Senate lawmakers voted Thursday to delay the Federal Communications Commission’s proposal to “unlock” the set-top box until the agency studies the rules’ impact — one day after representatives of the pay-TV industry floated a plan of their own.
Members of the the Senate Appropriations Committee voted Thursday to block Chairman Tom Wheeler’s plan to compel pay-TV providers to open their content to third-party set-top boxes as part of agency’s 2017 funding bill.
In addition to approving a $341 million budget for the FCC — $17 million less than the agency asked for and $43 million less than 2016’s budget — the Fiscal Year 2017 Financial Services and General Government Appropriations bill would order the FCC to study the potential economic impact of Wheeler’s plan before implementing it.
The House Appropriations Committee passed a similar provision as part of its equivalent bill earlier this month along with several provisions aimed at blocking portions of the FCC’s net neutrality rules, upheld by a federal appeals court Tuesday.
A growing number of Republicans and Democrats in both chambers of Congress have voiced concerns about the proposal in recent months while asking the FCC to delay it for further study — something that could take up to a year, stretching beyond President Obama’s last term and possibly Wheeler’s tenure as chairman.
The White House has endorsed the set-top box plan and Wheeler has declined to commit to leaving at the end of the president’s term, as is custom among commissioners. His majority block of Democratic commissioners have also expressed support for the proposal, making it — like most all of Wheeler’s proposals — likely to pass if brought up for a vote.
“From a policy standpoint, this industry giveaway is another attempt at a transparent delay strategy, designed to perpetuate incumbent cable’s current stranglehold on consumers, and which flies in the face of Congress’ clear directive that the FCC act to ensure competition in consumer video navigation,” the pro-net neutrality group Public Knowledge said in a statement Thursday.
So far the only study the FCC has cited in the proposal originated in the Senate itself, where Democratic Sens. Ed Markey of Massachusetts and Richard Blumenthal of Connecticut released the results of a survey earlier this year that found the average U.S. household spends $231 annually in set-top box rental fees, pulling in almost $20 billion every year for providers.
On Wednesday pay-TV providers including Comcast, DirecTV, the National Cable and Telecommunications Association and others pitched a plan for providers to offer their content on HTML5-standard apps like those used by popular streaming services Netflix and Hulu.
Their plan, detailed in filings to the agency Thursday, would legally obligate providers to offer apps within two years — sooner than the FCC’s designated three year timeline for the set-top box unlock — and seeks to address the problem of standardized formats.
The FCC’s plan orders providers to agree on a standard format for video transmission, but provides no guidance on how to do so, prompting a warning by opponents — including Republican FCC Commissioner Ajit Pai — that the rules could necessitate two boxes instead of just one.
It further echoes Pai by endorsing his call not to unlock the box, but to do away with it entirely and embrace the video app market the industry has been moving toward on its own in recent years.
“Our goal should not be to unlock the box; it should be to eliminate the box,” Pai said after Democratic commissioners voted to advance the rules earlier this year. “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.”
Unlike Wheeler’s plan, the solution pitched by providers would not open those video streams to potential third-party device manufacturers like Google.
“Chairman Wheeler is heartened that the industry has adopted the primary goal of our proposal, to promote greater competition and choice for consumers, and agree it is achievable,” FCC spokesperson Kim Hart said in a statement. “We all agree that third-party access to pay-tv content, integrated search and the protection of copyright, content security, consumer privacy and minority programmers are critical. There is a lot more work to do.”
