Republican FCC Commissioners Seen Unlikely To Support Coming Set-top Changes

Industry officials expect FCC Commissioners Ajit Pai and Mike O'Rielly to oppose policy changes to move away from reliance on CableCARDs and toward successor standards, if not the NPRM set for a Feb. 18 vote that proposes the overhaul (see 1601270064). Both Republican commissioners repeatedly declined to comment Thursday on Chairman Tom Wheeler's proposed "opening up" of the set-top box market.

There will likely be "a fulsome debate" over the proposed changes to set-top rules, said Wheeler, who opened his monthly post-meeting news conference with a speech about the proposals. "There is no competitive market for set-top boxes," Wheeler said, a situation he said is "explicitly contrary" to statute.

O'Rielly and Pai said they couldn't comment on the proposal because they haven't seen the NPRM, which Wheeler had said would be circulating Thursday to eighth-floor offices. O'Rielly said he has begun to suspect there's no longer a technological need for set-tops, so a cheaper box would be of limited utility. O'Rielly also chided Wheeler for using a chart provided by Public Knowledge to illustrate his point that a lack of competition for set-tops has resulted in higher leasing fees. Pay-TV groups have characterized the FCC set-top box proposals as being a mirror image of policies suggested by Public Knowledge.

Pai said even less about the item Thursday. A 2014 commentary he co-authored with House Communications Subcommittee Vice Chairman Bob Latta, R-Ohio, also questioned the need for set-tops. “Today, there are myriad avenues for consumers to access video content without using a set-top box supplied by a cable company or a CableCARD,” Pai and Latta argued then. Latta released a statement opposing Wheeler's proposal Wednesday: "The latest FCC proposal replaces the failed CableCARD regime with yet another government dictated standard."

Consumers "have no meaningful options" for set-top boxes, Wheeler said Thursday. He shared supportive emails from the public complaining about their set-top costs, and repeatedly compared the box market to wireless phones. The proposed changes won't change the business practices of pay-TV carriers, Wheeler said. He condemned pay-TV efforts to characterize the current proposal as AllVid -- the name of a failed 2010 effort to create a CableCARD successor -- and said the FCC's current proposal wouldn't require a second box in consumer households as pay-TV companies have claimed. Responding to pay-TV arguments the proposal isn't currently technologically feasible, Wheeler said smart TVs already are doing something similar to what the FCC would propose by combining hardware and software that recognize different licensing rights and decodes signals from various sources.

The FCC's proposals would "undermine" diverse content because it forces programmers and distributors to disaggregate their shows and service, said the Multicultural Media Telecom and Internet Council in a news release. That would have unintended consequences for minority programmers, MMTC said. The proposal "ignores" the portions of the FCC Downloadable Security Technology Advisory Committee report that were supported by pay-TV companies, including an apps-based approach to security, said DSTAC member Mark Hess, Comcast chief technology officer, in a blog post. "We hope the FCC will decide to avoid this major step backward for consumers and video innovation." Wheeler's proposal is "another disappointing example of an FCC that thinks its smarter than highly competitive markets," said AT&T in a released statement.