Tag: cablevision

Retrans Food Fight! Why This Administration Will Deal With Cable After All.

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Remember how once whacky old Kevin Martin the Cable Playa Hatah was gone the FCC was gonna forget all about cable? Because, after all, cable was all vibrant and competitive and stuff and who needs dumb old cable when everyone has Broadband?

Item one in communications land for the new year is the first round of retransmission fights. The biggies at the moment are Sinclair/Mediacom, where Mediacom has tried to get the FCC to weigh in on its side, TWC v. Fox, TWC v. Food Network/Scripps Howard (which no longer includes Scripps broadcasting properties), and Cablevision v. Food Network. Although TWC and Mediacom agreed to extensions with the various programmers to continue to try to sort things out, and TWC ultimately reached an agreement with Fox, Cablevision and Food Network ended up in stalemate.

Result, Cablevision has dropped Food Network and HGTV. In the war for the hearts and minds of customers, the Food Network folks have launched web based outreach with clips and fact sheets. Cablevision’s response is a little harder to find, but digging through their customer service led me to this page which basically says “Scripps wanted to much money for their programming, we hope you enjoy the other cooking shows we have.” Unfortunately for Scripps, the broadcast TV fights have significantly overshadowed them.

Which brings us to the first point of importance for all those folks in policyland who keep insisting that “broadcasting is dead.” You will notice that from the perspective of people reporting news to folks outside policyland, keeping broadcast programming was much bigger news than people actually losing popular cable-only programming. Second point – this is Food Network’s first round of negotiations as a stand alone cable company without also negotiating for broadcast properties. This gives them significantly less leverage.

But all these pale beside the third point — cable (and I mean cable, not “MVPD”) regulatory issues remain important and the market power and consumer protection issue don’t disappear because we now have multiple delivery platforms. Millions of people spend billions of dollars on these services and care a heck of a lot about them. Like it or not, and despite all the coventional wisdom about youtube, twitter, teh inerwebz, blah blah, this medium and these programmers dominate — indeed, arguably define — our common national culture. That means cable policy will continue to be a vital part of the FCC’s focus despite a desire to do sexier things like wireless and broadband.

Which means the folks on the 8th Floor need to wake up, grudgingly admit that whacky old Kevin Martin wasn’t so whacky after all, and reopen the proceedings on wholesale cable programming unbundling, retrans, leased access, Section 616 reform, and the other issues around boring cable programming the FCC hoped it could forget about because broadband and wireless would solve evrything and who watched TV anymore anyway.

Stay tuned . . . .

Will The DC Circuit Pull The Plug On Program Access?

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Next week, the D.C. Circuit will hear oral argument on the FCC’s 2007 decision to extended the program access rules another five years. What surprises me is how few people seem to have considered the possibility that the D.C. Circuit will reverse this decision and vacate the rule, as they did last month with the 30% cable horizontal ownership limit.

Part of that is the way people tend to make analysis based on conventional wisdom. “Everyone knows” that without the program access rules, competitive providers would be toast because the largest cable incumbents can control programming, just as “everyone knows” that we don’t need a 30% cable ownership limit because the MVPD market is so wildly competitive that the largest cable incumbents can not possibly influence cable programming. As Comcast and Cablevision pointed out to the DC Circuit, however, the conventional wisdom in this regard is not entirely consistent. If, as the court found last month as a matter of law, the MVPD market is wildly competitive and consumers switch willy-nilly from one to the other rendering it impossible for a cable provider to block a rival programming network from emerging, how on Earth can cable programmers below the 30% limit exercise foreclosure?

