FilmOn X Finds Friends in Compulsory License Challenge

Online video streaming service FilmOn X has friends in Public Knowledge and the Electronic Frontier Foundation.

FilmOn X is challenging a D.C. U.S. District Court decision back in October 2015 that it was not entitled to a compulsory license, as are MVPDs, and the two groups filed an amicus brief with the U.S. Court of Appeals for the District of Columbia backing FilmOn X.

The groups said that notwithstanding the Copyright Office's repeated assertions that the license does not apply, "a facility that 'receives signals transmitted or programs broadcast by one or more television broadcast stations...and makes secondary transmissions of such signals or programs by wires...or other communications channels to subscribing members of the public' is a 'cable system' under the Copyright Act and should have access to the [compulsory] license."

Their argument is that extending the license to FilmOn and others will promote innovation and competition "by ensuring that copyright law does not privilege incumbent video distribution services over new entrants using cost-effective new technologies."

The issue is whether online video distributors are effectively MVPDs eligible for the compulsory license that allows them to avoid negotiating for individual network broadcast content. That issue is unsettled, with the Copyright Office saying they aren’t eligible, but also saying that could change depending on what the courts and the FCC decide. The FCC is mulling defining some over-the-top distributors as MVPDs and FCC chairman Tom Wheeler has pointed to the need to prevent “old rules” from hampering online video competitors like FilmOn, though he has put that redefinition on the back burner.

A compulsory license would allow FilmOn X to deliver TV station programming from the major networks at a below-market rate, broadcasters argue, and without having to negotiate for it individually through retrans deals. That's because it is not defined as a cable operator by the FCC and so is not subject to retransmission consent requirements.

In another court where the issue has been adjudicated, California district judge George Wu ruled last year that FilmOn X was entitled to the license. Fox has challenged that ruling in the Ninth Circuit Court of Appeals, with oral argument scheduled for next week.

Not surprisingly, the National Association of Broadcasters, in its amicus brief in support of Fox in that court filed last week, told the Ninth Circuit to overturn Wu, saying granting the license would have a "devastating" impact on broadcasters.

John Eggerton

Contributing editor John Eggerton has been an editor and/or writer on media regulation, legislation and policy for over four decades, including covering the FCC, FTC, Congress, the major media trade associations, and the federal courts. In addition to Multichannel News and Broadcasting + Cable, his work has appeared in Radio World, TV Technology, TV Fax, This Week in Consumer Electronics, Variety and the Encyclopedia Britannica.