Yesterday, Senator Jay Rockefeller of West Virginia--the Chairman of the Senate Commerce Committee--announced that he planned to introduce the Consumer Choice in Online Video Act. The proposed legislation aims to afford online video streaming services with the same access to content that cable and satellite providers enjoy.
Here's my take on this news:
No one envies the government's position as legislators try to balance consumer "choice" with a "free market" using the "gentle" hand of regulation. This dance is even more complex in the context of a technology landscape that is moving quickly, often outdating previously held standards and business models at a rapid clip. Over the last decade, even leading content providers have found themselves in restrictive, long-term commercial agreements as the over-the-top (OTT), pay TV and related ecosystem have changed on a yearly--nay monthly--basis.
Some facets of the shifting digital media industry may be difficult to consistently enforce. For instance, it's challenging to define what is reasonable when quantifying and negotiating content rights and related pricing, as content providers should have the option to decide how their content is distributed, its window of availability and the ideal pricing model. Anti-competitive collusion, on the other hand, is really the specter we're chasing (and what I think Senator Rockefeller has his eye on as well).
The legislation's provisions related to broadband access are critical to watch. Most consumers realistically have very limited options for true broadband access in the home. In my residence in Los Angeles, for instance, I only have a single option for broadband (i.e., greater than 10Mbps). While mobile/telco providers do offer competitive 4G LTE options, the pricing model is typically geared as an enabler for mobile access (vs. replacement for in-home).
In-home broadband access, therefore, becomes the medium through which viewers consume and experience content, thus rendering judgement on price and value. If data distributors that control the pipes to the home (tablets, OTT devices, game consoles, etc.) can control the quality and/or pricing of bits, this leads to an unlikely--but threatening--possibility that the integrated providers (many of them cable and telco pay TV operators) could degrade competitive content services through pricing and quality (i.e., lower speeds, increased latency, inconsistent performance). Broadband choice is limited at best unless you are lucky enough to be in a "battleground" territory (previously - the FiOS footprint; today - the Google Fiber footprint).
Even if we avoid these thornier issues, the core issue remains: how do we keep the entire ecosystem healthy?
Viewers must be given both choice and responsibility to easily and legally consume content while adhering to a pricing model (paid or free/sponsored) that adequately reflects the costs to create and distribute the great broadcast and filmed content we consume today. Without quality content, our debates on choice and regulation would leave us arguing the merits of forks, spoons, chopsticks and sporks over an empty bowl.
Content providers--both pay and OTT--must focus their energies on driving additional value and increasing consumption, otherwise a room full of cooks are arguing menu choices and plating to an empty dining room. Legislative action might play a role in making this a reality--but let's make sure we're focusing on the correct issues. Pitting pay and OTT against each other won't help consumers in the long run.