The Free State Foundation P.O. Box 60680 , Potomac, MD 2085 9 [email protected]
www.freestatefoundation.org Perspectives from FSF Scholars September 6, 2012 Vol. 7 , No. 25 FCC's Video Report Reveals Disconnect Between Market's Effective Competition and Outdated Regulation by Seth L. Cooper * In July, the Federal Communications Commission released its Video Competition Report . This means the FCC may finally be moving past its repeated failures to comply with Congress's mandate to annually issue its reports. By including data about the video market up through the end of 2011, the FCC now has a Report that more accurately reflects the current video market's competitiveness. But despite a mountain of evidence in the FCC's Video Report showing that the video market is "effective ly competitive, " the FCC refuses to declare it so. With its now familiar practice of refusing to recognize the competitiveness of other market segments, the FCC's posture in this regard appears calculated to bolster legacy video regulation and to provide a basis for future regulation. Online video, for the first time a major focus of the Video Report , constitutes just one of the latest innovative breakthroughs that is reshaping the video market's landscape and offering consumers an abundance of new choices . Other developments in the video market include the rapid expansion of high -definition video, digital video recorder (DVR) options, video -on -demand functions, as well as TV -everywhere and other mobility capabilities.
2 Report data regarding MVPD services u tterly demolishes any pretensions that the video market is now subject to a last -mile cable "bottleneck." In 2010, 98.5% of all households – that is, 128.8 million – had access to at least three multichannel video programming distributors (MVPDs) . The comb ined market shares of the five major cable operators has dropped to 60% of the video