“We’ve been here before” stands out among the profound rhetoric that poured into the FCC as it revived its rulemaking exploration of NextGen TV. Those words, from a filing by cable-TV industry groups, captured the frustrating dilemma as regulators try to figure out what to do about the retransmission of ATSC 3.0 broadcast TV signals via cable systems and other multichannel video programming distributors (MVPDs).
More than 1,600 comments (including formal submissions, replies to other parties and ex parte letters) have deluged the Federal Communications Commission since October, when it issued its docket on “Authorizing Permissive Use of the ‘Next Generation’ Broadcast Television Standard,” a spokesperson told TV Tech. The arguments came from “broadcasters, MVPDs, equipment manufacturers and retailer groups, consumer groups/advocates, accessibility groups, policy groups, technology/software providers, content producers, other interested parties and individual consumers,” the spokesperson said.
Few Innovative Ideas
This vast array of opinions refrains the familiar arguments of broadcasters vs. cable operators—with substantial input from equipment and software and content suppliers allied with one side or the other. As is increasingly common in such proceedings, there is also an extensive cadre of public-interest organizations and a dollop of Silicon Valley and wireless communications ventures with an appetite for spectrum.
Relatively few innovative ideas seemed to emerge from the reams of formal filings or in conversations with TV Tech, although analysts offered perspectives on what’s ahead.
The FCC hasn’t set a deadline to resolve the ATSC 3.0 retransmission issue. The agency’s only response to a query about a possible timetable: “This is an active proceeding.”
Independent analysts do not expect a quick resolution. As one inside observer said, “The ball is in FCC Chairman [Brendan] Carr’s court.” Another FCC watcher opined that NextGen TV is not a high priority, despite the agency’s public statements.
To complicate the deliberations, the NextGen TV migration also includes uncertainty about if, when or how to turn off the current ATSC 1.0 signals, which do have must-carry requirements. A slew of other factors, such as the absence of a tuner subsidy (as was available in the digital transition nearly two decades ago), add to the complexity—and are familiar themes in the current examination.
When it opened its latest rulemaking, the FCC said it was seeking “to support and accelerate the nation’s ongoing transition to NextGen TV (also known as ATSC 3.0),” which it claims “represents the future of broadcasting and promises to modernize the nation’s free and local over-the-air television service.”
NAB, ATSC Confront Multiple Challenges
In its filing, the National Association of Broadcasters contends the dissent about must-carry and other familiar issues repeats a “problem [that] is circular.” Stations won’t transmit until carriage is assured and receivers are available, and hardware makers won’t make equipment until rules are in place for distributing the enhanced content, NAB asserted.
Moreover, there is the question about the migration from ATSC 1.0 to 3.0.
“Broadcasters cannot offer the full benefits of Next Gen TV service until they can stop simulcasting in ATSC 1.0,” according to NAB’s filing—but there is widespread concern about the problems that would surface if simulcasting ended without viewers able to receive ATSC 3.0 signals.
NAB urged the FCC to adopt a “date-certain ATSC 1.0 sunset” and to “ensure continued MVPD carriage of stations’ primary ATSC 3.0 signals and associated program-related features.”
In its initial comments to the FCC, NAB insisted “extending must-carry to ATSC 3.0 is essential to an efficient and timely transition.” Broadcasters contend stations should be allowed “to assert mandatory carriage rights for their ATSC 3.0 signals.”
“Broadcasters are not looking to expand must-carry obligations but preserve the same framework that applies today as broadcast technology evolves,” NAB said. “As stations transition to ATSC 3.0, must-carry should continue to attach to a station’s primary programming stream regardless of transmission standard…Technical standards are already in place to support MVPD carriage of ATSC 3.0 signals,” pointing to an ATSC Recommended Practice on Delivery of ATSC 3.0 Services for Redistribution.
Alison Martin, NAB’s vice president of innovation and strategy, said ATSC 3.0 broadcast streams contain content-related data that is essential for viewers and should be subject to must-carry rules. Weather reports, emergency evacuation routes, accessibility information and similar local data must be part of the retransmission package, she said, alluding to the support broadcasters have received from social service agencies.
Martin acknowledged that some of the data ventures that broadcasters envision for ATSC 3.0 fit into what the FCC’s Carr calls “the broadcast internet,” which NAB contends is totally separate from the must-carry issues involved with traditional video programming. She said licensees see services such as BitPath, the wireless platform built on ATSC 3.0 architecture developed by Sinclair and Nexstar Media Group, as an extension of broadcasters’ capacity for data delivery.
“They look at it as a supplement for private wireless networks, so must-carry is not necessary,” she said.
That said, cable retransmission is “the most important thing” to assure broadcasters “are able to innovate” and develop enhancements such as “more immersive audio” and sports enhancements, according to Martin.
The Advanced Television Systems Committee added its endorsement to NAB’s arguments.
Although the group insists that its focus is strictly on technical issues, “any regulatory framework must preserve local broadcasters’ ability to innovate, serve their communities, and fully use ATSC 3.0’s capabilities,” ATSC Vice President of Standards Development Luiz Fausto emphasized.
“The absence of clear rules governing the treatment of ATSC 3.0 services in retransmission scenarios could create uncertainty,” Fausto said. “Conversely, a framework that recognizes the technical realities of ATSC 3.0, including its IP-based architecture and support for new services, can help broadcasters and distribution partners plan investments with greater confidence.”
