Satellite : DBS to FCC: Don't Change Fee Structure

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In joint comments recently sent to the Federal Communications Commission, both DIRECTV and DISH Network fought suggestions that the current regulatory fee structure for DBS should be modified, telling the agency that it shouldn't assess fees on small dish services on a per-subscriber basis.

At the moment, DIRECTV and DISH pay regulatory fees based on the satellites and earth stations they operate for their respective services. For the second time in three years, the FCC is seeking comment on whether the small dish platforms should pay fees based on a per-subscriber basis, similar to cable's fees.

In their arguments against a new fee structure, the companies said any assessment of a per-subscriber fee would "achieve only a false parity."

For starters, cable providers are dominant in the multiplatform business and therefore should be subject to more intense oversight and regulation, the companies said. Also, cable operators offer broadband and phone service along with video, all services regulated by the FCC.

"Because cable issues - particularly those involving the largest cable companies, which pay the highest fees - require substantially more staff time, forcing DBS providers to pay the same per-subscriber fee as cable would clearly be inequitable and counter to a (federal law) requirement that fees relate to the cost and benefits of regulation," the companies said in a filing sent to the commission.

In addition, DIRECTV and DISH said nothing much has changed in the past three years to warrant a modification of the fee structure.

"Twice in the past three years, the cable industry has tried to alter the manner in which DBS providers pay regulatory fees by transitioning satellite providers to the per-subscriber fee used for cable companies," the DBS companies said. "Both times, the commission rejected such a change, concluding that the number of subscribers to a DBS service does not significantly affect the regulatory costs from DBS services."