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Broadcasters challenge three GCI acquisitions

Concerns about GCI's takeover of KATH-TV and 2 other television stations reach FCC

Posted: March 2, 2013 - 10:18pm  |  Updated: March 3, 2013 - 1:18am

Some Alaska broadcast companies combined Friday to take their concerns to the Federal Communications Commission in a bid to deny or put conditions on cable company General Communication Inc.’s (GCI’s) purchase of three Alaska TV stations, including KATH in Juneau.

Denali Media Holdings, a subsidiary of GCI, offered last year to buy KTVA in Anchorage, Sitka’s KSCT and KATH. Several other broadcasters see that as a means for GCI to quash competing programming and dominate large areas of the state.

Northern Lights Media, which owns KTUU, and the other appellants want a major concession if the FCC won’t block the sale, KTUU General Manager Andrew MacLeod said Friday. “You can’t use that distribution network to squeeze us out of the news industry.”

GCI had little comment Friday.

“As the Petition just came out today, we are still reviewing,” spokesman David Morris, a GCI vice president, said in an email. “We will let the review process work its course. However, we do believe our entry into the broadcast market in Alaska will increase competition and result in more high-quality local news and local programming for underserved audiences in Alaska. We look forward to the opportunity for these stations to provide high quality viewing opportunities for Alaskans.”

KTUU’s MacLeod thinks otherwise, concerned that with GCI’s powerful presence in and control of cable access to wide swaths of Alaska, guarantees are needed that GCI will not simply crush the competition. He is especially worried about access to news and programming in rural areas, and that through its sheer strength other Alaska broadcasters run the risk of being excluded.

MacLeod said GCI has made statements that it is a cable company and not a broadcast company. He does not think they will make any move to improve free broadcast of their stations.

“They’ll use these stations to force people onto cable or keep them on cable.”

“Juneau has the highest cable penetration of any Nielsen measured Alaska market, in part because of terrain and limited broadcast power from KATH, which GCI will not improve unless required to by a condition the FCC attaches to the license transfer based on the statement of their director of engineering...,” MacLeod said. “Juneau also is now served by several Anchorage newscasts, including Channel 2 News. GCI will control our ability to get news to Juneau via fiber pricing and our ability to distribute it there with their NBC franchise they will obtain when granted KATH’s broadcast license. Unless safeguards are put into place it means more cable bills and less news choices for Juneauites.”

The filing’s summary pages state that GCI has announced that it plans to make its products the dominant news products in Alaska, and may abandon a broadcast tower in Anchorage, moving to another tower that will “leave large parts of the area without over-the-air CBS service. Similar concerns have been raised about its intentions in Juneau.”

MacLeod said Friday that having a diverse set of voices reporting the news is vital to the community. “It really comes down to what serves the public interest.” In a memo he wrote to his staff announcing the filing earlier, MacLeod said the company welcomes competition in news.

“More voices and choices are best for the consumer, and we seek to ensure that the entry of  GCI into the TV and news business is on a level playing field where distribution cannot trump content and disadvantage non-GCI owned content providers.”

There is a precedent for applying non-monopolistic conditions to a sale.

“The model used when Comcast purchased the NBC Universal network provided conditions that insured Comcast could not use its cable distribution business to squeeze television operators out of the content business. GCI is more powerful in Alaska than Comcast is in the Lower 48 on a per capita basis as it has a virtual monopoly on cable TV and broadband, especially in rural Alaska, and it also is a powerful player in wireless.”

“The very same safeguards the FCC provided in the Comcast/NBC merger are what we the other Alaska broadcasters are seeking. GCI rejected them, and that prompted today’s filing,” MacLeod wrote.”

Challengers of the sale are the parent companies of stations in Ketchikan, Fairbanks, Juneau, Sitka and Anchorage — Northern Lights Media, Inc., Coastal Television Broadcasting Company, LLC, Ketchikan TV, LLC, Vision Alaska I, LLC, Vision Alaska II, LLC, known collectively in the filing as “Alaska Broadcasters.”

GCI offered in November 2012 to purchase KTVA-TV from Alaska Broadcasting Company, Inc./Media News Group (Affiliated Media Inc. FCC Trust) of Denver, Colorado. Affiliates KATH-TV and KSCT-TV would be purchased from North Star Broadcasting based in Juneau, according to the GCI website.

• Contact Managing Editor John R. Moses at 523-2265 or at john.moses@juneauempire.com.

• Contact reporter Russell Stigall at 523-2276 or at russell.stigall@juneauempire.com.

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