12:12pm PT by Eriq Gardner
TV Giants Say Forcing Cable Companies to Sell "À La Carte" Violates First Amendment
Maine may suddenly have a good claim for being the most aggressively progressive state in the country when it comes to regulating the television industry. Earlier this year, state lawmakers quietly passed several measures that have the potential of disrupting the status quo. This week came fallout from the moves as some of the biggest companies in the entertainment industry went to court in hopes of obtaining a preliminary injunction.
One law, L.D. 832, attempts to force cable operators into providing the option of purchasing access to cable channels, or programs on cable channels, on an individual basis. Meaning, not only would citizens of Maine have the ability to say "yes" to ESPN while saying "no" to ESPN2, but they'd have the ability, for example, to only purchase NFL Monday Night Football without any of ESPN's other shows.
Rep. Jeffrey Evangelos, the bill's sponsor, touted the law when it was under consideration.
"I submitted this bill because during my campaign I met many senior citizens on fixed incomes who no longer can afford cable TV," Evangelos said. "Think about it. The generation that fought World War II and grew up with free television has been priced out of the market. The biggest complaint was they can't watch the Boston Red Sox anymore because the cable package that includes NESN costs about 100 bucks per month."
In federal court Wednesday, Comcast, CBS, Discovery, Disney, Fox and Viacom told a Maine judge Maine’s novel à la carte mandate is unduly burdensome and results in "increased cable costs, reduced programming choice, consumer dissatisfaction, and the diversion of resources from enhanced cable offerings."
As for the legal basis for the law's nullification, the TV giants allege that L.D. 832 is preempted by the Federal Communications Act and imposes restrictions on free speech in violation of the First Amendment.
It's argued that cable companies have editorial discretion when choosing which channels go on the cable dial.
"L.D. 832 eviscerates this protected editorial discretion, as it eliminates the ability of cable operators and programmers to decide not to offer programming on an à la carte basis," states a memorandum in support of an injunction. "It targets certain content (i.e., 'cable channels' and 'programs' carried on cable channels) and uniquely burdens certain speakers (i.e., cable operators and programmers that supply content to cable operators). Remarkably, no other types of MVPDs, including DBS video providers such as DIRECTV and DISH Network, 'virtual' MVPD services like Sling TV, YouTube TV, and AT&T TV NOW, nor the programming any of those services distributes, are covered by the law even though they distribute their services via video packages and tiers just as cable operators do today."
Remarkably, Maine's attorney general Aaron Frey also finds himself in court this week having to defend another new statute.
That would be L.D. 1371, meant to boost the viability and visibility of Public, Educational and Governmental Access Channels.
These public-access channels have traditionally been funded by local franchise fees imposed on cable operators, but for reasons including shifts in the marketplace and federal deregulation efforts, they find themselves financially endangered.
Among Maine's efforts to save them is requiring cable system operators to include them on a tier including other local broadcast channels — and in high-definition format. Additionally, cable operators are being directed to build out infrastructure to reach rural areas.
That has provoked a suit from NCTA — The Internet & Television Association, also complaining about increased compliance costs and competitive harm while alleging conflict with the Federal Cable Act and more First Amendment injury.
"Just as newspaper publishers make placement and presentation choices, cable operators exercise 'a significant amount of editorial discretion' by determining the best and most efficient way to provide programming on their cable systems for the benefit of their customers," states this injunction bid. "Although cable operators may not exercise editorial control over the content of PEG programming, NCTA members do exercise editorial discretion in deciding how to use scarce bandwidth. Yet because the Maine Act requires cable operators to devote bandwidth to broadcast PEG channels not just in HD (which uses four times as much bandwidth as SD), but in both HD and SD, this leaves operators with less bandwidth for other programming, services, and content they would prefer to deliver. The Maine Act thereby overrides cable operators’ editorial discretion."