Small cable companies say the cost of programming is hurting their business, and they’re placing the blame partly on bigger cable operators like Comcast and Time Warner Cable.

Cable TV companies complaining about programmers charging high rates is nothing new. Even the very biggest cable companies in the nation, despite having great negotiating power relative to small operators, complain about the ever-rising cost of video programming.

Thus, there are continuous disputes between cable companies and programmers. But it's more complicated than that because the big cable companies also own a lot of TV networks, pitting them against small cable companies who have to buy programming from them.

Comcast, for example, owns NBCUniversal and a bunch of regional sports networks. Time Warner Cable (TWC), which could be acquired by Comcast, also owns regional sports networks and has had tense negotiations with cable operators over programming fees.

Now the small cable companies are asking the Federal Communications Commission to intervene, arguing that they need to be protected from “cable-affiliated programmers” charging discriminatory rates. The argument came Friday in a filing by the American Cable Association (ACA), which represents more than 800 small cable operators, telephone companies, municipal utilities, and other telecommunications providers in small communities and rural areas.

The "cable-affiliated" label is applied to programmers that are at least five percent owned by a cable operator, ACA spokesperson Ted Hearn told Ars. "Comcast/NBCU meets this definition, but CBS, Viacom, Time Warner [that's Time Warner Inc., not the cable company], and Fox and Disney do not," he said.

The ACA summarized the money problem small cable operators face in two charts:

While video programming costs more than doubled between 2006 and 2014, "providers have not been able to pass along to their customers all of the increases in programming fees" because of competition from other MVPDs [multichannel video programming distributors] and online providers like Netflix and Amazon Prime, the ACA said. Broadcasters sometimes try to force cable operators to pay higher rates by taking programming off the air or even by blocking online access to content, the ACA wrote.

The problem isn't just related to cable-affiliated programmers. But the ACA's suggested rule changes include some that specifically target the cable-affiliated programmers. For example, consortiums that purchase programming in bulk on behalf of small operators, such as the National Cable Television Cooperative, should be able to protest discriminatory rates, the ACA wrote. The ACA also wants greater access to "standstill" requests that keep the terms of an expired contract in place, preventing programming from being taken off cable networks during contract disputes.

"The Commission’s program access rules should be updated to preserve and protect competition in video distribution markets, including by ensuring that an MVPD buying group, like the National Cable Television Cooperative ('NCTC'), has the right to bring a complaint against a cable-affiliated programmer who imposes discriminatory rates, terms, and conditions," the ACA wrote. "In addition, the Commission should ease the burden on aggrieved MVPDs and their buying groups to bring complaint cases and standstill requests against cable-affiliated programmers through the use of rebuttable evidentiary presumptions."

The ACA also wants the FCC to take a harder line against exclusive programming contracts between cable-affiliated programmers and cable operators. (The FCC allowed a ban on exclusive contracts to expire in 2012.)

The ACA is taking a somewhat roundabout approach in its complaint to the FCC. Although the fees being disputed are for TV programming, the consortium is making its case in a proceeding that concerns broadband Internet deployment. The FCC’s Section 706 authority granted by Congress in 1996 requires the commission to accelerate deployment of broadband to all Americans “by removing barriers to infrastructure investment and by promoting competition in the telecommunications market.” The ACA is arguing that the high programming costs are a barrier preventing small cable companies from boosting broadband networks, because they have to offer TV programming in packages bundled with Internet access to remain financially viable.

The National Cable & Telecommunications Association, which represents cable operators serving more than 90 percent of cable customers nationwide, declined to comment on the ACA's filing.

Time Warner Cable gets a special shoutout

While the high programming costs extend beyond programmers owned by cable companies, it's Time Warner Cable and its SportsNet LA network that provides the most specific example in the ACA's filing.

“ACA is not alone in its concern about the high costs of video programming. Many have recognized that excessive video programming costs may inhibit advanced telecommunications capability network investment,” the ACA wrote. “Last summer, for example, [FCC] Chairman [Tom] Wheeler wrote to the Chief Executive Officer of Time Warner Cable to inquire about the high price it was charging MVPDs to carry its regional sports network, SportsNet LA, and stated that he was ‘concerned about the negative impact that this dispute may have on the growth of broadband services in the Los Angeles area.’ The Commission thus should welcome the evidence that ACA presents in these comments, which demonstrates that excessive and increasing programming costs may harm network investment and deployment, and use it to act promptly on ACA’s recommended solutions.”

The TWC situation was a complicated one. In 2013, "Time Warner Cable entered into a 25-year agreement valued at more than $8 billion with the [Los Angeles] Dodgers to distribute SportsNet LA, but their inability to reach carriage agreements with other multichannel distributors has left about 70 percent of the region unable to access the games," Variety wrote in July 2014.

Responding to the ACA's filing, Time Warner Cable pointed to the high price of sports content. “SportsNet LA is available on fair terms consistent with its value, and in line with the price of other regional sports networks," a TWC spokesperson told Ars. "We agree sports content is expensive, which is why we made a long-term agreement with the Dodgers to rein in rapidly rising sports costs and deliver world-class content.”

With Comcast trying to buy Time Warner Cable, Sen. Al Franken (D-Minn.) warned that the merger could help Comcast raise the cost of programming for its rivals. Comcast argued that it can't just charge whatever it wants because it has plenty of competition from online video providers and points out that it has to pay huge programming costs itself. "Our programming costs have increased by over 130 percent over the past 10 years while our consumer pricing has increased at about half that rate," Comcast Executive VP David Cohen wrote last year.

The ACA's filing has some recommendations that address the cost of programming industry-wide rather than just for programming owned by cable companies. Broadcasters, the ACA said, should be required to continue offering video signals to consumers after retransmission consent agreements expire “and while the terms of a new agreement are pending resolution of a dispute.” Blocking an online content company should also be a violation of “good faith rules,” the ACA said.

The ACA complained about "the practice engaged in by some broadcast stations to block an MVPD’s broadband customers from accessing their online content, which is made freely available, during a retransmission consent dispute with that MVPD. This practice is intended to drive up prices for retransmission consent for linear broadcast station carriage and not only harms innocent broadband consumers but also is inconsistent with the Commission’s open Internet policies."