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ACA Summit: Pai Leans Toward Not Applying Regs to OVDs

FCC commissioner Ajit Pai told an American Cable Association
audience in Washington on Wednesday that, while he did not want to prejudge the
FCC's open proceeding on how to define an MVPD, he did say he was more inclined
to remove regulation from traditional video distributors than apply them to new

That came in a Q&A with ACA president Matt Polka.

Polka asked whether over-the-top providers like Netflix and
Hulu should be regulated by the FCC, or traditional distributors deregulated in
order to level the field.

"The consumer doesn't think about the mode of
distribution, they think about the content," said Pai. "I think it would
be good to have laws and regulations take that same approach."

After saying he did not want to pre-judge the proceeding, he
added: "I will say that my general preference is not to apply additional
regulations to the video market. Instead of regulating over-the-top providers,
we should probably focus on deregulating traditional providers."

Pai did not offer much hope on the retrans front. The day
before FCC chairman Julius Genachowski had suggested the FCC might have to
weigh in to reduce blackouts, but also said it probably needed congressional
authority. The FCC is currently confined to ensuring negotiations are fair, but
ACA has argued that gives it the leeway to step in to, for example, mandate
carriage during standstills.

He said the issue was obviously on his radar -- even his mom
had contacted him asking for an explanation of takedown warnings, but added.
"I don't want to be the bearer of bad news, but we are a creature of
Congress. Our authority is circumscribed. We don't have the authority to
dictate the outcome or even to some extent the process or retransmission

While he said the FCC's hands were tied, he would suggest
Congress make any necessary changes.

Pai said he had no problems with usage-based billing,
calling it a generally accepted principle in that the more you use, the more
you pay. He said he thought there would be some "unintended and probably
unpleasant consequences" to trying to restrict usage-based pricing, adding
that he didn't support the FCC inserting itself into pricing decisions

Following his speech, he was asked by one ACA member to
defend his opposition to Joint Sales Agreements being counted toward local
ownership caps. ACA wants those and other joint agreements to count, which
would reduce the number of those shared agreements thus the number of
broadcasters now allowed to jointly negotiate retrans for themselves and a
station they operator or sell ads for in the same market.

Pai said his support was not related to that issue, but
instead allowing broadcasters to upgrade their business, save overhead and
newsgathering costs. "Those are the kind of pro-competitive benefits I

Pai closed by praising Polka's and ACA's
representation of small cable issues. "You really are effective advocates
at the FCC. You are well served and I think we are, too, because we get the
information from our perspective that we need," Pai said.