On August 12, 2024, the Biden Administration released a Fact Sheet noting a proposed FTC rule that "would require companies to make it as easy to cancel a subscription or service as it was to sign up for one" and announcing that the FCC "is initiating an inquiry into whether to extend similar requirements to companies in the communications industry" (emphasis added).
A News Release issued the same day by FCC Chairwoman Jessica Rosenworcel revealed that she has circulated to her fellow commissioners a draft Notice of Inquiry that "would seek information on ways to ensure that consumers have appropriate and efficient access to customer service resources when working with their phone, cable and broadband providers" (emphasis added).
Source: whitehouse.gov
When it comes to video distribution, of course, there is a wide chasm between "companies in the communications industry" and "cable." The former, broader category includes both unregulated streaming services and traditional Multichannel Video Programming Distributors (MVPDs) that rely upon facilities within their exclusive control. The latter category presumably is limited to the traditional MVPDs uniquely subject to FCC regulation: cable operators and Direct Broadcast Satellite (DBS) providers.
Given this critical distinction, if adopted, this Notice of Inquiry (and the Notice of Proposed Rulemaking sure to follow) first and foremost would result, not in a net benefit to consumers, but in yet another one-sided restraint on the ability of traditional MVPDs to compete effectively with far larger streaming services that grow more popular by the day. Similar instances in just the last year include:
- A pending Notice of Proposed Rulemaking adopted in April 2024 that would interfere with contracts between traditional MVPDs – and traditional MVPDs alone – and independent programmers by banning most favored nation (MFN) provisions and "unreasonable" alternative distribution method (AMD) provisions.
- A requirement adopted in March 2024 that traditional MVPDs – and traditional MVPDs alone – must "specify the 'all-in' price for video programming in their promotional materials that include pricing information and on subscribers' bills."
- A pending Notice of Proposed Rulemaking adopted in January 2024 that would force traditional MVPDs – and traditional MVPDs alone – to provide subscribers with a rebate whenever they are unable to agree on carriage terms with a broadcast station or programmer, a proposal I critiqued in an October 2023 Perspectives from FSF Scholars.
- A pending Notice of Proposed Rulemaking adopted in December 2023, in response to which the Free State Foundation filed comments and reply comments, that would prevent traditional MVPDs – and traditional MVPDs alone – from employing two cross-industry common billing practices: (1) early termination fees (ETFs), which make it possible for distributors to amortize up-front customer costs over an agreed-upon and enforceable term, and (2) whole-month billing.
For more on this topic, I recommend that you read "FCC's Dated View Drives Dramatic Shifts in Video Strategies," a July 2024 post to the FSF Blog, and "The FCC Is Complicit in the Decline of Traditional MVPDs," a May 2024 Perspectives.
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