Feds wonder: Is it time for Web TV?

Feds wonder: Is it time for Web TV?
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The Federal Communications Commission is considering a plan to treat some types of online television like cable.

The draft proposal, which has yet to be released, is not likely to apply to services such as Netflix that allow people to pick and choose which shows to watch.

But it could lay the groundwork for a new version of something like Aereo — the online streaming TV service that was killed off by a Supreme Court ruling earlier this year.

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“This is part of the future of the Internet,” said Will Rinehart, the director of technology and innovation at the American Action Forum, a right-leaning group. “This proposal, network neutrality, these are all part and parcel of the future of the Internet and Internet content and we need to get this right.”

The plan would only apply to live streaming video services with multiple channels, and is still in the early stages of development, FCC Chairman Tom Wheeler said this week. He said the proposal is only being “kicked around” internally.

"I’m not ready to plant the flag," Wheeler said.

The FCC has been eyeing some type of action on online television for years, and was likely spurred to take a fresh look at the issue after the Supreme Court’s decision on Aereo this June.

The high court ruling put a stop to Aereo’s service, which had been allowing people to watch live streaming broadcast television via the Internet for a small monthly fee.

Aereo did not pay fees to broadcast companies to show their programs, however, unlike cable and satellite companies. It also only offered people the ability to watch broadcast channels such as ABC and CBS, not cable channels such as MTV or CNN.

The FCC’s plan would likely lay the groundwork to change that.

It would reportedly give online video companies the same access to channels as traditional cable and satellite providers such as Comcast and DirecTV.

It would also come with obligations, though, such as the requirement that they negotiate with and pay broadcast companies to retransmit their channels, as well as require that any subscription package includes broadcast channels on its cheapest level of service — just like cable companies.

The plan, in other words, would allow people to get a full cable TV package over the Internet.

That would be a positive development, said John Bergmayer, the senior staff attorney at the consumer interest group Public Knowledge.

“When you’re doing a really broad pro-competitive policy, it should be as technology-neutral as possible,” he told The Hill. “It would basically open up competition for consumers.”

Technology has changed dramatically in recent years, drawing more and more people online and causing many “cord cutters” to cancel their television and rely on services such as Netflix or Hulu.

Comcast pointed to the growing threat from those types of online video companies in support of its proposed $45 billion merger with Time Warner Cable, a deal that would combine the country’s two largest cable TV providers.

Satellite TV company Dish Network has also announced plans to launch an Internet television plan by the end of the year.

“In this field predicting more than about 10 minutes ahead is dangerous, but it clearly seems to be a direction they’re heading,” said Boston University communications law professor T. Barton Carter.

Like net neutrality — the notion that Internet service companies should be prevented from blocking or slowing people’s access to certain websites — many of the current ambiguities about the rules for online television stem from the fact that the main law giving power to the FCC has not been updated in nearly 20 years.

The 1996 Telecommunications Act was written when broadband Internet was still in its infancy, long before the concept of online television was even a possibility.

Lawmakers in the House have begun work on an update to the law, but the effort is likely to take multiple years. Until that happens, the FCC could be stuck using a mishmash of legal provisions to give some rules of the road. 

“It has to be fixed by Congress,” said Brent Skorup, a research fellow at George Mason University’s Mercatus Center.

“These agencies are kind of off on their own right now.”