The Federal Communications Commission (FCC) increased the annual fees of satellite operators Dish Network and DirecTV by 125%. Now they have to pay 27 cents per subscriber, from the 12 cents per subscriber plan as earlier. The agency said that the rise in the fees is due the increase in regulatory activity in the DBS area. FCC will be charging telecom operators with $384 million this year.
Last year, nearly $ 340 million was collected by FCC as regulatory fees. This year, FCC is imposing an extra “facility reduction cost” to cover the expense of changing employees to new offices or downsizing the present employees to save money. According to FCC, it will cost around $44 million extra.
FCC said that, “When we adopted this regulatory fee subcategory for DBS, we observed that numerous regulatory developments had increased the Media Bureau FTE activity involving regulation and oversight of multichannel video programming distributors (MVPDs), including DBS providers.”
“For example, providers (and cable television operators) are permitted to file program access complaints and retransmission consent complaints. In addition, DBS providers are subject to MVPD requirements such as those pertaining to program carriage89 and the requirement to negotiate retransmission consent in good faith,” FCC added.
At the same time, cable operators are charged $1 per subscriber, and compared to that, 27 cent is still a lower value. American Cable Association (ACA), which represents small independent cable operators, said that they are glad that FCC bought satellite operators to par.
“Achieving this goal will mean that the burden of supporting the FCC’s Media Bureau is distributed fairly among all types of MVPDs. As the FCC noted, the Media Bureau’s oversight and regulatory work related to cable/IPTV providers and DBS providers are similar. In ACA’s view, fee parity is also essential because smaller MVPDs should not be put in a position, by government policy, of subsidizing their largest pay-TV competitors,” ACA President and CEO, Matthew Polka, stated in a press release.
Polka also pointed out that the difference in fees cost small cable providers more than telecom giants like AT&T who have around 20 million customers in DirecTV. However, according to Dish Network, the price hike is unjustified. Dish wants FCC to explain and justify the hike in fees while they are downsizing. “Dish explained that the proposed rate increase only serves to harm consumers who will ultimately be forced to shoulder the burden of any increased regulatory fees,” Dish Network representatives commented.