WGA News – December 2010

Both the WGAs East and West have been keeping up with the many business developments that have been impacting the industry in recent months:

On August 9, 2010, WGAE President Michael Winship and Executive Director Lowell Peterson issued this statement about the reported collaboration between Verizon and Google on broadband definitions that claim to maintain net neutrality but that may actually be paving the way for the introduction of paid tiers for Internet access:

“While the Writers Guild of America, East, AFL-CIO, usually takes pride in celebrating creativity, we must condemn the creative magic by which Verizon and Google have split the online world into the “public Internet” and “additional differentiated online services.” This semantic sleight of hand seeks to prioritize online content, granting privilege and advantage to those content creators with deeper pockets who would like nothing better than to destroy the concept of net neutrality.

In their joint statement today, the two companies emphasize their dedication to the principles of net neutrality. But prioritized content runs directly counter to those principles, giving the upper hand to a favored few willing to pay more to wrest control of broadband access.

Today, we have had a glimpse of the broadband future, and it will not stand for those who have come to depend on the Internet not only for information and entertainment but the freedom of expression it offers to everyone. We urge Congress and the FCC to scrutinize this backdoor method of prioritizing Internet content carefully and to see it for the violation of liberty and creativity that it is.”

Protecting an Open Internet and Intellectual Property
On August 12, 2010, the WGAW called upon the Federal Communications Commission to preserve an open Internet and address copyright infringement by asking that the agency institute net neutrality by reclassifying broadband transmission under Title II while also creating clear rules that require Internet Service Providers (ISPs) to police piracy – but with techniques that do not interfere with lawful content, do not create barriers to entry, and do not disadvantage independent producers as they compete for viewers with huge media companies.

In a response for comments regarding the Framework for Broadband Internet Services, the WGAW voiced strong concern with the implications to free speech and the right to privacy if the methods suggested by others in the entertainment industry are employed under the guise of network management.

“We are opposed to all forms of piracy,” said WGAW President John Wells, “But we must find solutions that do not trample on 1st and 4th Amendment rights. We are confident that a free and open Internet, governed by net neutrality principles, can and must coexist with strong copyright enforcement.”

On October 8, the WGAE released these comments:

We applaud the Commission for recognizing that broadband providers can evade the basic principles of net neutrality by creating so-called “specialized services” as part of their broadband offerings and discriminating in favor of content provided through those services. This is nothing more than sleight of hand – avoiding open internet principles by declaring a major portion of the internet to be “not the internet.” This is the equivalent of stating that all of our nation’s highways are public, open to everyone and subject to neutral traffic laws – except those highways we have deemed to be private. The owners of those private highways would be free to discriminate in favor of the most profitable traffic, leaving the rest of us in the slow lanes.

Why is the WGAE so concerned about this? Because the internet and other digital distribution systems provide unprecedented opportunities for writers and other content creators to present their material directly to consumers. Whatever the cost of producing a program, the cost of distributing it online is close to zero, and there are no gatekeepers to divert the public’s attention away from the program. This is profoundly different from the current media environment, in which a relative handful of multinational conglomerates decide what gets distributed to the public on television and in the movie theaters. Permitting broadband providers to discriminate amongst content, to decide which programs get priority distribution, would transform the open architecture of the internet into a slightly upgraded version of today’s television and film industry. In practice, decisions about what people watch would be made by a small number of conglomerates which exist (of course) to make a profit and not to enhance our culture or educate our people.

We submit that this would squander the enormous potential of digital media to expand our intellectual, artistic, and entertainment options. It would force writers and other creators to abandon their independent projects and to sign on with the mega-studios. Of course, our members do work for these mega-studios, and many of them make good livings doing so; a handful have been able to express their own unique voices under the current system (especially when they have penned blockbuster hits in the past). But our members are, at heart, creative people who want to tell unique, compelling stories without excessive gatekeeping by commercial interests. An open, nondiscriminatory internet makes it possible for them to reach their audiences directly. It also gives new voices a chance to be heard on merit, and not simply as a result of prior box office success or personal connections.

