Hill Appropriators Ready To Mandate Set-Top Proceeding Pause

The GOP legislation would forbid FCC funding “to finalize, adopt, implement, administer, or enforce any proposed rule under section 629 of the Communications Act of 1934” until 180 days after completion of a cost-benefit analysis “peer-reviewed” study “conducted by an institution of higher education” that also reviews “other market-based solutions.” The FCC would have to seek public comment on the study and provide no less than 90 days for such comments and then address concerns raised in the comment cycle in a report adopted by commission vote and made publicly available.

The rider said the set-top study “at minimum” would have to assess the potential impact of the proposed rule on: “(A) all parties in the video programming marketplace, including video programming creators, programming networks, multichannel video programming distributors, and subscribers of multichannel video programming services; (B) video programming content diversity; (C) intellectual property and content licensing; and (D) consumer privacy and the legal remedies available to consumers for violations of video privacy obligations.”

“It’s pathetic, is what it is,” House Communications Subcommittee ranking member Anna Eshoo, D-Calif., said in an interview. “This is a clear demonstration of how status quo this place is. They are purposefully throwing sand in their own eyes and blurring their vision of the future. That’s what this represents.”

Eshoo, who wasn't immediately familiar with the rider unveiled Tuesday, has led a defense of the NPRM. It has split Democrats on Capitol Hill. Rep. Yvette Clarke, D-N.Y., loudly urged a pause to the FCC proceeding until the Congressional Research Service and GAO study its implications for diversity of programming. She formed a caucus last week with objections to the NPRM as a key stated aim (see 1605190055) and led a letter of more than 50 House Democrats backing her views. Other House Democrats who joined Hill Republicans in questioning the NPRM include Judiciary Committee ranking member John Conyers of Michigan, Intelligence Committee ranking member Adam Schiff of California, Homeland Security Committee ranking member Bennie Thompson of Mississippi and Congressional Black Caucus Chairman G.K. Butterfield of North Carolina. The White House broadly backed the FCC set-top proceeding last month but raised questions in comments filed by NTIA (see 1604150076). Replies on the set-top rulemaking showed the split between pay-TV and allied interests and tech and other interests backing the commission (see 1605230058 and 1605240069).

Clarke Supportive

The set-top appropriations rider is a “step in the right direction,” Clarke said Tuesday during a news-media call hosted by the Future of TV Coalition, an industry group opposing the NPRM. “This is a truly encouraging development.” She will “continue to push the envelope” and fight on this issue, she said. “What we’re really talking about is opening up a whole new landscape whose implications have not been totally vetted or even discussed.” She questioned FCC Chairman Tom Wheeler’s defense of the NPRM: “We cannot take this information as factual with only voluntary measures in place.”

Rep. Tony Cardenas, D-Calif., worried of “unintended consequences that would hurt minority and independent programmers,” he said during the Future of TV call. He aligned himself with “content creators and consumers who often get overlooked” in such battles. Consequences would be “disastrous” if a variety of content from women and minorities was hindered, he warned. He is concerned the FCC lacks the statutory authority to do some of what it proposes, he added.

Others on the call slammed the NPRM. “It is imperative -- this is not just merely an outcry or whining -- this is something that can crack or irreparably harm what we have as communications infrastructure for the nation,” Revolt TV CEO Keith Clinkscales said. National Urban League President Marc Morial agreed: “What the FCC is doing is rushing into an area without a complete record, with a record devoid of anything but anecdotal statements made by various people about the impact of this proposed rulemaking. We think it’s a bad way to make law.” MPAA Senior Vice President Neil Fried said the NPRM included violations of Communications Act Section 629.

Despite both Democrats and Republicans questioning the NPRM, Eshoo told us she doubts the rider will make it to the finish line. “They can’t answer the basic question I ask -- why has the cost gone up by 185 percent, screwing consumers, giving them the privilege of paying 185 percent more over the last 20 years?” Eshoo told us. “They can’t answer that.” She cited a statistic included in Wheeler’s set-top fact sheet and his commentary touting the item.

Net Neutrality, JSAs

The GOP funding bill also addressed net neutrality and broadband rate regulation. No funding “may be used to regulate, directly or indirectly, the prices, other fees, or data caps and allowances … charged or imposed by providers of broadband Internet access service,” another policy rider warned, “regardless of whether such regulation takes the form of requirements for future conduct or enforcement regarding past conduct.”

The bill included a rider forbidding the FCC from funding its net neutrality order until litigation is resolved, a previously defeated rider that appeared in last year’s House funding bill but never in the Senate’s. It also restored a version of another failed FCC process overhaul rider from last year that would prevent funds from going toward any new rules or amendments “unless the Commission publishes the text of such rule, amendment, or repeal on the Internet Web site of the Commission not later than 21 days before the date on which the vote occurs.” Commerce Committee Democrats had strongly opposed such a measure, requiring posting of FCC items upon circulation. Riders on FCC process and net neutrality failed during last year’s appropriations process.

Appropriators included a policy rider, as they had hinted, to forbid the FCC from cracking down on broadcaster JSAs through the transaction review process. Last year, the FY 2016 funding law included a bipartisan rider that grandfathered JSAs, and this year, lawmakers of both parties complained the FCC still was limiting such JSAs through transaction review. The top Senate Republican appropriator told us he also plans to include a rider along these lines in his unreleased funding bill.

“This bill makes great strides on all accounts -- carefully investing taxpayer dollars in programs that promote opportunity, while keeping these agencies accountable to the American people,” Appropriations Committee Chairman Hal Rogers, R-Ky., said in a statement. The FCC funding level is “a cut of $69 million below the fiscal year 2016 enacted level and $43 million below the request,” the Appropriations Committee said. The FCC’s FY 2016 funding is about $340 million, the amount it’s been frozen at for years, in addition to $44.17 million allocated for its headquarters transition process. Financial Services Subcommittee Chairman Ander Crenshaw, R-Fla., told us last week that the full committee markup of the measure is expected “after we come back and after the June break” (see 1605190050).