Rockefeller, Thune, Pryor, Wicker Letter on STELA

February 25, 2014

WASHINGTON, D.C.--Several provisions of the Satellite Television Extension and Localism Act (STELA) are set to expire on December 31, 2014. Today, Commerce Committee Chairman John D. “Jay” Rockefeller IV and Ranking Member John Thune, and  Communications, Technology and Internet Subcommittee Chairman Mark Pryor and Ranking Member Roger Wicker sent the following letter seeking input on the scope and impact of the STELA reauthorization from a diverse array of stakeholders, including satellite TV, broadcasters, cable television, online video, broadband, public interest groups, and free market think tanks. 

The text of the letter is below:

As you know, key provisions of the Satellite Television Extension and Localism Act (STELA) are set to expire on December 31, 2014.  STELA is the most recent in a series of acts that establish the rules for how satellite pay TV providers gain access to and deliver local and distant broadcast television signals to their subscribers under both the Copyright Act and the Communications Act.  These acts also address certain rules associated with how broadcasters and cable and satellite companies negotiate retransmission consent agreements.

The pending STELA reauthorization offers the Committee a chance to consider whether present law appropriately protects and promotes a video market that is responsive to consumer demands and expectations.  Various stakeholders already have identified a number of issues that the Committee could consider as part of the reauthorization of the Communications Act elements of STELA.  These issues implicate both traditional entities that provide video services, as well as possible future entrants into the video marketplace.

In light of the importance of the STELA reauthorization and video policy generally, the Committee would like to solicit your input on the scope and impact of the reauthorization legislation.  We seek your response to the following questions in order to help the Committee approach its work in a careful and deliberate manner.  We ask that your responses be precise and specific.  To the extent your responses contain non-public, confidential, or competitively sensitive information, please mark them accordingly.

If you have any questions, please contact John Branscome of the Democratic staff, or David Quinalty of the Republican staff.  We appreciate your efforts to provide this information to the Committee.

We would request that you submit your response to these questions to the Committee in electronic form no later than March 17, 2014.

STELA-specific Issues:

(1) Should Congress reauthorize STELA?  If so, for how long?

(2) Members of the Committee have heard from constituents who are unable to watch in-state broadcast TV programming.  Under Section 614(h) of the Communications Act, the Federal Communications Commission (FCC) has the power to modify Designated Market Areas (DMAs) for broadcast TV carriage on cable systems.  Should the FCC have a similar power with respect to satellite pay TV providers to address DMA issues?  Are there other ways to address these issues?

(3) One of the expiring provisions in STELA is the obligation under Section 325(b) of the Communications Act for broadcast television stations and multichannel video programming distributors (MVPDs) to negotiate retransmission consent agreements “in good faith.”  Should the Congress modify this obligation or otherwise clarify what it means to negotiate retransmission consent in good faith?  If so, how?

(4) As part of STELA, Congress changed the statutory standard by which households are determined to be “unserved” by broadcast TV signals.  Does Congress or the FCC need to take further action to implement this previous legislative amendment?

(5) Are there other technical issues in STELA that have arisen since its passage in 2010 that should be addressed in the current reauthorization?

General Video Policy Issues:

(1) Some have suggested that Congress adopt structural changes to the retransmission consent system established under Section 325 of the Communications Act (Act).  Others have indicated that the retransmission consent system is working as Congress intended when it was developed as part of the Cable Television Consumer Protection and Competition Act of 1992.

(A) Should Congress adopt reforms to retransmission consent?  If so, what specific reforms could best protect consumers?  If not, why not?

(B) Please comment on the following possible reforms that have been suggested by various parties:  

(i) Providing the FCC authority to order interim carriage of a broadcast signal or particular programming carried on such signal (and the circumstances under which that might occur).

(ii) Prohibiting joint retransmission consent negotiations for multiple TV stations at the same time.

(iii) Mandating refunds for consumers in the case of a programming blackout (and apportioning the ultimate responsibility for the cost of such refunds).

(iv) Prohibiting a broadcast television station from blocking access to its online content, that is otherwise freely available to other Internet users, for an MVPD’s subscribers while it is engaged in a retransmission consent negotiation with that MVPD.

(v) Eliminating the “sweeps” exception that prevents MVPDs from removing broadcast TV channels during a sweeps period, or alternatively extending that exception to prevent broadcasters from withholding their signals or certain programming carried on such signals under certain circumstances.

(vi) Prohibiting retransmission consent agreements that are conditioned on the carriage by an MVPD of non-broadcast programming or non-broadcast channels of programming affiliated with the broadcast license holder.

(2) Should Congress maintain the rule that cable subscribers must buy the broadcast channels in their local market as part of any cable package?  If the rule is eliminated, should an exception be made for non-commercial stations?

(3) Should Congress maintain the rule that cable systems include retransmission consent stations on their basic service tiers?  

(4) Section 623 of the Act allows rate regulation of cable systems unless the FCC makes an affirmative finding of “effective competition.”  Should Congress maintain, modify, or eliminate these provisions?

(5) Should Congress repeal the set-top box integration ban?  If Congress repeals the integration ban, should Congress take other steps to ensure competition in the set-top box marketplace both today and in the future?

(6) Should Congress limit the use of shared services agreements (SSAs) and joint sales agreements (JSAs) by broadcast television ownership groups, and if so, under what circumstances?

(7) Should Congress act in response to concerns that the increasing cost of video programming is the main cause behind the consistent rise in pay TV rates and that programming contracts contribute to the lack of consumer choice over programming packages?  If so, what actions can it take?

(8) With consumers increasingly watching video content online, should Congress extend existing competitive protections for the traditional television marketplace to the online video marketplace?  If so, what types of protections?

(9) The Consumer Choice in Online Video Act, S. 1680, is one approach to fostering a consumer-centric online video marketplace.  Are there elements of that bill that should be considered in conjunction with the STELA reauthorization?

(10) Would additional competition for broadband and consumer video services be facilitated by extending current pole attachment rights to broadband service providers that are not also traditional telecommunications or cable providers?  

(11) Would additional competition for broadband and consumer video services be facilitated by extending a broadcaster’s carriage rights for a period of time if they relinquish their spectrum license as part of the FCC’s upcoming incentive auction?

(12) Are there other video policy issues that the Congress should take up as part of its discussions about the STELA reauthorization?