America Channel Gets Verizon Carriage Deal; Competitive Issues Raised
The America Channel (TAC), which failed for 2 years to get cable carriage, signed a deal with Verizon to be part of its FiOS fiber pay-TV service. Some media activists said the deal raises competitive issues. The upstart network, 1 of 5 that Verizon said Mon. it will air, has fought against Adelphia’s takeover on grounds that it will further stifle programming competition (CD Aug 5 p9). The success of Verizon’s deal with the fledgling network will indicate whether programmers can succeed without help from major cable operators, said Media Access Project Senior Vp Harold Feld.
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TAC has been one of the most “aggressive” programmers in seeking regulatory relief from what it says are anti- competitive practices that favor networks owned by broadcasters and cable operators, Feld said. TAC said in one of its many FCC filings that Comcast’s reasons for not carrying the digital channel were hypocritical. Comcast cited limited bandwidth, but TAC noted the company and Time Warner said their $17.6 billion purchase of Adelphia would boost capacity. Verizon’s agreement to carry TAC “in some ways kind of proves the point of The America Channel,” Feld said. For the FCC, “it highlights that they have never dealt with that issue, really, the issue of independent content and so-called monopsony power,” said Free Press Policy Dir. Ben Scott: “They ought to be looking at this as a dangerous trend in a consolidating industry.”
TAC hopes the Verizon carriage agreement will be the first of many. The company expects the deal to help in talks for wider distribution, CEO Doron Gorshein said: “We expect more good things for The America Channel in the future… Free competition is a beautiful thing.” The channel will provide mostly original, non-fiction programming on diversity, family and other U.S. issues. The network will be part of Verizon’s expanded-basic product through fiber lines, a spokeswoman said. She predicted most FiOS TV customers will probably get that service.
Unlike Comcast, which cited bandwidth constraints in not offering TAC, Verizon said it has room. “One of the things we can do because we have a fiber system and the capacity is to carry independent channels that really speak to the interests of our diverse customer base,” the spokeswoman said. A Comcast spokesman, asked for comment, referred to its FCC filing earlier this month with Adelphia and Time Warner that answered opposition to the deal. That filing said TAC’s opposition contains “fanciful and unsupported theories” (CD Aug 9 p6). It said “TAC erroneously asserts that both ‘Time Warner and Comcast can act individually to prevent an independent network from reaching viability.'”
Verizon’s FiOS TV service will be launched by year end in the Dallas suburb of Keller, the spokeswoman said. Verizon expects its fiber-to-the-premises service to pass 3 million homes by Dec. 31. Not all homes will be able to get the new TV service. Verizon also agreed to offer Blackbelt TV, Expo TV, LIME and the Pentagon Channel. AOL co-founder Steve Case owns LIME, which was is expanding its focus beyond yoga and spirituality to health (CD July 26 p6).