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Posted January 7, 2012 | 5 Comments
WJLA owner files FCC complaint against Shentel
Cable company dropped D.C. ABC affiliate from its lineup
By Sally Voth -- email@example.com
EDINBURG -- Shentel Communications' decision to drop WJLA-7 from Shenandoah County cable subscribers' cable lineup was met with a Federal Communications Commission complaint this week.
Allbritton Communications Co., which operates ABC 7 as well as Politico, a political newspaper and website, filed the emergency petition Thursday, according to a news release.
Shentel announced last week its customers would no longer be getting WJLA, effective Jan. 1, but would still receive WHSV, an ABC affiliate from Harrisonburg.
The Federal Communications Commission allows broadcast stations to grant or deny cable providers the right to carry their signals, David Ferguson, former vice president of customer service for Shentel and now a consultant, has said. This year, the stations have begun requiring fees for the right to retransmit their signals that Ferguson said are eight to 13 times higher than the previously agreed upon amounts.
"As each asks for their own individual increase, it gets compounded, and the overall increase to the system is a very large increase in monthly programming expenses that ultimately the customer has to bear," he said last week.
In its release, Allbritton accuses Shentel of being "the poster child for bad faith bargaining," and of violating FCC rules.
"In short, Shentel proposed retransmission consent terms and, when Allbritton accepted those terms, Shentel withdrew the offer, dropped WJLA-TV with insufficient notice, and has refused Allbritton's further efforts to negotiate," the complaint says.
It says Allbritton notified Shentel in September that it wished for ABC 7 to continue to be retransmitted in Shenandoah County, and that Shentel wanted "a heavy discount" on the standard rates mainly because it was also carrying WHSV.
The companies exchanged various offers, with Shentel making an offer Nov. 10 -- reiterated Dec. 6 -- that was 25 cents per subscriber less than the normal asking price, the complaint says.
Allbritton countered with an offer that was 8 cents less than its asking price, and which was the amount Shentel had agreed to pay in other markets for Allbritton's Lynchburg affiliate, WSET, the complaint says.
Allbritton claims it contacted Shentel on Dec. 19 to see where things stood and to try to finish a deal before Christmas. On Dec. 20, Shentel told Allbritton it was planning to drop WJLA.
The next day, Ferguson told Allbritton's vice president of finance, Kevin O'Tool, that the company was willing to entertain a counteroffer to Shentel's Nov. 10 offer, the complaint says. It says Allbritton decided to accept the offer without countering, informing Shentel of this decision on Dec. 22.
"Instead of concluding the deal, however, Shentel simply went silent," the complaint says. "After five days passed, Allbritton again contacted Shentel to check on the status of the negotiations, at which point Shentel surprisingly informed Allbritton that it was still considering whether it would agree to a deal on terms that Shentel itself had proposed on multiple occasions and never withdrew.
"On December 28, 2011, Shentel indicated its intention to reject its own contract terms, claiming in a phone call that the rates it ended up paying for WHSV limited its ability to pay for WJLA."
Allbritton then asked Shentel to name its best price, and Shentel agreed to have an offer by Dec. 29, the complaint says, but continued to remain silent, despite a couple of attempts at contact by Allbritton. Allbritton said it planned to report the alleged bad faith conduct to the FCC.
"Shentel responded with a terse, 33-word email confirming for the first time that Shentel had finally decided to drop WJLA," the complaint says.
The filing accuses Shentel of "stringing Allbritton along through sham negotiations" as it finished talks with WHSV.
"Shentel encouraged Allbritton to jump through hoops to get a deal done, yet when Allbritton had cleared every hoop, Shentel still dropped WJLA's signal," it says.
Additionally, Shentel provided Allbritton 11 days' notice of its decision via email, not the 30-day written notice as required by the FCC, the complaint says. It also accuses Shentel of not giving customers proper notice.
Allbritton is asking that Shentel be forced to finish an agreement based on the Nov. 10 offer.
It is also seeking fines of $7,500 day for each day it hasn't carried WJLA, and $7,500 for each time if failed to give Allbritton proper notice.
On Friday, Ferguson said Shentel plans to file a response with the FCC, likely on Monday.
"Shentel feels that the points that Allbritton makes about the negotiation process are not accurate, and that their understanding of laws as they've presented them is not accurate," he said.