Responding to an FCC inquiry to address a perceived lack of ethnic and racial diversity in pay-TV programming, the American Cable Network has urged the agency to examine the "forced bundling" practices of the large programming conglomerates.
"Large programmers require SmallTown Cable to take all of their programming as a package, rather than allowing SmallTown Cable to choose the programming its subscribers will want," the ACA said in its response to the FCC Notice of Inquiry.
"If SmallTown Cable wants to carry the Awesome Channel because its subscribers want to see The Awesome Monster Show, for example, it must also take the Slightly Less Awesome Channel, the Not Really Awesome Channel, and the Downright Unpopular Channel," ACA added. "No questions, no exceptions. When SmallTown Cable (or its buying group) tells AwesomeCorp. that its subscribers only really care about The Awesome Monster Show, AwesomeCorp. says, in effect, 'too bad.'"
Such forced bundling harms program diversity in three ways, ACA said.
"First, it leaves less room on SmallTown Cable's limited-capacity system for diverse programming," the trade group added. "Second, it prevents SmallTown Cable from transitioning system capacity from video to broadband, which makes it harder for subscribers to access diverse programming online. Third, as the Commission has repeatedly found, forced bundling of 'must have' programming assets results in higher prices and more onerous terms and conditions. This, in turn, makes it more difficult for SmallTown Cable to find the resources necessary to acquire additional independent programming.
ACA also took aim at penetration requirements it said are often imposed by the bigger programmers.
"Large programmers require SmallTown Cable to offer most of their networks to the overwhelming majority of its subscribers," the group said. "Thus, not only must SmallTown Cable buy the Downright Unpopular Channel in order to get the Awesome Channel, but it must also offer the Downright Unpopular Channel to the vast majority of its subscribers. As a result, SmallTown Cable's 'Expanded Basic' tier might more accurately be characterized as 'Super Expanded Basic,' a bloated, overly expensive tier full of channels of marginal interest."
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