The OTT video market is booming because of, not in spite of, regulations that keep over-the-top providers from being considered as multichannel video programming distributors (MVPDs). That's the position of FCC Commissioner Ajit Pai, who reiterated his stance in a speech to an audience in Hong Kong.
"When it comes to Internet-delivered video, we have an incredibly dynamic and diverse industry, one that is constantly giving American consumers new choices and better programming. This success, moreover, has been brought to us by the free market," Pai said in a speech at the Cable and Satellite Broadcasting Association of Asia convention. "The U.S. government has taken a hands-off approach to the regulation of over-the-top video. And I believe that our restraint has yielded terrific results."
Pai said that while cable operators and satellite companies are heavily regulated in many aspects including content, pricing and differing business models, OTT video is not subject to those constraints. He added that facilities-based providers like Time Warner Cable and Comcast are responding to the competitive threat of online video by launching their own OTT programming.
"For me as a regulator and an online video consumer, the way forward is simple. There is no
market failure. There is no problem to be solved."
Not everyone sees the MVPD issue in the same light, of course. FilmOn X CEO Alki David has been lobbying the FCC for more than a year to give OTT providers the ability to be considered MVPDs. Such a rule change would make it possible for his company to negotiate carriage deals with major U.S. broadcasters to stream their content, something they will not do unless compelled to under "must-carry" rules.
Another segment of the television industry, namely, community access TV providers, is fretting that adoption of the proposed rule revision would cause them harm. A provision in the FCC's Notice of Proposed Rulemaking might create a loophole that cable operators could use to stop paying PEG (public, education and government access) fees to communities in return for using their rights-of-way.
FilmOn's David: Amazon, Google lobbying 'heavily' against regulating OTT providers as MVPDs
Community TV stations want cable operators' OTT efforts included in MVPD reclassification
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