Marketing

Groups Call for Retrans Reform

3/09/2006 6:49 AM Eastern

EchoStar Communications Corp. and groups representing small and rural cable distributors teamed up Thursday to ask Congress to reform retransmission-consent rules.

Pointing to a recent statement from CBS Corp. CEO Les Moonves -- who said the company hopes to reap “hundreds of millions of dollars” by getting distributors to pay for carrying CBS -- the groups argued that satellite and cable distribution drives broadcast ad revenue, and that they, therefore, shouldn’t be asked to pay for the programming.

“The lack of marketplace competition allows broadcasting to extract unreasonable fees for their programming, resulting in higher consumer bills,” the groups wrote in the letter, which was signed by executives from EchoStar, the National Telecommunications Cooperative Association, the American Cable Association, the Broadband Service Providers Association and the Organization for the Promotion and Advancement of Small Telecommunications Companies.

The National Cable & Telecommunications Association -- members of which include companies like The Walt Disney Co. and Fox Broadcasting Co., which rely on retransmission consent -- didn’t participate in the letter.

The groups also complained that media conglomerates Disney, News Corp., Viacom Inc. and NBC Universal have used retransmission consent to force distributors to carry cable programming on basic tiers.

“This increases the cost to consumers and requires consumers to purchase programming they do not want. Rather than reinvesting in local programming, as the rules were designed to encourage, these media conglomerates extract enormous revenues and increase corporate profits off the backs of the viewing public,” the groups wrote in the letter.

September