Retransmission Consent

Congress enacted the retransmission consent statute in 1992 to prohibit cable, satellite, telco, and other pay-TV companies from retransmitting and reselling the signals of local television stations without their consent. The law enables local television stations to negotiate with pay-TV companies in a free and highly competitive video marketplace for the privilege of retransmitting and reselling local television broadcast signals.

The current retransmission consent law reflects Congress's decision that competitive markets-not the government-should regulate these negotiations between pay-TV companies and local broadcast stations. Since 1992, Congress and the FCC have, on several occasions, reviewed how the retransmission consent process works in practice. Each time, Congress concluded that the current regulatory scheme is balanced, fair, and, notwithstanding the complaints of pay TV companies, working well.  Just last year, the FCC declined to make changes to its retransmission consent rules after an extensive review proceeding.  Former Chairman Wheeler announced that "what we need is not more rules, but for both sides in retransmission consent negotiations to take seriously their responsibility to consumers[.]"

Broadcasters continue to reinvest retransmission consent revenues in local news, weather, and emergency coverage. Survey research results from the Radio and Television Digital News Association (RTDNA) reported 719 stations originating local news programming, 27,300 employees in local TV newsrooms, and more than 40% of news directors nationwide expecting to add staff in 2014.

If local TV stations cannot charge pay-TV resellers competitive market rates for the privilege of reselling their channels, it will jeopardize the ability of local TV stations to continue to invest in top-rated local news, information, and entertainment programming to serve viewers across the State.

 

QUICK FACTS - RETRANSMISSION CONSENT

What Is "Retransmission Consent"?

  • Congress enacted the retransmission consent law in 1992 to stop cable, satellite, telco, and other "pay-TV" companies who compete with local television stations from retransmitting andresellingthe signals of local broadcast stations without the stations' consent.
  • Pay-TV companies pay retransmission consent (or "retrans") fees for the privilege of retransmitting and reselling local television signals.  These fees are negotiated in the private marketplace.  Local broadcast signals are extremely valuable to pay-TV companies because these stations provide the majority of the most-watched local and national network programs.

 

Why Do Local TV Stations Charge Retrans Fees to Pay-TV Resellers? 

  • Local TV stations pay significant sums to produce local programming and to buy the rights to popular national network and syndicated programming-e.g., national sports, entertainment and news programming.  Local TV stations offer this programming to their viewersfor freeover-the-air.  However, pay-TV companies resell the local station signals for a profit, so it is understandable that local stations expect to be compensated by the pay-TV companies.
  • Retrans fees allow Virginia's television broadcasters to make additional investments and improvements in local programming, such as investigative teams, state-of-the-art weather equipment, and around-the-clock emergency and public safety information that is critical to serving local communities. 

 

Are Retransmission Consent Fees for Local TV Signals Fair?

  • Retrans fees are more than fair-in fact, they are a bargain for pay-TV companies. Broadcast television programs account for the overwhelming majority of the top 100 primetime TV programs, and pay-TV companies pay far less for local broadcast stations than for less popular cable channels.  A Wells Fargo analyst estimated that if broadcasters received retransmission consent fees at a rate comparable to what is paid to cable networks, broadcasters would receive five times their current compensation. 

 

What Happens When a Local TV Station Is "Blacked Out"

  • While a local TV station may be removed during an impasse with a pay-TV provider, the station is never "blacked out."  It is always available over-the-air in HD format-for free-through an antenna.  It is also available from competing pay-TV companies.

 

What Action Has the FCC Taken on Retransmission Consent?

  • On July 14, 2016, former FCC Chairman Tom Wheeler announced that the FCC would not adopt any additional rules to change or "reform" the retransmission consent process as part of the FCC's review of the law's good faith negotiation requirement.  This outcome supports broadcasters' longstanding view thatthe law is fair and produces the market-driven results that Congress intended. 

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