Graham Writes Broadcasters on Post-STELA Transition Plans, Fueling Speculation

Letters Senate Judiciary Committee Chairman Lindsey Graham, R-S.C., sent Friday to executives from major broadcasters ABC, CBS, Fox and NBC added further fuel to ongoing chatter about the direction of Congress' debate on Satellite Television Extension and Localism Act reauthorization. Senate Commerce Committee Chairman Roger Wicker, R-Miss., is continuing to eye circulating a draft renewal measure in the coming weeks (see 1910300055), but lobbyists are becoming doubtful it will be ready for an early November markup, as originally anticipated. The law will expire Dec. 31 absent recertification.

Wicker told us Thursday he's still considering what additional media policy issues he's willing to address in a STELA measure beyond simply renewing the law's existing provisions. Wicker's interested in including language from the Truth-in-Billing, Remedies and User Empowerment over Fees (True Fees) Act (HR-1220/S-510) in a STELA bill (see 1910290064). “The next week or two will tell the tale on that,” he said. “I don't know that we’re there yet.” He still believes it's “must-pass” legislation and “I think a majority of the House and Senate don't want to see it totally sunset” at the end of this year. Wicker said he remains optimistic he'll be able to circulate a renewal measure soon (see 1910300055).

Communications lobbyists said they expect Wicker to circulate a draft bill within weeks, though behind-the-scenes negotiations appear to be moving slowly enough that they believe it's not going to be ripe for teeing up early in the month. Senate Commerce staffers are looking to include placeholder language in their STELA bill for a short-term renewal of the law's distant-signal compulsory license and are seeking Senate Judiciary members' input on the length of time they prefer, lobbyists said. Wicker has been eyeing a shorter recertification than the standard five-year time period as a compromise with STELA skeptics (see 1909250063). Senate Commerce is eyeing a three-year recertification period, but broadcaster interests are opposed, lobbyists said.

Graham wrote broadcasters to “inquire about” their post-STELA transition plans “to a free market at the end of this calendar year to avoid any impact upon customers.” U.S. consumers “need assurances that during this transition to a free market their favorite network news and prime time shows will continue to be available to them on their current provider,” Graham said. “More clarity is needed” from all parties, including whether broadcasters are “willing to provide a one-year license to satellite providers” for broadcaster-owned shows “provided you receive market-by-market usage data from each satellite provider, including the total usage by long distance truckers and recreational vehicle owners.”

Graham also wants assurances from the broadcasters on whether they will charge satellite providers carriage rates “comparable to the 2018 rate” the Copyright Royalty Board set for the compulsory Copyright Act Section 119 license” and whether they will commit to negotiating carriage agreements during a one-year transition period “that would begin no later than” Jan. 1, 2021. The broadcasters have until Nov. 12 to respond.

NAB, which publicized the letters, believes they show Graham recognized that STELA's “expiring distant signal license is outdated and that the [CO] has recommended that it not be renewed” (see 1906030065), CEO Gordon Smith said in a statement. The office similarly recommended Congress eliminate that license in 2008 and 2011 (see 1108310083). “Long having outlived its usefulness, [STELA's] distant signal license now serves as incentive for dominant pay-TV platform [DirecTV] to serve its satellite subscribers with out-of-market rather than local broadcast channels,” Smith said.

Congress "should not only reauthorize [STELA] so nearly one million Americans can continue receiving all their current network programming, but also modernize the retransmission consent rules, which currently favor broadcasters at the expense of consumers and competition," an American Television Alliance spokesperson emailed on behalf of DirecTV owner AT&T.

Pro-STELA lobbyists disagreed with NAB's interpretation of the Graham letters, with one saying it's a “gambit.” Senate Judiciary may be looking to find an excuse to not deal with the STELA issue amid a jam of other issues in its jurisdiction, lobbyists said. They pointed to a letter the International Brotherhood of Electrical Workers sent Wednesday to the leaders of the House and Senate Commerce committees as a more important indicator of momentum in the STELA debate.

The law “has a direct impact on the IBEW's membership, which includes some DirecTV employees, International Brotherhood of Electrical Workers' International President Lonnie Stephenson wrote the lawmakers. “Failure to reauthorize this law would threaten the livelihood of those workers and negatively impact the communities they serve.” The more than 870,000 satellite customers that depend on the STELA-mandated distant-signal license “could lose access to these distant network signals that are an integral part of their satellite TV service causing consumer disruption, dissatisfaction and confusion,” Stephenson said. “This is an unacceptable outcome.”