Consumer Groups Attack TV Everywhere

Seven consumer advocacy groups are taking aim at TV Everywhere, a strategy adopted by subscription TV providers, which they claim stifles competition and violates antitrust regulations.

The groups today filed letters with the Department of Justice, the Federal Trade Commission and several congressional committees, calling for an investigation into the initiative, which would limit Internet viewing of certain programming to subscribers of the subscription service.

Comcast launched its TV Everywhere product, Fancast Xfinity, in mid-December 2009. The service offers episodes of several shows, including those airing on cable and on over-the-air TV networks. To view, consumers must subscribe to both Comcast and its Internet service. Other cable, satellite and phone companies have similar plans in the works.

The groups, Free Press, Media Access Project, Consumer Federation of America, Consumers Union, Open Technology Institute, Participatory Culture Foundation and Public Knowledge, claim the plan is the result of “illegal
collusion.”

“Statements by top MVPD [multichannel video programming distributor] executives demonstrate that MVPDs would not introduce TV Everywhere services unless assured of an agreement with competitors,” the letter said. “TV Everywhere is thus designed to ensure consumers cannot cancel their MVPD subscriptions and turn to competing TV services that use the Internet, Internet-connected televisions and set-top devices, which perhaps include over-the-air digital streams. By tying online television to incumbent MVPD subscriptions, TV Everywhere is designed to undermine new forms of competition and consumer choice currently emerging over the Internet.”

Kyle McSlarrow, president and CEO of the National Cable & Telecommunications Association, took issue with the opinion of the consumer groups, stressing that the new online service would be provided at no extra charge and include
programming from competing program networks.

“The call for an ‘investigation’ of TV Everywhere has no factual or legal basis no matter how many times Free Press and its allies repeat the words ‘collusion,’ ‘cartel’ and ‘illegal,'” McSlarrow said in a statement. “In the name of protecting competition, they would actually reduce the amount of online content available to consumers.”

The conflict comes at a time when all program providers, including broadcast and cable networks, are searching for ways to distribute and monetize content across emerging platforms.

“A model that would give consumers the option to get more value, by access to online content, as part of the TV subscription they already pay for is something that consumers should have the right to embrace or reject,” McSlarrow said.