FCC Pulls Controversial Set-Top Box Proposal From Meeting Agenda

FCC chairman Tom Wheeler says rules reshaping access to TV programming will remain under consideration, but that the FCC needs to resolve technical and legal issues.
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FCC chairman Tom Wheeler

In a surprise move, the FCC announced Thursday it won't be taking up at its open meeting a proposal touted as the beginning of the end of expensive cable set-top boxes.

FCC chairman Tom Wheeler has been squarely behind the proposed rules that would require pay TV providers to offer to consumers a free app widely deployed platforms. Under the regulations, if adopted, apps would be required to have extensive search functions and barred from discriminating against independent content sources. An independent licensing body also would be established to figure out licensing of the apps on devices and platform.

Cable companies and content studios have been fiercely against the proposal and have spent months aimed at convincing lawmakers and the public that the rules amount to a heavy-handed government mandate that would spur piracy, hurt privacy and security and cause further damage to the entertainment industry. They've also hinted at legal challenges with expressions that the FCC could be exceeding its authority.

Congress has directed the media regulatory agency to look into the issue of increasing competition in the set-top box space, and while critics suspect that the proposed rules favor tech companies like Google and Apple over those distributors currently paying for television content, it has been applauded by the Writers Guild of America, many public interest groups and the tech community at large.

Wheeler, Mignon Clyburn, and Jessica Rosenworcel — the three Democratic Commissioners on the five-member FCC panel — said in a statement Thursday that the proposal will go into circulation and remain under consideration.

“It’s time for consumers to say goodbye to costly set-top boxes," they said. "It’s time for more ways to watch and more lower-cost options. That’s why we have been working to update our policies under Section 629 of the Communications Act in order to foster a competitive market for these devices. We have made tremendous progress — and we share the goal of creating a more innovative and inexpensive market for these consumer devices. We are still working to resolve the remaining technical and legal issues and we are committed to unlocking the set-top box for consumers across this country.”

The move to delay a vote comes after more than 60 Democrats in the U.S. House of Representatives sent a letter to the FCC asking the agency to extend the rule-making period and make public the full proposal. Rosenworcel has been seen as the swing vote and indicated uneasiness a couple weeks ago by saying "the FCC getting a little bit too involved in the licensing scheme here."

Chip Pickering, CEO of the tech industry trade group INCOMPAS, reacted to Thursday's development by emphasizing the FCC's obligation to act.

"Competition is the law, and the FCC has an obligation to continue working toward solutions that bring real choice, innovation and lower prices to consumers," he said. "The members of the commission are smart, well intentioned, and we believe they will find common ground that will open the market and promote innovation. For competition to rise, the set-top box monopoly must fall, and we look forward to working with all members of the FCC toward this shared goal.”

“The MPAA is pleased that the FCC is taking more time, and we hope they use it to ensure any set-top box proposal remains consistent with copyright policy and avoids harming creators," responded MPAA chairman Chris Dodd. "As the MPAA and its member companies have repeatedly stated over the last year, we support the FCC’s goal of promoting set-top box competition, but we continue to urge the Commission to forge a path that does not undermine the creative economy."

The DGA also put out a statement:

"The Directors Guild of America was pleased to learn that the FCC has decided to delay consideration of the set-top box proposal. Although supportive of providing consumers free choice, the DGA has vigorously expressed its concerns regarding the proposal and its potentially devastating effects on the rights and livelihoods of the creators of film and television. It is our hope that the FCC has heard the DGA and other voices and that they will craft a proposal, released for public comment in advance of any vote, that protects copyright, privacy, and the essential revenue streams that allow for the creation of entertainment programs enjoyed around the world.”