Republicans in Congress asked the new head of the Federal Communications Commission Wednesday to abandon a proposal to make cable providers offer content on apps instead of forcing subscribers to rent set-top boxes.
The proposal is aimed at giving cable and satellite TV subscribers an alternative to paying monthly fees to rent boxes from Comcast, Verizon and others. Those fees cost the average American household $231 annually, according to congressional Democrats. It would also allow third parties like Google to build and sell set-top boxes, on which subscribers could download apps from their TV provider and view content.
Republicans on the House Energy and Commerce Committee have opposed the rules since introduced by former Democratic Chairman Tom Wheeler last year. They asked his newly named successor, Republican Commissioner Ajit Pai, to close the proceeding Wednesday.
“We are writing to ask that you close the docket on the set-top box proceeding,” Chairman Greg Walden wrote to Pai, “and signal clearly to consumers, content producers, consumer electronics manufacturers, and video programming distributors that the commission’s consideration of its set-top box proposal is at an end.”
The letter was signed by Tennessee Rep. Marsha Blackburn, who chairs the Subcommittee on Communications and Technology that frequently oversees the FCC, and echoes arguments they lobbed at Wheeler on the plan’s potential to harm copyright, advertisers and minority programmers.
“Cable, satellite and over-the-top video services are innovating, bringing their services to apps on new platforms, and responding to consumer demand,” the letter reads. “We should be fostering that kind of consumer-focused innovation, not mandating a one-size-fits-all ‘innovation.'”
The agency scheduled a vote on the plan last year, but Wheeler failed to get the votes necessary for passage from one of his two Democratic colleagues. Former Commissioner Jessica Rosenworcel dissented over a proposal to establish a licensing body at the FCC to review contracts between pay-TV providers and the third-party device manufacturers they would have to offer their apps on.
Pai and his Republican colleague Commissioner Michael O’Rielly agreed. Last year Pai said the two-year delay on the plan’s implementation will leave it lagging far behind technology “moving away from set-top boxes” in favor of video streaming services like Netflix, Hulu, and Amazon Prime. A proposal focusing on hardware, he said, could slow the app-based direction of the industry.
“Our goal should not be to unlock the box; it should be to eliminate the box,” Pai said. “If you are a cable customer and you don’t want to have a set-top box, you shouldn’t be required to have one. This goal is technically feasible, and it reflects most consumers’ preferences — including my own.”
Pai said previous FCC regulation in the set-top box market shaped the current system, which costs Americans $20 billion a year in rental fees and $500 million in kilowatt hours in energy consumption, “enough to power all the homes in Washington, D.C. for three months.”
He added multichannel video programming distributors and electronics manufacturers are unlikely to agree on video formats, specifications and standards that would make third-party boxes workable.
“The odds are probably better that Mark Zuckerberg will agree to Kanye West’s request for $1 billion,” Pai joked at the time.
In response to Wednesday’s letter, pro-net neutrality group Public Knowledge asked Pai to support reform.
“Despite the FCC’s recent efforts on this issue, the law has not been enforced and consumers continue to be burdened by a multi-billion dollar set-top box ripoff,” PK Senior Counsel John Bergmayer said. “Chairman Pai should continue the FCC’s work to bring consumers relief in this matter.”
Television provider heavyweights like Comcast and Verizon have begun offering limited content on mobile applications. Last year, DirecTV launched the most competitive offering to date, DirecTV Now, which offers a limited time entry price of $35 monthly for 100 live-streamed channels aimed specifically at cord-cutters.
