EchoStar Ramps Up Big Ten Network Fight

[BGonaSTICK]

EchoStar Communications told the Federal Communications Commission Thursday that it should mandate tight conditions, including arbitration of carriage disputes involving all Liberty Media and News Corp. networks, as part of approval of R. Murdoch’s sale of his stake in DirecTV to Liberty.

EchoStar made the suggestion in a three-page letter to the FCC regarding a petition the satellite service filed last week. In that filing, EchoStar asked the federal regulators to declare Big Ten Network a regional sports network, which means that it would fall subject to the so-called 2004 News Corp.-Hughes order. That mandates that distributors can seek arbitration of disputes with News Corp’s RSNs.

But EchoStar went even further in its letter to the FCC when it cited Big Ten Network’s claim that it is a national network and, therefore, not subject to arbitration.

Big Ten Network is 49%-owned by Fox Cable Networks, which is part of News Corp.

“The proper classification of the Big Ten Network has direct consequences in this [DirecTV-Liberty] merger review,” EchoStar said in its letter. “News Corp. has pledged to maintain the News/Hughes RSN and broadcast conditions for their full six-year term [until January 2010] if the Liberty acquisition is approved, but maintains that any restrictions on national programming should be lifted … Given the apparent manipulation of its latest RSN, the value of that guarantee is in doubt.”

EchoStar argued that a “fully vetted” definition of an RSN must be included in any conditions set on the Liberty-DirecTV merger.

“In lieu of searching for that perfectly calibrated RSN definition, the more logical course of action, however, is to broaden the arbitration remedy to all John Malone’s Liberty and News Corp.-owned programming: Any line drawing would be subject to potential abuse or manipulation,” EchoStar’s letter said. “Further, such a bright line rule would better serve all stakeholders, as no party has provided a reasonable objection to arbitration or the News/Hughes arbitration procedures.”

According to EchoStar, Discovery Communications networks, which Liberty holds a stake in, should also fall subject to special conditions.

“Dr. Malone-owned and controlled Discovery and Discovery Holding are central players in Dr. Malone’s acquisition of DirecTV, and any programming restrictions should apply in full to such entities,” EchoStar said in its letter.

Big Ten Network has called EchoStar’s petition to the FCC a “brazen attempt” to gain leverage in contract talks.

Source: Multichannel News