Programmer Split Emerging in Indie Programming Inquiry
A point of agreement between independent and diverse programmers and major content companies was that many parties in the FCC indie programming notice of inquiry have cited practices like bundling as inimical to a fair and competitive market. Otherwise, the programmers and content companies diverge sharply, with CBS, Time Warner, 21st Century Fox, Viacom and Walt Disney calling such arguments "a rehash," while a number of indie programmers and allies said it was clear those programmers face an uphill struggle getting onto multichannel video programming distributors' channels. "There is widespread agreement that independent programmers face significant obstacles in reaching consumers," RFD-TV said in a filing posted Wednesday in docket 16-41.
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Tuesday was the deadline for reply comments and a number of indie programmers and allies are pushing the FCC to take action (see 1604200014). Comments weren't available earlier because the FCC filing system wasn't fully working. The FCC's focus should be on bundling practices and MVPD efforts to quash over-the-top competition "by encroaching on the openness and affordability of Internet alternatives," Free Press said in a filing posted Wednesday in the docket. National Hispanic Media Coalition, arguing most-favored-nation (MFN) and alternative distribution method (ADM) clauses in contracts hit indie programmers particularly hard, said that the FCC "should investigate the purpose of such provisions and evaluate whether placing limitations on their severity or timing could help programmers achieve wider carriage." The agency hosts a workshop Monday on the state of the indie and diverse video market (see 1604130007).
Content companies CBS et al. dismissed as tired the arguments that bundling, tiering and penetration requirements limit MVPDs' channel capacity and force them to buy undesirable programming, in turn leading to higher consumer prices. The programmers said those are the same arguments raised in FCC proceedings regarding everything from program access rules and tying arrangements to the totality of circumstances test to the regulations governing video programming vendors, programming companies. Programmers pointed to a study indicating prohibitions on bundling and distribution requirements "often require onerous price controls" and could discourage competition.
"Tooting their own horn will only get these cable giants so far," Free Press said, adding it was "clear" that indie and diverse programmers face difficulty getting on MVPD channels as well as through online distribution platforms, since OTT "remains subject to MVPD influence." It also dismissed arguments in favor of bundling arrangements, such as that they give a leg up to diverse content trying to build an audience. "This paternalistic argument ignores the fact that diverse content is not a niche product but an extremely valuable commodity that speaks to an ever-growing (and often ignored) segment of the population," Free Press said.
T-Mobile, calling mobile video "the next frontier for mobile broadband disruption," said it's concerned about practices that could negatively affect its Binge On service, particularly concerned with MFN clauses that let MVPDs "cherry-pick" particular terms. It also said it was concerned about the ramifications of ADM provisions and bundling, recommending the FCC look at their effect on program diversity and competition
Pointing to Communications Act Section 616 authority, RFD-TV said that the FCC should use its current totality of circumstances test review as an opportunity to disassemble bundling. It also said the agency should look into Verizon's dropping of RFD-TV despite the programmer offering to cut its monthly fees by 25 percent, questioning whether that was "based on a persistent bias against rural-and-senior-oriented programming." Verizon told us Thursday that there is no such bias, citing programming networks it carries on Fios such as Great American Country, BlueHighways and Retirement Living TV. RFD-TV also tried to rebut arguments the FCC doesn't have authority under Section 616, which covers MVPD carriage discrimination, saying it has parallel structure to 628(c), which relates to video programming competition and diversity and which the U.S. Court of Appeals for the D.C. Circuit said in its 2011 Cablevision v. FCC decision is a minimum, not maximum requirement on FCC authority.
Public, educational and government programmer advocates Alliance for Community Media and Alliance for Communications Democracy said jointly Wednesday that arguments about the technical infeasibility of including PEG channel information in programming guides, especially as that access is controlled by third-party vendors, "is disingenuous." They said that providing such information wouldn't require expensive of major hardware or software upgrades.