Comcast Sues Maine To Stop Law Requiring Sale Of Individ. TV Channels

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COMCAST VS À LA CARTE —

Comcast sues Maine to stop law requiring sale of individual TV channels

Industry suit says Maine law violates First Amendment and Communications Act.

JON BRODKIN - 9/10/2019, 9:54 AM


Comcast and several TV network owners have sued the state of Maine to stop a law that requires cable companies to offer à la carte access to TV channels. The complaint in US District Court in Maine was filed Friday by Comcast, Comcast subsidiary NBCUniversal, A&E Television Networks, C-Span, CBS Corp., Discovery, Disney, Fox Cable Network Services, New England Sports Network, and Viacom.


The companies claim the Maine law—titled "An Act To Expand Options for Consumers of Cable Television in Purchasing Individual Channels and Programs"—is preempted by the First Amendment and federal law. The Maine law is scheduled to take effect on September 19 and says that "a cable system operator shall offer subscribers the option of purchasing access to cable channels, or programs on cable channels, individually." The lawsuit seeks an injunction to prevent the law from being enforced.


Many cable TV customers want the ability to pay for channels individually instead of in large bundles, in hopes of getting only the channels they want and saving money in the process. But cable TV operators and the programmers that license their content to cable TV operators have resisted changes to the bundle system.


"I submitted this bill on behalf of Maine's hundreds of thousands of cable television subscribers," Representative Jeffrey Evangelos, an independent, said in testimony when the bill was being debated in March. "For far too long, consumers have been forced to purchase cable TV packages which include dozens of channels the consumer has no interest in watching."

Comcast cites First Amendment rights

But the current system involving service tiers and bundling "reflect[s] the exercise of First Amendment rights—both by the programmers who decide how to license their programming to cable operators, and by the cable operators who decide how to provide that programming to the public," the industry lawsuit said.


Besides the First Amendment, the lawsuit says that "an array of federal statutory provisions precludes Maine from dictating how cable programming is presented to consumers." The state law "is expressly preempted by several provisions of the Communications Act," including a section that "prohibits state and local authorities from regulating the 'provision or content of cable services, except as expressly provided in' Title VI of the Communications Act," the lawsuit said.


The Maine law is also preempted by Communication Act sections that prohibit local franchising authorities "from regulating 'the services, facilities, and equipment provided by a cable operator except to the extent consistent with [Title VI],' or from 'establish[ing] requirements for video programming,' except in very limited respects not applicable here," the industry argued.


Moreover, Comcast and the programming companies argue that forced à la carte pricing would end up costing consumers more.


"Programmers often negotiate license fees with cable operators based on tiered carriage, and eliminating such carriage would force programmers to charge higher license fees to cable operators, which ultimately would be passed on to subscribers," the complaint said.

“Thin legislative record”

Evangelos argued in his legislative testimony that Maine can take action because of a Federal Communications Commission statement that "There is no law that requires (or prohibits) cable companies to offer channels or programs on an à la carte basis."


"Therefore, since there is no federal regulation prohibiting à la carte pricing, it is within a state's authority to add this option for Maine's local franchising authorities," he said.


But the industry complained that the "thin legislative record" generated by lawmakers didn't meet the state's legal burden. The industry also complained that the Maine law applies only to cable companies and not to competitors such as satellite TV operators and online streaming providers.

We contacted Maine Governor Janet Mills' office about the lawsuit and will update this story if we get a response.


Defendants named in the lawsuit are Mills, Maine Attorney General Aaron Frey, and the municipalities of Bath, Berwick, Bowdoin, Bowdoinham, Brunswick, Durham, Eliot, Freeport, Harpswell, Kittery, Phippsburg, South Berwick, Topsham, West Bath, and Woolwich. The lawsuit was filed against municipalities because they would have the authority to enforce the state law. That list covers Maine municipalities where Comcast has franchise agreements.


The cable company Charter also opposed the Maine law but isn't involved in the lawsuit.


