In what could signal a big change in regulatory approach, FCC chair Ajit Pai has scheduled a vote on an item that would set the precedent that streaming services qualify as "effective competition" to MVPDs sufficient to trigger basic rate deregulation of those MVPDs.
Charter had asked the FCC to rule that AT&T's video streaming bundles available in Hawaii and Massachusetts are comparable to their cable video service. When the FCC determines a cable system is subject to effective competition, that system is no longer subject to basic rate regulation by local franchise authorities.
Pai said in a blog post about the upcoming Oct. 25 public meeting that the vote would be on an item at that meeting granting Charter's request for a finding of effective competition. He almost certainly has the votes to approve it (otherwise he would be unlikely to schedule it for a public vote).
"Adopting this order would be a major step toward the Commission recognizing the realities of the modern video marketplace, and the increasingly important role that streaming services are playing in it," the chairman added.
“ACA Connects is pleased that the FCC has circulated an order that would grant Charter’s effective competition petition," said the group, which backed Charter's petition. "The order reaches a legal conclusion that catches up with what consumers already understand -- online streaming services like AT&T NOW are a source of ‘effective competition’ for cable operators’ traditional video offerings.”
Free State Foundation president Randolph May applauded the proposal in a tweet:
The FCC has yet to define over-the-top services as MVPDs subject to the same regulatory regime--program access, program carriage rules--but the Charter ruling could fuel that debate anew.
Pai has said the FCC should not redefine some over-the-top video providers as MVPDs subject to FCC program access regulations. But that was back in 2015.
FCC chairman Tom Wheeler proposed redefining linear over-the-top providers (with day-and-date channel lineups similar to those of traditional cable and satellite) as a way to promote online video competition, but got pushback from some OVD providers as well as from cable operators.
Rep. Frank Pallone (D-N.J.), chairman of the House Energy & Commerce Committee, used his first media policy speech as ranking member of the House Energy & Commerce Committee to advise the FCC to "hit the pause button on regulating streaming video," but that was also back in 2015.