Requiring access to cable-owned content creates a barrier to entry for smaller content providers

Yesterday Federal Communications Commission chairman Tom Wheeler announced his intent to ask his fellow commissioners to sign off on a rule that would require cable companies to provide over-the-top video distributors with access to cable company-owned content.  According to Mr. Wheeler, the intent of the rule modification is to provide consumers of content “more alternatives from which to choose so they can buy the programs they want.”

What this change to the rules will actually do is create a barrier to entry by smaller content providers.  Mr. Wheeler’s rule amendment, much like the statute passed in 1992 and its subsequent rule, will simply give incumbent content an additional platform from which to be seen.  “Law and Order: Criminal Intent” will now be seen on cable, satellite, and over-the-top video distribution.  Over-the-top providers can now take a short cut to content and forgo negotiating contracts for new content from new entrants.

For start-up, minority-owned, or woman-owned content production companies there will be a lost opportunity to showcase more of their content to over-the-top distributors.  Smaller content providers may have to reduce the price offerings for their programming just to get one of fewer remaining slots on a over-the-top’s network.

If the FCC is so concerned with competition throughout the internet ecosystem, it should let all stakeholders in the ecosystem enter into contracts on their own without government interference.  Also it should provide smaller content providers the opportunity to enter into strategic partnerships that get their product in front of the public.

About Alton Drew

Alton Drew brings a straight forward and insightful brand of political market intelligence. Alton Drew graduated from the Florida State University with a Bachelor of Science in economics and political science (1984); a Master of Public Administration (1993); and a Juris Doctor (1999). You can also follow Alton Drew on Twitter @altondrew.
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One Response to Requiring access to cable-owned content creates a barrier to entry for smaller content providers

  1. kenski2013 says:

    The FCCs reasoning does seem like an excuse, not a reason. It may or may not know all the effects of this idea. Perhaps you should file a formal complaint somewhere.

    By the way, what do you think of the US lawsuit against AT&T for “throttling back” data rates to customers who were sold “unlimited data”?

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