The video programming marketplace has been transformed over the past thirty years. In the early 90s, multichannel video basically meant the local cable operator, leading Congress to enact a regulatory structure that reflected a lack of competitive choices. By contrast, consumers today can choose from a dizzying array of video services, including traditional providers such as cable, broadcast, and satellite TV, as well as a multitude of streaming services that provide both linear and on-demand programming. At the same time, programming networks and TV distributors compete for consumers’ attention in a broad universe of entertainment options that includes gaming, social media, and more.
The explosion of video programming options has upended traditional business models and left market participants scrambling to figure out what consumers want and how to deliver it. In this hyper-competitive environment, Congress and the FCC should be removing regulations based on a marketplace that no longer exists – not extending those outdated rules to new entrants.
Just consider:
- This summer – for the first time – viewing of broadcast and cable TV networks fell below 50% of TV use. This stands in stark contrast to the video landscape more than 30 years ago when Congress enacted the laws that continue to govern cable today.
- Nearly all consumers can now choose from at least three—and many from four or more—competing MVPDs.
- Even more significant is the plethora of streaming options available today, including free, linear ad-supported services, linear subscription services, and on-demand subscription services. Cord-cutting is why traditional viewing options have fallen below 50%.
Instead of acknowledging this marketplace reality, some are calling for the FCC to reopen a long-dormant proceeding proposing to extend these same 1990s-era rules to streaming video providers. In 2014 the FCC examined whether to reinterpret the term MVPD to apply to linear over-the-top providers and declined to proceed. Broadcast affiliate groups want to use the proposal to force streamers to negotiate with them for carriage. Essentially, they seek to radically alter the regulatory landscape to gain leverage in internal broadcast industry business disputes. That transparently self-interested objective should not justify dusting off an old proceeding whose flaws have only become more apparent over time.
More recently, Chairwoman Rosenworcel stated that the record of the FCC proceeding revealed “significant concerns” with the FCC’s authority to reinterpret the term MVPD to include vMVPDs. But even were the proposal not statutorily barred, it is clear that trying to force an aging regulatory regime on the new world of video entertainment—with all its many challenges and choices-- would not serve the interest of consumers. And although the broadcast affiliate groups are focusing solely on the retransmission consent issue, the blunt instrument of redefining “MVPD” would subject vMVPDs to a wide array of legacy regulation that applies to cable and satellite today.
Instead of extending regulation designed for a competitive landscape that no longer exists, Congress should eliminate those rules for all video providers and let competition work its magic.