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indiantelevision.com Team
MUMBAI: Arizona senator John McCain has introduced legislation in the US.
This will make cable TV operators and other television service providers to split up content bundles and instead offer TV shows in smaller, more affordable packages and as a la carte channels. His legislation is called the Television Consumer Freedom Act. The aim is to have a shift from where customers are being forced to accept bundled packages to one where they are allowed to pick and choose which channels they want.
He said, "Mr. President, today I am introducing the Television Consumer Freedom Act of 2013. This legislation has three principal objectives: (1) encourage the wholesale and retail ?unbundling? of programming by distributors and programmers; (2) establish consequences if broadcasters choose to ?downgrade? their over-the-air service; and (3) eliminate the sports blackout rule for events held in publicly-financed stadiums."
He plans to penalise broadcasters who stop being free to air because of Aereo. "For over 15 years I have supported giving consumers the ability to buy cable channels individually, also known as ?a la carte? -- to provide consumers more control over viewing options in their home and, as a result, their monthly cable bill."
He went to hit out at NBC and Disney saying, "The video industry, principally cable companies and satellite companies and the programmers that sell channels, like NBC and Disney-ABC, continue to give consumers two options when buying TV programming: First, to purchase a package of channels whether you watch them all or not; or, second, not purchase any cable programming at all."
"This is unfair and wrong especially when you consider how the regulatory deck is stacked in favor of industry and against the American consumer. This is clear when one looks at how cable prices have gone up over the last 15 years, which is brought to light by the most recent Federal Communications Commission pricing survey," he added.
He noted that in the FCC survey, the average monthly price of expanded basic service for all communities surveyed increased 5.4 per cent over 12 months ending 1 January 2011, to $54.46 compared to an increase of 1.6 per cent in the Consumer Price Index. Over the last 15 years, this rise in costs becomes even more evident. According to the FCC, the price of expanded basic cable has gone up at a compound average annual growth rate of 6.1 per cent during the period from 1995 to 2011. This means that the average annual cable price has gone up from about $25 a month in 1995, to over $54 today. This he noted is a 100 per cent price increase.
However he also said that those who provide video directly to consumers, like cable and satellite companies, are not solely to blame for the high prices consumers face today. He attacked the concept of bundles - packages of channels, sold to cable and satellite companies by video programmers like Comcast-NBC, Time Warner, Viacom and The Walt Disney Company, which owns 80 per cent of ESPN. The ?Worldwide Leader in Sports, he said that ESPN calls itself that and it thrives because of the advertising revenue it is able to generate and large subscriber fees. ESPN he noted charges roughly $4.69 per household per month compared to the next costliest national network, TNT, which takes in $1.16 from about as many homes. All cable subscribers are forced to absorb the cost if even they do not watch ESPN because channels are bundled into packages. "Cable and satellite carriers that consider dropping ESPN must also contemplate losing other channels in the bundle, like the Disney Channel.
"Some have described this as an ?a tax on every American household." He warned that ultimately, there would be a revolt over the cost. "Or policymakers will get involved, because the costs of these things are so out of line with cost of living that someone?s going to put up a stop sign. Today, we?re putting up a stop sign," he further stated.
"My legislation would eliminate regulatory barriers to a la carte by freeing-up multichannel video programming distributors (MVPDs) -- like, cable, satellite and others offering video services -- to offer any video programming service on an a la carte basis. Notably, my bill offers no mandates, regulations and is entirely voluntary.
"In order to give MVPDs an incentive to offer programming on an a la carte basis, the legislation links the availability of the compulsory copyright license to the voluntary offering of a la carte service by the MVPD. In other words, if the MVPD does not offer a broadcast station -- and any other channels owned by the broadcaster -- on an a la carte basis, the MVPD cannot rely on the compulsory license to carry those broadcast stations. The compulsory license is a benefit conferred on MVPDs. So, it?s reasonable to ask the recipients of that benefit to provide consumers with an a la carte option."
The second section of his bill is a response to statements by broadcast executives (Fox, CBS) that they may ?downgrade? the content on their over-the-air signals, or pull them altogether, so that the programming received by MVPD customers is preferable to that available over-the-air. "Our country is facing a spectrum crunch, and if broadcasters who are using the public airwaves in return for meeting certain public interest obligations are going to deviate from those obligations, it is my view that we should consider if that is the most efficient use of our country?s spectrum. It would be a distortion of this basic social compact if over-the-air viewers were treated as second-class citizens. This bill provides a legislative response if broadcasters either downgrade their signal or pull it altogether. The bill provides that a broadcaster will lose its spectrum allocation, and that spectrum will be auction by the FCC, if the broadcaster does not provide the same content over the air as it provides through MVPDS."
Finally, the bill touches on ?sports blackout? rules that can limit the ability of subscribers to see sporting events when they take place in their local community but are not broadcast on a local station. "When the venues in which these sporting events take place has been the beneficiary of taxpayer funding, it is unconscionable to deny those taxpayers who paid for it the ability to watch the games on television when they would otherwise be available. Therefore, the bill proposes to repeal the sports blackout rules insofar as they apply to events taking place in publicly financed venues and/or involve a publicly financed local sports team."
"In the end, the Television Consumer Freedom Act is about giving the consumer more choices when watching television. It?s time for us to help shift the landscape to benefit television consumers. Now I know the broadcasters and cable companies are likely to suggest that the government should not micromanage how they offer their product to customers and that bundling can promote diverse offerings. What those interests will fail to mention, is that the government has already entered the marketplace, and conferred certain rights and privileges like the compulsory license, network non-duplication, syndicated exclusivity and retransmission consent, which stack the deck in the favor of everyone but the American consumer," he ended.
