Given that it represents cable operators and programmers, the NCTA had always taken a neutral position on retransmission consent.

But no more. After two of its smaller cable members, Mediacom Communications and SuddenLink, found themselves battling with TV station groups over retrans fees—and losing—NCTA decided it was time to step in, something nobody in cable expected to occur. 

In this interview with TVNEWSDAY Contributing Editor Marianne Paskowski, NCTA chief Kyle McSlarrow explains why he’s seeking retrans reform on Capitol Hill, while conceding that it will not be quick or easy.

In the meantime, he also says, cable and broadcasters can work together on common interests—ensuring a smooth digital transition and heading off the effort to regulate TV violence.

An edited transcript follows.

Why did it take the NCTA so long to take a stand on retransmission consent?

I can’t necessarily answer that for the period prior to my arrival two and a half years ago. One of the things I was quickly told is, there’s an issue called retransmission consent, but you don’t need to deal with it, because we have members all over the map on the issue.

And to be honest, I didn’t think about it much once I had been told that. We, of course, were in the middle of all of the telecom rewrite on the Hill. So we really were not into it until the summer of 2006.

And that’s when broadcasters really began demanding fees.

Right. It was the flare up between SuddenLink and Sinclair that sparked this conversation on the NCTA board. The upshot was that, by early this year, we had concluded that it made sense for NCTA to participate in the conversations on the Hill or at the FCC in a way that we hadn’t before.

We should always be champions of the free market. That doesn’t mean that every piece of regulation, every regulatory regime, is something that we’re going to go full bore and try to change overnight.

But it does mean that, as a matter of principle, our position as NCTA should be trying to draw policy makers towards that result.

The board’s conclusion was that it’s really not just the issue of retransmission consent. To us, it’s a much broader issue. It’s the issue of broadcast carriage, the whole thing.

Including must carry?

Yes, because they’re two sides of a coin.

Broadcasters opt to take one or the other, but they’re getting both.

Right. Must carry and retrans, seen together, are a classic heads-I-win-tails-you-lose scenario. It’s actually far from being a free market negotiation. It’s actually a very complex, robust regulatory regime from the network non-dupe rules, to the syndex rules, to the must buy tier. You can’t just pretend that this is a free market in action.

We, at the NCTA, have a responsibility to educate policy makers and to actually engage in constructive conversation with broadcasters about this set of issues.

Now, I’m not delusional about it. We’ve got a lot of issues that divide us and we have our opportunities for food fights. But at the end of the day broadcasters and the cable industry need each other.

This is a symbiotic relationship. I would far rather be looking for the win-win, if there is one. But, at the same time, and I know it makes some people uncomfortable, I’m not just prepared to say everything’s OK with retransmission consent so leave it alone. I don’t think everything is OK.

Univision, in its recent upfront ad sales presentation, said it would be seeking a dollar per sub for carriage.  Do you take this seriously or is it just saber rattling?

Honestly, I have no way of knowing whether it’s saber rattling. And because of the antitrust rules, I have to be careful about individual transactions.

What I’ve been telling members of Congress over the last three or four months is that we’re living with a regime largely created in 1992 and the world’s different in dramatic ways in terms of the cross-platform competition, in terms of programming competition. The relationship between broadcasters and the cable industry is different and the technology is totally different.

Most of the important conversations are taking place around what’s the value exchange in the world of DVRs. It’s a little anachronistic for us to be living in a regime where the assumption is that without must carry, for example, the very survival of the broadcast industry is at stake.

The world has changed dramatically. So, when and if Congress ever decides to take another look at this regime, I think we have to be on the side of having the law catch up to the reality. Most of these things are all | More …