American Cable Association President and CEO Matthew Polka issued a following statement condemning Viacom for denying access to its websites by broadband Internet subscribers served by smaller cable broadband providers who are members of the ACA, which includes most recently Cable One, which recently dropped all of Viacom’s channels over failing to reach a new retransmission deal:
“All who care about ensuring access to content on the Internet should be outraged that Viacom is selectively blocking access to its public websites by broadband Internet subscribers served by smaller cable companies.
Viacom took this punitive step against these companies in retaliation for their recent refusals to sign cable programming renewal contracts seeking exorbitant fee increases for Viacom networks with low ratings and minimal viewer interest. As part of its retaliatory efforts, Viacom’s action is impacting access to a subset of broadband customers, also known as ‘cord cutters,’ who are not video customers of these companies.
We know that all broadband Internet subscribers of two ACA members – Cable ONE and Liberty Cablevision of Puerto Rico – are being blocked by the powerful media conglomerate. We fully expect the list of small cable operators targeted by Viacom to grow based on preliminary information from dozens of ACA members who did not renew with Viacom.
Viacom’s actions are a flagrant attack on Internet openness and a textbook replay of the vengeful action CBS took against Time Warner Cable and Bright House Networks broadband customers during their well-documented retransmission consent dispute last August.
Viacom’s move is momentous because of the policy and industry debate occurring right now regarding the fundamental tenets of Internet openness, which include allowing consumers to reach the lawful content of their choice. In selectively blocking these users’ access, Viacom is violating Internet openness in a way that should be seen as a call to action to policymakers on Capitol Hill and at the Federal Communications Commission.”
In an Op-Ed in today’s online edition of The Hill, FCC Commissioner Michael O’Rielly noted that a balanced and ‘intellectually honest’ debate about the need for anti-blocking net neutrality regulations should not only include broadband access providers but also Internet edge or content providers that engage in content-blocking aimed at consumers. By way of example, Commissioner O’Rielly referenced CBS’ broadband blocking of Time Warner Cable and Bright House customers.”
Noted Bruce Beckner, Owner at Garvey Schubert Barer: “I don’t see a clear case of illegality here; although this raises the question of Viacom’s market power in controlling so many channels and in using them as a block to force rate increases on certain channels that viewers may find more desirable. This is a variant on the “tying arrangement” which used to be a “per se” violation of Sherman Act section 1; but that jurisprudence has been diluted down very much in the last 25 years. It seems to me that the industry’s lobbying activity should focus not on the FCC (which doesn’t have much authority to regulate this) but on the Federal Trade Commission, which, under FTC Act Section 5, has authority to proscribe “unfair methods of competition.” The courts have traditionally given the FTC wide latitude in defining what that means in various contexts, in part because the FTC’s only remedy is prospective (cease and desist) and because, unlike a criminal antitrust case brought by the Justice Department for violation of the Sherman Act, an FTC Act Section 5 “conviction” does not create any private right of action or expose the respondent to the risk of money damages. There is, frankly, a lot of room for the FTC to get involved in these matters, if it could be persuaded to do so.
The challenge is to restrict the use of this kind of “leverage” without jeopardizing an individual’s right to chose with whom it will deal, and the terms on which it will deal. After all, the New York Times and the Wall Street Journal, among others, operate websites that put some of their content behind a “pay wall” that is available only to paying subscribers. I don’t think anyone wishes to prohibit that practice. As a practical matter, there are “anonymizers” (perfectly legal) available that allow someone to surf the Internet using one or more intermediaries that effectively conceal the surfer’s identity, IP address and ISP. Perhaps Cable One should supply its broadband customers with instructions on how to use these tools to circumvent Viacom’s digital wall.”