizona television stations aired “Hooked: Tracking Heroin’s Hold on Arizona,” an investigative report produced in English and Spanish by students at Arizona State University’s Walter Cronkite School of Journalism and Mass Communication in partnership with the Arizona Broadcasters Association (ABA). The program focused on the growing perils of heroin and opioid use in Arizona.
    • Detroit: Graham Media Group’s WDIV examined the school-issued helmets that several local high school football teams were using and tested their ability to prevent concussions. The station’s investigation found one in four helmets that were being used by the Detroit Public School System held one- or two-star ratings on a scale of five.
    • Denver: E. W. Scripps Company’s KMGH won a Peabody Award for its “Investigating the Fire” series, which examined a controlled fire set by the Colorado State Forest Service that expanded into an out-of-control forest fire that cost three lives and damaged 22 homes. Producing more than two dozen reports, two town hall meetings and a 30-minute special, the investigation uncovered negligence on the part of the Forest Service and prompted state lawmakers to take action to compensate victims.
    • Columbus: In a series called “Investigating the IRS,” Dispatch Broadcast Group-owned WTHR uncovered massive fraud caused by mismanagement and lack of oversight inside the Internal Revenue Service that cost American taxpayers billions of dollars. The investigation earned the station a Peabody Award and prompted the IRS to institute permanent changes in agency practices and policies.

    The questions Ms. Sullivan asks are the right ones: Where will local investigative journalism come from? Who will expose corruption and defend the taxpayer? Who is going to hold people accountable?

    Broadcasters understand our role as Americans’ most-trusted, top-choice news source and our power to drive local conversations.  That’s why many TV stations have invested in investigative journalism to fill the gap left by a declining print industry. I believe we have answered Ms. Sullivan’s questions. Broadcasters have already assumed the important role of the watchdogs of our democracy.

  • Rick Kaplan 12:08 pm on September 23, 2015 Permalink

    Revisionist History, Cable Goodies and Still Nothing for Consumers 

    On Tuesday, Federal Communications Commission (FCC) Chairman Tom Wheeler’s Media Bureau chief, Bill Lake, took to the blogosphere in an attempt to reverse the palpable lack of enthusiasm for the Chairman’s plan to eliminate the broadcast TV exclusivity rules. Unfortunately, Mr. Lake’s written defense of the Chairman’s proposal is fatally flawed and obscures the larger questions surrounding the Chairman’s recent efforts.

    There are many reasons why Chairman Wheeler’s self-generated push to eliminate the Commission’s network and syndicated exclusivity rules is misguided. As the National Association of Broadcasters (NAB) has detailed in numerous filings, the exclusivity rules enhance localism without granting new substantive rights. They also create a significant marketplace efficiency by preventing protracted and expensive litigation over private marketplace deals. They are part of a larger comprehensive system developed and reworked by Congress over the last several decades and serve as an important deterrent against cable operator mischief of the sort that industry typically reserves for its customers.

    Since the Chairman first circulated his proposal in August, broadcasters across the country have reminded the FCC that Congress already has in place a carefully constructed framework that includes exclusivity protections at its core. As Mr. Lake acknowledges for the first time, Congress, the White House and the FCC forged an agreement among stakeholders in 1971 that would lead to cable’s compulsory license, content owners’ compensation and broadcasters’ bargained-for exclusivity protection at the FCC. Notably, the cable industry received a hefty government subsidy in the copyright deal, as the government and not the market continues to set the rates cable companies pay for the underlying content they re-sell to consumers.

    Mr. Lake argues that despite this agreement, subsequent events nullify the need for the FCC to uphold the part of the system that promotes local broadcast TV service. Specifically, Mr. Lake asserts that because Congress instituted the retransmission consent regime in 1992, there is no longer a need for the FCC to preserve local exclusivity. The thinking goes that broadcasters need not worry about the importation of distant signals because retransmission consent makes it more difficult for cable companies to obtain the rights to import signals from third-party stations.

    This argument, however, is not only inaccurate, but also completely misses the point. When enacting the retransmission consent regime in 1992, Congress stated expressly:

    [T]he Committee has relied on the protections which are afforded local stations by the FCC’s network non-duplication and syndicated exclusivity rules. Amendments or deletions of these rules in a manner which would allow distant stations to be submitted on cable systems for carriage or local stations carrying the same programming would, in the Committee’s view, be inconsistent with the regulatory structure [adopted in the 1992 Cable Act].

    Contrary to Mr. Lake’s central claim, Congress was well aware of the importance of the exclusivity rules when it granted retransmission consent rights to broadcasters. The “major piece[] of the intervening history” (i.e., the 1992 Cable Act) that Mr. Lake identifies in his blog itself recognized that exclusivity is part and parcel of the copyright/retransmission consent framework. It is awfully difficult to claim that an intervening event fundamentally altered an initial deal when the authors of that event stated that they were incorporating all of the elements of the original agreement.

    But even if those pages of intervening history were lost, one could simply look to the satellite reauthorization bill Congress passed just last year to see how hollow Mr. Lake’s claim rings. In reauthorizing the satellite distant signal license, Congress yet again preserved local exclusivity for satellite viewers. Therefore, even if somehow one could claim that Congress didn’t understand the potential impact of retransmission consent on exclusivity in 1992, no one can plausibly claim that Congress was so blind as to miss the implications of local exclusivity in 2014. And does Mr. Lake seriously think that Congress meant to create a mechanism for broadcasters to enforce their exclusivity rights against satellite, but not against their cable competitors?

    Moreover, missing in all of this historical rewriting is that neither the Chairman nor Mr. Lake even attempt to suggest that consumers may benefit from the Chairman’s proposal or that eliminating the rules will alleviate some burden that the Commission currently faces. Their central premise is simply that the rules are “old” and “unnecessary.”

    As NAB has highlighted elsewhere, if age were the measure of a regulation’s validity, why is the Chairman wasting his time with the relatively recent exclusivity rules, when the World War II-era media ownership rules are comparatively low-hanging fruit? The beauty of the Commission’s oversight of the ownership rules is that, unlike the exclusivity rules, Congress actually requires the FCC to review them every four years to see if they are still operating in the public interest. This raises the question of why consideration of the exclusivity rules has vaulted ahead of a meaningful review of the ownership rules, which have been subject to an ongoing proceeding since 2009 with no end in sight.

    It can be a tough pill to swallow to pull back a proposal one has made to his or her colleagues. In this case, however, it appears that no one but the Chairman and Mr. Lake believe that eliminating the exclusivity rules is a good idea, or even, at best, should be a Commission priority. Even the American Cable Association (ACA) only supports the change insofar as it leads to the Commission outlawing exclusive broadcaster arrangements altogether. With history and common sense as a guide, it’s time to shelve this proposal and move on to more important matters that preserve localism, competition and diversity for the benefit of consumers.

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