NTIA Questions FCC Set-top Proposal As White House Support Draws Concern

An executive branch filing in support of the FCC set-top box proceeding (see 1604150003) is largely laudatory of the commission's proposal but also questions aspects of the agency's plans on privacy and copyright, which have also been a focus of the proposal's opponents. “The Commission should take steps to ensure that expansion of competition in navigation devices does not diminish existing privacy protections,” NTIA Administrator Larry Strickling said in the filing. Privacy and copyright concerns were the focus of a joint NCTA/MPAA news briefing denouncing the FCC plan last week (see 1604130052), which itself followed experts saying that access to consumer data may be the ultimate tech prize in the NPRM approved by a politically split FCC (see 1603080037).

The White House intervention in the proceeding is surprising, numerous communications attorneys told us, and is seen as partly an attempt to appear pro-consumer and pro-tech. The popular reaction to Comcast's scuttled buy of Time Warner Cable and the net neutrality proceeding have shown “cable companies make great villains,” one communications attorney told us. A blog post from White House officials explaining executive branch involvement in the proceeding said the move is a reaction to “companies stacking the deck against their competitors and their workers.”

Third-party set-top makers “will have access to large amounts of personal information about the users of those devices, not limited to the programming that they search for, watch, or purchase,” Strickling said. Strickling acknowledged the FCC plan to use a licensing process to deal with security concerns, but took aim at that idea as well. “This approach has appeal, but leaves important questions to be addressed -- most importantly, who will ensure compliance with a certification and through what legal authority?” Those are very similar questions to those raised by multichannel video programming distributors since the Downloadable Security Technology Advisory Committee process began.

Strickling also asked about FCC plans to handle programmer concerns about the set-top proposal. The selection and organization of multichannel video programming distributor programming “reflects investment decisions and market assessments made by MVPDs -- with attendant business risks -- as well as a constellation of licensing arrangements between MVPDs and program producers,” he said. But Strickling also said commenters in the proceeding should identify and propose ways to address “elements of MVPD-programmer agreements that could hinder development of competitive navigation devices.”

The White House's entry into the set-top proceeding is seen as a continuation of a pro-tech, anti-cable agenda from President Barack Obama and Chairman Tom Wheeler, cable attorneys who oppose the FCC set-top proposal told us. Though DOJ supported the FCC plan months ago, that isn't seen as being as surprising as the White House getting involved, one cable attorney told us. Georgetown Law Institute for Public Representation Senior Counselor Andrew Schwartzman said executive branch commenters in an FCC proceeding isn't that unusual. The White House is largely seen to be getting involved to associate itself with what is seen as a pro-consumer proceeding, several attorneys told us.

Though the filing is also seen as having the effect of ensuring that Democratic FCC Commissioners Jessica Rosenworcel and Mignon Clyburn vote with Wheeler on the matter, several communications attorneys told us this is unlikely to be the reason for the very public declaration of support. There are subtler ways to nudge a commissioner, one attorney told us, and public support of the set-top proposal is sure to bring the same sort of condemnation that White House involvement in the net neutrality proceeding did, the attorney said. Wheeler and the White House wouldn't accept those consequences without a reason, the attorney said.

AT&T sees the White House's involvement as “a blatant subordination of policy to politics,” Senior Executive Vice President-External and Legislative Affairs Jim Cicconi said in a statement. “The White House is intervening in order to direct an outcome that favors one company viewed by many as its political ally,” AT&T said. “It seems clear this intervention is aimed at muscling Democratic commissioners to support the Google proposal; to do otherwise they would not only have to defy the FCC Chairman but now also the President.” The “legitimacy” of the proceeding has been “irreparably compromised,” USTelecom President Walter McCormick said.

Sen. Ed Markey, D-Mass., backed Obama's support of the FCC proposal. The White House support will help ensure that “consumers, competition and choice” are “at the heart of a robust 21st century economy,” Markey said. “This is the type of pragmatic progressive step that can work both for consumers and for America’s innovation sector,” Computer and Communications Industry Association President Ed Black said. "It is deeply disappointing that the White House appears once again to have outsourced a major tech policy decision to Mountain View, without taking the time to understand what’s really at stake in this fight,” said set-top box proposal opponent Future of TV Coalition, referring to the location of Google's corporate headquarters. Obama's support “virtually ensures that consumers will finally see a $15 billion per year rip-off exploded by new electronic devices streaming innovative video services that challenge cable monopolies," Public Knowledge CEO Gene Kimmelman said.