On December 19, the FCC released a Notice of Proposed Rulemaking (NPRM) relating to the designation of certain online video programming distributors as “multichannel video programming distributors” (MVPDs) under the Communications Act.  This NPRM raises important and complex issues for the content community and has implications for other statutory regimes as well as existing program licensing and distribution agreements.

The FCC tentatively has concluded that “the statutory definition of MVPD includes certain Internet-based distributors of video programming,” specifically identifying “all entities that make available for purchase, by subscribers or customers, multiple streams of video programming distributed at a prescheduled time.”  The FCC, however, expressly proposes to exclude certain categories of online linear video programming distributors from the revised definition — such as entities that make available stand-alone offerings of only their own programming.

The FCC seeks comment on these proposals, as well as on an “alternative interpretation” that would retain the current understanding that MVPDs must be “facilities-based” (i.e., that they must control the transmission path by which programming is distributed to the subscriber).

The Commission also requests comment on the implications of the proposed definitional change, focusing on the program access, program carriage and retransmission consent rights and obligations of MVPDs, but also noting rules relating to closed captioning, video description and the CALM Act.

In addition, the FCC seeks comment on the collateral ramifications of the revised definition, such as:

  • The effect of the proposed definition on broadcast network affiliation agreements;
  • Whether the proposed definition conflicts with Section 111 of the Copyright Act and its implications for compulsory copyright;
  • Whether cable networks have the necessary contractual rights to distribute their services online; and
  • How the proposed definitional change will affect the content licensing marketplace.

We will continue to update our readers as the FCC’s inquiry proceeds.