Justices deal loss to cable industry Operators must carry all local TV stations, Supreme Court rules

April 01, 1997|By Lyle Denniston | Lyle Denniston,SUN NATIONAL STAFF Sun staff writer Timothy J. Mullaney contributed to this article

WASHINGTON -- A deeply divided Supreme Court upheld yesterday a federal law that forces cable-TV operators to carry all the local TV stations in their areas, undercutting some of cable operators' control of their programming.

The 5-4 ruling settles a constitutional controversy that has spanned more than 30 years, testing the government's power to set aside some channels of cable operators for use without charge by competing local broadcasters.

With access to wider audiences through cable, local TV stations can attract more advertising and can survive more securely in an era of expanding cable offerings.

"Judgments about how competing economic interests are to be reconciled in the complex and fast-changing field of television are for Congress to make," Justice Anthony M. Kennedy wrote for the thin majority favoring the so-called "must-carry" rules.

The main argument behind the effort that produced a new cable law in 1992 was that broadcast TV, which anyone can receive free, was threatened by fast-growing for-pay cable programming.

About 40 percent of U.S. households do not subscribe to cable TV, and the broadcast industry convinced Congress that those homes could lose their television viewing entirely if local stations went under because they were blacked out by cable operators.

"Must-carry," Kennedy wrote, "is intended not to guarantee the financial health of all broadcasters, but to ensure [that] a base number of broadcasters survive to provide service to non-cable households."

Without must-carry rules, the court majority said, Congress was justified in believing that cable-TV systems would not include the offerings of local TV stations, thus threatening the very existence of free TV.

The decision promptly drew criticism from the cable industry.

Brian Lamb, chairman of the public affairs cable network C-SPAN, decried the ruling, saying that the "must-carry" rules have cost his system 3.5 million viewers nationwide because C-SPAN was blacked out to make room for local broadcast stations.

Daniel Brenner, vice president for law of the National Cable Television Association, said the ruling would mean that "the marginal broadcaster who needs to be carried takes up space that could have been given to new programming."

Only the "marginal" stations, Brenner argued, need guaranteed access. Cable-TV systems routinely pick up the most popular programming offered by local broadcasters and demanded by cable customers.

Local reaction

In the Baltimore area, local broadcasters said they were pleased by the decision.

"I think for all broadcasters it's a decisive victory," said Phil Stolz, general manager of WBAL-TV, Channel 11, the NBC affiliate. But Stolz said the issue was never a make-or-break one for most network affiliates because they have enough market power to keep most cable systems from dropping them -- an advantage that small independent stations lack.

Patrick J. Talamantes, director of corporate finance at Sinclair Broadcasting Group Inc. in Baltimore, which owns Fox-45 and provides programming to WNUV-TV, Channel 54, said that local stations that benefit from must-carry rules "are becoming increasingly important in a multichannel world, because local stations are the only things that differentiate the cable companies from satellite broadcasters."

But Comcast Cable Communications Inc., which provides cable to most of Baltimore, Howard and Harford counties, said the decision preserves the status quo.

"We have consistently honored our legal obligations to carry all qualified local broadcast TV stations on our systems, and we will continue to do so," said Thomas G. Baxter, president of Comcast.

The "must-carry" rules were enacted by Congress three years ago. Previously, lower courts had struck down attempts by the Federal Communications Commission to require cable operators to carry local stations.

Yesterday, with Justice Stephen G. Breyer, new on the court since the prior decision, providing the decisive fifth vote, the court found the rules constitutional.

Reasoning

The majority said it was not judging whether free TV needed guaranteed access to survive. But it said Congress had reason to believe that free television was under threat from for-pay cable's growth and that the court was not free to second-guess that belief.

The cable industry, the majority found, has not been seriously harmed by the must-carry requirement. Out of 500,000 cable channels nationwide, only 5,580 have been set aside for local broadcast stations as a result of the rules, the majority noted.

The dissenting justices noted, however, that an additional 30,006 channels on cable are also being used by broadcast stations or networks. Those channels now cannot be dropped even if the cable operator found something preferable for its viewers.

Justice Sandra Day O'Connor, writing for the dissenters, said the majority belittled the impact of the rules on the cable operators' First Amendment rights.

The court majority, besides Kennedy and Breyer, included Chief Justice William H. Rehnquist and Justices David H. Souter and John Paul Stevens. Dissenting along with O'Connor were Justices Ruth Bader Ginsburg, Antonin Scalia and Clarence Thomas.

Pub Date: 4/01/97

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