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Topeka Letter

Topeka Letter

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Published by: tvnewser on Jul 13, 2011
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Giant Communications | Mediacom Communications | Rainbow CommunicationsTwin Valley Communications | WTC Communications
July 13, 2011Governor Sam Brownback State of KansasCapitol, 300 SW 10th Ave., Ste. 241STopeka, KS 66612-1590
Re: FCC Must Prevent Massive TV Signal Blackout In Topeka
Dear Governor Brownback:Television stations in this country are granted licenses to use the public airwaves in return for a promiseto operate in a manner that serves the public interest. The Federal Communications Commission (FCC),charged with the responsibility of ensuring that stations meet their public interest obligations, hasrecognized the importance of promoting competition and diversity in the television marketplace to protectconsumers from market failures that reduce choice and shoot prices skyward for an extended period.Unfortunately, a predictable market failure with severe negative consequences will reduce competitionand diversity and hammer more than 150,000 pay-television subscribers early next year in Topeka, Kan.,
if the federal government evades its obligation to promote robust competition among the community’s
powerful ABC, CBS, NBC and FOX television stations.Our immediate cause for concern is the pending sale of Topeka's ABC affiliate KTKA to PBCBroadcasting. Topeka's NBC and FOX stations are already commonly owned by a third entity called NewVision Television. In other areas of the country
including Youngstown, Oh., and Savannah, Ga., whereboth PBC Broadcasting and New Vision own television stations -- these station groups coordinate theiractivities, particularly with regard to carriage negotiations with cable, satellite and other pay-TVproviders for the purpose of charging the highest possible carriage fees.This much is quite clear: If the FCC approves the sale of KTKA without appropriate conditions, PBC andNew Vision will have a green light from government to form an unprecedented local station triopoly,controlling pay-
TV providers’ access to three of the market’s Big Four stations. Absent government
intervention, the Topeka Triopoly will use its market clout to stage massive signal blackouts until pay-TVproviders, especially vulnerable small and midsize cable operators, cough up an outrageous pile of cash.Under the 1992 Cable Act, pay-TV providers must obtain retransmission consent from local TV stationsto carry their signals. As consumers know all too well, retransmission consent fees have been goingthrough the roof for many years because of the market power that local TV stations derive from theirability to exploit outdated federal regulations that are clearly at war with the free enterprise system. SNLKagan estimates that "retrans" fees will soar to $3.6 billion by 2017, twice what they are today. However,the harm to consumers is made even worse when separately owned broadcasters in the same market alsocollusively coordinate their negotiations.The stakes in Topeka could not be higher. Topeka is a major television market with nearly 180,000television homes served by 13 cable operators along with two satellite TV providers. Small cablecompanies offer service to 30,000 households within a 17-county boundary. Many pay-TV providersmust renew their retransmission consent contracts with KTKA by Dec. 31, 2011. A pay-TV provider that
won’t kowtow to the Topeka Triopoly will lose access to ABC, NBC and F
signals on New Year’s

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