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Free Market Solutions in Television Regulation

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Dear Ranking Members Thune and Wicker,

On behalf of the more than 276 thousand members and supporters of Frontiers of Freedom, I am writing to ask that as you consider reauthorizing the Satellite Television and Extension of Localism Act (STELA) this year, to preserve the foundations of the current retransmission consent negotiation process. We oppose any changes to the structure in place which guides how cable and satellite television providers negotiate with broadcasters for their content and signal.

Specifically, Frontiers of Freedom opposes the inclusion in STELA of provisions which would preclude joint negotiations between broadcasters and pay television providers or broadcasters and advertisers; arbitrarily change ownership rules; alter the basic-tier or buy-through carriage provisions; or regulate how broadcasters negotiate for their signal and content with both Internet service providers and pay-tv providers.

The current negotiation process works exceedingly well with contracts privately negotiated in the free market without any impasses. On the rare occasion when impasses do occur, they are also handled in the free market, at the negotiating table and ultimately resolved. Legislatively altering the structure of these successful private negotiations would do nothing more than unabashedly disadvantage broadcasters’ ability to negotiate fair market price for their signals and content.

STELA is narrowly-tailored legislation that was originally intended to promote competition between fledgling satellite television providers and established cable companies. The legislation achieved its goal, a competitive pay-TV market was established, and the legislation should then have expired. As this legislation is once again set to expire, we encourage you to allow it to do so. However, if you feel it imperative to reauthorize STELA, we urge you to reject the inclusion of ancillary provisions which will create a decidedly anti-free market framework designed to pick winners and losers in the video marketplace.

Today the Senate Judiciary Committee finalized a clean version of the STELA legislation, which lays the path for a fulsome examination of video marketplace reforms at the right time and in the right vehicle.

If Congress sees fit to re-evaluate the current ecosystem of video and telecommunications, it should do so with an eye toward true deregulation, relieving the regulatory stressors on all parties involved in this vast marketplace. We believe a fair and thorough approach is the best path to real reform. What the current path offers is nothing more than standard corporate cronyism: legislative handouts for specific entities, disadvantaging their competitors.

Frontiers of Freedom and its members thank you for your leadership on this issue and strongly urge you to maintain your free market, limited government approach as you consider the reauthorization of STELA reauthorization or any changes to the current retransmission consent process.

Sincerely,

George Landrith
President
Frontiers of Freedom