FCC Moves To Give Internet Video Startups The Same Protections As Cable Companies

from the actually-leveling-the-playing-field dept

While the FCC's decision to raise the base broadband definition to 25 Mbps, its ruling on municipal broadband and the agency's new net neutrality rules have seen the lion's share of media attention, there's another potentially important FCC plan underway that has largely managed to fly under the radar. The FCC has recently been fielding comments on whether the agency should reclassify linear over-the-top (OTT) Internet video providers as multi-channel video programming distributors (MVPDs), giving these companies FCC-enforced access to vertically integrated programming. The full order can be found here (pdf).

The idea is that by giving Internet video providers formal protections and the right to negotiate content deals like cable companies, we'll see a surge in Internet video service competition and a reduction in the logjam surrounding content licensing. Note that this would only really impact subscription-based, prescheduled content (live TV), and as a result wouldn't really apply to on-demand catalogs like Netflix or YouTube. Not too surprisingly, the cable industry, still sore from the FCC's Title II ruling and wary of new competitors, doesn't think modernizing cable regulations to include Internet video is a great idea:

"[H]aving recently adopted what was once understood to be the 'nuclear option' of Title II regulation of broadband Internet access service to address a hypothetical threat to the openness of the Internet," NCTA told the commission, "the Commission in this proceeding is proposing to apply an arsenal of regulations from the Cable Consumer Protection and Competition Act of 1992, purportedly to promote competition in the already competitive and well-functioning online video marketplace."

Some of the new wave of Internet video giants similarly aren't happy with the idea. Even though the rule change likely wouldn't impact the company's on-demand services specifically, an Amazon filing with the FCC argues it doesn't really want the FCC's help, either:

"In light of the excellent results achieved over the last several years, Amazon does not see why the commission would risk interfering with the OTT marketplace, which is still growing and changing, at this stage in its development," the company said. Amazon argued that services offered by Amazon, Netflix and Apple represent a whole new ballgame, not another team in the MVPD league. It said that planned services from Dish and HBO are an effort to be players in this new space, a space it and others have been building for years."

Amazon's likely wary for two reasons: the company's already seeing success and is justly nervous about regulatory good intentions, and the FCC's proposal could actually go both ways -- as in it might help cable operators looking to deploy an out-of-footprint streaming service (giving them mandated access to regional sports networks, for example), generating additional competition for Amazon. Meanwhile, broadcasters like ABC, CBS, Fox, and NBC support the measure, pleased that it would force OTT upstarts into gaining consent out of the gate for retransmitting their broadcasts (read: they think it will help thwart piracy or force the next Aereo to the negotiations table).

Consumer advocates like Public Knowledge quite like the rule change, suggesting it could ramp up competition and bring down prices "without subjecting most kinds of online video services to additional regulation." The updating of the definition of an MPVD could provide Internet video companies with protections they didn't have previously:

"That interpretation meant that none of the protections that MVPDs have against other MVPDs, and that programmers have against MVPDs, applied to online video. That means that programmers could be prevented through contracts or incentives from selling video to online services, and that programmers affiliated with cable companies could discriminate against online services. Actions like this can add up to starve online video services of content--which is why most of the most popular services offer video that is complementary to traditional MVPD service (back catalog programming, and original and user-generated content) instead of the same lineup of things like first-run shows and live sports."

For an agency that spent decades paying empty lip service to competition, the FCC's focus in this case really does appear to actually be on modernizing regulations to help foster competition and protect the smaller Internet video providers of tomorrow. Reclassifying ISPs as common carriers under Title II protects upstart companies from discrimination by broadband and cable companies, and reclassifying Internet video providers as cable companies would provide them additional protections and programming negotiations rights they don't currently have.

In short, for the first time in fifteen years or so the FCC actually appears to be focusing on competition as a real policy goal. That's in stark contrast to the expectations most people had (myself included) when we learned that a former wireless and cable industry lobbyist would be the latest to run the FCC.

Filed Under: fcc, multi-channel video programming, mvpd, online video, ott, over the top video

Comcast, NBC Have Learned Little, Still Cling Tightly To Broken 'TV Everywhere' Mindset

from the change-is-apparently-hard dept

For years the cable and broadcast industry has tried to pretend it's keeping pace with the times via an initiative called "TV Everywhere." TV Everywhere essentially lets cable subscribers watch a selection of limited content on limited devices -- if you have a traditional cable connection. The idea is that if you've got TV Everywhere, there's simply no need to wander off campus to enjoy streaming services from the likes of Netflix. But as we noted years ago, the idea was unlikely to accomplish much given it's based on DRM'd, restrictive walled gardens and unskippable ads -- precisely the sort of things that drive users to streaming alternatives and piracy in the first place.

