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FCC Closes Loophole in Cable Program Access Rules for Sports Networks

Thu, 01/21/2010 - 6:56am
Joelle Tessler, AP Technology Writer

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WASHINGTON (AP) -- Cable TV companies will no longer be able to use a federal loophole to withhold sports networks and other popular programming that they own from satellite providers and other rivals.

The Federal Communications Commission voted 4-to-1 on Wednesday to close the so-called "terrestrial loophole" in a 1992 federal cable law.

Under that law, a cable TV provider must let competitors carry any channel it owns if satellite connections are used to transmit the channel to the individual cable systems around the country. Until now, the provision didn't apply when cable operators sent programming over land-based networks instead.

Satellite providers and phone companies that offer subscription TV services complain that big cable operators have exploited that quirk in the law to deny them access to must-have programming, particularly regional sports networks.

Cable companies have been using the loophole to keep San Diego Padres games off AT&T Inc.'s U-Verse video service and Philadelphia sports teams off DirecTV Inc. and Echostar Corp.'s Dish Network satellite systems, for instance.

"Consumers who want to switch video providers should not have to give up their favorite team in the process," said FCC Chairman Julius Genachowski.

That sentiment was echoed Wednesday by the cable industry's key competitors.

"The FCC gave sports fans a reason to tailgate today by adopting rules to bring sports programming to more video providers," AT&T Senior Vice President Bob Quinn said in a blog post. "Ultimately, this means consumers will have more choices in how and from who they receive programming they want."

DirecTV called the FCC vote a "big win for consumers and fair competition in the marketplace."

The one dissenting FCC vote came from Robert McDowell, one of agency's two Republicans. He said the commission does not have the authority to close the loophole.

Cablevision said the new rules do not mean that it will automatically have to make its high-definition sports programming available to AT&T and Verizon. In a statement, Cablevision said if the phone companies file a complaint, it could prove that any troubles they have competing have nothing to do with the sports channels.

Comcast, Cox and the National Cable & Telecommunications Association, an industry trade group, had no comment Wednesday on the new FCC rules. But in the past, cable companies have argued that the terrestrial loophole helped them differentiate their offerings in a highly competitive business.

Time Warner Cable Inc. does not use the terrestrial loophole to withhold programming from competitors.

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