8:17am PT by Eriq Gardner
Comcast Accused of Discriminating Against Spanish-Language Network
The FCC is now being asked to look into whether Comcast discriminated against Spanish-language television network Estrella TV to benefit affiliated networks Telemundo and NBC Universo.
Liberman Broadcasting on Friday filed a program carriage complaint before the media regulatory agency that presents its channel as a "rising star in the Spanish-language video marketplace," with solid Nielsen ratings in Los Angeles and Dallas-Ft. Worth, but is being tripped up by Comcast's alleged refusal to extend a reasonable offer for fair distribution and compensation. As a result, Estrella has been taken off of Comcast's cable service in Houston, Denver and Salt Lake City.
Liberman, which switched Estrella from "must carry" status to one requiring retrans fees in 2014, aims to take advantage of various telecommunications laws as well as the conditions imposed upon Comcast at the time of its merger with NBCUniversal in 2011, hoping that a 52-page complaint to the FCC presents a prima facie case that Comcast is discriminating on the basis of affiliation.
"Rather than provide expanded distribution to proven-ratings-success Estrella TV, Comcast has padded its channel lineup with programming of dramatically lesser audience appeal," states the complaint. "While such decisions allow Comcast to claim cosmetic credit for 'supporting' Spanish-language programming, they are indefensible as legitimate business decisions designed to maximize value provided to Comcast subscribers."
Recent high-profile complaints alleging discrimination haven't fared too well for the complainers. Most notably, Comcast repeatedly beat the Tennis Channel, which accused the cable service of favoring Comcast-owned sports networks, Golf Channel and Versus. Last year, Cablevision prevailed in a closely-watched battle with the Game Show Network as well. Liberman asserts that it presents a "stronger case on the merits" than either case.
The complaint (read here), filed on behalf of Liberman by attorney Dennis Corbett, features one element that presents a potential test case for the FCC.
Liberman is claiming that Comcast's demand for digital rights is improper. According to the complaint, the demand is "more than a plain vanilla acquisition of non-exclusive TV Everywhere-type rights," that it constitutes the "kind of financial interest as a condition of carriage" that is barred by Section 616 of the 1992 Cable Act. The argument could prompt the FCC to clarify whether cable and satellite operators are barred from doing more than demanding "ownership" and "equity" rights under this statutory provision.
In a statement, Comcast responds forcefully to Liberman, stating there's no case. "First, as a threshold matter, the program carriage rules simply do not cover broadcasters like Liberman," says a spokesperson. "They do not apply to broadcast networks. Second, Comcast did not drop Estrella TV; Liberman pulled the broadcast stations in three markets, and Comcast continues to carry Estrella TV to about six million subscribers across the country."
Comcast says it negotiated in good faith for months and offered the same terms as other comparable stations. The cable operator presents Estrella's performance as "weak" and adds that since the Spanish station went dark in Houston, Denver and Salt Lake City, there hasn't been any measurable customer defections or negative customer reaction.
The complaint anticipates some of these arguments.
Liberman states: "There can be only one rational explanation for this demonstrable gulf between Comcast’s unique assessment that Estrella TV lacks value and the directly contrary judgment of so many non-conflicted companies that Estrella TV provides value: Comcast owns competing services Telemundo and NBC Universo, whereas the many MVPDs and broadcasters which have freely and consistently decided to distribute Estrella TV own no competing Spanish-language channels."