Sources confirmed last week that the Department of Justice had been asked to investigate cable operators’ treatment of over-the-top video, both theirs and others, and that DOJ has agreed to do so.
Good. You heard us right. As a Justice Department representative pointed out, an investigation is just that. It does not mean cable operators have met some threshold of anti-competitive behavior, or that they have done anything wrong. Someone asked Justice to look. It is just looking.
What it means, or at least should mean, is that Justice, like the FCC and Congress, is thinking seriously about how online video fits into the traditional world of video delivery that the Web is in the process of blowing up, or at least radically remaking.
Cable operators are trying to make sense of their place in that future; so should the media’s regulators and antitrust monitors. The result could even be some regulatory humility. Few things are as humbling as trying to process all the permutations of digital content delivery.
While at least one public interest group was hammering the FCC last week for not having launched its own investigation, we would argue it is doing just that in collecting info from the industry and others on how and whether to redefine over-the-top providers in terms of access to programming or carriage—some of the same issues Justice will need to figure out. Unless there are “smoking gun” e-mails of cable operators colluding in back rooms to kneecap the online competition, we expect DOJ will conclude, or should conclude, that cable is remaking its business model in a highly competitive marketplace. Operators themselves are still trying to fi gure out where and how all this video content is going to be delivered, and how to monetize it.
Anyone who says they don’t have any questions about how the relationships between old and new media should be handled in Washington is either clueless or disingenuous. Should online providers have must-carry obligations? Should they get program-access and carriage rights? If the Administration’s goal of universal broadband is reached, does that become the newest uniquely pervasive medium whose content must be regulated? Remember, it was that universal reach to all those little pitchers with big ears that the courts and FCC have used to justify indecency regs.
The FCC teed up these issues in the NBCU deal approval with online-access conditions that signaled it thought over-the-top would eventually be a competitor, but wasn’t yet. Online is still an ancillary service, but as the population matures and technology advances, that day will come.
The government needs to be ready for that day, anticipating the issues and learning as much as it can about them, and about how a hotly competitive marketplace tries to deal with change coming at lightning speed with huge consequences.
Since the answers will help define video delivery’s future, we have said for a while now that these are questions the government needs to be asking sooner rather than later. The FCC is doing that in its Sky Angel request for help defining “MVPD” and “channel.” Justice should investigate new media business models thoroughly, so long as the goal is strictly to gather the facts rather than grind anyone’s political ax.
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