‘Broken’ Video Market Said to Need Telecom Act Rewrite
The Telecom Act has many features that no longer make sense in the video market, said representatives of broadcasters, multichannel video programming distributors and public interest groups in interviews. “Competition in video is broken,” said Fletcher Heald broadcast attorney Frank Jazzo, pointing to the uneven regulations that apply variously to broadcasters and MVPDs, and the act’s failure to account for over-the-top competitors. “The act as written doesn’t take into account the changes in technology” in the video realm, said BakerHostetler cable attorney Gary Lutzker.
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One way a rewritten act could improve competition would be to eliminate the broadcast ownership rules, said an executive at a large broadcast network. Though the FCC is examining changing or getting rid of some broadcast ownership rules as part of the 2014 quadrennial review, the commission has shown it’s unlikely to take action on those rules, the executive said. Compulsory licenses, which allow MVPDs to air content without getting permission from each individual copyright holder, should also be eliminated, the executive said. That would create an alternative to retransmission consent, with MVPDs needing to pay the many copyright holders of their content. Neither of those policies is likely to make it into a rewritten act, because they're political hot potatoes, the executive conceded.
The retrans and must-carry rules in the act are among many outdated regulations it applies to cable, said Lutzker. “All of Title 6 was written as though cable were a monopoly provider.” Though it’s unlikely a rewritten act will eliminate retrans, it might contain strategies for improving retrans negotiations, said Garvey Schubert cable attorney Bruce Beckner. When such negotiations break down, the act should require both parties to disclose the details of their offers, Beckner said.
Requirements that cable companies offer channels to governments and leased access rules that set aside channels for independent programmers no longer make sense and are a burden to cable companies, said Lutzker. “You can’t get your lawn mowed for the prices cable companies have to sell their rates” under leased access, Lutzker said. The rise of the Internet means that the access problems those rules were meant to solve no longer exist, he said. “They should be excised immediately."
Not everyone thinks video competition needs fixing, or that the act is the way to fix it. The current rules for broadcasting and cable “have worked fairly well,” said public interest attorney Andrew Schwartzman, of Georgetown University’s Institute for Public Representation. It’s not surprising that the industry side would “push for less rules,” he said. However, Schwartzman also pointed to things in the act he'd like to see changed. Broadcaster license renewal terms should be shortened to increase accountability, and the act should encourage multicasting, he said. All interviewed for the story agreed that any substantive change to the act is likely a long way off. “I'm not holding my breath,” said the broadcast executive. -- Monty Tayloe (mtayloe@warren-news.com)