There are, of course, sound answers to that in both law and economics, although the biggest single deciding factor is likely to be the absence from the panel of Douglas Ginsburg, a man who believes membership in the Federalist Society substitutes for an actual understanding of economics and has published an academic article yearning for the “good old days” when the courts made economic regulation unconstitutional and concluding that courts should not defer to agency efforts to create “synthetic competition.” (An offense in the eyes of the Gods of the Marketplace.) I believe the panel is Sentelle, Griffith and Kavanaugh, which is not exactly good news for the program access rules but isn’t death on wheels like Ginsburg (or Williams or Edwards). Sentelle and Griffith, who were both on the imaginary competition outweighs real competition decision back in June overturning the FCC’s decision not to grant Verizon a forbearance petition, and Kavanaugh, who was on the cable ownership panel and therefore presumably agrees that switching costs aren’t real and cable operators are in such fear of youtube clips they would never make programming decisions based on affiliation. On the flip side, Kavanaugh actually wrote the somewhat more deferential special access opinion from July. Unfortunately for those who rely on program access, none of the judges who affirmed the Inside Wiring Order are on this panel.

Of course, there is something to be said for actual law and analysis of the underlying FCC Order, even in the D.C. Circuit. So below, I shall provide a brief outline of the program access rules, how we end up in court, the likely arguments, and what happens if the D.C. Cir. overturns the rules (which even I give a low probability to, but do not discount — especially given the panel) — including why that might actually be the best thing to happen to cable regulation in the long run.

More below . . .

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Update on Cablevision Free Wi-Fi, and What It Means for VZ (and everyone else).

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Awhile ago, I wrote about Cablevision’s decision to offer free wi-fi to its subscribers throughout its footprint. As I explained then, this amounted to a “Plan B” after the failure to win usable spectrum in either the AWS-1 auction in August 2006 or in the 700 MHz Auction in the winter of ’08. Now, according to this story at DSL Reports, Cablevision is massively expanding and improving its wi-fi service for customers. This represents a real challenge for VZ, more so IMO than Time Warner’s participation in New Clearwire.

Why? See below . . . .

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Cablevision’s WiFi Roll Out — A Wireless Plan B?

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As I discussed in the context of the Sprint/Clearwire/Etc. spectrum menage (and discussed a bit more with Gordon Cook on his blog), the reality of the post-700 MHz auction world makes it necessary for cable operators to have some kind of wireless strategy if they want to meet the potential next generation competitive threat from either AT&T and Verizon or possibly from newly en-spectrumed DISHTV. At the same time, cable operators are desperate to avoid the downdrag on the their stock that would come from a heavy investment in wireless licenses and further nvestment in infrastructure — especially when analysts don’t give them a prayer of taking on the wireless carriers in what has become a reasonably mature market. How to resolve this difficult dilemma?

Those cable systems with the combination of resources and forethought to address this have opted for different solutions. Comcast, Time Warner and Brighthouse –through their new partnership with Sprint/Clearwire etc. — have flopped back to the old cable standard of joint ventures and strategic investment. (Anyone else remember @Home Network?) Cox went out and won its own set of licenses covering its cable service area, as did Charter parent Vulcan Enterprises (as have a few lesser systems, such as Washington Post owned CableOne, which captured a bunch of licenses in the AWS auction).

Cablevision tried twice to acquire its own set of licenses: first in the AWS Auction in 2006, and again in the 700 Mhz Auction. Both times Cablevision went home empty-handed, outbid by the wireless giants. With no new spectrum on the horizon, and apparently no invite into the Sprint/Clearwire Happy House ‘o WiMax partnership, Cablevision found itself in need of a spectrum “Plan B.” Happily for Cablevision, there is also such a thing as “unlicensed spectrum” which — as I and other boosters of the competitive power of open spectrum continually point out — is available to everyone and cheap to deploy (relative to building a licensed network from scratch).

Hence the recent Cablevision announcement that it will deploy a wifi network in conjunction with its cable network. As a Plan B, it has some real advantages over using licensed spectrum, as well as some potential disadvantages. But given Cablevision’s unique deployment situation — it is primarily located in New York City and Long Island which gives it incredible population density for its relatiely small footprint — this fall back position may work for it where it would not work for other cable companies.

A bit more analysis below . . . .

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What Does Cablevision Want With Newsday? And Should I Care?

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For a business supposedly on the edge of extinction, newspapers attract an odd assortment of newcomers eager to get in on the game. Real Estate billionaire Sam Zell bought Tribune last year, marking fresh blood coming into the newspaper and broadcasting biz. Now, as Zell sells off some chunks of Tribune to to pay down debt, it would appear another new player is poised to enter the game.

