APTS, cablers craft digital carriage deal

Originally published in Current, Jan. 31, 2005
By Jeremy Egner

The Association of Public Television Stations has struck a deal with the cable industry in which major cable operators will guarantee to carry as many as four program streams from all public television stations in their markets once the digital TV transition is complete.

Public TV regards multicast carriage as essential if it is to take full advantage of digital broadcasting capabilities. Cable companies now are required to carry only stations’ primary video feeds—analog or digital—in the present period before the DTV transition is done.

The agreement, yet to be ratified by stations, would be triggered when stations give back their analog spectrum. It will not affect multicast deals that stations or PBS have already negotiated with cable operators. Over-the-air digital viewers can already pick up all streams that stations transmit.

APTS President John Lawson and retiring National Cable and Telecommunications Association head Robert Sachs will announce and sign the agreement at a Washington press conference this week. [Text of APTS announcement, Jan. 30, 2005.]

The deal awaits approval by the PBS Board and must be ratified by pubTV stations serving at least 80 percent of TV households, including a majority of the top Nielsen-rated stations in each market. Major cable carriers must give their blessing as well, but an NCTA executive committee composed of reps from the largest companies has already approved the plan, Lawson says.

Observers see a PTV carriage deal as a way for the cable industry to engender political good will and possibly stave off federal efforts to mandate must-carry on a wide scale. NCTA staff did not return calls for comment.

The must-carry issue has been a source of contention between cable and broadcast lobbyists. Cable reps have maintained that such a requirement would violate their first amendment rights; broadcasters counter that with so many consumers getting their TV via cable, there would be little incentive to create multiple streams unless they could be sure people would see them.

The FCC has waffled on digital must-carry. Though a carriage mandate was part of outgoing Media Bureau Chief Ken Ferree’s transition plan, Chairman Michael Powell, who also resigned recently, suggested the commission might push for its transition plan without must-carry.

Public TV’s deal is the product of 16 months’ negotiation with the NCTA. Multicast carriage rights are a cornerstone of Lawson’s early giveback, digital-only-broadcasting strategy.

The following are the principle components of the deal:

All cable systems with total bandwidth of 750MHz, the standard capacity for most digital cable operators, will carry the streams transmitted — up to four per station — by all the public TV station in a market.
Cablers cannot degrade digital signals—station or PBS HD channels must be offered at the same bitrate as HBO HD, for example—and must not relegate pubTV streams to hard-to-find channels.
Complicated program duplication limits discourage pubTV stations from running the same programs as each other or airing the same schedule on several streams. But stations are rewarded with looser limits if they provide the HD and kids’ channels that cable companies covet.
Cablers pledge to carry program-related datacasting and other ancillary services for education and public safety.
Stations are free to negotiate different terms with local cablers; the national deal serves only as a “floor” agreement.
As long as analog broadcasting continues, cable will carry both the primary analog and digital streams of at least one pubTV station per market.

APTS consulted with stations extensively throughout the negotiations and is optimistic that they’ll okay the deal, Lawson says.

In the labyrinthine rules that discourage duplicated schedules, the gold standard is the top pubTV station in the market, as chosen by the cable operator. Smaller stations, ranked by audience size, are permitted to duplicate descending percentages of its schedule.

For example, the second station in a market could air 70 percent of the monthly schedule of the top station, and each smaller station is allowed less duplication. Cable operators will count programs as duplicated only if they are the same episodes.

The duplication restrictions apply only to content that has been broadcast and not to programming on direct-to-cable channels such as the planned PBS Kids channel to be launched this year in partnership with Comcast.
“I’m not sure not all stations will see it as a perfect agreement,” Lawson says, “but without it it’s hard to see how we could . . . fully realize what digital broadcasting can do for us.”

John Boland, executive v.p. in charge of content for San Francisco’s KQED, sees promise for a more diverse pubTV presence on cable. However, Comcast, which has deals with many major-market stations, carries all five of KQED’s digital streams but none from smaller Bay Area stations.

Nashville PTV is among the pubcasters whose local cable operators are uninterested in multicast carriage. NPT consequently airs only one digital stream, says President Steve Bass, because local cablers won’t carry any more.

