Sinclair slams Dish, ACA over argument that expanding national audience cap would increase blackouts

Sinclair TV station map
Sinclair TV station map. (Sinclair)

Sinclair is going after Dish Network’s argument that the FCC expanding the national audience reach cap for broadcasters could result in more broadcast channel blackouts on pay TV.

Dish and the ACA have argued that further broadcast consolidation would grant broadcasters more leverage in retransmission negotiations and allow broadcasters to impose “frequent and harmful blackouts.”

In response, Sinclair accused Dish of placing sole blame on broadcasters for breakdowns in retransmission consent negotiations and said that blackouts are “extremely rare.” The company said that of the 39 blackouts that occurred in 2015 and 2016, 17 involved Dish and that those 17 Dish blackouts involved 17 different station owners, most of them smaller broadcasters.

“Moreover, Dish and the ACA are flatly incorrect to suggest that ‘blackouts’ are uniquely harmful to MVPDs and that increased consolidation would lead to more frequent negotiation breakdowns. In reality, broadcasters of all sizes are highly motivated to reach retransmission consent agreements, as they are likely to suffer much larger losses of revenue from any retransmission consent dispute than an MVPD would,” Sinclair wrote in an FCC filing.

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Dish is urging to the FCC to maintain the national audience reach cap to guard against the magnified effect of losing both Sinclair’s and Tribune’s stations in a retrans blackout.

Sinclair argued that MVPDs like Dish are in a better financial position than broadcasters to withstand a blackout.

“MVPDs—particularly the top ten that account for approximately 95% of subscribers nationwide—are typically in a much better position than broadcasters to absorb whatever small subscriber losses they suffer from a supply disruption,” Sinclair wrote.

Last month, Dish Network argued that the FCC should maintain the 39% cap and eliminate the UHF discount to prevent further broadcast television consolidation that it says could ultimately hurt consumers. In a filing, Dish warned that further relaxing broadcast ownership rules would result in an imbalance of power between broadcasters and distributors, which could result in higher prices for broadcasters during retransmission and carriage negotiations. That could translate to higher prices for consumers, Dish said.

Sinclair is currently pursuing a $3.9 billion merger with Tribune Media, which would give Sinclair a portfolio of more than 200 television stations.