6163821276_9dcebe87f7_b

This FCC Proposal Will Legalize Streaming Live TV

photo by Scott Swigart via Flickr 

FCC reclassification of Multichannel Video Programming Distributors (MVPD) may soon break the shackles of traditional bundled cable packages by allowing a la carté service for your favorite channels.

Any cable subscriber has said it at one time or another, “Why do I pay for all of these channels if I only watch a handful?”

As it turns out, this sentiment is one mirrored by not just cable subscribers, but elected officials–namely FCC Chairman Tom Wheeler, who announced that an FCC proposal to alter the definition of MVPDs is in the pipeline.

So what exactly does that reclassification mean for customers, and more specifically, when when will you be able to shed all of those pesky reality TV networks?

MVPD

In a statement on the FCC.gov website, Chairman Wheeler announced that the FCC will be taking “the first step to open access to cable programs as well as local television,” noting that “The result should be to give consumers more alternatives from which to choose so they can buy the programs they want.”

aha75pxIcon “Consumers have long complained about how their cable service forces them to buy channels they never watch.  The move of video onto the Internet can do something about that frustration.” – Tom Wheeler

What Wheeler is referring to is what the FCC has acknowledged is an outdated model of cable subscriptions in which customers are forced to purchase channels that they don’t in fact want. More specifically, Wheeler is referencing what the FCC has also deemed an outdated definition of MVPDs.

By current FCC definition, MVPDs are:

MVPD

“A service provider that delivers video programming services for a subscription fee”

Under the existing definition of MVPDs, which only encompasses traditional cable providers like Comcast, Time Warner, and Direct TV, online video providers (OVD) like the controversial Aereo, which was recently shut down for streaming live TV to customers for a fee. This, however, may soon change.

Under the new proposal, by expanding the definition of MVPDs to fit online video providers (OVD), as well as current cable providers, Wheeler and the FCC hope to do a couple of things:

  • Increase competition – by expanding the market to new providers like Aereo, the FCC hopes to foster competition that will benefit consumers. A method which Wheeler likens to the 1990’s when congress and the FCC paved the way (pdf) for satellite providers to enter the cable market
  • Provide consumer-friendly programming by allowing the definition of MVPDs to blanket OVDs, Wheeler hopes that consumers will be able to watch what they want without the hassle of paying for channels they don’t want

What to watch out for

Though the specifics of such a plan are yet to be unveiled, the FCC is aware of some potential pitfalls of their reclassification. In order to ensure that the proposal is effective, the FCC must take a few measures:

  • Technological neutrality – in order to allow the meshing of OVDs and MVPDs, the FCC must make sure that the definition of MVPDs is “technology neutral.” This means that it should make the definition of MVPD unrestricted to just cable-box providers–a technology that the FCC recognizes is quickly becoming a thing of the past.
  • Equal access to programming – in order to ensure that the redefinition of MVPDs does in fact spur competition, the FCC is charged with making sure their proposal gives OVDs equal access to programming. Mainly, the concern here will be that cable companies will outprice new competitors by charging them exorbitant rates for access to their programming.

The road towards a revamp of the traditional cable subscription model will not be without its obstacles. In order to reclassify MVPDs the FCC will have to grapple with a prior D.C. District Court decision against OVD provider Sky Angel, which may further muddy the waters in pushing a measure forward.

The takeaway

So far, big cable providers like Comcast have yet to comment on the FCC’s statement, but given the interest of major players like Verizon, Sony, DirectTV, and Dish, it may be safe to assume that big telecom is taking the FCC seriously.

Whether or not the FCC’s proposal will actually make cable cheaper also remains to be seen. One thing is for sure, however–watching television is in for a major shakeup.

We measure success by the understanding we deliver. If you could express it as a percentage, how much fresh understanding did we provide?
James Pero