Tomorrowvision, a new whitepaper by Public Knowledge, calls for policymakers to fix the outdated rules that are holding back the evolution of TV.
Television: A Land of Contrasts
On the one hand television shows are as good as they’ve ever been. To name a few, frequent Public Knowledge bête noire (Comcast-)NBCUniversal is airing Parks and Recreation and Community, some of the best TV comedies I’ve ever seen. Basic cable and public television have hits with AMC’s Mad Men and PBS’s Downton Abbey. And I never would have thought that Armando Iannucci’s smart, absurdist style of comedy would be given a chance in the US but his new show, Veep, premiers on HBO later this month.
At the same time, though, “TV” kind of stinks. Smartphones, tablets, and Internet services have shown us just how intuitive and fun accessing content and communicating can be. But the way most people watch TV hasn’t significantly changed since the 1980s. The problem is not TV shows but the TV distribution model.
I actually agree with much of Tim Carmody’s recent Wired piece, “The Nimble Empire: In Defense of Cable.” As he points out, the success of Netflix, Amazon Prime, and Spotify have shown that there’s a lot of demand for subscription services. Of course, those are all subscription on-demand services–very few online services have bothered to reproduce the concept of a “channel” with content that you “tune in” to at specific times. That said, there’s no reason to suppose that the iTunes model where all content is à la carte and driven by micropayments is the only possible future, and I think the basic cable business model of selling access to bundles of content is sound.
Like Carmody, my “problem with cable is cable as it actually exists… with bad service, local and regional monopolies, crummy interfaces, waiting in line for hours to return a stupid set-top box before [I] can leave town and move somewhere else to do the same dance all over again.”
The fundamental reason TV distribution stinks is its uncompetitive and convoluted industry structure. There are just too many middlemen that add little value between creators and viewers. And viewers have too little choice in how they watch TV, which means that cable companies have little reason to innovate. Their customers have nowhere to go.
What To Do About It
But I think we can do better than just hope that cable gets its act together. This is because the television industry structure is not the result of market forces but the result of incentives created by government policies. We can change those incentives and make the market more competitive–in particular, by adopting policies that allow online video distributors to compete on an even playing field with traditional pay TV distributors, with access to the same content and protected by the same rules. A more competitive TV distribution system would better serve the needs of viewers and creators alike, and would be more likely to offer viewers access to programming that isn’t tied to a Carter-era distribution model.
Tomorrowvision calls on policymakers to undertake a number of specific reforms. In particular:
- The FCC should issue a declaratory ruling that MVPDs (cable and satellite pay TV services) may not engage in “unfair methods of competition or deceptive acts and practices” with regard to online video distributors (OVDs).
- The FCC should begin a proceeding to determine which regulations ought to apply to OVDs that choose to operate as online cable providers.
- Congress and the FCC should reform the law to allow MVPDs more flexibility in carrying broadcast signals.
- The FCC should open up device competition.
The Future of TV Regulation
The only way to start to undo the effects of decades of incumbent-swaddling media policy is with new policies designed to jumpstart competition. Just getting rid of the entire system in one swoop would likely just give today’s incumbents the ability to strengthen their hold on the market. But these new rules don’t need to last forever. If policymakers are successful in making the structure of TV distribution more competitive, industry-specific rules might be able to sunset–replaced with simple antitrust law, or with general purpose “media” laws that don’t single out “television” as a separate industry. In any event, the best way to avoid “regulation” is to avoid having anticompetitive industries that need it. Tomorrowvision offers a blueprint for a more competitive future of television.