A Regulatory Framework Built for Another Era

Must-carry and retransmission consent rules were crafted in the early 1990s, when cable and satellite dominated pay television and the internet was not yet a mass medium. Today, millions of Americans have cut the cord in favor of streaming services, and "virtual MVPDs" — online pay-TV services like YouTube TV, Hulu + Live TV, and FuboTV — have emerged as major distributors of broadcast content.

This transformation raises a fundamental question: do the old rules apply to the new players, and if not, should they?

What Is a Virtual MVPD?

A virtual multichannel video programming distributor (vMVPD) is an online service that bundles live television channels — including broadcast networks — and delivers them over the internet rather than through a traditional cable or satellite infrastructure. From a viewer's perspective, the experience is similar to cable TV. From a regulatory perspective, the classification is murky.

Key characteristics of vMVPDs include:

  • Delivery via broadband internet rather than dedicated infrastructure
  • Subscription-based access to live and on-demand content
  • Inclusion of local broadcast affiliates in most markets
  • No physical set-top box or cable installation required

Are Virtual MVPDs Subject to Must-Carry Rules?

Currently, the answer is no. The FCC's must-carry rules apply to "cable operators" and "direct broadcast satellite" providers as defined by statute. Virtual MVPDs do not fit cleanly within either definition, and the FCC has not issued a ruling that extends must-carry obligations to them.

This means that a vMVPD can negotiate retransmission consent for broadcast stations — and must do so — but is not legally required to carry any local station that it doesn't want to include. Broadcasters have no must-carry backstop against a vMVPD.

Retransmission Consent and Virtual MVPDs

While must-carry doesn't apply, retransmission consent rules do require vMVPDs to obtain permission from broadcasters before retransmitting their signals. This has created a robust (and sometimes contentious) negotiating environment between broadcast groups and streaming pay-TV services.

Notable dynamics in these negotiations include:

  • Broadcast station groups demanding fees on par with or exceeding what traditional cable operators pay
  • vMVPDs threatening to drop local stations from their packages — and following through
  • Disputes over whether vMVPD carriage agreements should include streaming rights beyond live linear feeds
  • Geographic licensing complications when subscribers travel outside their home market

The Policy Debate: Should Must-Carry Apply to Streaming?

Broadcasters and consumer advocates have called on Congress and the FCC to extend must-carry obligations to vMVPDs. Their arguments include:

  • Consumers who switch from cable to streaming services should retain access to free, local broadcasting
  • Local news and emergency information are public goods that should be universally accessible
  • Regulatory parity between cable and streaming prevents an unlevel playing field

Opponents — including vMVPDs and some free-market advocates — counter that:

  • Imposing must-carry on internet-based services raises serious First Amendment concerns
  • The market is already delivering local content through vMVPDs voluntarily
  • Mandated carriage could distort pricing and stifle innovation in the streaming space

What Broadcasters Should Do Now

Given the regulatory uncertainty, broadcast stations and groups should:

  • Engage proactively with vMVPDs on retransmission consent agreements before subscriber counts on those platforms grow further
  • Participate in FCC proceedings and Congressional hearings that touch on vMVPD regulation
  • Develop direct-to-consumer streaming strategies to reduce dependence on any single distributor
  • Monitor court decisions and FCC rulemaking that could clarify the regulatory status of vMVPDs

The Bottom Line

The rise of virtual MVPDs represents one of the most significant structural challenges to the existing must-carry and retransmission consent framework. Whether regulators will adapt these decades-old rules to fit the streaming era — or allow the market to determine carriage outcomes — remains one of the defining policy questions in broadcast law today.