Over 600 Local TV Stations Form Organization to Advocate for Live TV Streaming Reforms

Cord cutting may have left audiences with the impression that traditional TV is doomed, but there’s still a large portion of the population that values local news broadcasts highly. A recent survey found that local TV news garnered eight to 12 times as many viewers as streaming in major markets, and now local TV stations are banding together to publicly advocate for reforms from Congress and the Federal Communications Commission.

While it had originally been reported that the organization would lobby lawmakers, a spokesperson for the organization told The Streamable, “The Coalition will not be engaged in traditional lobbying at this point, but rather public advocacy efforts.”

According to Axios, the group of more than 600 local affiliates of ABC, CBS, Fox and NBC stations are requesting the government close a loophole that allows live TV streaming services to bypass negotiating with them directly. Instead, streamers can go all the way up to the national networks, which can agree to contracts that affiliates have no say in until the network brings it to them and asks for their approval.

That’s exactly what happened in January, when Fubo dropped CBS affiliates in 160 markets across the country. The streamer had an agreement in place with the network, but when CBS presented the deal to its affiliates, a large portion of them rejected it, and they went dark on Fubo for weeks. Traditional pay-TV plans like cable and satellite have to go to affiliate owners directly to negotiate, but the law has no such provision for streamers.

The offending loophole has been in place since 2014. At that time, the market research institute MoffettNathanson estimates that only 200,000 people used a live TV streamer like YouTube TV or Fubo. Now, the firm estimates that almost 17 million Americans use such a service, and the Coalition argues it can’t effectively reach those users if it can’t negotiate directly with streaming platforms.

“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, SVP and chief distribution officer at the affiliate-owning E.W. Scripps Company.

This is not exactly the issue at the heart of the carriage dispute currently happening between DIRECTV and Nexstar, the largest owner of local affiliates in the United States — but it is related. Nexstar is able to directly negotiate with DIRECTV, as the company’s contract to carry Nexstar stations expired both for its linear satellite packages and for DIRECTV STREAM in late June. Nexstar is simply asking for carriage fees that DIRECTV says it cannot afford without raising prices for customers, which is why more than 200 Nexstar-owned stations are currently unavailable for DIRECTV users.

The problem, in that case, is that there are simply not enough customers paying for cable and satellite to justify Nexstar’s carriage demands. That issue is why DISH co-founder Charles Ergen called carrying local affiliates a “tax” earlier this year, and why local channels gaining the right to negotiate directly with live TV streamers might not solve all their distribution problems overnight.

Now, the Coalition’s demands are making their way through the halls of government. FCC chair Jessica Rosenworcel says her group does not have the authority to change the provision, and that an act of Congress is required, so the Coalition could be in for a bit of a wait while its protests go through the necessary channels.

The Coalition’s goals are somewhat similar to the Independent Streaming Alliance. The ISA formed earlier this summer, as a way for smaller streaming platforms with more niche audiences to have a seat at the table in discussions that affect the entire industry.