ECHOSTAR CHALLENGES FCC ON PROGRAM ACCESS DECISION
EchoStar faced tough questioning in U.S. Appeals Court, D.C., Tues., in bid to overturn FCC order that denied its program access complaint against Comcast involving delivery of SportsNet regional programming in Philadelphia area. FCC said Comcast didn’t have to provide network to DBS operator because program access rules only apply to satellite- delivered networks. Other satellite companies could lose sports programming if regional cable operators elect to use terrestrial network rather than satellite links. EchoStar attorney Pantelis Michalopoulous said decision was clear evasion of FCC rules and unfair practice. FCC attorney Louis Peraertz said he could find no motive for decision and David Mills, representing Comcast, said it was strictly business decision, citing $500,000 saved by using terrestrial network.
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Three-judge panel focused most of questioning in oral argument on why EchoStar thought Comcast decision to circumvent regulations by using terrestrial instead of satellite networks was unlawful, since decision saved company money. Chief Judge William Ginsburg called EchoStar case “fishing expedition.” Michalopoulous replied: “The legal standard is Comcast trying to evade the rules. The [Commission] finding is a red herring.” Judge Harry Edwards said “bad feelings in business deals don’t matter.”
Decision by Comcast to roll out programming as new service also weighs heavily on decision. “Our conclusion might be different if they had moved from satellite to terrestrial,” Peraertz said, “but they took 2 existing services and created one.” He said Commission also came to its conclusion because EchoStar “didn’t present their own analysis in the case.” He said FCC found it took $600,000 less for terrestrial than satellite. Peraertz said SportsNet wasn’t national network so it was unnecessary for Comcast to purchase more satellite equipment.
Commission “closed door to the facts and didn’t allow any discovery in Comcast markets” that would have shed more light on case, Michaloupous told us after hearing. Bottom line is that “people in Philadelphia can’t get SportsNet because Comcast blocked it,” official close to EchoStar said. Mills said he thought hearing went very well for Comcast.