FCC isn’t ready to consider streaming media as full competitor to...
FCC isn’t ready to consider streaming media as full competitor to broadcast and cable TV, it said in its decision allowing major broadcast networks to own smaller networks. CBS owner Viacom, which wanted permission to continue owning UPN, had…
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argued that Internet was viable competitor to TV, but FCC, in footnote, said: “Given the nascent stage of the Internet video industry, we believe it is premature to give decisional significance to Internet video at this juncture.” In order released May 15, Commission also said it still was too early to determine competitive impact of DTV. In other portions of final text, FCC said: (1) Growth in number of commercial TV stations to 1,663 in Sept. from 1,550 in Aug. 1996, and declining network viewership share had reduced competitive impact of allowing dual network ownership. (2) Rapid growth in number of cable channels, as well as in DBS, also mitigated impact. (3) Merger of large and small broadcast networks “may produce significant efficiencies by internalizing the contentious issue of program production risk- sharing.” (4) Commenters divided on issue of whether merger of 2 major networks would enhance market power, so FCC decided it didn’t have to address that issue. (5) Retainion of old dual network rule would have “adverse consequences on diversity at the local level” since affiliates of failed network might not be able to afford quality programming. (6) Dual networks would have “strong economic incentive” to diversify programming and serve minority or niche audiences. Commission also stayed requirement that Viacom divest itself of UPN by May 3.