7/22. The House passed HR 4572
"STELA Reauthorization Act of 2014", by voice vote.
This bill provides five year extensions of the expiring exemptions and
statutory license in the communications and copyright statutes that allow
satellite television companies to have access to certain broadcast content.
The bill also prohibits television broadcasters from coordinating the negotiation of
retransmission consent agreements, prohibits cable operators from deleting or repositioning
TV stations during sweeps week, eliminates the FCC's integration ban, and makes other changes
to the Communications Act.
Rep. Fred Upton (R-MI), the Chairman of
the House Commerce Committee (HCC),
stated that this is a "must pass bill" that "eliminates the costly cableCARD
integration ban that has increased the cost of cable-leased set-top boxes and
made them less energy efficient, evens the playing field for cable and satellite
providers when it comes to protecting broadcast signals during Nielsen sweeps,
brings fairness to retransmission consent negotiations by barring broadcast
stations from jointly negotiating with programming distributors, and ensures
that broadcasters who have had their business models upended by recent FCC
actions indeed have adequate time to make the changes necessary to comply with
the new rules." See, Congressional Record, July 22, 2014, at Page H6590.
Welch (D-VT) (at right) stated that "These
narrow changes only begin to scratch the surface of the broken video marketplace. In my view,
Congress should revisit the entire video regime and update the corresponding laws to better
represent the 21st century marketplace, to drive competition, and, most importantly, to provide
more benefits to consumers." See, Congressional Record, July 22, 2014, at Page
STELA Extension. Rep. Greg Walden (D-OR),
the sponsor of the bill, stated that this bill "will ensure that 1.5 million subscribers
in hard-to-reach areas, including many in my home State of Oregon, will continue to receive
vital news and information through the television. The STELA Reauthorization Act extends the
copyright and retransmission consent provisions for distant signals retransmitted by commercial
satellite providers for 5 years." See, Congressional Record, July 22, 2014, at
Rep. Bob Goodlatte (R-VA), Chairman of the
House Judiciary Committee (HJC), elaborated that the
Section 119 "license ensures that when our constituents do not have access to a full
complement of local network television stations, they can have access, through satellite
television carriers, to distant network television stations. This helps ensure that consumers
in rural areas, like my congressional district, have the same access to news and entertainment
options that consumers in urban areas enjoy." See, Congressional Record, July 22,
2014, at Page H6590.
HR 4572 is the bill approved by the House Commerce
Committee (HCC) on May 7. HR 5036
"Satellite Television Access Reauthorization Act", is the bill approved by the
House Judiciary Committee (HJC) approved on
July 10. Both bills address STELA reauthorization. However, HR 4572 also contains
several other changes to communications law.
HR 5036 is a short bill that amends the provision of the Copyright Act
(17 U.S.C. § 119) necessary to
provide the five year extension. Section 119 is the distant into local statutory license.
See also, story titled "House Judiciary Committee Approves Satellite Television Access
Reauthorization Act" in TLJ Daily E-Mail Alert No. 2,674, July 15, 2014.
The version of HR 4572 approved by the House on July 22 adds the language of
HR 5036 as Title II of HR 4572.
Section 101 of the just passed bill amends the retransmission consent provisions of the
Communications Act (47 U.S.C. § 325(b)) necessary to provide a five year extension.
Without this bill, the exemptions and license would expire at the end of this year. This
bill extends the them through December 31, 2019.
STELA is an acronym for the title of the previous bill that provided for the
extensions. It was the Satellite Television Extension and Localism
Act of 2010. The STELA was S 3333
WW] in the 111th
Congress. See also, story
titled "Obama Signs Satellite TV Bill" in
TLJ Daily E-Mail Alert No.
2,089, May 28, 2010.
Retransmission Consent. Section 102 addresses retransmission consent negotiations.
It would prohibit television broadcasters from coordinating the negotiation of retransmission
Rep. Walden explained that "broadcast stations in a single market will no longer be
able to negotiate jointly with pay-TV providers. Pay-TV subscribers will no longer have to
worry about losing more than one signal should a programming distributor be unable to reach
its retransmission consent agreement with a broadcast station."
The retransmission consent regulatory regime was established by the Cable Act of 1992.
47 U.S.C. § 325 provides that
"No cable system or other multichannel video programming distributor shall retransmit
the signal of a broadcasting station, or any part thereof, except ... with the express
authority of the originating station".
Broadcasters can charge cable companies and other MVPDs for retransmission of
their programming. The companies have been negotiating retransmission consent
contracts for 18 years. Broadcasters are content with the current regime.
Broadcasters argue that the existing retransmission consent regime works and
should continue, and that market negotiations for new retransmission consent
agreements should be allowed to run their course.
However, MVPDs and some other non-broadcasters argue that the broadcasters
never paid for the spectrum that they use, and benefit from the government
imposed must carry regime, and should not now be allowed to engage in brinksmanship and
threats of service blackouts when retransmission consent contracts expire.
HR 4572 would amend 47 U.S.C. 325(b)(3)(C) to require the FCC to write rules
within nine months of enactment that "prohibit a television broadcast station
from coordinating negotiations or negotiating on a joint basis with another
television broadcast station in the same local market ... to grant
retransmission consent under this section to a multichannel video programming
distributor, unless such stations are directly or indirectly under common de
jure control permitted under the regulations of the Commission.''.
