No change to UK retrans fees despite law change

The UK government will repeal a law that says pay TV operators need not pay fees to carry commercial public service channels, but said it expects no change to the status quo.

In a consultation document published yesterday, the government confirmed that it will repeal Section 73 of the Copyright, Design and Patents Act 1988, which states that cable platforms such as Virgin Media are not required to provide copyright or retransmission fees for broadcasting public service channels like ITV and Channel 4.

However, it said that its policy objective was to ensure that there are still “zero net fees” owed and that if this situation appears to be at risk, it will consider again whether legislative change is required.

“[The] government considers that the commercial PSBs are fairly compensated for their licensed PSB channels via the existing PSB ‘compact’ [EPG prominence and spectrum in return for PSB obligations]), an agreement which is underpinned in their PSB licences,” said the government in the consultation.

“[The] government therefore expects that there will continue to be no net payments between all platform operators and the PSBs for carriage of their licensed PSB channels going forward.”

Virgin Media praised the ruling, having consistently campaigned against retrans fees. Chief corporate affairs officer Brigitte Trafford said: “Virgin Media welcomes the government’s decision to reject a two-year lobbying campaign by ITV and Channel 4 to charge viewers extra fees for watching programmes on cable and satellite that they’ve already paid for.”

In a statement, a spokesperson for Channel 4 said that while it agreed with that the UK’s broadcast and production sector is a success, the government could have done more.

“We believe that this has been a missed opportunity to update and modernise the regulatory framework for broadcasting and ensure that it fully takes account of the considerable value created by the public service broadcasters,” they said.

An ITV spokesman said that the roll-back of Section 73 was a “welcome first step” in reforming the existing broadcast rules.

“We have consistently called for major pay TV platforms to pay UK public service broadcasters fairly for the ‘transmission’ of their channels ending what is effectively a multi-million pound subsidy,” said ITV.

“This is simply about ITV, and other PSBs, being paid fairly for their investment in original UK content so that we can continue to invest in the programmes viewers love.”

Rentransmissions are big business for US broadcasters, with an estimate from Kagan SNL suggesting pay TV providers paid US$6.3 billion in 2015.