NAB, NCTA Oppose Digital Broadcasting OVS’s Application
The NAB and NCTA opposed an application by Digital Broadcasting OVS to operate an online open video system in the top 50 U.S. TV markets (CD June 1 p9). The NAB also asked for more time to comment on the application because it wasn’t initially available on the FCC’s website and the public notice soliciting comments was published directly before a federal holiday, and the deadline for comments was immediately following it (CD May 31 p17). Under OVS rules, the agency must act within 10 days on certification applications. The commission should reject the application because Digital Broadcasting OVS failed to establish that it’s a local exchange carrier under the Telecom Act, the NAB said.
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"Congress intended that in order to qualify for an ‘open video system,’ the entity had to be a ‘local telephone company’ providing local telephone service,” NAB said. Digital Broadcasting OVS’s plans to provide service to the top 50 TV markets goes against OVS rules requiring operators provide service in the same area they provide phone service, the group said. “The FCC should deny the Application because it contravenes the ‘local cable service’ provision of the Act."
Online video distribution didn’t exist when Congress authorized open video service in the 1996 act, NCTA said. It’s not clear if Digital Broadcasting’s service would be eligible for OVS certification, the group said. “For example, it is implicit in the statutory provisions governing Open Video Service and in the Commission’s rules that an Open Video Service will deliver video programming service over ‘channels,'” a term which is defined in FCC rules, NCTA said. “While Digital Broadcasting claims that it will provide ‘1000 IP HDTV channels,’ it is unclear whether its service will in fact use ‘channels’ as that term is defined” by the FCC, the trade association said.
There are other aspects of the OVS rules that appear to exclude Digital Broadcasting OVS’s plans, cable lawyers said. “Open video systems are defined in a way to suggest it is an actual system” said Dow Lohnes attorney Chris Redding. Digital Broadcasting OVS has said it will rely on existing last-mile broadband infrastructure, rather than building its own. “If you look at the definition of an open video system, they don’t meet that description,” Redding said.
Getting OVS certification would give Digital Broadcasting OVS equal footing with incumbent pay-TV providers in programming negotiations, CEO Roy Jimenez said in an interview. A provision of the OVS rules says “nothing in this chapter precludes a video programming provider to making use of an open video system from being treated as an operator of a cable system for the purposes of section 111 of Title 17.” That section refers to the secondary transmissions of TV signals by cable systems. Such a certification could set Jimenez apart from other recent online video distributors of TV stations such as Ivi and FilmOn, which have quickly found themselves in court with station owners and programming suppliers over copyright infringement claims.
With the upcoming cable show in Chicago “all those channels are about to be served with a notice,” Jimenez said. He said he doesn’t have any programming contracts signed. If the FCC grants his certification application, “because we have the same rights, I don’t think there will be a problem getting content,” he said. The service Jimenez plans also wouldn’t require subscribers to buy special equipment, he said. It would be available to existing IP-enabled devices, and even some devices with ATSC receivers, he said. Part of his plan, not laid out in his initial application, involves leasing unused spectrum from TV stations to deliver some programming, he said.