FCC Chairman Hints at Proposal to Define Online Video Services Like MVPDs

With the groundbreaking news that HBO and CBS would offer standalone streaming services, FCC chairman Tom Wheeler on Friday was asked repeatedly about whether the agency would weigh in on the fast-growing market for online video.

“It’s the right question. Stay tuned,” Wheeler teased reporters after the commission’s regularly scheduled meeting. “It’s something we’re very involved in.”

He gave no timetable, but last month an agency official said that the FCC was looking at rules that would define certain online video providers would fall under the definition of a multi-channel video provider, the designation given to cable and satellite operators.

“We have been looking at the entire question of ‘What is an MVPD?'” Wheeler said, adding that online video would be a part of it.

Such a move would not apply to services line Netflix or Hulu, but only to online video providers that are delivering multiple channels of linear programming, or content that is not on demand. After it lost in the Supreme Court, Aereo has sought such a definition.

Wheeler said of the CBS and Netflix streaming plans, “Obviously they are going to have a marketplace impact.”

The rationale behind making such a move would be to try to boost competition in the multichannel marketplace, as it would give such online providers greater access to broadcast and multichannel programming. There also would be the question of whether such online providers would have to pay retransmission consent fees to broadcasters.

Wheeler was asked at the meeting if the FCC also would seek to apply some kind of public interest obligations for wireless and broadband services, such as those required of broadcasters. Cable providers also fund public interest channels like C-SPAN.

“I think that is a question you probably will see dealt with,” he said.

It’s unclear whether the HBO or CBS proposals would have an impact on the Justice Department and FCC review of proposed mergers of Comcast with Time Warner Cable, or AT&T with DirecTV. In arguing for the merger, Comcast has often cited competition in the growing online video marketplace, and an option like HBO would seemingly bolster the case that consumers will have more options beyond a cable subscription. But the proposals also could increase focus on the competition for high-speed broadband, a market that Wheeler has said is lacking, with consumers having few reasonable choices other than their cable provider.

In speaking to reporters, Wheeler also said that he has not talked directly to President Obama about the agency’s effort to establish net neutrality rules, although he said that he has kept White House staff and Congress updated.

He also pushed back against any notion that he disagrees with Obama on paid prioritization. In a visit to Santa Monica, Calif., last week, Obama told an audience of tech entrepreneurs that he opposes the idea that companies could buy speedier access to the consumer.

“I believe that on the important question of paid prioritization … the president and I are in agreement and always have been,” Wheeler said.

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