Appeals Court Upholds FCC Ban On Exclusive Cable Contracts
March 12 2010 - 11:23AM
Dow Jones News
A divided federal appeals court on Friday upheld the Federal
Communications Commission's decision to extend a rule that bars
cable operators from withholding some television programs from
competitors through exclusive contracts.
Cablevision Systems Corp. (CVC) and Comcast Corp. (CMCSA) had
challenged the FCC's decision to keep the rule in place, arguing
that the prohibition was not necessary to preserve competition in
the paid TV market.
The U.S. Court Appeals for the District of Columbia Circuit
rejected that challenge in a 2-1 ruling.
The court's majority said it was reasonable for the FCC to
conclude that the ban on exclusive contracts between cable
operators and affiliated cable programmers continued to be
necessary.
The dissenting judge said the ban was no longer justified
because of the high level of competition in the market for video
programming.
The ban on exclusive contracts for TV programs was set by
Congress in 1992. At the time, lawmakers were particularly
concerned about cable companies withholding popular programs that
they owned from competitors, effectively creating a monopoly.
The FCC extended the ban until 2012.
The case is Cablevision Systems Corp. v. FCC, 07-1425.
-By Brent Kendall, Dow Jones Newswires; 202-862-9222;
brent.kendall@dowjones.com
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