Federal video regulation still treats broadcast, cable, and streaming as separate worlds. Consumers do not. The gap between how the law classifies video services and how people actually watch them is widening, and it increasingly distorts competition across the modern media marketplace.
Last week, the International Center for Law and Economics (ICLE) hosted a panel on the future of video competition in the United States. The conversation ranged widely—from broadcast-ownership caps and retransmission consent to smart-TV intermediaries, data-driven advertising, and the role of user-generated content. A consistent theme emerged: the legal silos structuring federal video regulation no longer reflect consumer experience. As Congress and the Federal Communications Commission (FCC) revisit video-competition policy in the coming year, those tensions will become harder to ignore.
For casual observers, the debate may appear limited to recent FCC broadcast-rule enforcement or high-profile streaming mergers. More attentive followers may point to broadcast-ownership reform or consolidation among major streaming firms. These developments, though, are only surface manifestations. As the video marketplace evolves, regulators confront a growing set of distinct but interrelated policy questions.
At the center of these changes is a simple fact: consumers no longer care about technical distinctions among cable, broadcast, and streaming. They just want to watch the content they choose. The FCC’s legal categories, however, were built for a 20th-century broadcast environment. They do not map cleanly onto how video is marketed, discovered, and consumed today. Updating regulation requires understanding how consumers perceive substitutable services and how siloed rules across technologies can impede competition on the merits.
Many of these distortions do not stem from recent FCC action, but from the Communications Act’s statutory architecture. Title III’s broadcast-licensing regime and Title VI’s cable-specific mandates were designed for spectrum scarcity and infrastructure bottlenecks that no longer define the marketplace. Piecemeal administrative action cannot resolve these structural tensions. A durable solution will require congressional engagement, not merely agency reinterpretation.
The End of ‘Tonight at 8’
For most of the 20th century, audiovisual media followed a linear, appointment-viewing model. The Communications Act—particularly Title III—regulated broadcasting around that assumption. Because only a limited number of licenses could operate in a market without harmful interference, Congress granted the FCC broad authority to regulate broadcasters in the “public interest,” with localism as a central regulatory hook. The framework reflected a world dominated by the “big three” networks, in which locally licensed stations served as the transmission points. That structure continues to shape FCC authority.
Technological change complicated this model. Improvements in transmission mitigated some interference concerns, and new delivery technologies emerged. Cable systems began in the late 1940s outside the regulatory structure, initially as a reception workaround in mountainous areas. Operators placed a large antenna on a mountain or tower and wired the signal directly into homes, allowing communities physically unable to receive broadcast signals to access programming. A single wired connection could deliver multiple channels, unlike broadcast stations operating over scarce spectrum.
As cable grew, the FCC asserted authority, and the Supreme Court recognized the agency’s ancillary jurisdiction over the technology. Congress then intervened. The Cable Television Consumer Protection and Competition Act of 1992 created the multichannel video programming distributor (MVPD) category and imposed must-carry and retransmission-consent requirements, giving local broadcasters greater control over how MVPDs carried their signals. The Telecommunications Act of 1996 relaxed parts of the regime, but many legacy provisions remain.
Today, the premises underlying that framework have eroded. The linear model has largely given way to an asynchronous, on-demand environment. Viewers decide when and where to watch, decoupling content from the infrastructure used to deliver it. The shift appears in the rise of “cord-cutting,” in which households cancel traditional cable subscriptions, and the emergence of “cord-nevers,” viewers who have never subscribed to a traditional MVPD service.
Regulators See Categories; Viewers See Content
As video markets evolve, regulators face pressure to update legacy rules. Doing so requires clarity about convergence and market definition. Antitrust analysis defines markets by substitutability: if consumers can switch between products and still satisfy their needs, those products likely compete in the same market.
