February 19, 1999

February 19, 1999 | News Releases on Regulation

Channel-Surfing on Dead Air

WASHINGTON, FEB. 19, 1999-Bye bye, "X-Files." So long, "60 Minutes."

That's what satellite TV subscribers across the country will be saying when they lose access to major TV networks like CBS and Fox over the next few weeks. A U.S. District Court has ordered satellite TV providers to stop transmitting CBS and Fox signals to 700,000 viewers by Feb. 28 and to another 1.5 million by April 30.

Unfortunately, the steps being taken by Congress to correct this situation will only make the problem worse, a new paper by The Heritage Foundation says.

The broadcast television lobby triggered the court order by filing a lawsuit against satellite TV providers for transmitting out-of-town stations to their subscribers. Local TV affiliates say they lose advertising revenue when satellite TV viewers watch popular shows on out-of-town stations rather than on local stations. The court order affects about 2.2 million viewers in states such as Florida, North Carolina and Texas.

But the broadcast lobby is simply trying to protect local monopolies and deny customers a wider range of programming choices, according to Heritage analysts Bryan Johnson and Adam Thierer. Federal lawmakers should not allow broadcasters to unfairly eliminate legitimate competition, they write.

Yet lawmakers may end up doing just that. The Satellite Television Act of 1999, now pending before Congress, is supposed to fix the problem. But the bill would restore service only to a small number of satellite TV subscribers and would impose unnecessary regulations on the satellite TV industry, Johnson and Thierer say.

The analysts recommend several ways Congress can adopt a "consumer-first" approach to reform. For one, lawmakers should extend the court-imposed cut-off date so that satellite customers can continue to receive out-of-town stations until the broadcasters and the satellite industry arrive at a mutually agreeable solution. In addition, households that already subscribe to broadcast affiliates through a satellite provider should be "grandfathered" into any new arrangement.

"All television consumers should be able to purchase service from whomever they prefer and on whatever terms they can negotiate, and neither legislation nor regulation should stand in the way of such voluntary market transactions," the analysts write.

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