Kerry: FCC Should Step In To Keep Fox On Time Warner
Calls on agency to intervene if retrans dispute is not resolved
By John Eggerton — Broadcasting & Cable, 12/30/2009 10:35:08 PM
Senator John Kerry (D-Mass.) has told Fox that if it does not find a way to keep its broadcast signals on the air after the Dec. 31 expiration of its contract with Time Warner, he wants the FCC to step in and mandate that interim carriage.
That came late Wednesday in response to News Corp. President Chase Carey’s letter to Kerry explaining that Fox was not interested in arbitration of the retrans dispute, which Kerry had proposed and Time Warner agreed to.
“This letter is a rejection of arbitration as a solution, but it is silent on alternative mechanisms for keeping the signal on the air post contract expiration,” said Kerry in his statement. “That is my primary goal. If FOX can find an alternative way to achieve that end or reach agreement with TWC before the contract expires, then there is no need for us to act.”
Kerry is concerned about the cable viewers who could wake up without the TV stations that will be carrying big-ticket college bowl games the first week of January.
“If FOX believes that withdrawing programming from 4 million households is its best negotiating tactic,” he said, “then I would ask the FCC to intervene and mandate continued carriage and arbitration...”
Interestingly, I think they will live. Why does Kerry think this is something the government needs to step into?
If I recall the process correctly, the local TV stations can declare that they be carried on the cable system. This was called “must carry.” The other option was to negotiate with the cable company for a fee to be carried.
The TV stations usually only negotiate when they have a vested interest. For example, in smaller markets they need to ad revenue from the 75% of the homes with cable. However, in the larger markets a network like fox has much more leverage.
For example, they carry the NFL, American idol, 24, and some of the other top rated shows on broadcast TV. I am not sure if they have the superbowl, but would certainly be a draw.
Now if I were TW and Fox wanted a buck per sub, then I would pay it, but insist on 2 minutes per hour of ad time across all of their networks. This would give the local TW cable advertising group a massive ability to sell their products (CNN, ESPN, etc.) plus the broadcasters time. Fox would not go for that. It would turn the industry upside down.
TW will pass whatever they pay, right along to the subscribers. And I havent read wether its a buck a month, or a buck a year. Either way its big dollars—right to your wallet.
This is a massive game of chicken, and Fox is choosing one of the weaker players in the industry. This is not unlike the way the Auto Workers negotiate hard with one of the big three to settle their contracts. Then the others fall into line.
You do not see them pulling this crap with Comcast—because Comcast has the power in the industry to tell them to pound sand.
Glad it isnt happening in my town.