He stressed: “Cable retransmission is part of a larger transition. ATSC 3.0’s value lies in enabling local broadcasters to use a flexible, scalable, IP-based platform to reach viewers and communities in new ways.”
Opposition From Cable, CE Makers
The “been here before” sneer came from NCTA–The Internet & Television Association on behalf of a cadre of cable TV and broadband providers and their collaborators.
In its filing, the group took aim at NAB’s claim that the cable industry opposes broadcasters’ use of new technologies. “We simply believe that broadcasters’ transition to a new standard should not come at the expense of MVPDs, equipment manufacturers, and consumers, with no guarantee of meaningful benefits,” NCTA said.
“Requiring cable operators to carry ATSC 3.0 signals—despite the substantial costs involved and the uncertain consumer value—would further intensify the serious constitutional concerns associated with the must-carry regime,” NCTA Senior Vice President of Strategic Communications Brian Dietz told TV Tech. “Allowing broadcasters to discontinue ATSC 1.0 transmissions at this stage of the current market-based transition would impose real costs on consumers without any assurance of meaningful benefits.”
Requiring cable operators to carry ATSC 3.0 signals—despite the substantial costs involved and the uncertain consumer value—would further intensify the serious constitutional concerns associated with the must-carry regime.”
Brian Dietz, NCTA
The Consumer Technology Association and its equipment-making allies take a similar stance. CTA contends the marketplace is working and a 3.0 tuner mandate is unnecessary. It would be “misguided” to impose a mandate “before broadcasters have adopted and promoted NextGen TV on a nationwide basis, and thus before there is adequate indication of consumer interest or demand,” the group argued.
FCC Commissioner Anna Gomez, the agency’s sole Democrat, said the new rules would trigger “additional thorny questions” over matters such as “encryption technologies [i.e.] digital rights management.”
She voiced concerns about whether audiences “will be able to continue to enjoy free, over-the-air television as they do today.”
“Technology should not be a bottleneck to innovation,” Gomez said, noting that the “significant costs of the transition” will extend to consumers who must pay for new “equipment to…receive the new signal over the air or potentially pay higher prices for new televisions.”
Does Wall Street Care?
Blair Levin, a former FCC chief of staff and longtime telecom policy expert, identified several barriers to the must-carry requirements for NextGen TV.
“The value to consumers is completely different” from the original DTV transition nearly two decades ago, Levin said. “The streaming networks, which didn’t exist then, are a much bigger factor than alternative content at the time of the earlier transition.
“There will be a point when the MVPDs say ‘It’s over,’” Levin predicted, suggesting that the necessity to retransmit broadcast content may become irrelevant.
Levin, now a policy and regulation adviser at New Street Research, headed the team that wrote the U.S. National Broadband Plan (2009-2010) and was deeply involved in the 1996 Telecommunications Act while at the FCC.
Several barriers will impede the must-carry efforts, Levin told TV Tech, especially the lack of a tuner mandate and a specified turn-off date for the current ATSC 1.0 signals. The transition also lacks momentum because there is no pressure from Congress or the White House, he noted.
Would Wall Street care about such a break with historical models?
“Not really,” Levin said, noting that investors now care more about actions “that affect wireless carriers and Silicon Valley,” citing increasing efforts to open up different spectrum bands to auction for nonbroadcast purposes.
From his Washington perspective, Levin noted, “NAB has been unable to elevate this on Carr’s agenda.” He acknowledged that broadcasters have traditionally been big defenders of the First Amendment, but said NextGen TV does not fit into that category.
Focus on Other Opportunities
Rick Ducey, managing director at BIA Advisory Services, expressed optimism about TV stations finding a role in the emerging environment.
“I think broadcasters would still offer enhanced services over-the-air even if MVPDs wouldn’t provide the service enhancements,” Ducey said. “That might both hasten video subscriber drops from MVPDs and drive more OTA viewing.
“Broadcasters are leveraging ATSC 3.0 to create an enhanced consumer OTA experience, and [they] would love to see that experience also offered via MVPD retransmission of must-carry if necessary.”
As for the contentious stances of the major camps in this debate, “Each group has reasons for their positions,” Ducey explained, citing the “new expenses (and new competition) for MVPDs” when NextGen TV services are launched.
Equipment makers are wary of new expenses for an unproven market and don’t like the government telling them what their bill of materials should be, he acknowledged.
Ducey also pointed to concerns raised by the role of “tax-and-waste” groups such as Americans for Tax Reform, Taxpayers Protection Alliance, Citizens Against Government Waste and American Action Forum as new advocates of the FCC’s effort to create industrial policy.
Wall Street is paying attention to the NextGen TV situation, Ducey said.
“They’ve been listening to ATSC 3.0 plans, forecasts, expectations, and market signals for years,” he said, noting that investors are “waiting to see what happens as we get closer.”
Non-media ventures for data delivery provide “very promising signals that there may yet be an emerging and scalable market for broadcasters,” Ducey said, citing ventures such as EdgeBeam Wireless. That joint venture, involving E.W. Scripps, Gray Media, Nexstar Media Group and Sinclair, plans to use ATSC 3.0 technology for multipoint data delivery.
Meanwhile, the must-carry diatribes continue with no decision date in sight.
