Several Urge Deregulation, in Video Competition Comments
More competition than ever, hobbled by analog-era regulations: that's how multiple commenters described the video market as the FCC readies its 18th video competition report. NCTA, in a filing posted Thursday in docket 16-247, said the annual inquiry -- now treated as routine, done by the Media Bureau without consideration by the full commission -- "misses the point: The development of true marketplace competition means that a great many regulatory measures are no longer needed and should, if anything, be curtailed." Small and midsize multichannel video programming distributor representatives argued the market is too tilted in programmers' favor to be considered competitive.
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NCTA criticized the FCC for "proposing and imposing more regulation to substitute for marketplace forces," pointing to the net neutrality order, the set-top box proposal and the diverse programming rulemaking. AT&T said the market, not regulatory intervention, has led to a growth of the MVPD apps.
For broadcasters, the big regulatory challenges include "burdensome" ownership regulations, NAB said. It warned of the broadcast incentive auction's outcome "if the subsequent broadcaster repack is not handled correctly." NAB said broadcast-only households are growing "and that the trend toward diminishing reliance on traditional pay TV systems is now an irreversible reality," with NCTA's rebranding that dropped the word “cable” from its name (see 1609190017) pointing to "how dramatic this shift is.”
Some commenters sought more rulemaking. NTCA said the agency should help rural MVPDs gauge market rates for programming and stop programmers from bundling practices that have rural MVPDs buying undesired programming to get the programming they want. It also said the FCC should stop mandatory broadband tying where rural MVPDs pay per-subscriber fees for non-video broadband customers, stop programmers from requiring rural MVPDs put content in specific service tiers and monitor the over-the-top market to ensure exclusive arrangements don't wall off certain web-based video content from rural MVPDs and broadband providers. Some of those proposals also had been discussed as part of the FCC's look at the totality of circumstances test in retransmission consent negotiations (see 1509020061). The agency's decision not to pursue any rule changes (see 1607140047) is resulting in increased video service rates for rural customers "and a failure on the part of the Commission to fulfill its responsibilities under Section 706 of the Telecommunications Act ... to advance broadband deployment," NTCA said.
Midsize ILECs haven't had an easy time entering the video business between regulatory uncertainty, such as FCC inaction on revising the totality of circumstances test, and the hurdles that come with local franchising processes and other barriers to marketplace entry, ITTA commented. It also said small and new-entrant MVPDs are weighed down by "dramatically increasing fees and discriminatory terms" in video content negotiations, with some members saying retrans consent fees have gone up as much as 77 percent annually over the past few years and one reporting a 900 percent increase since 2008. "The single most significant cost issue [ITTA members] face in the delivery of their video programming is the helium-infused trajectory of retransmission consent fees," it said.
Evidence shows the video segment is effectively competitive and the FCC should declare so in its next video competition report, the Free State Foundation said. That evidence includes the growth of online video distributors and of the IP device viewing market, it said, saying the agency should pursue "a more straightforward deregulatory presumption" for video services.