According to this story, NYC based Cablevision has beat out Rupert Murdoch for the Daily News. Unlike the Murdoch deal, this would not implicate any FCC rules and should not raise too many hackles on the antitrust side. Arguably it has an impact on the local advertising market, but hardly enough to make a difference. Besides, I’m not sure if there is any evidence that the newspaper advertising market and the cable advertising market are related.

What is more interesting is “why does Cablevision want Newsday at all? And should I care?” Cablevision has in the past tried to break out of its main business as a cable operator and dabbler in cable programming and owner of various sports venues and franchises. At various points, it has tried to launch a satellite service and was a bidder in the last two major FCC spectrum auctions (coming away empty handed both times). Is this a toe in the water to go into the newspaper business or a more limited foray?

It is interesting to note that a few years ago, Cablevision was sued by the Jets over an alleged effort to block the Jets from building a sports stadium that would compete with those owned by Cablevision. Among the charges, the Jets claimed that Cablevision routinely gave its own front group free advertising time on its cable systems to drum up support against the Jets’ stadium effort, while refusing to sell advertising time to the Jets for pro-stadium advertising. Owning Newsday will certainly give Cablevision a bit more political clout in its backyard should it find itself wanting to lobby local government again. While I don’t think that’s the primary reason for Cablevision buying Newsday, it does make for an attractive bonus from Cablevision’s perspective.

Unfortunately, I think only DOJ or the FTC will examine the acquisition. It doesn’t trigger either FCC rules or local franchise review. But this sort of impact on the diversity of news sources and the ability to leverage ownership of different media assets for political gain falls outside antitrust review — even in an administration that cares about antitrust. So for better or for worse, barring some new bidder emerging, I expect the deal to sail through easily.

Stay tuned . . . .

The 700 MHz Band Auction, Part IIIb: More Mid-Range Competitors

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Once again let’s begin our analysis of strategic options for major actors in Auction 73, 700 MHz Band, with a look at the footprints established by many of those actors in two previous Lower 700 MHz auctions (Auction 44 and 49) and the AWS-1 auction (Auction 66):
Cellular Market Areas (CMA) Map for Auction 44
Economic Area Groupings (EAG) Map for Auction 44
Cellular Market Areas (CMA) Map for Auction 49
Economic Area Groupings (EAG) Map for Auction 49
Cellular Market Areas (CMA) Map for Auction 66
Economic Areas (EA) Map for Auction 66
Regional Economic Area Groupings (REAG) Map for Auction 66

The Mid-Range Competitors (Continued)

Cablevision is bidding as CSC Spectrum Holdings LLC. In Auction 66 it bid as Dolan Family Holdings and got creamed by incumbent blocking bidding. Cablevision unsuccessfully bid on two EAs, AW-BEA010-B (NYC-Long Is. NY-NJ-CT-PA-MA-VT) and AW-BEA010-C (NYC-Long Is. NY-NJ-CT-PA-MA-VT), and the following CMAs: AW-CMA001-A (New York-Newark, NY-NJ), AW-CMA042-A (Bridgeport-Stamford-Danbury CT), AW-CMA062-A (New Brunswick-Perth Amboy NJ), AW-CMA070-A (Long Branch-Asbury Park NJ), AW-CMA144-A (Orange County NY), AW-CMA151-A (Poughkeepsie NY), AW-CMA551-A (Ocean NJ), and AW-CMA552-A (Sussex NJ). Cablevision unsuccessfully sought all three licenses for the Northest REAG: AW-REA001-D, AW-REA001-E, and AW-REA001-F. The pattern is straightforward: replicate the footprint of their cable service in the NY-CT-NJ region in the A and B Blocks and try for one of the Northeast REAGs. Cablevision didn’t get it in AWS-1 and it has to do well in Auction 73 or its triple play options are seriously curtailed. Anonymous bidding helps Cablevision only a bit, because the chief competitors know exactly where they have to bid and it is prime spectrum in the richest market in America.

More below…

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