July 14, 2016 - 10:37 am
By Tom Wheeler | FCC Chairman

Whether they're tuning in to hear the local traffic and weather reports or settling in on the couch for an evening of entertainment, American television viewers have a simple expectation: when they turn on their TV, the channels they want will be waiting for them. A blank screen or a crawl notice announcing a contract dispute between a broadcast station and their pay-TV provider isn't just an inconvenience, it's a roadblock to the timely news, local sports, and other valuable content on which we all rely day in and day out.

Congress, in Section 325 of the Communications Act, sought to reduce the likelihood that TV viewers would face this roadblock. The law requires broadcasters and multichannel video programming distributors (MVPDs) to negotiate for retransmission consent in good faith. Congress gave the Commission the authority to keep an eye on these negotiations, and our rules include a two-part framework to determine whether broadcasters and MVPDs are negotiating in good faith.

  • First, the Commission has established a list of nine objective standards, the violation of which is considered a per se breach of the good faith negotiation obligation.
  • Second, even if the specific standards are met, the Commission may consider whether, based on the totality of the circumstances, a party failed to negotiate retransmission consent in good faith.

In the recent STELA Reauthorization Act of 2014 (STELAR), Congress expressed concern about the harm consumers suffer when negotiations fail and sought-after broadcast programming is blacked out on their pay TV service. STELAR directed the Commission to initiate a rulemaking to consider possible revisions to our “totality of the circumstances” test. 

In response to that directive the Commission issued a Notice of Proposed Rulemaking, which invited all stakeholders to give us their views about negotiating practices that should factor into a good faith determination. We received extensive comments and ex parte submissions.  Many commenters identified practices that occur during retransmission consent negotiations that were said to show bad faith; others disagreed or argued that our present rules suffice. 

Based on the staff’s careful review of the record, it is clear that more rules in this area are not what we need at this point.  It is hard to get more inclusive than to review the “totality of circumstances.”  To start picking and choosing, in part, could limit future inquiries.  So, today I announce that we will not proceed at this time to adopt additional rules governing good faith negotiations for retransmission consent.

Now let me be clear; this does not mean the FCC will turn a blind eye to disputes.  Nor does it mean that Congress couldn’t expand the scope of the Commission’s authority in this space.  What this decision does mean is that “totality of circumstances” is pretty broad and ought not to be constrained.

There is nothing in the record that suggests that our current totality of the circumstances test, which is intentionally broad, is inadequate to address the negotiating practices of broadcast stations or MVPDs in the marketplace today. Though commenters complained about a variety of negotiating practices, none showed that those practices are the causes of the blackouts that occur. Further, a number of the practices complained of were said to have been engaged in by a single negotiating party or in a small number of negotiations and do not appear to be gaining currency in the marketplace.

What we need is not more rules, but for both sides in retransmission consent negotiations to take seriously their responsibility to consumers, who expect to watch their preferred broadcast programming without interruption and to receive the subscription TV service for which they pay.

This isn’t pie in the sky. Many broadcasters and MVPDs take that responsibility seriously and conclude hundreds of retransmission consent deals without interruption. And this process is entirely invisible to their viewers – as it should be.

That’s not to say, however, that impasses won’t happen. But when they do, I am prepared to use the authority Congress has conferred on the Commission to help to bring negotiations to a conclusion.

For example, in the recent – and ongoing -- dispute between DISH Network and Tribune Media, when the parties failed to reach an agreement or to extend their prior deal pending further negotiations, consumers began to suffer what is becoming an extensive blackout. I summoned both parties to Washington to negotiate in coordination with Commission staff. When that step failed to produce an agreement or an extension, the Media Bureau issued comprehensive information requests to both parties to enable FCC staff to determine whether they were meeting their duty to negotiate in good faith; we are reviewing their responses as I write. If that review reveals a dereliction of duty on the part of one or both parties, I will not hesitate to recommend appropriate Commission action.

And we do not need one of the parties to a negotiation to cry foul before acting in the public interest. The Commission can investigate a potential good faith violation on its own and take enforcement action when a party fails to fulfill its statutory obligations.