A Few Words About KATU, Frontier Communications, and Over-the-Top Box Deregulation

Due to a fee dispute, Portlanders who receive their cable television from Frontier will not be able to receive local traffic, news, and weather from a longstanding local television station.

Not only is this a serious blow to KATU’s viewership, as it will be forced to rely on over-the-air transmission, with considerably fewer viewers, but the dispute also highlights serious problems with cable and over the top regulation in the United States, a microchasm of the greater issues with US tech policy.

Under current regulations, cable companies have immense bargaining power, deciding what channels they will and will not carry, giving them the ability to negotiate absurd fees from TV stations, and black them out if agreements aren’t reached.

Additionally, cable and satellite television companies are able to artificially restrict what channels can and can’t be seen by consumers, allowing them to bundle channels together, charging consumers for channels they don’t want, and charging a premium for access to certain channels. Additionally, purchasing the right to view a single TV show is often impossible, and consumers are forced to buy a bundle of channels if they want to see their favorite show before it comes out on Netflix. Even purchasing the access box costs over $200 on average.

The result? Consumers face higher prices and less selection for tv channels, and as a result, have been “cord-cutting,” and migrating to Netflix, Hulu, and Amazon streaming.

However, the monopoly of cable companies has been hurting innovation, and leads to absurdity in access. No matter how much someone may want to watch the PAC-12 Networks in Michigan, they can’t. They aren’t even allowed to buy access online, due to contractual obligations between the PAC-12 networks and TV providers. We have the technological ability to allow anyone to view the channel, but the absurdity of current regulations allow TV networks to restrict access to it.

That is unacceptable.

The FCC needs to deregulate over-the-top boxes, and allow third parties to bundle channels independently, allowing people to buy only the channels and shows they want, without paying for unneeded content.

There is enormous potential for improved access and reduced prices if the monopoly on channel bundling is broken. Unfortunately, the FCC’s attempt to deregulate over-the-top boxes has been thwarted, and the new Trump nominated FCC chair will certainly not take further action.

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