The TV carriage laws that apply to satellite carriers (Direct TV & Dish) are different from those that apply to cable systems. Under federal law, if a satellite carrier carries one station in a local market, it is required to carry all stations, unless an agreement cannot be reached regarding retransmission consent. Moreover, unlike cable system regulations, there is no requirement that stations be placed on a “basic tier” that is available to all subscribers.
Direct TV has decided to take advantage of the difference in regulatory treatment and offer a “non-local” programming package to its customers. Under this approach, subscribers would have the option to eliminate all local stations from their satellite programming line-up. To receive local stations, consumers would need to connect to an antenna to receive local signals.
Direct TV claims that the costs associated with local retransmission consent are driving this new policy. However, local stations have been and remain the most popular signals on satellite services. Retransmission fees paid to local stations are far less than the fees paid by satellite providers for less popular services. Moreover, Direct TV claims that popular network shows are already being shifted to streaming services.
It will be interesting to see the economic impact of DirectTV’s proposal. Given the popularity of local stations, especially local news, the “no local” approach could backfire on Direct TV and lead to more cord-cutting. We are watching this closely.
You can find more information about Direct TV’s "No Locals" plan here.