Matthew Polka, head of the American Cable
Association (ACA), praised passage of this bill. He stated in a
release that "Importantly, the bill
includes a ban on retransmission consent bargaining collusion by separately owned local TV
stations serving the same market. That provision builds on a similar bipartisan collusion ban
adopted by the Federal Communications Commission on March 31."
Report and Order and
Further Notice of Proposed Rulemaking, adopted and released on March 31, 2014. It is
FCC 14-29 in MB Docket No. 10-71.
Michael Powell, head of the National Cable &
Telecommunications Association (NCTA), also praised this bill. He stated in a
release that it "appropriately protects consumers from anticompetitive harm by
preventing separately owned broadcast stations in local markets from jointly coordinating
or participating in negotiations for retransmission consent."
No Deletion or Repositioning of TV Stations During Sweeps Week. Rep.
Walden stated that this section "evens the playing field for cable operators and
broadcasters during sweeps weeks by removing a government restriction on cable's
ability to drop broadcast signals during the Nielsen sweeps."
Section 104 would amend 47 U.S.C.
§ 534(b)(9) to provide that within 90 days of enactment the FCC shall revise its rules
by "removing the prohibition against deletion or repositioning of a local commercial
television station during a period in which major television ratings services measure the
size of audiences of local television stations."
Integration Ban. Section 105 repeals the FCC's integration ban.
Rep. Walden stated that this section "repeals the FCC's integration ban on
cable-leased set-top boxes. That clears the way for innovation and investment by
lifting an unnecessary regulatory burden that has cost the cable industry and
its consumers who pay the $1 billion -- $1 billion, Mr. Speaker -- since 2007."
The NCTA's Powell stated that "By eliminating the FCC's Integration Ban, the
legislation removes an unnecessary technology mandate that imposes higher costs and energy
use on cable customers who lease set-top boxes while offering no benefits."
The ACA's Polka stated that the "ACA is also pleased that the House STELAR bill
repeals the FCC rule requiring cable operators to deploy set-tops boxes (STBs) with a separate
security module known as the CableCARD. This regulation has proved to be costly, burdensome
and, by the FCC's own analysis, ineffective in creating a retail market for cable STBs."
Summary of Other Provisions. Section 106 would require the
Government Accountability Office (GAO) to
write a report within 18 months that "analyzes and evaluates the changes to the
carriage requirements currently imposed on" MVPDs by the Communications Act and
FCC regulations "that would be required or beneficial to consumers, and such
other matters as the" GAO "considers appropriate, if Congress implemented a
phase-out of the current statutory licensing requirements set forth under
sections 111, 119, and 122 of title 17 ..."
Section 107 would require "satellite carriers" to submit annual reports to the
FCC containing specified data regarding retransmission of television broadcast signals.
Section 108 would require the FCC to write a report on "the extent to which
consumers in each local market ... have access to broadcast programming from
television broadcast stations ... located outside their local market, including
through carriage by cable operators and satellite carriers of signals that are
significantly viewed", and "whether there are technologically and economically
feasible alternatives to the use of designated market areas ... to define
markets that would provide consumers with more programming options and the
potential impact such alternatives could have on localism and on broadcast
television locally, regionally, and nationally."
Section 103 pertains to deadlines for broadcasters to unwind joint sales agreements (JSAs)
in connection with the FCC's obsolete media ownership regulatory regime.
It provides that "In the case of a party to a joint sales agreement (as defined in Note
2(k) to section 73.3555 of title 47, Code of Federal Regulations) that is in effect on the
effective date of the amendment to Note 2(k)(2) to such section made by the Further Notice
of Proposed Rulemaking and Report and Order adopted by the Commission on March 31, 2014 (FCC
14-28), and who, not later than 90 days after the date of the enactment of this Act, submits
to the Commission a petition for a waiver of the application to such agreement of the rule
in such Note 2(k)(2) (as so amended), such party shall not be considered to be in violation
of the ownership limitations of such section by reason of the application of such rule
to such agreement until the later of -- (1) the date that is 18 months after the date on which
the Commission denies such petition; or (2) December 31, 2016."
Senate. The Senate has not yet passed HR 4572.
On June 10, 2014, Sen. Patrick Leahy (D-VT) and
Sen. Charles Grassley (R-IA) introduced S 2454
WW], the "Satellite
Television Access Reauthorization Act of 2014". The
Senate Judiciary Committee (SJC) amended and approved it on June 26, 2014. The full Senate
has not yet passed S 2454 either.
S 2454 is a short bill that contains a five year extension of the Section 119 statutory
license, and related matters. It contains none of the amendments to the Communications Act that
are in the House bill.
More Information. Walter McCormick, head of the US
Telecom, stated in a
release that "We commend the House for taking this pro-consumer action to increase
competition in the video marketplace and look forward to working with the Senate
on further improvements needed to update our nation's video policy."
Dish and Directv also expressed support for this bill in a release.
See also, story titled "House Commerce Committee to Mark Up STELA Reauthorization
Bill" in TLJ Daily E-Mail
Alert No. 2,655, May 7, 2014, and
story titled "HCC/SCT
Marks Up STELA Reauthorization Bill" in
TLJ Daily E-Mail Alert No.
2,636, March 25, 2014.)