Sinclair mini-blackout could be a retrans milestone

Mean, angry TV set with teeth

© Depositphotos / herminutomo

Last week, we got to see the full lifespan of a retransmission consent dispute condensed to just a day or two. When Sinclair Broadcasting tried to tie an unrelated pay-only network to permission to rebroadcast 129 over-the-air channels, Dish Network and the FCC blocked them, and Sinclair’s blackout ended in less than 24 hours.

At least that’s what happened if you believe Dish, and since I’m still a Dish shareholder, that would be my inclination. Sinclair has a completely different view, and I’ll get around to that.

First, the details. A couple of weeks ago, Dish filed a complaint to the FCC saying Sinclair was refusing to negotiate. The day after that formal complaint, Dish said Sinclair had resumed talks. Then last Tuesday, Sinclair pulled its 129 TV stations off Dish solely “to gain negotiating leverage for carriage of an unrelated cable channel that it hopes to acquire,” according a Dish press release. Dish also restarted the FCC complaint.

The next morning, FCC Chairman Tom Wheeler sprang to action, calling for an emergency meeting with Dish and Sinclair. “Just last year, Congress instructed the Commission to look closely at whether retransmission consent negotiations are being conducted in good faith,” he wrote. “That’s why I have proposed to my fellow Commissioners a new rulemaking to determine how best to protect the public interest.” By the end of the day, Sinclair had agreed in principle to a long-term deal with Dish and lifted the blackout.

BTIG analyst Richard Greenfield wrote in a blog post that Sinclair’s short-lived blackout may be the last straw for unfettered retransmission demands. “The government is looking for reasons to get more involved to help consumers,” he wrote. “Sinclair may have finally given them a blatant enough excuse.”

On the other hand, Sinclair later claimed that the FCC’s actions had literally nothing to do with the speedy end to the blackout. Seriously. “In fact, the FCC process actually delayed the resolution, because it added more issues to negotiate, which lengthened DISH’s service interruption, not shortened it,” Sinclair wrote. So without that meddling FCC, the blackout would have been over in maybe eight hours? I guess we’ll never know.

If this incident signals a new willingness for the FCC to protect the public interest in retransmission fee negotiations, Greenfield might be spot on. If stations have to negotiate on price alone without leveraging unrelated networks, and if the FCC will nudge them to bargain in good faith, maybe we could start seeing contracts reached through arbitration instead of blackouts. If viewers are okay with monthly subscriptions to watch their local free-TV stations, they deserve to get what they pay for.

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