(Roberto Machado Noa/LightRocket via Getty Images)

As Americans increasingly watch their favorite channels go dark due to disputes between broadcasters and television providers, both sides of the escalating industry war are hoping to find a light at the end of the tunnel on Capitol Hill.

Cable and satellite providers are increasingly balking at the retransmission fees broadcast networks charge to run their channels, leading to a record number of blackouts through the first half of 2019. When the two parties can’t agree on the right price, the broadcaster’s channels get blacked out, leaving the customer in the dark.

Both sides of the industry battle are hiring armies of lobbyists to pitch Congress on why the other side is to blame for blackouts, which disportionately hit consumers in rural areas that rely on satellite providers. The lobbying and influence push comes as the 2014 Satellite Television Extension and Localism Act (STELA), which governs the way television providers and broadcasters negotiate fees, is set to expire at the end of the year.

Broadcasters want STELA to sunset, due in large part to its provision that allows satellite providers to air out-of-market programming rather than carry local stations. Television providers are pushing for the legislation to be extended with new rules to clamp down on retransmission fees charged by broadcasters, which have steadily risen and peaked at $10 billion last year.

The National Association of Broadcasters (NAB), a trade group for major broadcast networks including ABC, FOX, CBS and NBC, is making the case to Congress that cable and satellite providers are strategically creating blackouts to force reforms to retransmission fees.

NAB spent $6.9 million on lobbying through the first half of 2019. The group’s 48-person lobbying team includes 43 former government employees, three of whom are former members of Congress.

The trade group’s members aren’t shy about flexing their lobbying muscle in Washington. Formed after 21st Century Fox sold its film and television studios to Disney in March, Fox Corp reported spending $990,000 on lobbying in the second quarter of 2019. For the first time, Rupert Murdoch’s television company dispatched its lobbying chief Danny O’Brien, former aide to Vice President Joe Biden, as a registered lobbyist as it pushed for STELA to expire.

Multi-million dollar lobbying spender Disney is also lobbying on STELA’s sunset, and the massive broadcast network has launched its own public relations campaign to blame Dish Network and Sling for the loss of Fox Sports channels across the country.

On another wavelength, the satellite and cable backed American Television Alliance (ATVA) is placing the blackout blame squarely on broadcasters, calling on Congress to reform “outdated rules” that allow broadcasters to charge retransmission fees. The group also notes that if STELA were to sunset, hundreds of thousands of satellite customers would lose access to certain channels.

The group, which is bankrolled by satellite giants DISH Network and DirectTV owner AT&T, spent $370,000 on lobbying through the first half of the year. Its influence operation is run by Fierce Government Relations, a lobbying firm that deploys eight members of the revolving door including former aides to legislators on key committees.

The 501(c)(4) has deployed creative strategies to reach its preferred audience. ATVA has run more than $25,000 worth of Facebook ads since its page was launched in mid-June, targeting Washington, D.C., Virginia and Maryland residents almost exclusively as it makes apparent attempts to reach Washington lawmakers and their aides.

Currying favor

If campaign contributions build goodwill, both sides of the blackout battle have cultivated their fair share of it with key lawmakers overseeing the legislative process.

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Rep. Frank Pallone (D-N.J.), chairman of the House Energy and Commerce Committee that is considering STELA reauthorization, has already received $20,500 from affiliates of NAB in 2019, making the trade association his top donor so far this cycle.

The committee’s ranking member and former chairman, Greg Walden (R-Ore.), has raked in nearly $393,000 from affiliates of NAB, making the group his top all-time donor. On the other side, Comcast arrives as his second-largest donor at $195,250, while AT&T comes in sixth, giving $101,800.

Walden introduced the successful 2014 STELA reauthorization, which satellite providers enthusiastically celebrated and NAB begrudgingly supported.

NAB CEO Gordon Smith, a former U.S. senator from Oregon, has only contributed to a handful of lawmakers since leaving public office in 2009. Walden is his top recipient, receiving $9,600 since 2016.

Smith made the broadcasters’ case to Pallone and Walden’s subcommittee on STELA in June, arguing that satellite providers should air local channels rather than import distant signals.

“To put this in practical terms, DIRECTV subscribers in Ottumwa, Iowa, recently saw a news story about a garbage truck catching fire in Los Angeles,” Smith told the subcommittee. “The local news they should have seen is that of crop insurance prices rising and the impact on farmers across the Hawkeye State.”

Although a few members, including Reps. Jared Golden (D-Maine) and Michael Cloud (R-Texas), have come out in favor of letting STELA expire, cable and satellite providers appear to have an early leg up on their opponents.

House Minority Whip Steve Scalise (R-La.) and Rep. Anna Eshoo (D-Calif.), both situated on the key House committee, introduced legislation last week that repeals retransmission consent and introduces an outside arbitration system for stalled negotiations. Television providers cheered the bill, while broadcasters scoffed.

“Amid cord-cutting, growing video options and internet-based platforms, broadcasters use their special protections in current law to continue to demand price increases from the customers of cable and satellite distributors for TV programming that consumers watch less and less,” AT&T told Multichannel News in a statement.

The bipartisan bill is expected to be considered as the committee explores STELA reauthorization. In the upper chamber, Senate Commerce Committee Chairman Roger Wicker (R-Miss.) has expressed interest in reauthorizing the law.

Wicker receives much of his minimal campaign cash from various television interests, taking $103,600 from employees of BGR Group, a lobbying firm that represents cable giants such as Comcast and Cox Enterprises. Also among Wicker’s top 10 donors to his campaign and leadership PAC from 2015 to 2020 are Charter Communications ($75,100), NAB ($73,200) and Cox Enterprises ($70,500).

“I think it should be reauthorized …” Wicker told Politico in June. “Members of the committee are being thoroughly courted by all parties concerned from a variety of angles. And it’s not for me to say what the result will be.”

Legislators have so far placed their focus on consumers, stressing blackouts as the main problem that needs fixing. The urgency comes as 6.5 million AT&T customers continue to go without access to CBS channels — one of several disputes that have left viewers in the dark.



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