DIRECTV Chief Content Officer Rob Thun told Cord Cutters News last week that the ongoing disputes with local broadcast companies has him considering whether the pay-TV provider should just drop local ABC, CBS, FOX, and NBC affiliates altogether. In a follow-up interview with StreamTV Insider, Thun floated an idea about how he would do this: Swapping out all the different local programming for the national network feed instead.
Thun is in the middle of a dispute now, with DIRECTV unable to come to terms with Tegna for a new distribution agreement, which has resulted in 64 local stations in 51 markets going dark. Thun told Cord Cutters News the two sides were “extremely far apart.”
He added that the dynamic of local broadcasters continuing to seek higher retransmission fees from pay-TV providers isn’t sustainable, since they ultimate are passed down to consumers and hasten the already accelerating wave of cord cutting. There’s a point where Thun said it may make sense to cut local stations out of the equation. “We don’t need the stations to deliver the network content — we can go get it from the network,” he told StreamTV Insider.
That’s a bold suggestion from Thun, although it’s unclear if DIRECTV could even implement that plan. Federal regulations require traditional pay-TV providers like DIRECTV to work with and carry the feeds of local broadcasters, and it’s barred from a network feed to replace local stations. The exception would be for its DIRECTV STREAM service, which is considered a “virtual multichannel video programming distributor” like YouTube TV or Fubo, and isn’t bound by such restrictions.
There’s precedent for this. In January, Fubo temporarily replaced its local CBS affiliates with the CBS national feed after some local broadcasters were upset with a deal that the streamer cut with Paramount.
There’s a movement by local broadcasters to push the Federal Communications Commission to take those existing rules that apply to cable and satellite providers and apply them to streaming services, which would require them to negotiate individually with each local station for the rights to carry those feeds. The FCC hasn’t looked at this issue yet, but Chairwoman Jessica Rosenworcel last week cast doubt on whether the agency has the authority to make such a change.
It’s unclear where DIRECTV via Internet sits, since it is the full “cable experience” delivered over the internet.
Thun said he’s talked with the networks about this, but DIRECTV declined to comment further on those discussions.
Tegna, for its part, has declined to respond to Thun’s comments, or DIRECTV’s suggestion that local stations be charged separately via a la carte fee.
“We’re committed to reaching an agreement that continues to ensure all of DIRECTV’s subscribers in our communities have access to the local and national news, sports and entertainment our stations offer, while providing our stations with the fair compensation they need to continue their significant investments in the content viewers value,” said a Tegna spokeswoman. “In contrast, DIRECTV’s proposal to instead require its customers to pay yet another standalone fee for our local stations – unlike all other broadcast stations – disserves subscribers and is not productive.”
Tegna added in its statement that its terms are based on existing deals it has struck with other distribution partners, and said that it had made “significant moves” to narrow the gap, which it believes DIRECTV has failed to reciprocate.
“Still, we remain available and ready to work around the clock to reach a deal when DIRECTV is ready to bargain seriously,” said the spokeswoman.