Network Affiliation Agreements Could Effect Channel Sharing
Network affiliation agreements could make it difficult for some stations to participate in channel sharing deals with stations they aren’t commonly owned with, broadcast attorneys, industry officials and an engineer told us. FCC officials have stressed the complexity of channel sharing deals in recent public appearances (see 1506160057 and 1506250060). The commission is holding a July 22 webinar on channel sharing and network affiliation agreements. The pacts are expected to inject additional complexity into the process because they often include specific bandwidth requirements, which could leave little bandwidth for potential sharing partners, said industry officials.
Sign up for a free preview to unlock the rest of this article
If your job depends on informed compliance, you need International Trade Today. Delivered every business day and available any time online, only International Trade Today helps you stay current on the increasingly complex international trade regulatory environment.
Although network affiliation agreements differ by network, some can have very high bandwidth agreements, said broadcast attorney Jack Goodman, who spoke about channel sharing on a recent FCBA panel. The high amount of bandwidth is necessary for content that involves a lot of movement or action, such as sporting events, said broadcast engineer Donald Everist of Cohen Dippell. Affiliation agreements are generally multiyear, and older ones tend to specify the higher bandwidth requirements, broadcast officials said. The effect on channel sharing will likely depend on the individual agreements, Goodman said. Some network affiliation agreements require a minimum amount while others use the phrase “nominal” in describing the bandwidth requirements, which gives broadcasters considering channel sharing more flexibility, Goodman said. "The network affiliation agreements can be pretty tight, from what we’ve seen," Everist said.
If a network affiliate wants to channel share, it can ask the network to be released from that portion of the agreements for sharing purposes, Goodman said. In some small markets, network affiliates already share space with other network channels, broadcast officials said. In those instances, the networks agree that the “host’ station will get the spectrum it needs while the newer station will operate at a diminished capacity, said an official. “I’m confident that the networks will understand the need to modify affiliation agreements," said Expanding Opportunities for Broadcasters Coalition Executive Director Preston Padden. The EOBC has lobbied on behalf of relaxed channel-sharing guidelines. Padden is a former Disney executive.
Few network affiliates are likely to seek channel sharing deals with stations owned by other broadcasters, said an industry official. The affiliates with valuable spectrum likely to go for high prices in the incentive auction won’t want to exit the business or share their bandwidth, the official said. Affiliates that would be likely to make a channel sharing agreement are mostly in small markets, where their spectrum won’t be worth enough to incentivize them to sell it, the official predicted. The FCC declined to comment.