TV programming blackouts often elicit statements from mayors or other elected officials urging the sides to come to an agreement. But the role El Centro, California, and other communities are playing in a carriage dustup between Charter Communications and Northwest Broadcasting is largely unprecedented, experts told us.
Despite some progress in a decade-old fight over the FCC's embattled 2008 leased access rules, there's no clear picture as to what -- if anything -- the agency will do next, with implementation facing big hurdles and some seeing the possibility of the agency instead seeking to roll them back. “I don’t think anybody cares,” said Georgetown Institute for Public Representation lawyer Andy Schwartzman, since the tougher rules former Republican Chairman Kevin Martin tried to put in place never went into effect.
Comcast, if allowed to buy Sky, would maintain Sky News spending for 10 years at a level equal to Sky's FY 2017, set up a Sky News board to maintain its editorial independence for 10 years, keep Sky News' U.K. headquarters for five years and not buy a majority interest in U.K. newspapers for five years. Those are the commitments Comcast made as it said Wednesday it made a $31 billion cash takeover offer. In Comcast's Q1 earnings call, CEO Brian Roberts said the Sky deal will boost Comcast’s strategy of vertical integration of distribution and content while bringing “new and attractive geographies” in an internationalization of NBCUniversal. The 52 million combined customer base of the two companies will allow more investment in programming and technology, Roberts said. The bid signals Comcast belief "the required scale for next-gen media will be enormous," MoffettNathanson analyst Craig Moffett wrote investors. He said the cable business is slowing, but instead of generating cash for investors, cash flows are being "diverted to a high-risk gambit for massive scale in Media." Roberts disputed that. He said Comcast doesn't see Sky as a necessity but was opportunistic because the company became available. He said international isn't a broad strategy for Comcast but Sky fits into its existing vertical strategy, with the added benefit of geographic diversity. Comcast's bid for Sky is seen by many not facing as much regulatory difficulty as Fox's pending bid has (see 1802270011). Comcast said Q1 had revenue of $22.79 billion, up 10.7 percent. It ended the quarter with 21.2 million residential video customers, down 93,000; 24.2 million resident broadband customers, up 351,000; and 10.2 million residential voice customers, down 70,000. Roberts said the video subscriber losses were partly due to increasing competition from virtual MVPDs. He said Xfinity Mobile ended the quarter with 577,000 customer lines. Chief Financial Officer Mike Cavanagh said Comcast sees continued broadband growth due to new home construction in its footprint, to the company expanding its network within its footprint, and from market share gains. Comcast closed at $34.26, up 2.7 percent.
The American Space Commerce Free Enterprise Act (HR-2809), which the House OK'ed Tuesday evening by voice vote, would sizably change how nontraditional space operations are governed, though issues of orbital debris oversight aren't clear, experts told us. The proposal to give Commerce much oversight that rested with the FAA is a major change that raises some concerns given lack of Commerce expertise, said Michael Listner, principal of the Space Law & Policy Solutions consultancy. House Space Subcommittee Chairman Brian Babin, R-Texas, tweeted the proposal is an "important step ... to secure America’s leadership in space [as it] declares America open for space business."
Consumers have a mushrooming array of options for blocking or otherwise avoiding unwanted robocalls, but legitimate callers are increasingly caught up in those nets, robocall service vendors said Monday at an FCC/FTC expo on illegal robocall technology. Legitimate callers "are getting Heismaned" by robocall-blocking tech, said Deirdre Menard, Transaction Network Services director of product management.
An FCC freeze on new or modifications of fixed satellite service licenses in the 3.7-4.2 GHz band is seemingly the next step toward the agency issuing an NPRM on an Intelsat/Intel/SES plan for freeing up part of the C-band for mobile wireless use (see 1710020047), experts told us. Action on the band seems imminent, given the freeze announced Thursday. The agency is apparently "moving aggressively" toward an NPRM regarding mobile and high-capacity fixed wireless in the band, emailed Michael Calabrese, director of the Wireless Future Program at New America's Open Technology Institute.
AT&T isn't buying Time Warner to use that content to drive value to its distribution business but the opposite, with aims of using its distribution arm to get more value out of the content, AT&T CEO Randall Stephenson testified Thursday in U.S. v. AT&T and TW. Limiting content "is not a good strategy," he said, saying when he first presented the TW idea to the AT&T board in September 2016, one of the issues discussed was how to do such a deal without hurting TW's wide distribution. AT&T/TW rested after Stephenson's testimony, with DOJ then calling a rebuttal witness, Ron Quintero of Chartered Capital Advisers, to testify on the deal's claimed efficiencies.
The idea that being part of New AT&T would give Turner leverage to raise its affiliate fees on distributors is like speaking Greek to the programmer universe, Time Warner CEO Jeff Bewkes testified in the U.S. v. AT&T and TW antitrust trial Wednesday. “It’s not how this works,” he said, saying any blackout of Turner would be “catastrophic” in lost advertising revenue and lost affiliate fees. He likened increased incentives to a Turner blackout under New AT&T to the equivalent of a 950-pound weight falling on that company’s head versus a 1,000-pound weight on TW’s head. AT&T CEO Randall Stephenson is scheduled to testify Thursday.
Citing Comcast/NBCUniversal using NBC content as a competitive cudgel to whack broadband competition, RCN CEO Jim Holanda testified in U.S. v. AT&T and Time Warner that he fears New AT&T doing likewise. Turner content is "significantly viewed" by RCN subscribers, with three of its networks among the 10 most watched, judging by set-top box data, he said. A DOJ attorney asked Holanda about an RCN offering that pairs broadband with a video tier of only TV stations and public access, and how his company can't offer that to its entire subscriber base because Comcast contracts prohibit it in some areas without selling the entire cable giant's bundle of content due to penetration requirements. He said those limits came up after Comcast bought NBCU, and the operator has since come into some RCN markets with a roughly analogous offering. He worries New AT&T would similarly use Turner programming as competitive leverage against RCN when competing for double- and triple-play customers in markets where it overlaps with AT&T. RCN programming costs have been going up five to eight times the rate of inflation over the past five years, Holanda said. He said major MVPDs have a 25 to 40 percent price advantage for programming due to their size, which puts RCN at a $10 to $15 a month cost disadvantage. Also Tuesday, DOJ's lawyer and an AT&T/TW expert witness -- UCLA economics professor Peter Rossi -- locked horns repeatedly as Justice challenged Rossi's criticisms of research that played a big role in the government's model (see 1804160030). DirecTV filed a docket 17-2511 motion (in Pacer) Tuesday in U.S. District Court for the District of Columbia asking that it be dismissed from the DOJ suit, as expected (see 1803190023). It said government failed to state a claim against it, since it's not a party to the challenged deal.
Beyond agreeing Communications Act Title II net neutrality rules are bad, speakers at a Federalist Society event clashed over of paid prioritization and whether it should be permissible even without Title II oversight. Also Tuesday, a House subcommittee held a paid prioritization hearing (see 1804170037) while states also considered net neutrality bills (see 1804170057).