Market definition is not an abstract taxonomy exercise. It is a practical tool for assessing whether a firm can profitably restrict output, raise prices, or degrade quality in ways that harm consumers. The relevant question is not whether cable, broadcast, streaming, and user-generated platforms are technologically identical, but whether they constrain one another in practice. If viewers shift their time and attention across delivery modes, those modes impose competitive discipline on each other, regardless of how the Communications Act classifies them.
From the consumer’s perspective, many video services are substitutes. The National Football League on Amazon Prime, Love Is Blind on Netflix, a local CBS affiliate’s broadcast of Survivor 50, and Mr. Beast on YouTube all compete for the same scarce resource: time and attention. Whether content comes from a major studio or an individual creator often matters less than whether viewers find it compelling. Differences in production and audience targeting remain, but they may not prevent consumers from switching.
Regulation has not kept pace with this shift. Broadcasters remain subject to ownership caps, structural limits, and certain content rules that do not apply to other media. MVPDs, meanwhile, face retransmission-consent and must-carry obligations that can require them to carry local broadcast stations or pay substantial fees, even when consumers might prefer alternative programming.
Leveling the Playing Field — Up or Down?
Participants at the ICLE video-competition panel broadly agreed that disparate regulatory regimes distort competition across video services. The next question, then, is what it means to “level the playing field.” Policymakers face a choice: extend legacy rules to new technologies—by applying traditional MVPD requirements to vMVPDs and online video distributors (OVDs) such as Sling TV, YouTube TV, and Netflix—or scale back the legacy regime itself.
The panelists favored deregulation. The existing rules were built for scarcity conditions that no longer exist in a broadband environment where content providers can reach audiences through multiple pathways. Broadcasters no longer need to rely on over-the-air transmission to reach viewers, and the cable bottleneck that justified many Title VI mandates—retransmission consent, must-carry, program carriage, and billing regulations—has weakened substantially.
Retransmission consent and broadcast-ownership limits illustrate the problem. Both emerged from a world of fragmented, relatively small local affiliates operating in a linear distribution system. Ownership caps constrained scale, while retransmission consent supplied leverage to secure carriage and compensation. Together, they formed complementary features of a scarcity-based framework.
Changing one without the other alters the regulatory balance. Removing ownership caps while preserving retransmission consent would allow consolidated station groups to wield statutory bargaining leverage at a scale Congress never contemplated, potentially increasing pricing pressure on MVPDs and vMVPDs. Eliminating retransmission consent while maintaining strict ownership caps would strip affiliates of negotiated revenue without permitting the scale efficiencies needed to compete directly in streaming markets. The policy problem, in short, lies in the interaction among these rules, not in any single provision viewed in isolation.
“Leveling the playing field” by extending outdated regulations to new entrants would raise costs and discourage innovation. A more coherent approach is comprehensive reform. Treating broadcast signals like any other copyrighted content—licensed through voluntary negotiation rather than regulatory entitlement—would remove government-granted leverage that distorts competition. It would instead allow cable operators and vMVPDs to compete on service quality, not regulatory classification.
The Last Mile Is Now Wi-Fi
Retransmission-consent reform raises a recurring concern: what happens to local affiliates? These independent stations partner with national broadcast networks to deliver a mix of local programming and nationally produced content. The traditional network-affiliate model was symbiotic. Networks relied on local stations for last-mile distribution, and stations relied on high-budget network programming to attract viewers.
Technology has altered that relationship. Not through anticompetitive conduct, but through direct-to-consumer streaming. Networks such as NBC (via Peacock) and CBS (via Paramount+) now reach viewers without relying exclusively on local affiliates. As alternative distribution channels expand, affiliates no longer control the only pathway to the audience, and their economic leverage has declined. Critics worry that loosening ownership limits or other restrictions could further weaken the local character of broadcasting.
Localism, however, largely refers to local news. Broadcast stations historically held an advantage because they maintained facilities within the community and could gather and transmit local reporting. That advantage still matters, but the form of distribution is changing. Younger viewers increasingly encounter local reporting through social feeds, livestreams, and mobile apps, rather than the traditional 6 or 10 p.m. newscast. Breaking news often circulates online well before it appears on broadcast television.