Text of APTS announcement

Agreement Provides Public Television with Digital Cable Carriage During and After the Digital TV Transition, Jan. 30, 2005

U.S. cable consumers will be able to enjoy the rich diversity of high-definition, educational and children’s programming provided by the nation’s local Public Television stations for the foreseeable future under a major digital cable carriage agreement announced today by the Association of Public Television Stations (APTS) and the National Cable & Telecommunications Association (NCTA).

The “Public Television Digital Cable Carriage Agreement” ensures that local Public Television stations’ digital programming will be carried on cable systems serving the vast majority of the nation’s cable subscribers. Further, it provides significant digital cable carriage incentives for local Public Television stations to produce more high definition, children’s and local programming. It also recognizes and enhances the unique role that public broadcasters play in national homeland defense efforts and provides for cable carriage of additional emergency public safety information.

There are currently 356 Public Television stations in the U.S. As of the end of January, digital signals from about 100 Public Television stations were being carried by cable systems.

A number of Public Television stations have created, or are planning to launch, new and differentiated programming via their digital signals. For example, the New Jersey Network (NJN) already has a digital channel lineup that includes digital distribution of NJN's regular channel, a channel for adult learners, a children’s channel, and “NJN JerseyVision”, which features all locally-produced news, public affairs, and other programming. NJN also provides a channel of High Definition (HD) programming that features a combination of NJN’s own HDTV productions and special wide-screen and HDTV presentations distributed by PBS and other program sources. Similarly, Thirteen/WNET and WLIW use their digital resources to provide cable viewers in the New York metro area with a suite of digital channels that include “World”, “Create”, “Kids”, and “Thirteen HD”. These examples show how multicast carriage enables local Public Television stations to draw on substantial programming libraries to offer their viewers a wealth of new series and specials.

APTS President & CEO John Lawson said: “This agreement is truly historic. Securing cable carriage of America’s local public television stations’ digital offerings achieves one of the most important strategic objectives of our industry. Our stations developed extensive plans to use multicasting to provide new programming and services that meet the educational and public safety needs of the communities they serve. This agreement enables local stations to focus their resources on developing new digital content with the confidence that cable subscribers in their communities will be able to benefit from these services.”

NCTA President & CEO Robert Sachs said: “Public TV for many years has been an important outlet and educational resource for millions of Americans. Cable operators recognize that public TV has been a leader in producing new and compelling digital television content. Through the agreement, the cable industry is ensuring that our customers will benefit from the quality and creative non-commercial PTV digital content that is available today, and will be offered in the future.”

APTS was assisted in its negotiations by the Public Broadcasting Service (PBS).

Pat Mitchell, president & CEO of PBS, said: “PBS has been building a positive relationship with cable for many years. We, in support of our member stations, are pleased to have played a part in bringing this significant agreement together. The progress made between APTS and the NCTA in addressing the issues and our concerns is commendable. Final action on the agreement is on the agenda of the PBS Board of Directors meeting this week.” One significant benefit of the agreement is that it represents the resolution of complex digital TV issues through private contractual negotiations rather than government mandate, giving Public Television stations and cable operators the ability to make long-term business plans without the uncertainties that often accompany legislative or regulatory solutions to complicated business issues, said APTS and NCTA.

Terms of the unprecedented carriage agreement include:

· During the period when Public Television stations are broadcasting both in analog and digital formats, upgraded cable systems that offer High-Definition Television (HDTV) will carry up to four streams of free non-commercial digital broadcast programming and associated material from one Public Television station in a market, if a station chooses to distribute that many streams, in addition to the station’s analog signal.

· After all TV stations in a market are transmitting only digital signals, upgraded cable systems that offer HDTV will carry free non-commercial digital programming of each local must-carry Public Television station. This carriage may include four streams of free non-commercial digital programming and associated material, subject to reasonable programming duplication parameters.

· Any Public Television station that decides to shut off analog transmission and broadcast in digital-only before the DTV market transition may choose to have its digital signal carried on the upgraded local cable system at that time.

The Public Television Digital Cable Carriage Agreement does not supersede existing pre-transitional digital carriage agreements among Public Television stations and cable systems. The existing agreements would remain in effect until they expire. Following approval by the Boards of Directors of APTS, NCTA and PBS, within 60 days the agreement must be ratified by Public Television stations in markets that comprise 80 percent of U.S. TV households, and by cable Multiple System Operators (MSOs) representing at least 80 percent of cable subscribers. The MSOs will begin carrying Public Television stations pursuant to the agreement within 180 days of its ratification.

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