Impact Study Needed Before FCC Pursues Set Top Box Proposal

Impact Study Needed Before FCC Pursues Set Top Box Proposal

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With the shot clock ticking for people to file comments in the FCC’s “Unlock the Box” proceeding, a coalition of civil rights and social justice organizations wrote a letter to Chairman Tom Wheeler requesting that he pause the current rulemaking to conduct an “analysis regarding this proposal’s impact on diversity and inclusion.”

The group, which includes the National Urban League, the Asian American Justice Center, and the League of United Latin American Citizens, among others, warns that the current proposal disaggregates content in such a way as to likely disadvantage people of color and traditionally underrepresented voices in this space.

Citing the Commission’s responsibility, as the regulatory agency in charge of cable content, the group said the FCC has an “obligation to assess and address the lack of minority ownership and participation in this ecosystem statutorily.”  Further, the group noted that “[h]istorically, civil rights organizations have been opposed to an a la carte television ecosystem, driven by consumer choice, because of the financial impossibility for minority and independent programmers to sustain new content if few people are watching.”

Even today, though multitudes of content creators produce rich video content hosted by various outlets online, very few are able to monetize, sustain, and scale their operations. For instance, a web series on YouTube with 10 million views can expect to receive about $200 a month as compensation from advertising royalties. At less than $2,500 a year, content creators – producers, actors, writers, directors, cameramen, crew, designers, marketers – couldn’t afford to pursue this kind of venture full time. At best, they’d have a chance of getting recognized for their work and maybe get picked up by a larger network, or cut a deal with advertisers looking to leverage their audience.  At worst, content creators in this scenario are left with a financial deficit from producing their popular hobby.

Indeed, back in 2004, when Bob Johnson was still CEO of Black Entertainment Television, the network joined other diverse programmers in warning Congress that “a la carte packaging and pricing of programming would have a chilling effect on programming diversity in America.”  In a May 12 letter to Members of the House Energy and Commerce Committee, they said networks serving multicultural and diverse interests could not be launched or thrive in an a la carte world.

If cable and satellite companies sell channels a la carte, it would instantly erode potential advertising support, forcing us to dramatically increase the per-subscriber fee we must charge. Ultimately, subscribers would find themselves paying about the same amount — and possibly more — for just a handful of channels, rather than having hundreds from which to choose, as they do today.

According to the civil rights groups in their recent correspondence, the “Commission must ensure that the proposal to ‘unlock the set top box’ will truly promote diversity and inclusion, especially since it will empower emerging platforms from a tech industry that has shown very little to no commitment and progress in effecting diversity and inclusion in their own industry. After years of resisting disclosure, many tech giants released their employment diversity numbers for the first time in 2014, which highlighted an astonishing lack of inclusion. Most worrisome is that despite that disclosure and many acknowledgments of their failings, follow-up disclosures in 2015 did not show any improvement. In fact, some companies reported a decrease in diversity.”

 

While the group says there are several questions an impact study could address, some of the key questions to consider include:

  • Will unlocking the set top box serve the goal of increasing media, content and ownership diversity compared to the current system?
  • Could unlocking the box result in less diversity and fewer successful minority programmers and content producers? If so, what is the projected data on the extent/size of the disparity that would result? If not, what is the projected data on the extent/size of diversity gains?
  • What type of new opportunities and/or harms will unlocking the set top box create for minority programmers and content producers?
  • What are the costs and/or savings associated for minority programmers and content producers?

The first round of comments to the FCC are due in mid-April.  To learn more about the proceeding and weigh in, click here.

1 COMMENT

  1. Why is this article so biased and one sided? You know there are positions other than cable industry talking points and you consciously chose not to include these viewpoints! Is Politics365 funded by cable interests? If so, this should be disclosed!

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