In a statement provided to Ars, Comcast and the TV networks said that "Maine's à la carte mandate is prohibited under federal law and is unconstitutional... the law is not only unnecessary, but also likely to suppress competition and result in higher consumer prices and less program diversity."


https://arstechnica.com/tech-policy/2019/09/comcast-tv-networks-sue-maine-to-stop-law-requiring-a-la-carte-channels/

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Comments (10)
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bob_cville

Good for Maine. The claims that the First Amendment somehow protects their right to gouge money from their customers by charging them for more than they want seems not very well founded.

If this goes through I can see other states following suit. Perhaps the other states can use the rallying cry "Remember the Maine mandate"

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JodiK

Cable, satellite... it's all a waste of money. Who wants to overpay for a bunch of channels they have no interest in watching? And that's what one gets. And if you want better movie or other channels, the rate you pay is much higher!


Not worth it. No, thanks. It's easier and less expensive to stream the shows and movies you want.

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maifleur01

I am not certain that this is a good thing. It may be for those that only watch a couple of channels but for a family who has multiple tvs and favorite channels it could be a financial disaster if cable companies would decide to do this in all markets rather than the current bundling system. Once the providers can recode their systems to offer individual channels and shows and then switch to show by show selection cable and other types of providers including places like Amazon and Hulu will also raise their prices. One of the things it might do is to prevent new shows from even being presented because people would have to know about them to ask for them in their selections which most people would not.

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gyr_falcon(Sunset 23)

In this, I side with Comcast. It is one of those things consumers latch on to (and then gets picked up by the politicians) as sounding better and less expensive, while the ultimate outcome will greatly disappoint. The smaller market channels will die, and the costs won't change as much as consumers imagine.

There are a lot of domino consequences that can happen even beyond the lack of production of new shows. This will starve the smaller channels even more, because they will lose viewership, and revenue. There will be moving of the advertising dollars from the smaller markets into the larger, bringing more concentrated revenue and higher business costs, and a possible increase in the amount of commercials. Add layoffs and unemployment.

New networks will not be able to launch and compete. The finale will be a few mega channels, and little choice, and no way for the market to broaden the selection within the system. What happens without competition? Higher prices. Get ready to pay at least as much as currently billed, for a lot less. Consumers will be sorry they asked for this.

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chijim

lurker111

This
will be the end of CNN and MSNBC. They survive off of cable subsidies.
Same for all of the Spanish speaking stations. I don't watch reality
tv or fake news so cable is a waste of money at this point.

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

This is from 2yrs ago - but even if MSNBC went up in $$$.....

Also if you didn'tknow MSNBC/NBC are owned by Comcast

Liberals keep Rupert Murdoch rich by paying their bundled cable bills.
Every month, local cable providers remit a portion of their bill to Fox
News, a portion to MSNBC, and a portion to each of the other channels in
any package. How much time is spent viewing any particular channel is
meaningless. Thanks to cable industry practice, every channel gets paid
no matter whether it’s viewed or not. And, according to Variety, Fox News makes $1.55 per subscriber while MSNBC makes only 26 cents.

https://www.bostonglobe.com/opinion/2017/07/26/liberals-cut-your-cable-cords/rBelLxLuDjASbEaJArnhjM/story.html

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miss lindsey (still misses Sophie)(8a)

Question: even if channels were offered individually, would this legislation prevent providers from also offering bundles?

Something like “buy x, y, and z channels and try channel 1, 2, or 3 for just $X more” or “add on one ‘surprise’ channel each month when you order 10 channels or more! If you like it, keep it for just $X extra!”

Would those types of incentives to buying be made illegal under this bill?

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Delilah66

Even if Maine is successful, the select-a-station user will get gouged.

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bob_cville

> Even if Maine is successful, the select-a-station user will get gouged.

Well it is the cable company, gouging their customers is kind of their go-to move.

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JodiK

I would think they'd actually gain customers if they offered packages where the consumer could pick and choose which channels they wanted... instead of being forced to pay for channels they'll never watch and don't want.

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maifleur01

If the companies offered the consumer the ability to pick and choose what they wanted that would no longer be a package but individual sales.

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