House Passes Sat TV Bill, Lawmakers Take Aim at DISH

[Gregg Lengling]

By a voice vote, the House on Wednesday approved key satellite TV legislation, parts of which have must-pass provisions for the industry.

Most critical were provisions granting satellite TV compulsory license permits to offer superstations and distant network signals to consumers. The compulsory license was set to expire Dec. 31, but the legislation passed by the House provides for a five-year extension, to Dec. 31, 2009. The license was part of the landmark Satellite Home Viewer Improvement Act (SHVIA) passed in 1999.

Also, the House bill would allow satellite TV to broadcast certain "significantly viewed" channels from neighboring TV markets to areas served with satellite-delivered local TV packages. The House version also includes a provision allowing DBS platforms and other affected parties, such as content providers, to privately negotiate royalty rate increases, allowing for the industry to bypass a CARP (copyright arbitration royalty panel) process.

The more controversial part of the bill focused on a ban for the delivery of local TV signals to two dishes. The legislation, if signed into law, will require satellite TV providers to deliver analog local TV signals for a particular market to one dish, and forces the removal of a two-dish/local TV solution for those analog signals one year after the law's enactment.

The two-dish/local TV solution has been employed by EchoStar, which uses a second dish for reception of a certain number of local TV channels in select markets. And lawmakers discussing the legislation on the House floor took aim at the company and its two-dish/local TV practice.

Rep. Eliot Engel (D-N.Y.) said EchoStar's two-dish practice is discriminatory since it places less-viewed channels, such as public, religious or Spanish-language stations, on a second dish. Rep. Charlie Gonzalez (D-Texas) didn't mention EchoStar by name during his remarks on the House floor, but complained that one satellite TV company was putting a number of Spanish-language stations in his home state on a second dish.

In a statement, EchoStar said it's disappointed that the House legislation "includes many provisions harmful to consumers. The current bill would potentially force the installation of millions of second satellite dishes that consumers neither want nor need, benefiting only broadcaster special interests in other markets."

EchoStar also criticized the bill for not addressing "digital white areas," which would allow satellite TV to deliver digital distant network feeds to consumers not served locally by digital broadcasts. "Where local broadcasters fail to invest in the equipment necessary to allow consumers to view digital channels off air, a digital white area would allow those consumers to receive high definition distant networks by satellite, providing millions of consumers the only current path to participation in the HD revolution," EchoStar said.

"We look forward to a final law that includes provisions in the Senate Commerce bill, which would allow rural consumers to receive a distant digital network signal via satellite and allow a longer period of transition to address the two-dish issue," EchoStar added.

In a separate statement, DirecTV President and CEO Mitch Stern said, "This legislation will make the video marketplace competitively more robust by allowing us to carry the same out-of-market 'significantly viewed' stations that cable operators already offer. We are also pleased that this legislation clarifies that 'carry one carry all' means that satellite providers may not split local stations between two dishes. We look forward to working with the Senate to ensure passage of this important legislation."

The next step is a vote in the Senate. At the moment, there's no news concerning a Senate vote on a satellite TV bill, and there's speculation that the Senate and House may adjourn at the end of the week without Senate passage of the key legislation. However, some expect the Senate to come back for a lame-duck session after the Nov. 2 election, possibly Nov. 15, and keep working on the legislation.