DBS Claims Paying Higher Fees Yields “Rate Shock” Lack Credibility
PITTSBURGH, July 7, 2016 – The American Cable Association is calling on the Federal Communications Commission to require Direct Broadcast Satellite (DBS) providers to fund their fair share of support for the Media Bureau’s portion of the agency’s operating budget now and in the future so as to create a modern fee scheme that no longer discriminates against cable and IPTV providers.
ACA’s call for regulatory fee parity – a course of action the trade group has advocated for many years – came in reply comments filed on July 5 with the FCC as part of the agency’s Congressionally mandated process of deciding how much various regulated entities must pay in annual regulatory fees. This year, the FCC plans to collect $384 million in regulatory fees and has allocated $64.1 million to cable/IPTV and $9.1 million to DBS providers to support activities of the Media Bureau through fees assessed on a per-subscriber basis.
The FCC’s proposal requires cable operators and IPTV providers to pay $1.00 per subscriber, while satellite TV giants Dish and AT&T/DirecTV will be required to pay a baseline fee of just $0.24 per subscriber to help fund the Media Bureau’s regulatory oversight of multichannel video programming distributors (MVPD) with business before the agency.
In the reply comments, ACA called on the FCC to establish fee parity between cable/IPTV and DBS as quickly as possible. The filing said the FCC should no longer require smaller MVPDs effectively to cross-subsidize their much larger competitors. AT&T/DirecTV is the largest MVPD in the U.S., and DISH the fourth largest.
ACA also stressed that the FCC should summarily dismiss as baseless DBS operators’ claims that raising their regulatory fees to parity level will produce “rate shock,” an argument that ignores the ongoing “rates shock” felt by cable/IPTV providers stung by a fee regime unfairly tilted in favor of DISH and AT&T’s DIRECTV.
“These are multi-billion dollar corporations for which even substantial fee increases would cause minimal disruption and no threat to operational viability,” ACA President and CEO Matthew M. Polka said. “If it is unfair to ask DBS providers to pay their fair share of Media Bureau regulatory fees, it is perforce unfair to ask cable operators and IPTV providers – and ultimately their subscribers – to continue to pay the DBS providers’ share of regulatory fees for them.”
About the American Cable Association: Based in Pittsburgh, the American Cable Association is a trade organization representing nearly 750 smaller and medium-sized, independent cable companies who provide broadband services for nearly 7 million cable subscribers primarily located in rural and smaller suburban markets across America. Through active participation in the regulatory and legislative process in Washington, D.C., ACA’s members work together to advance the interests of their customers and ensure the future competitiveness and viability of their business. For more information, visit https://acaconnects.org/