NCTA asked the FCC to grant Midco and the Connect America Fund Phase II Coalition's petition for limited waiver to "align the CAF Phase II location requirements with those more recently adopted by the Commission for the Rural Digital Opportunity Fund," said a letter posted Thursday in docket 10-90. CAF II recipients should be subject "to the same 65 percent location threshold for support reductions that applies to RDOF recipients, rather than having their support reduced for every location overestimated by the cost model," NCTA said. The Wireline Bureau previously granted a similar waiver allowing CAF II recipients to be subject to the letter of credit requirements adopted under RDOF.
The FCC rightly deciding noncash cable-related extractions by local franchise authorities count as franchise fees and wrongly went with market value for their worth, which should be assigned equal to the cable operator's marginal cost here. That's per the 6th U.S. Circuit Court of Appeals Wednesday partially denying and partially granting petitions challenging the commission's 2019 LFA order. Deciding were Judges Raymond Kethledge, Richard Griffin and David McKeague, with Kethledge penning the docket 19-4161 decision. Oral argument was in April (see 2104150051). The court said the fee on broadband services levied by Eugene, one of the petitioners, doesn't count as a franchise fee but is preempted. It rejected the challenge to the FCC saying a cable operator can go to court on a request for public, educational and government channel support that's considered excessive. The FCC and counsel for petitioners didn't comment. FCC Commissioner Brendan Carr called the ruling “a good win for every American that wants better, faster and cheaper internet service.” The 6th Circuit decision upheld “key reforms that the 2019 FCC majority put in place,” he said. “Now is the time to double down on those successful infrastructure reforms, which allowed providers to increase speeds, lower consumers' monthly bills for broadband and extend their networks to more Americans.”
Roku’s dispute with Google over what it calls unfair terms (see 2104260071) for YouTube TV “has nothing to do with an economic deal,” Roku Chief Financial Officer Steve Louden told investors: Roku is "not asking for any more money or any more value." The streaming platform company is asking Google "to be reasonable" by not manipulating search results on Roku, not making Roku divulge personally identifiable information in consumer data “that we don’t provide to anybody,” and not requiring things on the device side “that would increase our cost basis, erode our [bill of materials] cost advantage” from Google streaming products including Chromecast and Android TV, he said Monday. Google didn't comment Tuesday.
The FCC wants comments by June 21, replies July 6 on Comcast's petition for a waiver of certain E-rate rules for its Lift Zone initiative, said a public notice Friday in docket 02-6. Comcast asked to waive the gift rule and requirement that libraries pay the "non-discount portion of services" (see 2105130059).
NCTA noted fears the chip shortage could slow broadband deployment. Federal policy on the shortage should be industry- and technology-neutral, NCTA blogged Thursday. It said government efforts to bolster this supply chain, if not "equitable," could strand the tens of billions of dollars being invested in broadband through the Rural Digital Opportunity Fund auction and other actions. NCTA said the U.S. should invest more in R&D and chip manufacturing capacity, and it wants the Creating Helpful Incentives to Produce Semiconductors for America Act fully funded.
Top cable providers had a Q1 net loss of about 775,000 video subscribers, reported Leichtman Research Group Wednesday. Losses in Q1 2020 were 595,000. Comcast slid 491,000 to 19.3 million. AT&T Premium TV, Dish Network, Verizon Fios and Frontier shed 865,000, led by AT&T Premium. Top publicly reporting virtual MVPDs lost 255,000 vs. 210,000 exits a year ago. Overall, top U.S. pay-TV providers dropped 1.89 million vs. 1.95 million losses a year ago. The only pay-TV service to post Q1 gains was fuboTV, which added 42,550 to reach 590,430. Hulu shed 200,000 to 3.8 million, and Sling TV dropped 100,000 to 1.4 million. The top seven cable companies have 43.1 million of the 78.7 million pay-TV subscribers. Other traditional pay-TV services have 28.9 million and vMVPDs 6.7 million. Over the past year, top pay-TV providers lost 4.79 million vs. a loss of 5.12 million in the prior year, said Principal Bruce Leichtman.
Cable One asked for limited waiver of emergency broadband benefit reimbursement rules, requesting an additional month to submit claims for EBB's first three months, in an FCC docket 20-445 petition Tuesday. It sought waiver of the requirement it claim reimbursement within 15 days of the first snapshot date that a subscriber is enrolled in EBB.
Growth in U.S. net new broadband subscriptions fell 16% compared with the 2020 quarter when they got a COVID-19 boost, Pivotal Research Group's Jeff Wlodarczak wrote investors Friday. Subs were up modestly from Q1 2019. He expects 2021 net additions down 35% from record 2020 results but about 20% above 2019. Broadband household penetration finished Q1 at 86.8%, up 0.7% sequentially. Cable, with 98% share net new subscribers, saw a 24% drop year on year, up modestly from 2019. Telcos were “treading water” the last three quarters as DSL losses offset fiber-to-the-home gains; telcos added 18,000 in Q1. Some 19 million copper-based telco data subs “are ripe for cable to steal,” he said. Pay-TV results and outlook remain “ugly,” said the analyst, citing “bloodletting” at former DirecTV properties. Pay TV had a 2.1 million subscriber drop vs. 2.4 million in Q1 2020, the worst quarter, and virtual MVPDs lost 1.9 million. Traditional pay TV “remains a dead man walking,” and if players don’t have a credible direct-to-consumer strategy, “they are in trouble,” Wlodarczak noted. PRG is “increasingly excited” about Dish Network’s wireless buildout, noting “what could be a game-changing service with their [Amazon Web Services] relationship a key piece” (see 2104290045).
Comcast wants an E-rate waiver for a pilot with libraries to offer free internet and educational resources, a petition said Thursday in FCC docket 02-6. It asked for a waiver of the gift rule and requirement that libraries pay the “non-discount portion of services.” This would “open an important new opportunity to help bridge the digital divide and close the homework gap,” the petition said: The goal is 1,000 community center learning locations by Dec. 31.
FuboTV reported 43,000 Q1 sequential net subscriber additions to 590,430 vs. a loss of 28,000 in the largely pre-COVID-19 pandemic year-ago quarter, as the company is positive on bundles for virtual MVPDs like itself. Revenue rose 135% year on year to $119.7 million. Churn fell and it raised forecasts. CEO David Gandler cited to investors Tuesday personalization features, better onboarding and improved targeting. NFL recent carriage deals with major broadcasters and by extension vMVPDs is good for the packages' future, Gandler said: Increasing subscription VOD choices mean the streaming experience becomes more “costly and fractured.” Consumers who care about sports and live TV want aggregation in a “seamless, curated” experience, he said: The bundle “will undergo a revival, and we’ll see a major shift back to aggregation and bundling as individual services begin to raise prices” and it becomes more burdensome to manage numerous services. The stock closed up 9.7% Wednesday at $19.38.