The letter-to-Congress battle between broadcasters and pay-TV operators over retransmission policy continued Friday when Mediacom executive Thomas Larsen sent a letter to House and Senate leaders, blaming price hikes in the pay-TV industry on broadcast retrans fees.
Larsen's letter comes three days after broadcast industry-backed TVFreedom sent a letter to the same respective leaders of the House and Senate communications oversight subcommittees, pushing them to investigate pay-TV pricing.
The broadcasters' letter "turns the facts on their head," writes Larsen, group VP of legal and public affairs for America's eighth largest cable company.
"Contrary to the allegations in the letter, cable companies' prices and policies are easily discoverable," he adds. "Content owners, on the other hand, hide their 'wholesale' prices and practices that have been the single biggest cause of the increases in pay-TV subscription rates during the last decade."
In its own letter Tuesday, TVFreedom asked lawmakers to "focus on pay-TV industry wide practices, such as erroneous overbilling, equipment rental fees, early termination fees, and inflated or unnecessary 'extra' charges" as they begin the process of updating the Telecommunications Act of 1996.
Larsen counters that cable, satellite and telecommunications companies involved in video services are at least federally regulated.
"By contrast," he notes, "broadcast and cable networks are not legally required to disclose the retransmission consent or license fees they collect from pay-TV providers. And rather than voluntarily following a policy of openness and transparency, broadcasters and non-broadcast network owners use contractual confidentiality clauses to hide their prices and policies. Content owners have rejected Mediacom's offer to delete confidentiality provisions from our carriage agreements or include an exception that would permit disclosure to Congress or the FCC on a non-public basis."
According to SNL Kagan, broadcast retransmission fees have grown from roughly $200 million in 2006 to $3.3 billion 2013. They're expected to jump to $7.6 billion by 2019.
UPDATE: Shortly after the original posting of this story, TVFreedom spokesman Robert Kenny emailed FierceCable and asked that the following on-the-record quote be included in our story.
"Only in Washington can pay-TV's army of lobbyists and lawyers ignore two decades of FCC data showing geometric rate increases that far outpace the rate of inflation.
"Instead, the pay-TV cabal offers double-speak aimed at diverting consumers away from real pocketbook issues of rising cable rates and ghost charges. Americans want to know why their bills keep rising beyond the costs of inflation and a better explanation of mysterious and unexplained charges.They want to know why they are being charged $7 billion a year in set-top box rental fees that seem to rise every month. The bottom line is that Americans aren't fooled by the pay-TV doublespeak."
- read this Multichannel News story
Broadcasters ramp up retrans battle, ask Congress to investigate pay TV pricing
Aereo pitches legitimacy of its tech in new YouTube video
TV interest groups rise to fight the retransmission wars