Some argue that must-carry rules and ownership limits remain necessary to preserve local news. Yet local reporting is adapting to new platforms, rather than disappearing. Policymakers should hesitate before locking in a particular delivery model while audience behavior shifts rapidly.
Indeed, reforms could strengthen local affiliates. Eliminating broadcast-ownership caps would allow station groups to consolidate beyond current limits, reducing compliance and overhead costs and freeing resources for local programming. A larger station group reaching a significant share of U.S. households would also possess real bargaining power, enabling it to negotiate distribution terms without relying on retransmission-consent leverage.
Everyone’s a Studio Now
The regulatory debates above focus on distribution—how video reaches viewers. A complete view of competition must also account for how content is created. Historically, broadcast networks and major studios were among the few firms able to finance high-quality programming that attracted large audiences. Today, large digital platforms both distribute and produce content, and recent acquisitions have drawn regulatory scrutiny. High-profile transactions—such as Netflix’s proposed acquisition of Warner Bros. Discovery, and earlier combinations like Comcast and NBC—reflect vertical integration between production and distribution. Such integration can reduce transaction costs and improve quality, allowing firms to deliver programming at lower prices.
At the same time, barriers to entry in content creation have fallen dramatically. Modern smartphones include cameras and microphones capable of professional-quality recording, enabling creators to produce programming for Instagram, TikTok, and YouTube. Many independent creators now reach audiences at a scale that rivals traditional media companies. Even smaller creators benefit from rapid advances in generative AI, which allow artists to produce feature-length or episodic video at a fraction of the historical cost.
Consolidation among traditional studios therefore does not occur in a vacuum. The growing ability of new entrants to produce competing content limits any single firm’s ability to behave as a monopolist. Antitrust law does not treat consolidation as per se unlawful. Liability arises when a firm can raise prices or restrict output beyond competitive levels through anticompetitive conduct, rather than success on the merits. Even if concentration increases among legacy studios or platforms, low entry costs and expanding creative tools constrain the extraction of monopoly rents.
Scarcity Rules in an Abundance Market
Comprehensive statutory reform of media regulation may be politically difficult in the near term. Congress nevertheless has incremental options. As former Commissioner Michael O’Rielly noted during the ICLE panel, one step would be extending the FCC’s existing forbearance authority—currently available for telecommunications services—to media and video regulation. Such authority would not require deregulation, but it would allow the commission to suspend or modify legacy provisions when enforcement no longer serves the public interest. In a marketplace that has moved far beyond the assumptions embedded in Title III and Title VI, targeted flexibility may be a practical first step.
The convergence of policy silos—from broadcast ownership and retransmission consent to privacy and platform liability—shows that the Communications Act’s core premises no longer hold. Scarcity once justified close government supervision. Today’s market is defined by abundance, where the limiting factor is consumer attention, not spectrum or transmission capacity. Forcing cross-platform competition into static regulatory categories creates distortions that harm consumers. The resulting friction—whether regulatory arbitrage between vMVPDs and cable operators or artificial distinctions between broadcast and digital advertising—typically arises from the regulatory framework itself, not from a failure of competition.
Policymakers should therefore resist calls to “level the playing field” by extending obsolete rules to new technologies. Expanding retransmission-consent obligations to streaming services or imposing gatekeeper-style mandates on smart-TV manufacturers would export yesterday’s inefficiencies into tomorrow’s markets. Rapid entry by new competitors—enabled by low-cost distribution and generative AI—suggests that consumer welfare is better protected through conventional antitrust analysis and a clean-slate approach to sector-specific regulation. Removing structural barriers that prevent firms from competing on the merits would allow video providers to deliver lower prices, higher quality, and greater content diversity for modern viewers.
