Borrowing the playbook of the pay-TV industry that vigorously fought his original plan to open up the leased set-top business, FCC Chairman Tom Wheeler today pitched a revised proposal based on free apps provided by MVPDs themselves.
Wheeler submitted the revised proposal to the five-member FCC Commission today for approval. The new proposal is a win for the pay-TV industry, which sharply disagreed with Wheeler's earlier, not-fully-sketched-out plan to have them share their data streams with third-party device makers like Google and TiVo.
Led by the National Cable Telecommunications Association, the pay-TV industry pitched an apps-based counter-proposal called “Ditch the Box,” which led to the compromised proposal Wheeler presented today.
Operators maintain control over the user experience via the apps they provide. All arrangements between operators, programmers and advertisers remain intact, including such things as channel order. This was a major issue for operators and programmers under Wheeler’s original “Unlock the Box” proposal.
“Now, I am putting forward proposed rules that would end the set-top-box stranglehold,” Wheeler said in a statement. “If adopted, consumers will no longer have to rent a set-top box, month after month. Instead, pay-TV providers will be required to provide apps – free of charge – that consumers can download to the device of their choosing to access all the programming and features they already paid for.”
Pay-TV operators will have two years to start providing customers with a free app that enables their full range of services on devices including tablets, smart phones, gaming systems, streaming devices and smart TVs, without requiring a leased set-top.
The apps must be widely compatible with a broad range of devices – the FCC mentioned Roku, Apple iOS, Amazon Fire, Windows and Android by name. The rules would require operators to furnish all of their available content – both live and on-demand – as well as DVR or any other available functionality.
Operators would also have to deploy integrated search capabilities, so that consumers could search across all their available platforms for content.
“One of the biggest benefits consumers will see is integrated search,” Wheeler said. “The rules would require all pay-TV providers to enable the ability for consumers to search for pay-TV content alongside other sources of content. Just type in the name of a movie, and a list will come up with all the places it is scheduled for broadcast and where it can be streamed (like Amazon Prime or Hulu).
“Integrated search also means expanded access to programming created by independent and diverse voices on the same platform as your pay-TV providers,” the Chairman added. “Consumers will more easily find content even if it’s not on the pay-TV service to which they subscribe.”
The FCC will control a “standard licensing” process for apps and compatible devices – a shift from how an earlier, failed attempt to open the pay-TV ecosystem to third-party device makers, CableCARD, was handled.
“We learned our lesson with CableCARD,” an FCC official said. “The operators were able to control the licensing process and keep the level of competition down.”
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