By Fawn Johnson
Of DOW JONES NEWSWIRES
WASHINGTON (Dow Jones)–A senior Senate Democrat on Monday asked the Federal
Communications Commission to prevent television content providers from bundling
less-popular networks with flagship networks in their negotiations with cable
operators.
Sen. Herb Kohl, D-Wis., who chairs the Senate Judiciary Antitrust Subcommittee,
said in a letter to the commission that such network packaging forces cable
operators to buy more space than they need, which limits the channels available
for independent programming.
Kohl said the FCC should ban the wholesale packaging practice “when such bundling
is done in order to deny independent programmers the channel capacity needed to
be carried on (multi-channel cable) systems.”
Kohl is in agreement with FCC Chairman Kevin Martin on the issue. Martin told a
group of small cable operators in April that they shouldn’t be required to buy 10
or 20 channels if they only want to offer one to subscribers.
Martin is engaged in a similar crusade on the retail side of the cable business,
wanting companies to offer cable channels on an “a la carte” basis to
subscribers. The cable industry has balked at that suggestion.
In the wholesale arena, the FCC is considering whether content providers should
be required to offer channels to cable operators on an individual basis. An FCC
spokesman declined to comment on the status of that discussion.
Such a rule would be a boon to small cable operators such as Mediacom (MCCC) and
Wave Broadband, which compete against larger cable companies and satellite
operators to provide specialized packages to local markets, often in rural areas.
If the commission acts, large media conglomerates such as Walt Disney Co. (DIS),
which owns ESPN, would be forced to change their bundling practices.
“Disney takes a marquee service such as ESPN. They say to us, ‘If you want ESPN,
you must take all this other programming,’” said American Cable Association
President Matthew Polka.
Polka said a rule limiting programmer bundling would make it easier for thousands
of small cable operators to compete with cable giants such as Comcast Corp.
(CMCSA) and satellite operators.
A spokesman for the National Cable & Television Association, of which Comcast is
a member, declined to comment on Kohl’s letter.
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