Now that the digital television transition is moved back to June, the Congress turns to another burning issue in telecommunications. Next week, hearings begin on the Satellite Home Viewer Extension and Reauthorization Act.

The goal, eventually, is for satellite companies such as Dish Network and DirectTV, to carry the local television stations in their markets. Cable systems are required to do so. It’s the peoples’ acknowledgment of the importance of local broadcasting in delivering relevant news, weather and emergency information to the communities they serve.

Congress established a blanket license in 1999 to the then-fledgling satellite companies.with the Satellite Home Viewers Improvement Act (SHVIA). It’s been renewed in five year intervals and it’s time to hold the satellite guys to their original vision.

Among other provisions, satellite companies were allowed to import distant network signals to viewers who couldn’t receive a local signal. For instance, in Terre Haute, which has no ABC Television Network affiliate, satellite operators can bring in stations from New York or Atlanta. It seems to me the best option would be to offer the folks in Terre Haute our WRTV signal which is already on satellite. I’m betting they have a payment deal with those distant stations.

You can’t get the local Terre Haute NBC, CBS or Fox affiliates if you’re a satellite customer there. They offer those affiliates from other cities.

And now, the Congress lead by Rep Rick Boucher (D-VA), the new chair of the House Communications, Tech & Internet Subcommittee, will tackle the subject. Boucher’s district includes one the television markets that have no local stations available to satellite customers.

There’s no announced schedule for the House hearings but the Senate starts work on this next Wednesday in its Judiciary Committee.

Local broadcasters prove time and again their value to the community, not only through support of community events and interests, but reports on severe weather, Amber Alerts to find missing children and putting issues before the public that keep government honest.

The government understood that importance when they directed the cable companies to carry local broadcast stations.The satellite guys have had more than a decade to build their business. They need to be held to the same standard as their cable competitors.

As I write this, the battle between LIN Television and Bright House Networks continues into its second day.  The parent company of WISH-TV (Channel 8), WNDY-TV (Channel 23), WIIH-TV (Channel 17) and the LWS Cable Channel is at odds with the company that provides cable television service to around 135,000 customers in Indianapolis’ center city and outlying northern suburbs.

Neither side could agree to terms moving forward on carriage of the television stations and cable channel, so all of them are no longer being provided to Bright House’s customers, of which I am one.  No CBS.  That means no CSI…no David Letterman…no Katie Couric.   (OK, two out of three ain’t bad.)

At issue, is the request from LIN that Bright House pay a small fee to carry the popular channels.  Under Federal law, the TV company has the right to be compensated for the product that Bright House takes and resells to their customers.

LIN is seeking less than a penny a day per cable customer.  Small change in WISH-TVs case for one of the most important channels on Bright House’s system.

I know my biases are showing, big time.  But, I’m a strong believer that anyone who takes a product and resells it should compensate the rights holder, in this case, LIN-TV.   It would be akin to someone renting a DVD at Blockbuster and charging people to watch it in a theater.  That’s illegal.

Bright House pays for a lot of its less popular programming.  The monthly cost for a channel such as ESPN is in the two dollar/subscriber/month range.  Sure ESPN is popular but it’s no CBS, which is only looking for a fraction of what ESPN costs.

I’ve been involved in these “retransmission consent” negotiations for years.  I understand that the cable giant doesn’t want to add to its costs.  I hate it when the program suppliers we use, such as Paramount Television, are able to raise the license fees for  programs such as Judge Judy.  But that’s business.

The cable guys claim that if they have to pay for the ability to carry WISH et al, they will have to pass along the cost to customers.  That doesn’t make sense.  Our costs go up.  See Judge Judy example above.  But, using that as the basis of raising our commercial rates, falls flat.  I have to find the expense savings elsewhere or make the decision to tell Judge Judy good-bye.

And other resellers do have deals to pay the broadcast stations.  I’m not privy to LIN’s deals, but am guessing the satellite guys have no problem realizing the value of having CBS and their other offerings available to satellite customers.

Bright House and other resellers have to wake up and realize that the broadcast stations, such as Channels 8 and 23, make up a huge amount of the viewing on their systems.  Think of the half dozen favorite channels you watch.  I’m betting at least three or four are the local stations.

Bright House and its brethern could get away with this when they were monopolies and carved out exclusive territories.  No, they didn’t collude but the cost of “overbuilding” on a competitor’s territory didn’t make sense.  So we got quasi-monopolies who were only regulated, to some extent, on price by the cities that controlled their franchises.

But those days are long gone.  With two major satellite providers and others such as AT&T and Verizon offering similar services, they are in real danger of losing customers.  Actually, not in danger.  They are losing customers.   Each month, data is released on the number of television households subscribing to cable, to alternate delivery systems (ADS) which includes satelliteand phone companies or receiving local stations over the air.   The trend is a decrease in cable penetration.  Current subscribers and new residents are turning to ADS and the percentage of homes using antennas to get their TV for free is increasing.

Customers get angry with both parties.  They could care less about the business end of things.  They want their CBS, My Network and Univision programs.  And, carriage of the Colts game on CBS this Sunday at 1PM has the telephone lines to DirectTV and DishTV humming as Bright House’s customers look to a way to see the game.  I’m guessing the sports bars will be packed if they don’t come to an agreement.

I’m also betting Bright House is losing customers.  Channel 8 is playing a gutsy game.  Their faithful viewers may stray and find other favorites.  Their advertisers may seek a rebate for undelivered Bright House households.

I doubt it. This is a temporary blip.  Unless it goes for a very long time, Channel 8 won’t lose its long-time fans.  And the effect on ratings by not counting Bright House households will be pretty minimal.

But, Bright House, in my opinion, is driving its customers to seek other alternatives.   And, the loss of those customers is permanent.