Last year, a significant struggle broke out at the FCC between local ABC, CBS, FOX, and NBC owners and streaming services such as YouTube TV.
The underlying question here is whether streaming services should be classified as “cable TV” by the FCC and thus regulated in the same way that Comcast or Spectrum are.
This argument is made by the Coalition for Local News, a group of firms that control local ABC, CBS, FOX, and NBC stations. The group has spent months pushing to the Federal Communications Commission (FCC) to reclassify streaming services such as YouTube TV, Fubo, Philo, and Hulu, which also provides live TV. The idea is to impose stricter cable TV-style standards to streaming services, which “are essentially the same offering, only delivered over the internet”.
The National Association of Broadcasters recently announced that one of its primary goals for 2024 will be to persuade the FCC to modify the laws governing live TV streaming services.
So, why are locals doing this, and what do they expect to gain?
READ MORE: During The Strike, Local ABC, CBS, FOX, And NBC Stations Saw A 37% Decline In Primetime Ratings
In July, local TV station owners created the Coalition for Local News to lobby the FCC to treat cord cutting services like cable TV companies. If the FCC decides to amend the rules, it will require YouTube TV, Hulu, Fubo, and other providers to negotiate directly with the owners of local TV stations rather than the networks.
Last week, the Coalition for Local News, which consists of 600 local TV stations owned by companies such as Nexstar, issued a statement calling for reforms in how the FCC controls live TV streaming services.
How are streaming providers such as Fubo fighting back?
That same month, YouTube TV, Fubo, Vidgo, Roku, Paramount, Disney, NBCUniversal, and others created the Preserve Viewer Choice Coalition to oppose the change.
“Cable and satellite restrictions were passed decades ago, before most Americans had even heard of the internet. “It’s almost laughable that the same policies would be appropriate in an era of nearly unlimited viewing options,” the group stated at the time of launch and has since repeated multiple times.
This conflict pits local TV station owners, such as Nexstar, against network owners, such as ABC Disney NBCUniversal’s Comcast. Under current standards, ABC and NBC can enter into contracts with streaming services such as YouTube TV that include all of its affiliates, including those they do not own. If local TV stations win, the FCC’s regulation of live TV streaming services will shift substantially. Specifically, it would require live streaming firms, such as Nexstar, to deal directly with the owners of local television stations.
For example, Fubo, Hulu, and other streaming services would be unable to negotiate direct arrangements with Paramount for all CBS stations. Instead, they will have to contact each individual owner of each local TV station. This is what cable TV providers must do, and what live TV streaming services will do if the rules change.
The proprietors of local television stations claim that this reform is necessary to protect local news.
YouTube TV and others are pushing back. “Local news thrives in the existing system. Streaming services only took months to offer local news in every U.S. area, whereas traditional providers had to wait decades under the old norms and regulations that some huge affiliates now want to impose to streaming services. Requiring streaming services to negotiate carriage separately in all 210 selected markets will result in fewer local news options for streaming viewers.
Will this cost cord cutters additional money?
If local stations get their way, you may end up paying extra for services like YouTube TV, Fubo, and Hulu + Live TV. If the owners of local ABC, CBS, FOX, and NBC stations succeed, live TV streaming services will have to pay a $1.23 fee per subscriber per year to cover the FCC regulatory fee imposed on cable TV companies, according to Ted Hearn, a policy expert who previously worked for ACA Connects and posted the statistic on X (formerly Twitter). According to a Leichtman Research Group analysis that estimated 13.4 million users to live TV streaming providers, the costs would total $16.4 million.
Why is this happening?
They are pushing this to ensure that local news is available on streaming providers. But you can’t overlook the monetary aspect of the situation. Recently, several local station owners have pushed for carriage fee increases. Currently, they must accept whatever the parent networks agree upon with streaming providers. This regulatory change would enable people to decline offers that they do not like.
What does this mean for the cord cutters?
Local channels have complained that the agreements they received with live TV streaming platforms were too low. A change would necessitate a new round of negotiations for all local channels, potentially leading to blackouts if agreements are not reached. It may also result in greater streaming service expenses, as well as higher customer costs if they are passed down. The FCC has not yet addressed the matter, although it is on many people’s attention.
For the time being, it appears that local station owners are prepared to battle long and hard for what they feel will be a better bargain for them. Live streaming firms are likewise preparing to protect the status quo.
Radiant TV, offering to elevate your entertainment game! Movies, TV series, exclusive interviews, music, and more—download now on various devices, including iPhones, Androids, smart TVs, Apple TV, Fire Stick, and more.
