Online Video Distribution Proposed Under Telecom Act Provision
Taking advantage of a little-used provision of the Telecom Act, Venice, Calif.-based Digital Broadcasting OVS asked the FCC for certification to operate an online pay-TV service in the top 50 U.S. TV markets, filings show. The Media Bureau published a public notice on the proposal late Friday (CD May 31 p17), providing few details. The service would provide up to 1,000 HDTV channels over the existing Internet infrastructure, the company said in its application for certification as an Open Video System (OVS). It would also provide a special IP channel for “EAS First Responder agencies” it said. The company is a certified exempt telecom company under the 1996 legislation, CEO Roy Jimenez told us.
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"At the time we were certified in 1996, there were no modems that could carry IP HDTV as we had planned,” Jimenez said. “We chose to wait it out and let the technology improve, let the cost of the architecture come down and let the speeds get to a point” where an online video distribution service would be possible, he said. Though Digital Broadcasting OVS applied for OVS certification in the late ‘90s, it never introduced a service, he said. Prompted by the questions about online video distribution the FCC asked in its recent notice of inquiry on competition in the pay-TV market, and certain conditions of the order approving Comcast’s purchase of control in NBCUniversal, Jimenez said he decided the time was ripe to try again.
Digital Broadcasting OVS is taking a novel approach in its latest certification application. Historically, an OVS operator has been required to build facilities in a market it wanted to serve, Jimenez said. “You'd have to dig a bunch of ditches, attach a bunch of poles,” he said. “We're proposing we don’t need to do that any longer because we've got an IP broadcasting technology,” he said. “It goes through existing infrastructure and we're not asking for any rights of way … we're going to go through existing Internet connections, through broadband.” Seeking a national footprint is also a new approach. Other recent OVS certifications have been for operations that serve single markets or regions, FCC filings show.
Such filings, seeking to exploit an old rule in a new and creative way, appear before the agency occasionally, a communications lawyer said. “In my experience, the FCC usually shoots them down.” The OVS rules are cumbersome and assume the applicant owns the transport network, the attorney said. A Media Bureau spokeswoman declined to comment. At our deadline, Jimenez said he wasn’t aware if the commission had received any comments in response to the public notice it released Friday, and he hasn’t yet been served with any copies.
Jimenez said he’s confident the commission will grant the application. Under OVS rules, the agency has 10 days to act on the application. Comments on the Digital Broadcasting OVS application were due at the close of business Tuesday. “I feel it’s a 99 percent go,” Jimenez said.
If he’s right, Digital Broadcasting OVS could begin offering demo service within 120 days, Jimenez said. He plans to give TV stations a 90-day notice to elect retransmission consent or must-carry status, he said. “After the 90-day period, we'll have what the lineup looks like.” The system will also offer access to independent channels that can’t get distribution on traditional pay-TV operators, he said: Then it’s a matter of setting up the company’s servers and turning it on.