Our skepticism appears warranted. A study from earlier this year indicated that 82% of consumers have no idea what TV Everywhere even is. While polite about it, the study concluded that this was because TV Everywhere as a concept just isn't implemented very well, and inconsistently across carriers. The study also noted that just 4% even knew what their cable credentials are. Companies like Sling have seized on the TV Everywhere dysfunction, going so far as to launch entire ad campaigns mocking the concept for being overly restrictive and just kind of annoying.

In an amusing attempt to right the TV Everywhere ship, Comcast and NBC Universal appear poised to launch a new TV Everywhere brand awareness effort. This will include, reports indicate, promoting the service via ads running the tagline "watch TV without a TV":

"The campaign, which carries the “Watch TV without a TV” tagline and will be backed by digital and on-air promos across NBCU’s portfolio, will focus on how consumers can access content across those channels and brands on a variety of connected devices as part of their existing pay-TV The new TVE consumer campaign, NBCU said, will be “laser focused on driving web traffic, mobile downloads, video views and increased engagement across NBCUniversal’s brands."

Rather amusingly, this concept of "watching TV without a TV" only goes so far, given that while NBC is finally offering some live streams of its content on the company's website as part of this new initiative, in good-old TV Everywhere fashion you still need a traditional cable subscription to access it. In twenty years the cable and broadcast industry's attempts to fight consumers at every step of the way (skippable ads, walled gardens, a la carte) will be part of a hilarious master class in what not to do when fighting disruption. At the moment however, most of the cable and broadcast industry just believes it's being incredibly clever and innovative.

Filed Under: cord cutting, internet, over the top video, tv, tv everywhere
Companies: comcast, nbc universal

FCC Considering Extending Cable Rules To Internet Players Like Aereo (Though Probably Too Late For Aereo)

from the looks-like-a-duck,-perhaps-we-should-make-it-a-duck dept

Aereo's most recent effort to stay alive was to take the Supreme Court's "looks like a duck" test and to say, since the Supreme Court said it looked like cable TV (for the sake of declaring its service a "public performance"), "fine, then let us quack like a duck and pay compulsory licenses under Section 111." Only problem? Other courts have said internet services don't qualify as cable systems for Section 111, leaving them in a Schrodinger's CATV situation. Aereo is a cable TV system as far as the Supreme Court is concerned when it's talking about public performance, but it's not a cable TV system when it wants to go to the FCC and copyright office to pay a compulsory license, which is available to cable and satellite providers.

It appears that FCC Commissioner Tom Wheeler may be looking to change that, beginning a process to give internet companies access to those compulsory licenses, letting "over the top" (OTT) video providers get access to network television at compulsory rates:

In 1992 Congress realized that the then-nascent satellite industry would have a hard time competing because much cable programming was owned by cable companies who frequently kept it from competitors. Congress mandated access to cable channels for satellite services, and competition flourished. Today I am proposing to extend the same concept to the providers of linear, Internet-based services; to encourage new video alternatives by opening up access to content previously locked on cable channels. What could these over-the-top video providers (OTTs) supply to consumers? Many different kinds of multichannel video packages designed for different tastes and preferences. A better ability for a consumer to order the channels he or she wants to watch.

Wheeler is clearly thinking of Aereo here, even noting that the company recently came to the FCC to plead for this sort of thing:

In Title VI of the Communications Act, Congress created rules to ensure that cable companies that own video content can’t raise artificial barriers to competition by refusing to let their video competitors have access to the programming they own. That worked for satellite providers, and also helped telephone companies entering the video business. I believe it makes just as much sense – and will have just as positive a consumer benefit – for an OTT.

Such benefits follow from innovation. Taking advantage of this rule, new OTTs may offer smaller or specialized packages of video programming, so consumers will be able to mix-and-match to suit their tastes. Aereo recently visited the Commission to make exactly this point – that updating the definition of an MVPD will provide consumers with new choices. And perhaps consumers will not be forced to pay for channels they never watch.

Of course, this move may be too little, too late for Aereo. The company has been losing in court, and any final FCC rules may take a bit of time. Still, at the very least it can mean that the next Aereo or ivi may actually be able to survive, rather than have to deal with a veto from the TV networks.

Filed Under: cable tv, copyright, fcc, internet, internet tv, ott, over the top video, section 111
Companies: aereo