Print The Tennis Channel is launching a digital subscription service that puts a new spin on the established business model for TV sports programming. Beginning Sunday, the sports network will begin selling a programming package directly to consumers. The new product veers from the established order of the pay-television industry. At the same time, viewers increasingly are watching programming on mobile devices -- smartphones and tablets. And they are watching more than just short video clips.
Comcast filed exceptions to the Initial Decision in January of arguing that the ALJ misapplied the program carriage rules and that the remedy imposed violated the First Amendment.
The FCC found circumstantial evidence existed to conclude that: 1 Comcast had a general practice of favoring affiliates over non-affiliates; 2 Tennis Channel was similarly situated to Golf Channel and Versus; and 3 Comcast treated Tennis Channel differently from Golf Channel and Versus on the basis of affiliation.
Comcast argued that it had engaged in a cost-benefit analysis to determine the placement of Tennis Channel on the Sports Tier, but the FCC found the claimed analysis had failed to truly consider the benefits of wider distribution of Tennis Channel.
However, the FCC found the program carriage rules and remedy imposed were permissible, non-content based regulation that survived intermediate scrutiny. Likening the program carriage rules to the rules that prohibit cable operators from discriminating when selling or delivering affiliated programming, which were previously upheld by the D.
Circuit, the Commission found that while the rules may require some examination of content in determining whether there has been a violation, ultimately the rules regulate anti-competitive conduct and are not intended to encourage or discourage any particular type of content.
The remedy imposed was proper under intermediate scrutiny as it did not burden more speech than necessary to further the important government interest of promoting competition in the video distribution market.
Comcast argued that Tennis Channel had one year to bring a complaint from the date the parties entered into their carriage agreement in March The dissent also criticized the requirement that Comcast pay additional carriage fees to Tennis Channel if it complied with the decision by giving the channel wider distribution.
Such a requirement would, according to the dissent, ultimately harm consumers by causing MVPDs to protect themselves against future complaints by paying more to more widely distribute less appealing networks.