The FCC has adopted controversial new rules intended to make it easier for multichannel video programming distributors, such as cable television operators and satellite television operators, to acquire rights to retransmit video programming in which competing cable operators may have an ownership interest.
The Federal Communications Commission (FCC) has adopted new rules limiting the ability of multichannel video programming distributors—including cable television, satellite and other programming outlets—to restrict competitors’ access to programming in which they have an interest. Concerned about the effects on competition posed by increasing vertical integration in the programming and cable industries, the FCC adopted the new rules to address recent and ongoing disputes involving video distributors who are denied access to programming owned by their competitors, such as regional sports networks and other “non-replicable” programming. By giving competing providers access to this “must-have” programming, FCC Chairman Julius Genachowski characterized the order as leveling the competitive playing field; no longer will consumers be forced to choose between their favorite sports team and their preferred video provider.
Previously, the FCC’s rules on access to programming applied only to programming delivered to distributors via satellite, based on the express language of Section 628 of the Communications Act, which required the FCC to adopt rules for “satellite cable programming.” However, in the years since those rules were adopted, the use of fiber and other non-satellite media—including the Internet—to relay programming has increased greatly, prompting the FCC to close the so-called “terrestrial loophole” that allowed some cable operators with programming affiliates to lock their competitors out of popular content. Foreshadowing an expected appeal of the new rules by certain cable television operators, FCC Commissioner Robert McDowell dissented from the order, arguing that the new, broader rules exceed the FCC’s statutory authority under Section 628 to prevent anticompetitive conduct related to “satellite cable programming.”
The new rules explicitly do not create a new enforcement mechanism, but rather provide for enforcement on a case-by-case basis, allowing individual complaints to be filed by programming distributors who have been denied access to programming by their competitors. The FCC also clarified that complainants may bring claims related to access to high definition (HD) versions of programming even if they have rights to access the standard definition (SD) version of the same programming, finding that HD and SD may be treated as separate services.