Should television and video rights to the athletic contests of publicly funded high schools be sold exclusively to one carrier and denied to others and the viewers they serve?
How that question plays out in Hawaii, where Charter Communications last month took over Oceanic Cable as part of its $79 billion Time Warner Cable and Bright House Networks acquisition, is being closely watched nationally and could set a precedent, observers say.
Due to the fervent interest in high school sports in Hawaii and the changing ownership brought by the acquisition, “I think Hawaii should be the best example in the nation for televising high school sports and making them available to the whole community,” said David Goodfriend, a Washington, D.C., attorney and chairman of the Sports Fans Coalition, a national sports advocacy group.
Goodfriend said there are exclusive agreements in some other states, including New Jersey, Illinois, Florida and New York, though many of them deal with state playoffs only and the Charter acquisition of Oceanic could break important ground. Goodfriend was among those who petitioned the Federal Communication Commission to urge an opening up of the Hawaii market before granting approval of the acquisition in May.
The acquisitions make Charter the second-largest broadband and third-largest TV provider in the country, with more than 25 million customers in 41 states.
Oceanic, the dominant provider in the state with a reported 76 percent video market share and 69 percent of consumer broadband sales, has exclusive contracts with the University of Hawaii, the public high school Oahu Interscholastic Association and the Hawaii High School Athletics Association, which represents all schools, public and private, for state championships.
But while Oceanic makes its UH programming available to competitor Hawaiian Telcom for a fee and is said to impose carriage and advertising restrictions, it has so far refused to make available its popular, long-running high school inventory, Hawaiian Telcom has charged.
In its filing with the FCC last year challenging the acquisition, Hawaiian Telcom alleged TWC “engages in anti-competitive practices, imposing unreasonable terms and conditions upon unaffiliated MVPDs (multi channel video programming distributors) such as Hawaiian Telcom, particularly with respect to programming owned or controlled by TWC.”
In the filing, Hawaiian Telcom said local sports programming, “… is particularly important in Hawaii because there are no national sports franchises located in Hawaii. Therefore, sports viewers demand access to local sports …”
Hawaiian Telcom also claims, “In addition, Oceanic TWC produces and televises the OC 16 channel, which includes Hawaii high school sports, which are enormously popular in Hawaii. As Hawaiian Telcom has served customers, fielded customer inquiries and conducted surveys of both potential and current customers who have discontinued service, it has learned that a meaningful portion of those surveyed indicate that the inability to receive the OC 16 channel and high school sports is a deciding factor for not subscribing to, being completely satisfied with or disconnecting from Hawaiian Telcom video services. But, unlike the University of Hawaii sports channel OC Sports, TWC refuses entirely to allow Hawaiian Telcom to purchase OC 16 programming at fair market rates, thus preventing Hawaiian Telcom from offering this highly valued programming to customers.”
Oceanic is in its 28th year of showing high school sports. Hawaiian Telcom will begin its fifth year of operation next month.
Connecticut-based Charter declined to directly address the charges in the FCC filing, but in a statement to the Star-Advertiser held open the possibility of opening up high school sports as it integrates Oceanic into its operation.
Venech wrote, “Charter sees the importance and value of investing in and providing high quality local programming to consumers in the communities where we live and serve. As we progress through our integration with Oceanic Time Warner Cable we look forward to continue delivering this content to our customers in Hawaii and also to exploring new opportunities to make local high school sports more widely available across the state.”
The explorations apparently were prompted in large part by talks with U.S. Senator Brian Schatz, the ranking Democrat on the Subcommittee on Communications, Technology, Innovation and the Internet, who became aware of the situation in filings.
Schatz’s office said, “It is an important consumer issue. We want to make sure that parents, family and friends can watch student-athletes play high school sports. Right now, only Time Warner Cable (new Charter) customers can watch high school sports on TV.”
As a result, Schatz’s office said, “We’ve had discussions with Charter about this issue. They have assured us that once the merger is complete they will work with us to make high school sports programming widely available.”
The senator’s office said, “We think there is a win-win solution here. We want to make sure that high school sports programming is widely available while, at the same time, not impacting the funding high school sports associations receive for the programming.”
The OIA reportedly receives approximately $100,000 from their contracts with Oceanic, with additional monies paid to the HHSAA, but parties declined to discuss terms.
Phillip Berenbroick of the Government Affairs Counsel at Public Knowledge, a Washington-based public policy advocacy group that follows communications and sports, said, “At some point, for taking those taxpayer dollars you would imagine there should be some obligation to the community. Well, universities and high schools are the community and by having these exclusive deals that a large segment can’t access while they are themselves paying for through tax dollars is outrageous. I mean, I can imagine why schools would want to put their hand out and access money, especially in dealing with financial shortages. But to take a public-paid-for product, like high school sports, and put it behind a pay wall so only the wealthiest consumers can access it is very, very troubling.”
OIA executive director Raymond Fujino did not immediately respond to phone or email messages from the Star-Advertiser regarding the contract or its future.
Meanwhile, in a statement, Hawaiian Telcom said, “As Hawaii’s only local TV provider, Hawaiian Telcom would like to offer high school sports programming to our subscribers. Charter Communications officials are aware of our position and we welcome the opportunity to discuss access to this content, which would expand viewership to more families and fans.”
