[Editor’s Note: Bob Primosch is a Partner with the communications law firm Wilkinson Barker Knauer, LLP, Washington, D.C. (rprimosch at wbklaw dot com)]
Last week the FCC released new rules cutting the rates independent programmers must pay to lease channels on cable systems. Under federal law, cable systems must set aside up to 15% of their channels for this purpose. The FCC lowered the ‘maximum reasonable rate’ for these channels to 10 cents per subscriber per month – however, the lower rate is not be available to programmers who offer predominantly home shopping or infomercial programming. Cable operators seeking to charge programmers more must show that a higher rate is reasonable. The FCC has also adopted rules designed to speed up the process of leasing channels. Although the cable industry may appeal all of this, that may not stop the new rates from going into effect this summer.