FCC

Revolt CEO Revolts Against Set-Top Plan

Clinkscales asks President to reconsider support 4/24/2016 2:00 PM Eastern

Keith Clinkscales, CEO of minority-targeted music channel Revolt and no fan of the FCC's set-top proposal, has asked President Obama to rethink his support.

 

In a letter to the President and the FCC commissioners (April 22 was the deadline for initial comments), Clinkscales said that minority programmers would be the canaries in the mineshaft for the FCC's "flawed and destructive" rules.

 

Clinkscales echoed calls by Rep. Yvette Clarke (D-N.Y.), House Communications Subcommittee Chairman Greg Walden (R-Ore.) and others that the FCC hit the pause button on the proposal until either the Government Accountability Office or Congressional Research Service or both conduct and complete surveys on the impact of the proposal on diverse programmers.

 

The FCC has said the proposal, to require cable operators to make both programming and set-top data available to third-parties, will give many diverse programmers, particularly over-the-top video providers, more visibility.

 

But Clinkscale, who heads an established network with traditional carriage (launched in 2013 by Sean “Diddy” Combs ) sees it as a threat to his business model.

 

Clinkscale focuses on the President's support, saying that the proposal is analogous to a quick-fix loan—like the President’s auto bailout--when a long-term plan—which he says was the key to the success of the auto loans--is needed.

 

That plan, he says, should include 1) recognizing the value of enforceable contracts; 2) expanding competition in navigation devices in a way that does not privacy protections, and 3) recognize that expanding choices could impact specialized programmers that may not be able to attract the attention of competing navigation providers."

 

"Today, the media and cable industries are facing a similar crisis. We have many of the earmarks of an industry that is going through rapid change. The existing business models are under unprecedented stress. The audience for our business is changing and their expectations are rising. Without a proper response, there is little doubt that we will reach a crisis point before long," he wrote. "The temptation would be to look for a quick solution – a loan if you will – to put things back on track.

 

"The short-term and shortsighted solution being proposed takes the form of the new FCC rules for set-top boxes. The rules would force existing TV companies to hand over the programs they create to companies like Google to use and monetize without negotiating with, or paying, creators anything for the rights to that programming. These deals are the foundation of the economics of modern programming. We would lose the ability to negotiate for promotion, valuable channel placement, digital and on-demand rights, advertising restrictions and more. This kind of economic exploitation will devalue the work of all creatives and allow others to poach their value."

 

He says the set-top proposal will hurt everybody, but that minorities, who are already last in line, would be hurt the most. "We are the canaries in the coalmine for this radical experiment to reshape the video market by FCC fiat ," he said, "and you know what happens to the canaries."

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