US comms watchdog the FCC has published its revised plans to kill the multi-billion-dollar cable box rip-off.
In a fact sheet [PDF], chair Tom Wheeler reiterates the same arguments he made back in January when he first proposed forcing cable companies to publish their data streams in an open format so competitors could offer cable boxes.
"Ninety-nine percent of pay-TV subscribers currently rent set-top boxes because there aren't meaningful alternatives," Wheeler notes. "Lack of competition has meant few choices and high prices for consumers – $231 in rental fees annually for the average American household. Altogether, US consumers spend $20 billion a year to lease these devices."
Wheeler's original plan faced a fierce backlash from cable companies – but also from some companies that could benefit from the change, and even from his own allies on the Commission. Cable companies warned that the plan would allow third parties to introduce their own advertisements and could cause the leak of consumer data.
Instead, the industry proposed an alternative: an app-based approach that would allow other companies to offer apps on their devices.
As an industry veteran however, Wheeler was all too aware of the multiple times in the past that the industry has proposed solutions to bring in greater competition, only to strangle them at birth. With literally billions of dollars in profits on the line, his new proposal attempts to call the cable industry's bluff by accepting its proposal and pulling in the FCC in a key role to make it difficult for them to kill the initiative with a thousand cuts.
His plan revolves around what is called a "standard license" in the fact sheet. "The proposed final rules require the development of a standard license governing the process for placing an app on a device or platform," it notes. "A standard license will give device manufacturers the certainty required to bring innovative products to market."
The key detail? The FCC oversees that license. "Programmers will have a seat at the table to ensure that content remains protected. The license will not affect the underlying contracts between programmers and pay-TV providers. The FCC will serve as a backstop to ensure that nothing in the standard license will harm the marketplace for competitive devices."
That may seem like a small detail, but it has led to a furious response from the industry, which doesn't seem very keen on the FCC sticking its nose into their business; particularly if it means they can't maintain their ludicrously profitable control over who can access their content.
The full plans aren't available yet, thanks to the FCC's arcane functioning, but FCC staff have been briefing all sides on the likely content. The only people to see the full details are Commissioners and FCC staff, who will decide what to do with the proposal at the next FCC meeting on September 29.
One of those Commissioners put out a very quick retort however. "I will review this proposal carefully over the coming days and weeks," said Michael O'Rielly in a statement [PDF], "but at the outset it appears to exist within a fantasy world of unlimited Commission authority. The Commission is and must remain in the business of licensing spectrum and infrastructure, not content."
Before even seeing the fact sheet, the National Association of Broadcasters has fired off an angry letter arguing that "it is critical that neither the Commission nor any third party have the ability to rewrite any terms or conditions contained in programming contracts."
We can expect much more of that as Wheeler attempts to get around the cable industry and save American consumers hundreds of dollars a piece. ®