Satellite Television: Provisions in SHVERA Affecting Eligibility for Distant and Local Analog Network Signals
Satellite Television: Provisions in SHVERA
Affecting Eligibility for Distant and Local
Analog Network Signals
Julie Jennings
Information Research Specialist
Knowledge Services Group
Summary
In 2004, Congress passed the Satellite Home Viewer Extension and
Reauthorization Act, SHVERA, as part of the FY2005 Consolidated Appropriations Act
(H.R. 4818, P.L. 108-447). Among its many provisions, the law modified subscriber
eligibility for distant and local analog broadcast network television signals. Some
satellite television subscribers had to choose between either local or distant broadcast
network signals instead of receiving both. This report explains the provisions in
SHVERA, and outlines subsequent court decisions involving direct broadcast satellite
providers, including EchoStar Communications. It will be updated as necessary.
Background
Since 1988, Congress has passed several laws concerning television reception via
satellite: the 1988 Satellite Home Viewer Act (SHVA, P.L. 100-667), amendments to the
act in 1994, the Satellite Home Viewer Improvement Act of 1999 (SHVIA, P.L. 106-
113)1, and the most recent law, the Satellite Home Viewer Extension and Reauthorization
Act (SHVERA). SHVERA was passed as Division J of Title IX of the FY2005
Consolidated Appropriations Act (H.R. 4818, P.L. 108-447) in December 2004. A
number of changes were made to provisions affecting consumers who receive analog
“distant network signals” and “local-into-local” network signals.2 Three factors are
1 For more on these laws, see CRS Report RS20425, Satellite Television: Historical Information
on SHVIA and LOCAL, by Marcia S. Smith.
2 SHVERA sets other provisions for distant digital signals, which are outside the scope of this
report. For information on these provisions, see CRS Report RS21990, Satellite Television and
‘Digital White Areas’: Provisions of the 2004 Satellite Home Viewer Extension and
Reauthorization Act, by Marcia S. Smith.
important in understanding the eligibility criteria for these different signals: signal
strength, distant and local signals, and unserved households.
Signal Strength. Signal strength can be visualized as two concentric circles
around a TV station’s transmitter. Points in the inner circle close to the transmitter can
receive a strong, “Grade A” television broadcast signal, via an over-the-air antenna
(rooftop or “rabbit ears”). Points in the outer circle can receive a weaker, “Grade B”
signal.3 Beyond the outer circle, where no signal can be received, are “white areas.”
Over-the-air signal strength is the guiding factor in determining which households are
eligible to receive distant network signals via satellite.
Distant vs. Local Network Signals. A network broadcast signal is one received
by a household located within a network television affiliate’s local area. When
retransmitted by satellite back into the same local area, such signals are called
“local-into-local.” A distant network signal is one received from outside the local network
affiliate’s area. It is referred to as a distant network signal because it originates in one
place and is received in another.
Local-into-local signals were first offered to satellite television subscribers in 1999
under the Satellite Home Viewer Improvement Act (SHVIA). It permitted, but did not
require, satellite television companies to offer local-into-local signals. Subscribers who
were eligible for distant network signals under SHVIA could also receive local-into-local,
if offered in their area.
Unserved Households. Households are generally defined as either “served” or4
“unserved” under SHVERA based on the signal strength they can receive. Under the
law, only unserved households are eligible to receive distant network television signals
via satellite. “Unserved” households include those that
! are unable to receive a “grade B” signal via an over-the-air antenna; or
!were “grandfathered” per a May 1998 federal court ruling; (see below)
!have satellite TV dishes mounted on a recreational vehicle or commercial
truck (that are not fixed dwellings).
In the late 1990s, some satellite television companies broadcast distant network
signals to subscribers who were not eligible to receive them. Broadcasters filed suit
against those satellite television companies. In May 1998, a federal court ruled that a
3 See CRS Report RS20425, Satellite Television: Historical Information on SHVIA and LOCAL,
by Marcia S. Smith.
4 Some C-band subscribers are defined as being as an unserved household under SHVERA. Any
C-band subscriber who was getting distant network signals via their C-band antennas before
October 31, 1999 may continue getting those signals over those antennas. C-band subscribers use
the original large backyard satellite dishes that are about 7 feet in diameter. The number of C-
band subscribers is diminishing as many of them transition to the newer, smaller “rooftop”
satellite dishes used by the two major U.S. satellite television companies — EchoStar
Communications and DirecTV — and the wider variety of programming they offer.
company called PrimeTime 24 had violated the Satellite Home Viewer Act (SHVA) by
retransmitting broadcast network television signals to both served and unserved
households.5 The court ruled in favor of the broadcasters, meaning that many satellite TV
subscribers would have lost access to distant network signals.
However, Congress was debating satellite TV legislation (SHVIA) at the time and
chose to allow some of those subscribers — called “grandfathered subscribers” — to
continue to receive the signals for five more years (until December 31, 2004).
