The government wants to make it easier for you to buy and use cable boxes from companies other than your cable provider.
This could help companies like TiVo, Roku and Apple deliver a cable feed, too, as part of their video recorders or streaming-TV devices.
Introducing competition could also help lower people’s cable bills. The Federal Communications Commission says that 99 percent of cable and satellite TV customers rent boxes from their cable providers, and that the price of cable boxes has nearly tripled since 1994. Meanwhile, prices of common consumer electronics like cellphones, TVs and computers have fallen sharply. The FCC says the average U.S. household pays $231 a year to rent a cable box.
FCC commissioners will vote on the proposal on Feb. 18. That would kick off a process of writing new rules, which will likely take several months.
The cable proposal came a day before a meeting Thursday at which the FCC will update broadband access statistics. The FCC could call for changes from providers. (WRAL TechWire Insider subscribers get the full story.)
The rules would be meant as a successor to CableCard, which lets consumers get a card from their cable companies and stick it into another box like a TiVo. CableCards were supposed to free consumers from cable boxes, but it wasn’t very popular.
“CableCard never achieved a very competitive marketplace,” said Chris Lewis, vice president of government affairs for consumer advocacy group Public Knowledge. He hopes new rules could help other companies create technology that appeals to more consumers.
In an op-ed, FCC Chairman Tom Wheeler said new boxes could help you ditch extra remotes and better integrate content like Netflix and Amazon with a cable-TV feed, so that you can search for shows and movies across all your subscription services simultaneously.
In detail: The FCC proposal
As posted at the FCC:
The Chairman’s proposal will create a framework for providing innovators, device manufacturers and
app developers the information they need to develop new technologies. Consumers should be able to
choose how they access the Multichannel Video Programming Distributor’s (MVPDs) – cable, satellite or
telco companies – video services to which they subscribe. For example, consumers should be able to
have the choice of accessing programming through the MVPD-provided interface on a pay-TV set-top
box or app, or through devices such as a tablet or smart TV using a competitive app or software. MVPDs
and competitors should be able to differentiate themselves and compete based on the experience they
offer users, including the quality of the user interface and additional features like suggested content,
integration with home entertainment systems, caller ID and future innovations.
To ensure a competitive marketplace as required by the Telecommunications Act of 1996, the proposal
identifies three core information streams that must pass from MVPDs to the creators of competitive
devices or apps:
- Service discovery: Information about what programming is available to the consumer, such as the channel listing and video-on-demand lineup, and what is on those channels.
- Entitlements: Information about what a device is allowed to do with content, such as recording.
- Content delivery: The video programming itself.
Standards: Promoting interoperability and removing barriers to innovation
- Instead of mandating a government-specific standard for these three information flows, which might impede innovation, the Chairman’s proposal recommends that they be made available to the creators of competitive devices and navigation solutions using any published, transparent format that conforms to specifications set by an independent, open standards body.
- The proposal identifies five characteristics that must be met by an independent standards body: openness in membership, a balance of interests, due process, an appeals process, and consensus.
Security: Preventing theft and misuse
As technology has evolved, so has the market’s ability to prevent theft and misuse. Smart TVs, for
example, currently ensure the same security for copyrighted material as the traditional set-top box. The
proposal provides MVPDs flexibility in the security systems they use while putting in place some
constraints to ensure that they do not use their security choices for anti-competitive purposes.
The proposal does not propose a single mandated security system, but rather simply requires
MVPDs to offer at least one content protection system that is openly licensed on reasonable and
non-discriminatory terms. This will allow each MVPD to determine the content protection
systems it deems sufficient to prevent theft and misuse, and will not impede the introduction of
new content protection systems.
Programming: Lifting Up Independent and Minority Content
When consumers are able to access all their content – from MVPD programming to streaming video – in
a single place, they will be better able to find and enjoy the programming most relevant to them. When
it’s easier for content creators to reach consumers, we would expect this to lead to more and better
programming accessed more easily, especially minority, independent, and international programming.
Copyright Protection and Distribution: Honoring the sanctity of contracts
The proposal maintains important aspects of the traditional video distribution regime, such as
protections against copyright infringement and theft of service. The proposal is clear – the Commission
will not interfere with the business relationships between MVPDs and their content providers or
between MVPDs and their customers. The proposal does not change a company’s ability to package and
price its programming to its subscribers.
- Maintains strong protections for copyrighted content: Copyrights and licensing agreements will remain in place, and copyrighted content will be protected from piracy much as it is protected under the existing CableCARD regime. Similarly, the proposal honors the limits on the use of programming agreed upon between cable companies and content providers (e.g., ability to record content).
- Existing content distribution deals, licensing terms, and conditions will remain unchanged. These deals made between MVPDs and content providers are not affected by this proposal. MVPDs retain their customers and will still get a monthly fee for the subscription service that the MVPD provides. The only change the FCC is proposing is to allow consumers alternative means of accessing the content they pay for.
Consumer Protection: Emergency Alerts, Privacy and Advertising
The proposal seeks to ensure that important consumer protections like emergency alerting, privacy, and
children’s advertising restrictions will apply.
- EAS: The emergency alerting system is built to be technology neutral so that any entity – from an MVPD to an ISP to an online streaming service – can provide EAS alerts. The proposal notes that under the CableCARD regime competitive devices are required to pass through EAS alerts, and it proposes to require the same here.
- Privacy: The FCC has a long history of protecting the privacy of consumers of communications services. Device manufacturers and software developers already must comply with applicable state and federal laws regarding consumer privacy. The proposal seeks to ensure that the privacy protections that exist today will also apply when alternative navigation devices are used.
- Advertising restrictions: The proposal seeks to ensure that restrictions on children’s advertising will apply, whether a consumer uses an MVPD-supplied set-top box or a competitive alternative.
The Bottom-Line for Consumers
- More Choice: More choices for innovative ways to access the programming they pay for on the device or app they prefer. Just as consumers shop at retail for a smart phone today, and they can choose to purchase a wireless router instead of leasing one from their provider, consumers will have the same choice to use a competitive device with a third-party app if they choose.
- Greater Flexibility: No one will be required to purchase a new device to continue receiving the services they do today. Consumers will be free to retain the setup they have today. Increased Innovation: The proposal paves the way for user-friendly interfaces that integrate pay-TV and streaming content on one device.
- More Competition: A competitive marketplace could drive down costs. On both landline and wireless telephone and data networks, device prices decreased after consumers were allowed to choose how they connect to the networks they pay for – the FCC’s Carterfone and Open Access decisions, respectively – because closed markets were opened and competition increased.
- Better Prices: Notably, the average charge for a set-top box is $7.43 per month, an increase of 185 percent since 1994. This is over three times the increase in the Consumer Price Index (CPI) over that same period. With more choices on the marketplace, consumers could expect to pay less to own the device with the software of their choice rather than being forced to lease costly set-top boxes from their service providers.
An industry group made up of cable companies, the Future of TV Coalition, said the FCC’s proposal could lead to higher prices, “eliminates security protections, and provides no reassurance on privacy rights.”
In a statement, the group said many consumers are already watching cable through different kinds of apps and devices, such as a streaming TV box to watch HBO Go.
Big cable TV providers like Comcast, Time Warner, Dish and Charter are also experimenting with TV services that are delivered online and don’t require a cable box.