At House Media Marketplace Hearing, Competing Visions for Legislative Debate
House Communications Subcommittee members drew two competing pictures during a Thursday hearing on how federal statute is governing the media marketplace. House Majority Whip Steve Scalise, R-La., argued that the 1992 Cable Act is too outdated to still be effectual given the rapid growth of virtual MVPDs and over-the-top providers. Other Republicans noted changes in the landscape. House Communications ranking member Mike Doyle, D-Pa., and other Democrats trained their fire on how FCC actions under current Chairman Ajit Pai could negatively affect people who primarily rely on over-the-air broadcasting for content. The hearing included a focus on Scalise's Next Generation Television Marketplace Act (HR-6465) and the upcoming 2019 debate on Satellite Television Extension and Localism Act (STELA) reauthorization, as expected (see 1809260054).
Scalise framed HR-6465 as a “good starting point” for discussions about STELA recertification, saying the 1992 Cable Act has reached the “end of the road” as an effective statute. HR-6465 would repeal compulsory copyright licenses and retransmission provisions included in the 1992 law and end Communications Act mandates on carriage and purchase of certain broadcast signals by MVPDs (see 1807230044). He filed versions of the bill in the 112th and 113th Congresses (see 1207240073 and 1312130065). “We should be trying” to move to a regulatory structure in which broadcasters, vMVPDs, OTT providers and others must follow “the same set of rules,” Scalise said.
House Commerce Committee Chairman Greg Walden, R-Ore., concentrated on how YouTube and other “big tech” players in the marketplace are influencing market trends, noting that Google pre-installs the YouTube app on all Android-powered smartphones. MoffettNathanson analyst Craig Moffett said recent combinations like AT&T's purchase of Time Warner are a direct response to the “market power” of Google and Facebook, labeling such transactions as an often “defensive” measure aimed at keeping traditional providers competitive. Scalise questioned why traditional MVPDs are “fighting” against making substantial changes to the 1992 Cable Act given the significant changes in the marketplace, comparing them to the near-complete demise of Blockbuster. The company “died for a reason,” because it “fought” against market trends instead of adapting, Scalise said.
Doyle opened the hearing saying he hoped it would be “just a beginning” to a broader discussion within House Commerce about the state of the marketplace given upcoming work on STELA, saying he believed the Thursday panel would present only present a picture painted with a “very broad brush.” Congress “should be examining how these markets have been affected” by FCC actions under Pai that have created a “regulatory vacuum in the marketplace, including rescission of the commission's 2015 net neutrality rules and a raft of changes to media ownership rules. Those changes appeared to benefit Sinclair's now-doomed bid to purchase Tribune and despite that deal's demise the altered rules will “affect the market for years to come,” Doyle said.
Doyle and House Commerce ranking member Frank Pallone, D-N.J., both took aim at the FCC's kidvid NPRM (see 1807120050), noting concerns about proposals to eliminate requirements on length and frequency of children's educational programming and language that would allow broadcasters to fulfill kidvid rules by streaming programming online. The FCC should “rethink its bizarre [kidvid] proposal,” Pallone said. Pai and FCC Commissioner Mike O'Rielly think the current programming requirement is “too much to ask,” but for low-income households and people without access to cable, “I don't think so.”
ABC's Ocean Treks Executive Producer Jeff Corwin defended the existing kidvid rules, arguing that allowing broadcasters to use streaming and multicasting to fulfill requirements would severely affect content providers' ability to fund production, including via ad revenue. The loss of easy access to children's programming would be harmful for children in low-income households in part because it would isolate them by “not giving them resources that ought to be a stepping stone” to interest in topics in science, technology and world cultures, Corwin said.
Lawmakers' discussions during the hearing show there will likely be significant interest in the STELA debate next year, American Cable Association Senior Vice President-Government Affairs Ross Lieberman told us. ACA, the Center for Individual Freedom, Consumers Union and MPAA were among the entities that submitted letters to House Communications ahead of the panel.