WASHINGTON, D.C. – Representative Edward J. Markey (D-MA), chairman of the House Subcommittee on Telecommunications and the Internet, held a hearing on sports programming, consumer choice and migration of sports programming to pay television services. The following is his opening statement from the hearing:
"Good Morning. The subject of today's hearing is competition
in the sports programming market.
"Competition, in
sports, is the essence of the game. In
sports, there are great teams and dynasties; there are compelling stories of
underdogs and come-from-behind victories; there are perennial favorites to win
championships and ....there are the Chicago Cubs.
"Yet sporting
events are premised upon great feats of athletic prowess and competition being
performed upon a level playing field.
That level playing field ensures that athletes engage in sporting
activities in a manner where their God-given talents and a compelling work
ethic and practice can result in success.
"Competition in the
marketplace, on the other hand, is what makes the consumer king. In our
national video marketplace, many programming competitors assert that the
playing field is not quite level at present.
They argue that compelling content and a solid business gameplan do not
even the odds against them. The field is
unfairly tilted toward cable operators or broadcast networks, competitors
claim, by a couple of key factors: 1) an insufficient number of cable providers
within a market through which they can effectively reach consumers, and 2) by
laws or regulations that either fail to achieve fairness as intended or serve
to reinforce the position of incumbent market leaders or risk unduly raising
prices.
"The consumer-fan,
they say, is the resulting loser in this environment.
"We have seen
several episodes over the last year in the sports programming marketplace that
highlight policy issues for this Subcommittee to explore. Early last year, there was the issue of Major
League Baseball's package of "Extra Innings," or out-of-market games slated to
be carried on DirecTV on an exclusive basis and complaints by Comcast and other
cable operators that this was unfair.
"There was the
effort by the Big Ten conference to successfully launch its cable channel
through carriage on the most broadly-watched tier on major cable systems. We saw the FCC intervene to declare that The
America Channel, which has rights to various sports content, was a "regional
sports network" for purposes of conditions imposed as part of acquisitions of
the Adelphia cable properties by Comcast and Time Warner. These conditions permit unaffiliated sports
networks to seek commercial arbitration when a carriage agreement with Comcast
or Time Warner cannot be reached. The
Commission is now considering proposals to adopt an expedited dispute
resolution process for all such unaffiliated programmers, including regional
sports networks.
"And the NFL
Channel, in a manner similar to issues raised by the Big Ten Conference, sought
carriage on the most broadly-watched tier unsuccessfully with several major
cable operators. Cable operators, for
their part, have objected to such carriage arguing that the price the NFL seeks
is too high, or point to the NFL's exclusive deal with DirecTV over the
so-called "Sunday Ticket," where consumer-fans can see all the Sunday football
contests, or their deals with broadcast networks or ESPN, as an examples
demonstrating that the NFL has other choices in the marketplace to distribute
games.
"Policymakers have
sought to remedy the lack of competition over the years. The program access provisions that I
championed as part of the 1992 Cable Act have created competitive alternatives
to incumbent cable operators - most notably from satellite providers - but also
from cable over-builders, telephone companies and others. Today's hearing will provide the Subcommittee
an opportunity to examine the effectiveness of these provisions in the
law. It will also allow us to analyze
the current marketplace for sports programming and assess the continued
migration of sports programming from broadcast television to pay TV services,
exclusive programming packages, the nature of cable tiering for sports
programming, the emergence of conference or league channels, and program
carriage issues generally.
"In the absence of
sufficient competition, the role of this Subcommittee historically, and the
role generally of the FCC, has often become that of a referee. Most refs simply prefer that the athletes
just play the game and don't like to intercede.
But the refs are here to step in when unfair play is perceived and to
make tough calls at times to safeguard the integrity of the game, or in this
case, to ensure fairness in the marketplace and consumer welfare.
"I wish to thank
our witnesses for their willingness to testify today and look forward to their
testimony. Thank you."
FOR IMMEDIATE RELEASE
March 5, 2008 |
CONTACT: Jessica Schafer, 202.225.2836
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