FCC chairman Tom Wheeler is tackling the tough, and potentially game-changing, definition of what constitutes a multichannel video programming distributor (MVPD).
The Media Bureau is working on a proposal to classify online video providers— who deliver a linear lineup of programming similar to a cable, telco or satellite operator—as MVPDs, with the rights and obligations of being regulated as such by the FCC.
The bureau tentatively concluded in the Sky Angel program access complaint filed back in 2010 that unless an overthe- top provider also had the facilities to deliver its programming—meaning, the actual channels as it were—the way other MVPDs do, it would not qualify as such. Thus, Sky Angel would not have standing to bring the access complaint.
This present decision would reverse that tentative conclusion, which the FCC has always said could change based on what the commission heard from commenters about a fuller, wider MVPD definition.
This publication has been arguing for several years that it was important for the FCC to weigh in on MVPDs, given how fast broadband is taking over the world.
There is also a point about acting on a complaint that has been in the pipeline for over four years. Sky Angel suspended its over-the-top service at the beginning of this year, citing the regulatory uncertainty about its status and whether it had standing to complain about lack of access to programming.
Certainly, there is an argument that the FCC did not want to rush into a decision, and could not act on Sky Angel until it weighed in.
According to a commission source, the FCC wants to make sure online video distributors have access to vertically integrated programming. Since over-the-top is the likely future of payvideo distribution, the FCC does not want OVDs to be outliers.
The item as currently constituted would apply program access requirements—not to mention retransmission consent and must-carry obligations— to OVDs, tentatively concluding that they don’t need a transmission path so long as they deliver linear programming networks. That being the case, an Aereo would have access to broadcaster signals, but would have to pay for them—which was clearly not in its original business plan.
On-demand programmers such as Netflix and Hulu would not qualify, but online video services with a cablelike lineup of networks, such as Sony’s planned virtual pay-TV service, would be able to have club membership.
Another outcome would be that cable operators could not move to an OVD model to get out from under retransmission consent payments.
In time, we expect the plan will be circulated—which will trigger a long process of comment and reply and adjustment, given how important the issue is for the future of video distribution. But that process—again, currently four years old and counting— needs to begin.
