Sinclair Responds to Senators' Letter to FCC Regarding Mediacom Negotiation

Sinclair Responds to Senators' Letter to FCC Regarding Mediacom Negotiation

BALTIMORE, Jan. 31 /PRNewswire-FirstCall/ -- Sinclair Broadcast Group, Inc. (NASDAQ:SBGI) today sent the attached letter to U.S. Senators, Daniel Inouye and Ted Stevens, Chairmen of the U.S. Senate Committee on Commerce, Science and Transportation in response to a letter the Senators sent yesterday to Kevin Martin, Chairman of the U.S. Federal Communications Commission regarding the negotiations between Sinclair Broadcast Group and Mediacom Communications Corp. (NASDAQ:MCCC) over carriage of Sinclair's television stations.

The impacted stations are:

Des Moines/Ames (KDSM-FOX), Cedar Rapids (KGAN-CBS), Mobile-Pensacola (WEAR-ABC/WFGX-MNT), Peoria/Bloomington (WYZZ-FOX), Greenville/Spartanburg/Asheville (WLOS-ABC/WMYA-MNT), Lexington (WDKY-FOX), Madison (WMSN-FOX), Nashville (WZTV-FOX/WUXP-MNT/WNAB-CW), Minneapolis (WUCW- CW), Paducah/Cape Girardeau (KBSI-FOX/WDKA-MNT), Springfield/Champaign/Decatur (WICS-ABC/WICD-ABC), St. Louis (KDNL-ABC), Tallahassee (WTWC-NBC), Birmingham (WTTO-CW/WABM-MNT), Norfolk (WTVZ-MNT) and Milwaukee (WCGV-MNT/WVTV-CW).

Sinclair Broadcast Group, Inc., one of the largest and most diversified television broadcasting companies, currently owns and operates, programs or provides sales services to 58 television stations in 36 markets. Sinclair's television group reaches approximately 22% of U.S. television households and is affiliated with all the major networks.

The following is Sinclair's letter to the Chairmen of the U.S. Senate Committee on Commerce, Science and Transportation in response to a letter the Senators sent yesterday to Kevin Martin, Chairman of the U.S. Federal Communications Commission regarding the negotiations between Sinclair Broadcast Group and Mediacom Communications Corp. over carriage of Sinclair's television stations.

January 31, 2007

The Honorable Daniel K. Inouye, Chairman
The Honorable Ted Stevens, Vice Chairman
The United States Senate
Committee on Commerce, Science and
Transportation
Washington, DC 20510

Dear Senators Inouye and Stevens:

I have received a copy of the letter, dated yesterday, that you both sent to Federal Communications Commission Chairman Kevin Martin regarding the negotiations between Sinclair Broadcast Group and Mediacom. While I share your frustration that these negotiations have not resulted in an agreement, I do ask that you keep the following points in mind in your consideration of this issue:

1. 47 USC Section 325(b)(i), the most applicable Federal law on this subject provides that "[n]o cable system or other multichannel programming distributor shall retransmit the signal of a broadcasting station, or any part thereof, except with the express authority of the originating station."

2. Allowing Mediacom the right to retransmit the signals of Sinclair's stations without Sinclair's consent, whether through binding arbitration or otherwise, would be tantamount to removing the need for Mediacom to obtain Sinclair's consent, in direct contravention of the statute cited above governing retransmission consent.

3. The only ruling that has been made by the FCC to date on this matter is one in which the FCC concluded, after a thorough review of the record, that Sinclair has acted in a completely lawful manner during negotiations with Mediacom.

4. Virtually all residents in the markets where Mediacom historically retransmitted the signals of Sinclair stations have alternative means for watching these stations, whether through free over-the-air delivery or from one of Mediacom's direct competitors, such as DirecTV, the Dish Network or McLeod USA (a cable overbuilder which serves many of the same residents of Cedar Rapids, Iowa as does Mediacom), all of which were able to negotiate for the right to carry the Sinclair stations without any need for government intervention.

5. A primary intent of Congress in enacting the retransmission consent laws contained in the 1992 Cable Act was to allow broadcasters to be paid by cable operators consistent with the manner in which owners of cable-only channels were compensated. Fifteen years later this intent is only now starting to be realized and only as a result of broadcasters being willing to take the position that their signal cannot be retransmitted in the absence of adequate compensation.

While I can appreciate your desire to make sure that the public is not inconvenienced by this situation, I hope you can understand the danger of suggesting the government should order private parties to enter into an agreement when they are not able to reach agreement on their own. Although the laws surrounding retransmission consent imposes on the parties an obligation to negotiate in good faith (something Sinclair has been found to have done), the laws clearly do not require an agreement to be reached. Moreover, the laws also expressly contemplate that consistent with all private negotiations (whether personal or business), the government cannot order the parties to reach agreement. Requiring Sinclair to submit to binding arbitration and to accept a result therefrom with which Sinclair does not agree would not only be contrary to the intent of the 1992 Cable Act but, would be the equivalent of allowing Mediacom to retransmit the signals of Sinclair's stations without Sinclair's consent. The law does not permit such a result.

Finally, I would like to make you aware that I believe that any suggestion, such as the one contained in your letter, that government intervention will be forthcoming has had a chilling effect on the ability of the parties to reach a mutually acceptable agreement on their own. Unfortunately it appears that Mediacom's interest in reaching agreement has been tempered by a belief that it need not complete a deal because the government will step in to remedy such a failure. Accordingly, I respectfully suggest that the best way to increase the likelihood that the free market for negotiations will yield a successful result would be for Mediacom to understand that, consistent with the clear intent of 47 USC Section 325(b)(i), it will only be permitted to retransmit the signals of Sinclair's television stations if it (and not the government) obtains Sinclair's express authority to do so.

If you have any questions or would like to discuss this issue with me in greater detail, please let me know.

Sincerely yours,

Barry M. Faber
Vice President/General Counsel

First Call Analyst: Lucy Rutishauser

Source: Sinclair Broadcast Group, Inc.

CONTACT: Barry M. Faber, V.P. & General Counsel, Sinclair Broadcast
Group, +1-410-568-1500

Web site: http://www.sbgi.net/

Company News On-Call: http://www.prnewswire.com/comp/110203.html

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