As the Commission notes, the potential for the anti-competitive handling of content is particularly acute when vertically integrated providers of content, applications, and services gain significant market share. This is precisely the case with the proposed merger of Comcast and NBC/Universal, which would create a company that controls distribution of both cable television and broadband to tens of millions of homes and also owns a huge television network and studio. The company would have a compelling economic incentive to ensure that consumers watch the programs it produces. But the danger also exists with other structures – for example (as also noted by the Commission), arrangements in which the broadband provider obtains more favorable pricing from particular content providers.

We have concerns about three of the general policy approaches the Commission has identified in its Further Inquiry notice: definitional clarity, truth in advertising, and disclosure. From the perspective of the consumer and of the content creator, the digital distribution system they use feels like one seamless system; it’s what one accesses by computer or mobile device or, increasingly, television set. People call it “the internet”. Content is made available on that system by the creators and streamed or downloaded from the system by the consumers. The inevitable result of permitting providers to create favored avenues within this distribution system is to direct consumer traffic to these favored avenues. Access times would be faster, or quality would be superior in some other way. Otherwise there would be no reason for providers to create these preferred avenues. To suggest that net neutrality principles – including the principle of nondiscrimination – would not apply on these favored avenues is simply to say that providers can discriminate in favor of and against certain content. The preferred material will be distributed via “special services” and consumers will favor it. The diverse, creative, original material made by writers and other independent content creators will be relegated to the slower or lower-quality lanes, and will languish – not because consumers have decided they don’t like it as well, but because it is distributed on the official, slow-lane “internet” and not on the internet-renamed-as-special-services. We are concerned that the first three policy alternatives described in the Further Inquiry notice would simply provide a rubric for describing this fast-lane/slow-lane divide, and would do nothing to stop it.

The last three of the Commission’s policy alternatives (non-exclusivity, limited specialized service offerings, and guaranteed capacity) appear to address the problem more directly. If properly and thoroughly designed, a non-exclusivity rule could give independent content creators an equal shot at getting their material distributed in a nondiscriminatory manner. In other words, the ISPs would commit to distributing (for example) writers’ explorations of important public policy matters, or dramatic developments of significant cultural trends, on the preferred avenue. Unfortunately, there is a significant chance that the barrier to entry onto the preferred, speedier part of the internet will still be very high; that is, that offering the same arrangements to all “on the same terms” will be prohibitively expensive for independent producers.

Limiting special service offerings that do not, in fact, resemble distribution of news and entertainment programs could ensure that independent audio-visual programming remained protected by the principles of net neutrality. This would depend on how tightly the definition of specialized services was drafted – that is, that audio/visual programming was not lumped in with other “special services.”

If a guaranteed capacity approach really meant that all internet programming was distributed at the same speed with the same quality, specialized services would become a kind of branding, or a mechanism for pricing content according to what consumers were willing to pay. This would be different from the central problem presented by the fast lane/slow lane divide; consumers would not be directed to content based on some preference imposed by the provider.

1. Application of Open Internet Principles to Mobile Wireless Platforms

There is no theoretically sound reason to distinguish between wired and wireless digital distribution in the net neutrality analysis. In both cases consumers have access to the same datasphere; in one case the device is connected by wires and in the other case, by a wireless connection. In fact, in most homes and businesses, the computer or iPad or handheld device used by the consumer is wireless; the wireless connection is made between that device and another device in or near the home which in turn interfaces with the internet. The same is true with mobile wireless devices; the only significant difference is that mobile devices can be moved farther away from the device that interfaces with the internet.

Less theoretically, from the perspective of the consumer and the content creator, it’s all one distribution system, or at least it will be within a few years, at most. People already use their smart phones to watch streamed movies, access news and entertainment websites, participate in social networks, and engage in essentially the same activities they do on their desktop or laptop computers, in addition to using the smart phones to text and make phone calls . Indeed, the advent of the iPad seems to eliminate the distinction between “computers” and “mobile devices” altogether.

For these reasons, it seems self-evident that all of the net neutrality principles, including the nondiscrimination principle, must apply with equal force to mobile wireless platforms.

NBC-Universal/Comcast Merger
Concerned about the negative impact of the media industry’s increasing consolidation on consumers’ access to diverse and independent news, information, and entertainment content on August 19, 2010, the WGAW warned that the proposed Comcast/NBC-Universal merger will not serve the public interest unless the Federal Communications Commission (FCC) imposes requirements to preserve fair competition and promote diversity of content sources.

