FCC's Wheeler Moves on New Set-Top Box Plan

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By Tim McElgunn

Sept. 8 — FCC Chairman Tom Wheeler is circulating a modified pay-television set-top box proposal at the commission ahead of a scheduled Sept. 29 vote on the plan, the agency said Sept. 8.

Wheeler is calling for pay-TV providers such as Comcast Corp. to develop and provide free applications that can be incorporated into third-party video delivery platforms including streaming devices, gaming consoles, and smart TVs.

The chairman is trying to resurrect agency action on set-top box rules after an earlier proposal ran into pay-TV industry opposition and a bipartisan chorus of congressional concern. His new plan is aimed at addressing concerns raised by multi-channel video distribution providers (MVPDs) and content owners about the earlier proposal recommending that pay-TV providers be required to deliver specific information streams to third party device or app developers (2016 TLN 6, 3/1/16).

“I’ve circulated a proposal that would require pay-TV providers to offer to consumers a free app to access all the programming and features,” Wheeler wrote in a Sept. 8 blog post. “Consumers will be able to use this app on the device of their choosing, whether that’s a streaming device, gaming console, or even your current smartTV. This proposal would also enable integrated search across platforms and services, while protecting content and privacy.”

Senior commission officials told reporters Sept. 8 that the final version of the plan will allow consumers to access pay-TV content via free apps on a variety of devices so they no longer have to pay monthly rental fees, enable integrated search and protect content agreements and user privacy.

The commission would apply the same standards and safeguards for user information as currently applied to the pay-TV market. Service providers and device manufacturers will have to get users' permission before using their information for any purpose other than delivering services.

“Widely Available Devices.”

The new proposal would mandate that pay-TV providers develop apps compatible with “widely available” streaming devices, tablets, gaming consoles and other set-top alternatives. FCC officials said that widely available will be defined by operating system and that devices using an operating system that has shipped on more than 500,000 units in the past year would be included in the mandate.

The new proposal did not please everyone.

“While we appreciate that Chairman Wheeler has abandoned his discredited proposal to break apart cable and satellite services, his latest tortured approach is equally flawed,” Comcast Corp. spokeswoman Sena Fitzmaurice said in statement. Fitzmaurice said that even with the changes, the new proposal would impose “an overly complicated government licensing regime and heavy-handed regulation in a fast-moving technological space.”

Licensing Board

Among the most contentious parts of the plan is the proposed creation of a licensing board tasked with creating and overseeing a standard license and licensing procedure. FCC officials said that the new body would be composed primarily of representatives of the affected industries and argued the commission's oversight of such a body is well within the agency's mandate under federal communications law.

FCC officials said the agency's oversight would consist primarily of reviewing license terms to ensure they don't impose anti-competitive requirements on device makers.

Consumer advocacy groups have backed Wheeler's efforts to open the navigation device market to competition.

“This will increase competition and innovation in the video marketplace while making it easier for programmers and creators who aren't carried by cable to get equal billing in viewers' homes,” John Bergmayer, senior counsel at Public Knowledge, said in a statement

Small Providers Exempt

Large cable, satellite TV and other providers will have two years to fully implement the new requirements; medium-sized providers will have an additional two years to comply. The proposal will exempt operators with fewer than 400,000 subscribers from the requirements, but those companies can choose to provide apps or software “as appropriate for their business,” according to an FCC fact sheet. The commission is also planning to modify the rules to accommodate satellite- delivered direct broadcast satellite (DBS) services.

The officials also said that, if the proposal receives the required majority vote on Sept. 29, the commission will keep an eye on whether service providers deliberately limit or degrade the performance of the new apps in comparison to set tops, basing any enforcement actions, “purely on the user experience.”

To contact the reporter on this story: Tim McElgunn in Cherry Hill, NJ at tmcelgunn@bna.com

To contact the editor responsible for this story: Keith Perine at kperine@bna.com

For More Information

The FCC fact sheet is available at: http://src.bna.com/iqi.

Wheeler's blog post is available at: http://src.bna.com/iqw.

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