FCC Considering New Rules for OTT Video Services
By Ben Munson
Sep 30 2014
The Federal Communications Commission (FCC) will begin looking into new rules and regulations for Over-The-Top (OTT) video services aimed at providing subscription TV over the internet, according to the Wall Street Journal.
As Verizon and Dish Network work to bring online video services to consumers without pay-TV subscriptions, the FCC is considering whether those services should be subject to the same rules as traditional cable and satellite providers.
The report says new rules could give OTT operators power to negotiate terms for carrying local broadcasts as well as limit TV channel owners’ ability to refuse licensing. But the new rules could also expose OTT services to the same taxes and fees as traditional TV services as well as make them responsible for public interest services.
In 2012, the FCC originally began looking into OTT video regulation after online subscription service provider Sky Angel argues Discovery violated regulations by pulling out of a distribution deal it had with the company. At the time, Sky Angel argued for multichannel video programming distributor (MVPD) status so it would have to be treated like any other TV provider. Comcast weighed in saying the OTT industry is still growing and too much regulation would impede that, while DirecTV argued that any entity acting like an MVPD should be treated like one.
Now the debate looks to be revived at talk of LTE broadcast and multicast technology opens the opportunity for mobile network operators to efficiently send broadcast over their networks. Verizon demonstrated its LTE multicast technology earlier this year during the Super Bowl.
Along with Verizon and Dish, many of the major carriers are looking into video ventures in order to secure content rights and further monetize their existing networks.
AT&T earlier this year formed a $500 million joint venture with the Chernin Group in order to “acquire, invest in and launch over-the-top (OTT) video services.” New reports say SoftBank, the majority owner of Sprint, is pursuing a $3.4 billion deal for Dreamworks, a move almost certainly aimed at securing mobile content distribution rights.