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Dish rips plan to expand channels
Published February 23, 2009 at 9:05 p.m.
Dish Network Corp. and DirecTV Group Inc. may have to carry the signals of local television stations in even the smallest markets under legislation that faces an initial hearing in Congress today.
The House Energy and Commerce Committee will be the first of three panels to hold hearings on terms for reauthorizing the legal structure for direct-broadcast satellite companies.
Dish Network says expanding local service would impose unnecessary costs and use up capacity on satellites.
Rep. Bart Stupak, D-Mich., says 31 of 210 markets don't get satellite delivery of local channels, and guaranteeing such service is "one of the largest issues" for the legislation, Nick Choate, his spokesman, said Monday.
The reauthorization legislation is "a near-certainty to pass," and expanded requirements to carry local channels is "the most likely candidate" for an added provision, said Paul Gallant, a Washington-based analyst with the Stanford Washington Research Group.
"It would impose significant new costs on Dish Network and DirecTV and generate virtually no new revenue" because the markets in question are small, Gallant said.
Providing local service uses capacity at a time when satellite companies are under pressure to increase high-definition offerings in competition with cable companies such as Comcast Corp.
Neither satellite company provides local service in the 31 television markets, which have 2.6 million households, Stupak said as he introduced his bill requiring such service in all areas. Stupak represents a rural district in Michigan.
Douglas county-based Dish had about $11.09 billion in revenue in 2007. DirecTV, based in El Segundo, Calif., had $19.69 billion in sales last year.
"Without a hard date established in satellite law, Americans living in small markets have been and will continue to be ignored," Stupak said in a Feb. 10 statement. He wants his provision to be folded into the reauthorization measure, Choate said.
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