[opendtv] Re: FCC Proposes Defining 'Linear' OVDs as MVPDs | Multichannel

  • From: Craig Birkmaier <craig@xxxxxxxxxxxxx>
  • To: "opendtv@xxxxxxxxxxxxx" <opendtv@xxxxxxxxxxxxx>
  • Date: Tue, 30 Sep 2014 09:33:18 -0400

On Sep 29, 2014, at 7:12 PM, Manfredi, Albert E <albert.e.manfredi@xxxxxxxxxx> 
> I already addressed this a short time ago. To the extent that OTT TV 
> distribution services emulate the MVPD model, that's the extent to which they 
> will fail. They will fail because they offer nothing new to the consumer, 
> i.e. the cord cutter. If the cord cutting phenomenon persists, then this is 
> not the answer. That should be obvious. On what basis would they compete? 
> Well, at most, the service would be portable, an advantage for those who move 
> a lot.

If new OTT TV distribution services simply emulate the old MVPD model, I agree 
they are not likely to succeed. But these new entrants are not that stupid.

The ability to offer streaming channels is critical for competitive reasons, 
especially for live events like sports. The ability to offer the streams from 
many cable networks is less critical, especially as we move toward on demand 
consumption of pre-produced content. The ability to offer BOTH is the future. 
Live streams AND on demand access to the program libraries.

If the FCC gives OVDs the program access they are proposing, there is nothing 
to stop an OVD from doing both - other than their negotiations with the content 
owners. Comcast is ALREADY doing BOTH, by offering subscribers access to a huge 
program library delivered over the top.

And yes, the ability to deliver content to any device, anywhere is going to be 
a competitive advantage for new OVD/OTT services.

> But what really matters, Craig. This is the FCC talking, from the perspective 
> of the OTT site. The FCC is saying is that an OTT site must emulate the old 
> MVPD model, *if* it wants to FCC to force the content owners to give them 
> access to their content. So what? Who's talking about the government forcing 
> content owners to do anything?

Nobody. The FCC is simply forcing the content owners to treat new OVD services 
the same as the rest of the MVPDs. This greatly simplifies the process of 
building these new services. 

What is less clear is how the new service will deal with access to OTA 
channels. With facility based MVPDs the issue is straightforward. You offer the 
local channels. It got a bit more complicated with DBS, as they serve many 
markets; the issue moved to where the receiving dish is located. 

With OTT services, we now have the issue that the receiver can be anywhere. So 
new questions arise.

Can I access the local channels from the market where I live, when I am 

Does the OTT service use geo location data to determine which local channels 
can be accessed?

If they base access on geo location, how do they negotiate rights for every 
market? For example, I may pay $5/mo for my local channels. If I am in San 
Francisco, do I pay again for those local channels?

This may get interesting...
> What we are talking about here is new models that the *content owners* would 
> be interested in. We are talking about the likes of ESPN or HBO saying, what 
> should we do to reverse the trend of people dropping out? John Skinner 
> wouldn't go ask the FCC what to do. It's his content, so he's the one to 
> figure out new techniques.

The question is VERY different for HBO and ESPN, as we have discussed. 

Obviously these companies do not go to the FCC to deal with changing market 
> And he's doing so. Do you think John Skinner has to clear it with the FCC, if 
> he wants to set up a direct to consumer distribution model for, say, MLS?
Obviously not.

> The new distribution models emerge because the old ones are losing steam. 
> They aren't just flat, they are on the decline. You simply ignore this fact, 
> and it's all that matters.

New models emerge because they are enabled by evolving technologies. 

I am not ignoring any facts. I have provided many examples of how the models 
have evolved over the past four decades. Some older norms change or go away as 
new options emerge. Nothing new here.

What is a constant is that the entrenched players evolve and maintain control, 
as the Sullivan article you posted confirms...

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