600+ Local TV Stations Establish Organization to Push Live TV Streaming Reform

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Hundreds of local broadcast stations across the US have formed a new advocacy coalition to urge the Federal Communications Commission (FCC) to close a regulatory loophole that, according to them, threatens their ability to be disseminated via streaming services.

The Coalition for Local News organization, comprised of local broadcast station groups and backed by the ABC, NBC, FOX, and CBS television Affiliate Associations, which collectively represent over 600 local TV stations, argues that they have lost control of their retransmission consent rights under the current rules, which exclude them from the negotiation process with streaming services.

Local news is essential to the well-being of American communities and the strength of our democracy. - Coalition for Local News Website         

According to the newly formed organization, the "streaming loophole" in the current FCC rule, which requires cable and satellite providers, but not online streaming services, to negotiate directly with local broadcasters for carriage of their stations, is a hindrance to the viability of local news. Today, streaming services can go to national networks, which can agree to contracts that affiliates have no say in until the network brings it to them and asks for their approval. Traditional pay-TV plans, such as cable and satellite, must negotiate directly with local affiliate owners, but the law makes no such provision for streaming services.

“No business can succeed when the rules don’t apply fairly and reflect today’s reality,” says Mike Meara, former chair of the ABC Television Affiliates Association and member of the coalition. “The market has evolved dramatically, and it’s time for lawmakers and regulators to act to protect local broadcast news.”

The Coalition for Local News claims that without the capacity to deal directly with streaming providers, they cannot obtain the compensation necessary for them to sustain their investments in local news.

The coalition’s chief priority is urging the FCC to revisit the loophole to reflect the vastly changed market realities of 2023. Last week, the FCC announced its intent to consider updating a separate set of longstanding program carriage rules, an acknowledgment of the need to modernize video regulations in light of a changing marketplace.

Market Impact

A substantial portion of the population still value local newscasts. Parks Associates research finds 39% of internet homes would have difficulty giving up local news if they canceled their pay-TV provider . Users of traditional pay-tv services have long had access to local broadcast channels. Due to existing broadcast contracts, some online video providers cannot provide local broadcasts at the same level as traditional pay-tv providers. There is an affiliate relationship between the local television station and the major broadcast networks, and each network needs a separate agreement with each service provider.

These broadcast contracts must be renewed and/or renegotiated periodically, as new technologies and distribution methods emerge. The current FCC guidelines allow the national broadcast to negotiate with streaming services on behalf of the local affiliate. According to a Parks Associates consumer survey, local programs and local news were the most difficult content to give up if customers discontinued their pay-TV service.

This is an excerpt from Parks Associates Streaming Market Tracker, including monthly deliverables on industry developments and quarterly updates on subscriber estimates, business models, pricing and more. Written by Eric Sorensen Director, Parks Associates