The deployment of high-speed broadband means millions of consumers now have access to broadband speeds that enable an on-line viewing experience that is similar to that delivered over traditional distribution platforms. As broadband technology has evolved – both in terms of distribution and devices – there is a renewed interest in integrating content with distribution. Recent transactions have increased regulators’ concerns that vertical integration will increase the potential for exclusionary use of content and/or distribution platforms to the detriment of the broadcast system as a whole, and the development of online video distribution in particular. Regulators in Canada and the United States are moving towards more traditional broadcasting regulation when it comes to online video distribution. However, given the current structure of the industry, these rules may be more restrictive than is necessary. A better regulatory option may be to address complaints on an ex post, case-by-case basis, similar to undue preference rules that already exist. This would allow vertically integrated firms to take advantage of cost efficiencies, and experiment with new products and services, while at the same time ensuring regulators maintain oversight in situations where anticompetitive effects arise.
Available at: http://works.bepress.com/david_krause/6/