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F.C.C. Proposal Would Allow à la Carte Internet Video Services

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“Consumers have long complained about how their cable service forces them to buy channels they never watch,” Tom Wheeler, the chairman of the Federal Communications Commission, wrote in a blog post.Credit Jabin Botsford/The New York Times

WASHINGTON — Seeking to give online video a chance to compete against cable and satellite television providers, the chairman of the Federal Communications Commission proposed a measure on Tuesday that would give online companies equal access to cable and broadcast stations.

The F.C.C. chairman, Tom Wheeler, said that the result would be to allow services to offer à la carte programming, with consumers able to choose what channels they wanted to buy and not have to pay for hundreds they never watch.

“Consumers have long complained about how their cable service forces them to buy channels they never watch,” Mr. Wheeler wrote in an F.C.C. blog post. “The move of video onto the Internet can do something about that frustration – but first Internet video services need access to the programs.”

The proposal would allow some so-called over-the-top online video providers to be classified as “multichannel video programming distributors,” or M.V.P.D.s, which by law are allowed to carry cable and local broadcast stations, provided they can agree on financial terms.

Companies that offer on-demand video streaming – Netflix and Amazon, for example – would not be affected by the rules, which would apply only to companies that offer viewers a prescheduled lineup of programs.

But several companies have expressed interest in becoming online M.V.P.D.s, including Dish, Sony, DirecTV and Verizon.

“I am asking the commission to start a rule-making proceeding in which we would modernize our interpretation of the term ‘multichannel video programming distributor’ so that it is technology-neutral,” Mr. Wheeler wrote. “The definition of an M.V.P.D. should turn on the services that a provider offers, not on how those services reach viewers. Twenty-first-century consumers shouldn’t be shackled to rules that only recognize 20th-century technology.”

The result of Mr. Wheeler’s effort is months, if not more than a year, away. A majority of the five F.C.C. commissioners will have to approve releasing a proposal for public comment; after a comment period, they would then have to vote again to adopt a formal rule.

One company that has already expressed interest in the proposal is Aereo, which recently lost its bid in the Supreme Court to retransmit broadcast programming from distant stations.

“This is an important step in the right direction for consumers,” said Chet Kanojia, chief executive and founder of Aereo. “Clarifying the definition of M.V.P.D. to encompass linear online video distributors will create a stronger, more competitive television landscape for consumers.”

The Writers Guild of America, West, also applauded the measure. “A technology-neutral definition of an M.V.P.D. is long overdue and will enhance consumer choice,” the guild said in a statement. “With the largest M.V.P.D.s attempting to consolidate their control of content distribution through mergers, this game-changing proposal to allow new competitors is absolutely necessary.”

Mr. Wheeler said he also hoped that the measure would spur greater competition among companies offering high-speed Internet service. “Those seeking to deploy new competitive broadband networks tell us that it’s hard to provide new high-speed Internet access without also being able to offer a competitive video package as well,” he said.

Related:

If Video Sites Could Act Like Cable Companies

The Federal Communications Commission is considering giving online distributors like Hulu and YouTube the same rights and responsibilities enjoyed by cable companies.

With Perspective From Both Sides of His Desk, F.C.C. Chairman Ponders Net Neutrality

Tom Wheeler spent decades as a lobbyist for the cable and wireless industries, experience from which he has drawn in creating highly scrutinized policy guidelines for ensuring equal access to online content.