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FCC Chairman Tom Wheeler weighs in on Dodgers TV situation

FCC sends tough letter to Time Warner Cable about Dodgers TV situation

The Federal Communications is not happy with Time Warner Cable about the Dodgers TV situation.

In a blistering letter to Time Warner Cable Chief Executive Rob Marcus, FCC Chairman Tom Wheeler criticized the company for its inability to reach agreements with other area pay-TV distributors for SportsNet LA, the new Dodgers-owned channel.

"I am writing to express my strong concern about how your actions appear to have created the
inability of consumers in the Los Angeles area to watch televised games of the Los Angeles
Dodgers," Wheeler wrote. "The FCC will continue to monitor this dispute closely and will intervene as appropriately necessary to bring relief to consumers."

Wheeler sent the letter to Marcus on Tuesday after conversations about the standoff with Rep. Tony Cárdenas (D-Los Angeles) who had written the FCC to weigh in on the matter and Rep. Henry Waxman (D-Beverly Hills).

Time Warner Cable secured the rights to distribute SportsNet LA after agreeing to a 25-year deal worth $8.35 billion with the team, according to a valuation by the Dodgers and Major League Baseball.

DirecTV, Cox Communications, Dish Network and other distributors have passed on carrying SportsNet LA citing price. While Time Warner Cable has never disclosed what it is seeking from distributors for SportsNet LA, people familiar with the talks have put the price at more than $4 a month per subscriber in the first year. That figure steadily rises throughout the life of the deal.

On Tuesday, after Rep. Brad Sherman (D-Sherman Oaks) told Marcus and DirecTV Chief Executive Michael White that they should consider arbitration to resolve the dispute, Time Warner Cable said it was willing to go down that road.

"We prefer to reach agreements through private business negotiations, but given the current circumstance, we are willing to agree to binding arbitration," a Time Warner Cable spokesman said.

DirecTV is not in favor of arbitration. 

"Rather than force everyone to bail Time Warner Cable out, the simplest solution is to enable only those who want to pay to see the remaining Dodger games to do so at the price Time Warner Cable wants to set," a DirecTV spokesman said, adding that people who aren't sports fans should not have to pay for Time Warner Cable's "excess."

Wheeler said he was encouraged by Time Warner Cable's willingness to enter arbitration but is also worried about the rising cost of sports programming and its effect on consumers.

"As you know, soaring bills for cable and other MVPD [multichannel video programming distributor} services have become a cause of consumer dismay," Wheeler said.

The FCC wants Time Warner Cable to send it a written explanation detailing the arbitration process it is proposing within the next ten days. It also wants details of Time Warner Cable's terms for carriage of SportsNet LA.

A Time Warner Cable spokeswoman said the company is "grateful for the FCC’s intervention and happy to work with them to gain carriage for the Dodgers." The spokeswoman added that Time Warner Cable hopes that Wheeler is "is making similar inquiries of DirecTV and other LA television distributors to determine their rationale for refusing to carry SportsNet LA."

An FCC spokeswoman said for now Wheeler has only written Time Warner Cable.

Follow Joe Flint on Twitter @JBFlint.


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