Provisions in SHVERA
Under SHVIA, subscribers receiving distant network signals could also subscribe to
local-into-local when it became available. In 2004, Congress again deliberated satellite
TV legislation, ultimately passing SHVERA. Sections 103 and 204 of SHVERA
differentiated three groups of subscribers: grandfathered, other, and future subscribers.
In areas where local-into-local service was available, some had to choose between distant
network signals or local-into-local. Each subscriber’s situation was unique, complicating
efforts to understand how the new provisions affected a particular household.
Grandfathered Subscribers. This group consists of households that had been
receiving distant network signals illegally per the 1998 Miami court ruling. Under
SHVERA, if local-into-local was offered in their area, or became available later, this
group was required to choose between retaining distant network signals or receiving
local-into-local signals within 60 days of being notified by their satellite company. They
could no longer receive both.
Other Subscribers. This group consists of households who received distant
network signals legally. Under SHVERA, if a satellite company offered local-into-local
in a subscriber’s area on January 1, 2005, these subscribers could receive both distant6
network signals and local-into-local signals.
If a satellite company did not offer local-into-local service in the subscriber’s area
on January 1, 2005, but it became available later, the subscriber would then have to
choose between distant network signals or local-into-local.
Future Subscribers. This group consists of households that subscribe to satellite
television after December 8, 2004, the date of enactment of SHVERA. If local-into-local
service is offered in their area, they may not receive distant network signals. If local-into-
local is not offered when they subscribe, and they are eligible for distant network signals
(i.e. they are “unserved”), they may receive distant network signals until such a time as
local-into-local is offered.
5 CBS, Inc. v. PrimeTime 24 Joint Venture, 9 F. Supp.2d 1333 (S.D. Fl. 1998). EchoStar
Communications was also charged with violating the Satellite Home Viewer Act (SHVA) in a
similar manner. See Communications Daily, vol. 18, no. 216 (Nov. 9, 1998), p. 9
6 As long as the satellite carrier made notifications required by SHVERA to the network’s
affiliate by Mar. 1, 2005.
Impact of Local Signal Availability on Subscribers
To summarize, if local-into-local is offered in a particular area:
!subscribers who were receiving distant network signals at the time
SHVERA was enacted (December 8, 2004), because they were
grandfathered in, could continue to receive distant network signals, but
could not receive local-into-local at the same time. They had to choose
one or the other.
!subscribers who are receiving distant network signals because they
cannot get a grade B signal may continue to receive distant network
signals if their satellite TV provider was not offering local-into-local on
January 1, 2005. If local-into-local becomes available after January 1,
into-local.
!subscribers to satellite television after the date of enactment of SHVERA
(December 8, 2004) may receive distant network signals if they are
eligible for them and local-into-local is not offered. If local-into-local
later becomes available, they must subscribe to local-into-local.
Recent Developments
As noted above in the section “Unserved Households,” EchoStar Communications,
also known as the DISH Network, was charged with violating the Satellite Home Viewer
Act in 1998. EchoStar chose to defend its actions, and the company’s distant network
signals have been unaffected during the eight years the issue has been litigated.
In May 2006, an Atlanta appeals court ordered a permanent injunction on EchoStar’s
carriage of all distant signals, including those provided to eligible consumers who cannot7
receive a grade B signal. In order to avoid a circumstance in which customers would lose
access to distant signals they were eligible to receive, negotiations were undertaken
between EchoStar and the four major broadcast networks (ABC, CBS, NBC, and FOX)
to set the terms under which EchoStar could continue to carry those signals for eligible8
customers. A negotiated settlement was reached with three networks, but not with FOX.
EchoStar claims that FOX chose not to negotiate a settlement because it is part of
a vertically integrated company that is a partial owner of DirecTV, which would stand to
gain customers at the expense of EchoStar if EchoStar’s eligible customers could no
longer receive distant FOX signals. FOX, on the other hand, counters that it was involved
in this litigation for five years before its parent company took operational control of
7 Communications Daily, vol. 26, no. 101 (May 25, 2006), p. 1.
8 Echostar agreed to pay $100 million and terminate distant signals to ineligible subscribers.
Some FOX affiliates agreed to terms of the settlement; others did not. Satellite Today, vol. 5, no.
DirecTV, and having won the case in court, had no responsibility to negotiate a settlement
that differed from the court’s decision.9
On October 20, 2006, a Florida district court upheld the injunction and voided the
proposed settlement reached by ABC, CBS, NBC, and EchoStar. The court set December
1, 2006, as the effective date of signal cutoff.10 Seven pieces of legislation were
introduced that would have lessened the impact of the injunction (S. 4067 and H.R. 6402,
S. 4068 and H.R. 6340, S. 4074, S. 4080 and H.R. 6384), but none were passed before the
December deadline.11
9 Multichannel News, vol. 27, no. 35 (Sept. 4, 2006), p. 27.
10 CBS Broadcasting Inc. v. EchoStar Communications Corporation, No. 98-2651 (D. Fla. Oct.
11 See CRS Report RL33767, CBS Broadcasting v. EchoStar: The Satellite Home Viewer Act and
Satellite Retransmission of Distant Network Signals, by Daniel Schuman.