The DISH Network Blackout

Nearly 5 million households receiving their
paid TV service from DISH Networks lost access to 129 local TV stations in 36
states operated by Sinclair Broadcast Group late yesterday in the largest
single TV blackout in history.

DISH claims the
companies had reached an agreement on rates and all other terms for the
carriage of Sinclair’s local stations, but that Sinclair pulled its
stations to gain leverage in carriage negotiations for a cable channel that
Sinclair is aiming to buy. Broadcasters
tying retransmission of local TV stations to higher rates for cable channels
and online content rights is a trend that has fueled more blackouts.

Broadcast network blackouts on pay TV systems are at an all-time high, rising to 145 so far this year compared to
107 last year and just 12 in 2010. SNL Kagan projects that the retransmission
revenue broadcasters collect for “free” TV will rise to $6.3 billion in 2015,
$7.2 billion in 2016, and $10.3 billion by 2021.

The following can be attributed to Michael Calabrese, who directs the Wireless Future Project at New
America’s Open Technology Institute:

“The current rash of TV
channel blackouts result from a broken market that is itself a product of antiquated
laws and regulatory neglect. Long ago the government gave Sinclair and other
local TV stations free use of the public airwaves, a subsidy now worth
billions. In exchange, Sinclair’s primary public interest obligation is to
broadcast their content free over the air.

“Instead, like many broadcasters, Sinclair is holding millions of
consumers hostage to its demand for higher and higher cable carriage rates that
are ultimately passed along to those same consumers. The FCC needs to end these consumer blackouts
by imposing a system of alternative dispute resolution that includes mediation
and baseball-style arbitration if needed.”