Pai Calls FCC Online Video Reclassification Unnecessary

Tells Hong Kong audience it's solution to nonexistent problem

FCC commissioner Ajit Pai says the FCC should not redefine some over-the-top video providers as MVPDs subject to FCC program access regulations.

FCC chairman Tom Wheeler proposed redefining linear over-the-top providers (day-and-date channel lineups similar to traditional cable and satellite) as a way to promote online video competition, but has been getting some pushback from some OVD providers as well as cable operators.

In a speech to the Cable and Satellite Broadcasting Association of Asia Monday in Hong Kong, Pai, whose family comes from India, pointed out he was an over-the-top video consumer and producer (posting YouTube videos of his kids to show family members back home).

He said the over-the-top video marketplace is booming, thanks to the free market and a hands-off government regulatory policy and said those hands should remain off.

"Some have proposed extending to over-the-top providers many of the rules that currently apply to cable operators and satellite providers, regulations that in many cases are over two decades old," he said, a reference to the over-the-top proposal.

"I strongly oppose this idea. Given the remarkable success of the over-the-top video industry—success driven in part by regulatory restraint—I don’t believe we should change our regulatory approach," he said. "A leading over-the-top provider, Amazon, put it well when it told U.S. regulators, 'There has been no indication that additional regulation is needed to enable this new industry to grow and bring consumers even more benefits.'"

He cited the recent speech by Democratic Rep. Frank Pallone (D-N.J.), ranking member of the House Energy & Commerce Committee, against regulation of online video providers as evidence that he was not alone.

"'In the case of defining online video providers as cable companies, I do not think we can say yes,'” Pai said, quoting Pallone. "I couldn’t agree more."

Wheeler has said to look for a final vote this fall on his proposal to define day-and-date over-the-top video services as MVPDs, at least as it regards access to programming. His stated goal is to insure nondiscriminatory access to programming, both cable and broadcast. To do that he is seeking to read out the "facilities-based" requirement in the definition of MVPD. Cable operators and over-the-top services alike have registered reservations about that move.

Pallone advised not to proceed along that path.

"For me as a regulator and an online video consumer," said Pai, "the way forward is simple. There is no market failure. There is no problem to be solved."