DirecTV Scramble To Halt Cutoff Fails

DirecTV had hoped that terminating its programming contract Thursday, February 25 with PrimeTime 24 would avoid having to comply with a federal court order to stop beaming CBS and Fox programming via PrimeTime 24 to 750,000 plus subscribers. By delivering the networksí programming itself, DirecTV believed it could legally skirt the courtís order. The Miami, Florida Federal Court judgeís order was specific to PrimeTime 24 for illegally delivering a network signal to many of its customers. Another order by the same court will cut off an additional 1.5 million PrimeTime 24 customers from CBS and Fox signals by April 30.DirecTV contended that it could legally provide the signals because the court order applies only to PrimeTime 24. But PrimeTime 24 disagreed arguing that the order affects its distributor DirecTV as well. Should PrimeTime 24 lose DirecTV as its distributor, that would put PrimeTime 24 in a position that could force the company out of business. It is unclear whether PrimeTime 24 can continue to provide its customersí access to satellite-delivered programming. The company is considering legal action against DirecTV for breach of contract. The National Association of Broadcasters (NAB) is now considering legal action against DirecTV, along with CBS and Fox networks. The NAB sued EchoStar after it made a similar maneuver. Also NBC and ABC are now seeking to join the legal battle against DirecTV and others.Unfortunately for DirecTV subscribers, the Miami Federal Court ordered DirecTV to quit delivering the signals by Sunday, February 28 because the company was violating the law. When Judge Lenore Nesbitt granted the restraining order Thursday, the U.S. District Judge said she found DirecTVís attempt to distance itself from PrimeTime 24 ""a little disingenuous."" She said that the order ""binds not only the parties to this action but those who act in concert with them."" That is specifically DirecTV.DirecTV said it would comply with the court order but in a statement said it was ""very disappointed with the courtís decision."" And accused the broadcast industry of ""continuing their unfortunate anti-consumer crusade.""Direct TV said that ""(Thursdayís) court order creates a greater urgency for congressional intervention to assure that satellite subscribers who lose access to network signals will have this critical segment of programming restored while the FCC establishes a more accurate method for identifying subscribers eligible to receive distant network signals."" The on-going squabble between DBS and broadcaster centers on the Satellite Home Viewer Act. The law allows satellite companies to deliver distant network signals to customers who canít receive them from a local affiliate with a rooftop antenna. The law was designed to allow people who cannot get a local signal to receive network programming. Broadcasters contend that satellite companies, such as DirecTV, have been disregarding the law and beaming distant broadcast signals into local markets. The broadcasters argue that the act undermines local affiliatesí ability to attract viewers and advertising dollars.This issue is significant, especially in light of digital TV and HDTV broadcasting reception. The law provides that if a satellite TV customer lives in the local stationís coverage area, the customer is not legally entitled to buy distant broadcast signals, even if their picture quality is poor. Only in the case of a customer who cannot receive any signal from their local broadcast TV stations using an antenna, can that networkís programming be received by a DBS provider. Thus, people who technically receive a local signal under the Satellite Home Viewer Act, but do so with bad, unwatchable pictures, are out of luck. They would have no choice except to purchase cable service, should that be available. The satellite industry and consumer groups want the standard to be based not only on whether a signal can be received, but also on picture quality. In other words, if a satellite customerís local station reception is marred with snow, static and other interference using an antenna, that customer should be entitled to DBS access to distant signals.Congressional lawmakers began hearings on reforming the law last week, and the Senate Judiciary Committee unanimously approved a measure last Thursday aimed at alleviating the situation by allowing satellite companies to beam local TV signals back into local markets. Another bill was introduced in the House of Representatives by the Chairman of the House Telecommunications Subcommittee that would give Congress 90 days to act, thus delaying the U.S. District Courtís ruling.