Feds pave way for online TV

The Federal Communications Commission (FCC) wants to bring cable television to the Internet.

The agency on Tuesday circulated a draft change to its rules that would open the door to online TV options that go above and beyond Netfix, Hulu and similar services.

{mosads}The new proposal would allow Web-based companies to compete on a level playing field with cable and satellite companies, according to FCC Chairman Tom Wheeler.

“Twenty-first century consumers shouldn’t be shackled to rules that only recognize 20th century technology,” he said in a blog post explaining the draft proposal.

“Taking advantage of this rule, new [Web-based television companies] may offer smaller or specialized packages of video programming, so consumers will be able to mix-and-match to suit their tastes,” he added. “And perhaps consumers will not be forced to pay for channels they never watch.”

The rule change would give online companies the same ability to pay programmers for rights to show their channels that cable and satellite companies currently enjoy. It also asks whether current obligations for cable and satellite companies — such as the requirement that they carry broadcast channels such as NBC and CBS on their lowest tier — should extend to online services, an FCC spokeswoman said.

Not only would the change lead to new ways to watch TV, it also could encourage companies to build more high-speed broadband Internet lines since more companies will seek to compete over consumers, Wheeler predicted.  

News of the FCC move first leaked earlier this month, though the agency said at the time that it was merely exploring the idea. 

The rule change would only apply to companies looking to offer multiple channels streaming live over the Internet. It would not apply to Netflix or Hulu but would make it easier for a company like Aereo, which gave subscribers nearly live broadcast television over the Internet for a small monthly fee before it was killed by a Supreme Court ruling earlier this year.

Wheeler on Tuesday said that Aereo executives had recently visited the FCC to make the point that making room for online TV “will provide consumers with new choices.”

Companies have certainly indicated that online television is the wave of the future.

Sony, DirecTV, Verizon and Dish Network have all indicated plans to offer some TV package through the Internet, Wheeler noted. In recent weeks, CBS and HBO have also said that they will soon be getting into the area.