In comments filed with the FCC regarding the Comcast/NBC-Uni merger, the WGAW addressed the far-reaching implications of the vertical integration of content production, distribution, and exhibition that would be created as a result of this proposed consolidation: “The control of our news, information and entertainment sources in increasingly fewer hands is a profoundly negative development not just for writers but for consumers and all citizens in a democracy. The FCC should require that this merger create more competition, not less; more diversity, not less.”

On October 6, 2010, the WGAE issued a proposal regarding the possible merger and its anticipated impact on news and public affairs programming. The WGAE’s proposal was presented in letters signed by President Michael Winship and Executive Director Lowell Peterson, and sent to: the FCC and its Chairman Julius Genachowski, the U.S. Department of Justice and its Assistant Attorney General Christine Varney, and the House Judiciary Committee and its Chair John Conyers.

The letters reads as follows:

The Writers Guild of AMERICA East represents thousand of members in film television, radio, and digital media. Many of them work in news and public affairs for the major television and radio networks and stations and for public television. They write scripts, produce, edit, and create graphics material that is broadcast over the airwaves, distributed on cable television, and posted on the Internet.

The proposed merger between Comcast and NBC/Universal would further consolidate the production and distribution of news and public affairs programming relied upon by the American public and essential to the proper functioning of a representative democracy. But fewer and fewer entities creating news and public affairs programming for broadcast or cable television or for the Internet means less diversity of news content. By definition, fewer points of view are presented, fewer stories are reported in-depth and fewer resources are utilized to pursue them. True investigative reporting has almost vanished completely from commercial on-air news or has often been reduce to sensationalized, trivial coverage of no lasting significance. Instead of a town square where ideas flow freely, the news business becomes more like a shopping mall dominated by a small number of megastores. This thwarts the public’s ability to engage in robust, well-informed discussion of the critical issues of our time.

One way to counteract this trend would be a significant increase in public funding of public affairs programming on public television. This approach would recognize the economic pressures placed on all news-gathering organizations by declining advertising revenues, and it would permit content creators greater latitude to pursue stories for their intrinsic news value rather than their perceived ability to grab eyeballs and drive profit margins. This concept – more public funding for news and public affairs programming – might seem tangential to a review of a proposed merger, but we respectfully suggest that if media conglomerates insist on being permitted to consolidate their holdings in the media marketplace, in exchange they can be required to contribute assets to public programming. This was the tradition upon which quality American broadcasting was originally founded – the networks and stations understood their responsibility to the public and would counterbalance the tendency of consolidations to deprive the American people of diverse content and high quality news and public affairs shows.

This is particularly true in the caser of the Comcast/NBCU merger because it would result in a single company producing content and acting as sole distributor of that content – both on cable and online – for tens of millions of American. This new, mega-company would have enormous power over what people watch and a clear economic incentive to direct its customers to the content it produces. It is imperative that this further consolidation of control be counterbalanced by a commitment to broaden the programming available to the public.

If the merger is approved – and we hope it is not – we respectfully request that the FCC, the Department of Justice, and the Judiciary Committee require the merged company to contribute significant resources to the production of truly independent content. Although we are also deeply concerned that the merger will limit the ability of independent producers of entertainment programming to reach their audiences, the effect will be particularly profound in the area of news and public affairs programming. Therefore, we suggest that the merged company be required to set aside at least $10 million per year for ten years for the creation of thoughtful, independent, well-researched public affairs programs for television and the Internet. We further suggest that this funding be allocated in the same manner as public television funding – whether through the Corporation for Public Broadcasting or another entity to be established for this purpose.

3 thoughts on “WGA News – December 2010

  1. Sandra Branum

    There was a time when the government dissolved monopolies, i.e. Bell Telephone and Telegraph. Now it seems the more money one has the easier it is to buy everything up and monopolize it. I hope the FCC will be smart enough to control what NBC/Universal/Comcast can do; or we will lose another freedom — Freedom of Choice. As it is so many of the cable channels show the same shows because they are affiliated: Chiller TV & Syfy, etc.