Disney, NBCUniversal, More Join Coalition to Advocate Against Local TV Coalition Over Streaming Distribution Laws
Mickey Mouse is going to Washington. According to a report from Axios, the Walt Disney Company (ABC), alongside such media giants as Paramount Global (CBS), Fox Corp (FOX), NBCUniversal (NBC, c), Warner Bros. Discovery, Univision, Fubo, and Roku are forming their own advocacy group, hoping to persuade the Federal Communications Commission not to change rules that govern how local broadcasters negotiate with streaming platforms.
The group calls itself the “Preserve Viewer Choice Coalition,” which was organized in part to counter the efforts of the Coalition for Local News, which first launched in mid-July. The disagreement between the two coalitions stems from a provision enacted in 2014 that compels cable and satellite providers to negotiate carriage fees directly with the owners of local broadcast stations —companies like Nexstar and Sinclair Broadcasting Group. A loophole in that provision means that virtual multi-channel video-programming distributors (vMVPDs), also known as live TV streaming services, are not forced to go to local broadcasters, and instead negotiate carriage deals with the networks themselves.
The coalition that represents Disney and its cohorts wants to preserve the law as is. They say they don’t really see what the crisis is, and that the rules as applied to an increasingly-streaming environment are working just fine as far as they’re concerned.
“I’m not sure where the threat is to local news stations across the country from the current streaming environment,” coalition spokesperson Bryce Harlow said. “They’re available on every platform, both with entertainment content and on their own in different stations and apps.”
The problem with Harlow’s argument is that local channels are simply not available on every platform. For example, Sling TV only carries stations like Fox and ABC in select markets, and in those markets, users have to pay $5 extra per month if they get those two channels and their local NBC affiliate. If Sling were compelled to negotiate with the local stations themselves, perhaps it could find an arrangement that would allow more viewers to see their local channels without having to raise prices.
The Coalition for Local News says that its members are just seeking parity in negotiations, and that being shut out of the conversation as TV increasingly shifts to a streaming format is harmful to station owners and viewers alike. The group was formed by over 600 local affiliates owned by companies like E.W. Scripps, Nexstar, and others.
“There’s no way for us to advance our own individual strategies as broadcasters when we don’t have a say in the largest growing platform and revenue stream in our business,” said Michael O’Brien, SVPand chief at Scripps told Axios.
The biggest carriage dispute in the industry currently is an indication that something has to change. Customers of both traditional satellite DIRECTV plans and the internet version DIRECTV STREAM in more than 100 markets are missing Nexstar-owned stations thanks to a disagreement over retransmission fees. Both sides have heaped blame on the other, and the accelerating pace of cord-cutting has thrown the discussion of regulatory parity into sharp relief.
It may appear to some that companies like Disney/ABC and Paramount/CBS should have better things to do with their time, like trying to resolve the writer/actor strike that currently has Hollywood in a stranglehold. But as enormous channel owners, they stand to gain directly from keeping current FCC regulations in place as they are and could begin losing linear TV revenues even faster if local affiliates are allowed to negotiate directly with streamers.
DIRECTV STREAM
DIRECTV STREAM is a live TV streaming service, which is essentially the streaming version of the DIRECTV service. All packages include local channels and at least 31 of the top 35 cable channels. New subscribers can get a free Gemini streaming device from the company, in which case the service is called “DIRECTV via Internet.”