Potential Telecom Act Update Could End Debate Over MVPD Definition, Say Experts
Clarity on the definition of a multichannel video programming distributor could be addressed on the back of bigger issues like the retransmission consent model and must-carry rules if Congress goes ahead with a Telecom Act rewrite, said attorneys and executives in media, cable and MVPD. An expansion of the definition to include companies using the Internet to deliver video to subscribers was largely opposed by cable operators when the FCC proceeding closed for comment in 2012. The FCC proceeding has been dormant for two years, and it stemmed from a 2010 program access complaint from Sky Angel against Discovery Communications, concerning Sky Angel’s video service FAVE-TV. The complaint raised the Media Bureau proceeding on how to interpret the terms “MVPD” and “channel.” Some TV station owners, DirecTV and some Internet video distributors supported a broader approach to the term to include entities that provide multiple linear networks of video programming.
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The issue raised by the Sky Angel complaint and put out for comment by the FCC is appropriate, given the changes that have taken place with the development and availability of online video, said Matt Polka, American Cable Association president. It’s up to the FCC to look at the current statute, make its own interpretation and then rule as it sees fit, he said. The commission could also rule that because the statute is clear about a direct transmission path to meet the definition for MVPD, the stalled proceeding would require action by Congress, he said. That would lead into a act update, “where I think it would be entirely appropriate for consideration,” he said.
Congressional action could be through the rewrite or through a bill like the Consumer Choice in Online Video Act introduced last year by Sen. Jay Rockefeller, D-W.Va., Polka said. The bill aimed to ensure online video providers have access to broadband systems owned by cable and telephone companies and give online video distributors protections similar to satellite providers, allowing reasonable access to video programming (CD Nov 13 p1). The House Commerce Committee appears to want to eliminate the silos of regulation that separately apply to cable, phone and the Internet, Polka said, referring to the committee that expressed interest in revising the law. Providers are offering multiple services because of converging businesses and they should be regulated similarly, he said: “It would be a natural progression for Congress to consider the OVD question and whether or not changes to the current definition should be considered."
Congress isn’t likely to address how MVPDs are defined in a stand-alone provision, said Cathy Sloan, vice president-government relations at Computer and Communications Industry Association. Retrans fees, must-carry and program access are more important and more prominent than just the standalone issue of defining an MVPD, she said. “Retransmission fees are the culprit for causing blackouts.” Any update that grapples with retrans and the other larger issues as major drivers will naturally just sweep in the definition of MVPD, she said.
The MVPD term will probably be teed up in the event of a rewrite if the FCC doesn’t issue a decision by the time a rewrite occurs, said David Wittenstein, a Cooley communications and content company attorney. The retrans reform is probably more important than figuring out whether over-the-top providers are MVPDs, he said. “If there is a general rewrite, you can assume that the issue of what is an MVPD will be brought to bear."
As a new entrant and smaller MVPD, CenturyLink supports the House Commerce Committee’s interest in addressing the law, said Jim Campbell, regional vice president-regulatory and legislative affairs. The issues of retrans, must-carry and program access must be looked at because they have the most negative impact on consumers, he said. However, the types of companies that can now be considered MVPDs are wider ranging than in the past, he said. A definition should be technology agnostic, he added.
Aereo Impact?
The pending copyright decision on Aereo also could affect any rewrite or how an MVPD is defined, some professionals said. An oral argument is set for April 22 in the Supreme Court (CD April 4 p6). Groups, including ACA and CCIA, said in amicus briefs that a decision against the streaming TV service would hamper innovation. Even though Aereo is a copyright case, the MVPD definition is related and people will want to see how the Supreme Court rules, said Wittenstein.
The Supreme Court decision will probably take place before Congress revises the Act, Sloan said. The decision will affect the market, which will in turn affect the legislation, she said. Although the decision isn’t going to change anything about the definition of MVPD by itself, “it has the potential to cause a major shift in the marketplace and it could provoke legislative proposals around the change,” she said.
It appears that FCC Chairman Tom Wheeler is willing to take a look at the larger issues along with the MVPD issue, Campbell said. “I think it’s going to be more of a package deal and that’s probably the better way to address it.” NAB is agnostic on where the debate on defining an MVPD should occur, said a spokesman. “The important point is for policymakers to continue recognizing that quality programming is expensive, deserves to be protected from pirates, and has helped sustain a vibrant local broadcasting system that is unique in the world.”
The FCC already has the authority to determine the proper definition of an MVPD, said Charles Naftalin, counsel to Sky Angel at Holland Knight. “Congress adopted the statutory definition of MVPD, and it’s been the same ever since,” he said. “It’s up to the FCC to apply it.” As a general matter, it’s better to let the expert agency figure out whether there’s an answer to the question under existing law, said Wittenstein. If Congress thinks the agency got it wrong, then Congress could step in and change the result, he said. “At a certain point, agency inaction will invite others to step into the void.”