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With Martin’s Aid, The America Channel Beats Comcast

9/25/2007 7:53 PM Eastern

Washington – Dealing Comcast its second setback in as many days, the Federal Communications Commission ruled Tuesday night that The America Channel (TAC) qualifies to enter arbitration to gain distribution from the largest U.S. cable company.

The ruling wasn’t a surprise after news reports surfaced in August said that FCC chairman Kevin Martin was backing fledgling TAC over pay-TV distribution giant Comcast.

TAC, a program network that has yet to launch, has been feuding with Comcast for several years. The network gained key leverage when the FCC said in June 2006 that regional sports networks were entitled to seek arbitration to obtain carriage from Comcast and Time Warner.

At the time of the ruling, TAC was not an RSN. It claims it became one not long after the FCC ruling, which came in connection with Comcast and Time Warner’s joint acquisition of bankrupt Adelphia Communications. Comcast asked the FCC to reject TAC’s corporate makeover as an opportunistic move to game the Adelphia merger conditions.

The FCC determined that TAC was a sports network because it had programming deals with 14 NCAA Division I conferences to air 500 games of football, basketball, soccer and volleyball. TAC was regional, the FCC said, because it would offer a separate broadcasts in six geographic regions that include 20 individual TV markets.

On Monday, the FCC said it wanted Comcast to pay a $4,000 fine after an initial probe revealed that the cable company’s CN8 local news channel last year violated a sponsorship identification rule related the natural sleep aid Nelson’s Rescue Sleep. Comcast denied it violated the rule and claimed the law cited by the FCC applied to TV stations, not cable operators.

In Tuesday’s ruling, the FCC said it was also suspending the Adelphia merger condition used by TAC, claiming it was close to adopting a new process to settle cable carriage disputes involving “all unaffiliated programmers,” not just RSNs.

If the TAC and Comcast reach arbitration, the arbitrator would first decide whether Comcast had discriminated against TAC. If TAC prevailed, then Comcast and TCA would need to put forward their best offers for the arbitrator to select.

The arbitrator has 45 days to issue a final decision, which either TAC or Comcast may appeal to the FCC.


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