Distribution, Competition, and Antitrust / Intellectual Property (IP) Law

Can You Force TV Networks and Cable Providers to Unbundle Cable Channels? Answer: No.

Are you disappointed with cable and satellite television channel bundles?  Do you wish you could order channels a la carte?  You will, unfortunately, have to endure your limited choices.  In Brantley v. NBC Universal, Inc., No. 09-56785 (9th Cir. Mar. 30, 2012), the Ninth Circuit affirmed dismissal of an antitrust claim challenging TV networks’ tying of “must-have” channels to a group of less desirable, low-demand channels.

The plaintiffs lost their bid to challenge the tying practice because they did not (and apparently could not) allege that the tying caused any competitive foreclosure, that is, prevented independent programmers from participating in the market involving the sale of programs to cable and satellite providers.

The case is noteworthy because in it the Ninth Circuit expressly distinguishes between two familiar antitrust principles: harm to competition and reduction of consumer choice/increased prices to consumers.  In the Ninth Circuit’s view, these principles are two, separate elements of an antitrust claim, and allegation and proof of the latter is not sufficient to establish the former.  That is why the court affirmed the dismissal of the plaintiffs’ complaint.

The court included an interesting footnote to its opinion: “A rule to the contrary could cast doubt on whether musicians would be free to sell their hit singles only as a part of a full album, or writers to sell a collection of short stories.  Indeed, such a rule would call into question whether Programmers and Distributors could sell cable channels at all, since such channels are themselves packages of separate television programs.”

If the facts were otherwise — if the TV networks’ practices in fact foreclosed independent programmers — then presumably the result would be (or could be) different.

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Trackbacks

  1. [...] I recently covered a Ninth Circuit decision that denied consumers the opportunity to insist upon unbundled cable TV channels.  See this post. [...]

  2. [...] TV channel tying case, Brantley v. Universal, Inc. 675 F.3d 1193 (9th Cir. 2012), which I covered here, the court noted that plaintiffs had alleged that defendants’ tying of auction services to [...]

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