Law360 is providing free access to its coronavirus coverage to make sure all members of the legal community have accurate information in this time of uncertainty and change. Use the form below to sign up for any of our weekly newsletters. Signing up for any of our section newsletters will opt you in to the weekly Coronavirus briefing.
Sign up for our Commercial Contracts newsletter
You must correct or enter the following before you can sign up:
Thank You!
Law360 (April 30, 2020, 6:13 PM EDT) -- Regional cable operators are pushing back against the New York attorney general's suggestion that pay-TV providers should reduce or waive subscriber bills for now-canceled live sports programming, saying local broadcasters and program originators are the real culprits.
Cable trade group ACA Connects said Thursday that New York AG Letitia James "has taken aim at the wrong target," overlooking that pay TV providers negotiate program carriage deals with broadcasters and that those fixed costs are passed along to customers.
The originating programmers are the only ones that can lower or alleviate their rates for canceled sporting events amid the coronavirus pandemic, ACA Connects President Matthew M. Polka said in a statement.
"If Attorney General James truly wishes to address consumers' concerns about sports programming, we recommend she focus on the root cause of the problem and investigate sports programmers, broadcast networks and sports leagues," he said.
James wrote to seven major cable companies Wednesday, asking them to slash fees associated with live sports programming, as events large and small have been canceled due to the coronavirus and social distancing protocols.
In lieu of these events, sports channels are playing reruns of classic games, sports documentaries and video game simulations, but that's not "what customers bargained for," James wrote in her letters.
James called on the seven companies — Altice USA, AT&T Inc., Charter Communications, Comcast Cable, DISH Network, RCN Corp. and Verizon Communications — to issue "refunds, discounts and reduction of charges and fees, payment deferrals and waiver of termination fees" to ensure that customers aren't paying for content they are not receiving.
However, ACA Connects asserted this isn't a business decision that ultimately falls to the cable companies, which must negotiate payments to broadcasters, leagues and regional sports networks for the right to carry sought-after games. Pay-TV providers have long argued that broadcasters use their "must-have" programs to levy high retransmission fees that are then passed on to cable subscribers.
"Attorney General James is right to question why consumers are paying for expensive sports programming not being aired because of the COVID-19 emergency, but she has taken aim at the wrong target," Polka said in his statement. "The members of ACA Connects, their customers, and other [pay-TV providers] have been caught in the middle of these sports and media titans for far too long."
The National Association of Broadcasters pointed Law360 to a media research group analysis indicating that cable companies charge comparatively much higher rates than broadcasters do.
"Broadcasters have never been the cause of high cable rates," NAB spokesman Dennis Wharton said. "As demonstrated by Kagan's independent analysis, cable programming fees are four times higher than the fees received by local TV stations, even though broadcaster ratings dwarf that of the cable networks."
--Editing by Marygrace Murphy.
Update: This story has been updated with comment from NAB.
For a reprint of this article, please contact reprints@law360.com.
