The communications sector is beset by layers upon layers of unnecessary government burdens. While visible in many areas, obsolete policies fastened to traditional video providers – some of which were chiseled over 40 years ago – are clearly ready for the delete button.
Yet, erasing outdated regulations, even if there’s universal agreement, takes massive amounts of time and Herculean effort to overcome the procedural hoops and eventual court challenges. That’s unacceptable in today’s very fluid and competitive video marketplace.
As a remedy, Congress would be wise to expand the Federal Communications Commission’s (FCC) existing forbearance authority – which currently only applies to telecommunications carriers and services. Video forbearance could give the FCC a valuable tool to quickly and efficiently peel away video obligations that no longer make sense in the modern marketplace.
Indeed, this effort is an expedient way to further implement FCC Chairman Brendan Carr’s recent Public Notice that seeks “comment on deregulatory initiatives that would facilitate and encourage American firms’ investment in modernizing their networks, developing infrastructure, and offering innovative and advanced capabilities.”
For even the most casual observer, video programming akin to what once came solely from cable channels is available everywhere. Consumers have wide distribution options and a variety of alternative platforms to feed their content demands. Just last year, AlixPartners declared, “[D]igital disruption has tested tried-and-true business models as new technologies, new entrants, and shifting consumer behaviors accelerate waves of innovation and change.”
From individual streaming companies (some aligned with traditional video providers) to streaming aggregators, like YouTube TV and Hulu, companies 10 years old or less have completely changed the video dynamic for the good. It’s no longer a stilted industry, but one that seeks to meld with consumers on price, timing, options, and more. And providers that fail to respond? They will be as memorable as Blockbuster or Kodak film.
As the market is forcing video offerings to fight head-to-head, traditional providers have one arm tied behind their backs. Legacy regulations that no longer make sense in a competitive video marketplace mean that existing providers face higher compliance costs and reduced flexibility, depressing their ability to field a fully competitive video offering.
Take commercial leased access (CLA), for example, which requires cable providers to lease video channels to unaffiliated companies or individuals. Despite the existence of other distribution platforms for independent programming, the most obvious being the Internet, where the barriers to entry are much lower, the FCC’s leased access rules still apply.
The impact of these rules is still significant, as they require cable providers to conduct extensive rate calculations upon request from potential lessees, and to maintain staff trained to receive requests that often go nowhere. Finally, cable providers have to track payments or try to collect payments from lessees who never had the ability to pay for more than a few months. It’s a statutory mandate that is ready and waiting to be crossed out. But forbearance authority is the only way to quickly eradicate this failed policy and address a host of similarly situated circumstances.
Granting video forbearance authority (i.e., expanding the statute’s forbearance authority to Title VI of the Communications Act of 1934) would give the FCC a deregulatory scalpel. History of its use in other sectors by the agency for communications services shows that it is used narrowly to target requirements beyond their expiration date. As such, requests must be specific and are deemed complete only as the agency sees fit.
The forbearance statute also has built-in guardrails with specific timelines for the Commission to consider requests and specific legal criteria that must be satisfied. Thus, rather than being a source of authority for the Commission to impose constraints on new offerings, the very essence of Congress’s directive is to require the agency to stop enforcing senseless statutory provisions and rules.
To put it in perspective, the only reason forbearance doesn’t apply to video today, for those who remember, is because policymakers wanted to see it in operation with other communications services before spreading it wholesale. After many decades, there is a track record on which to rely and everyone is well versed in what to expect from the process. Extending the authority is not a hasty proposal, as wise practitioners like former FCC chair Ajit Pai have advocated extending forbearance to video for years.
With a small fix, Congress could give the FCC the authority to refrain from enforcing numerous outdated laws and regulations that unnecessarily burden traditional video providers, stifle innovation, and harm competition. Certainly, that is worth pursuing.
Michael O’Rielly is a Senior Fellow at The Media Institute and member of the Institute’s First Amendment Advisory Council. A former Commissioner of the Federal Communications Commission, he is President of MPO Consulting, Inc., based in Arlington, Va.