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NCTA: Multicast Laws Could Spur Litigation

Sep 7, 2005  •  Post A Comment

Legislation that forces cable TV operators to carry all of the free programming services that broadcasters multicast on digital TV channels could be met by cable TV industry lawsuits that would cost the federal government billions of dollars.

That was the warning from Kyle McSlarrow, president and CEO of the National Cable & Telecommunications Association, during a press briefing Wednesday. Mr. McSlarrow said a multicast must-carry rule could expose the federal government to financial liability because it could be construed as a “taking” of cable TV property rights under the Fifth Amendment.

During the briefing the NCTA also released a study that put a value of $4.2 billion to $115 billion on the cable TV bandwidth cable operators would lose under a multicast-carriage regime. Mr. McSlarrow said the cable TV industry had yet to decide whether to sue to collect what it would regard as “just compensation” for the use of its bandwidth.

“Of course it’s a possibility,” he said. “You could go into court and file a claim.”

During the briefing, Mr. McSlarrow also repeated the cable TV industry’s contention that a multicast-carriage requirement would violate the cable industry’s First Amendment rights.

A legal analysis released Tuesday by the NCTA contends that a rule would run afoul of Fifth Amendment prohibitions on the seizure of property without just compensation. “The marketplace is the right place to decide these issues,” Mr. McSlarrow said in the briefing.

Said a spokesman for the National Association of Broadcasters in response: “NCTA’s monopolistic plea for less competition and reduced program choice for consumers rings hollow. This is the same discredited argument made by NCTA in 1992, when the U.S. Supreme Court upheld rules that resulted in an explosion of new programming options for viewers. We’re optimistic that Congress will reject the call of the monopolist and embrace more choice for local television viewers.”

The tough talk from cable comes as NAB pursues an all-out campaign to include a multicast-carriage provision in DTV legislation that is being considered in Congress.

As part of the NAB campaign, up to 100 TV station executives are in Washington this week to lobby lawmakers. “Over the next couple of weeks, we’ve got a lot of people coming in too,” said Mr. McSlarrow. “Whatever the arguments are that are being made by the NAB, we are going to counter.”