FCC Chairman Tom Wheeler fired back at vocal critics in the pay-TV industry who criticized his proposal to open cable and satellite TV services to third-party set-tops sold at retail.
Specifically, Wheeler took aim at accusations that his proposal is essentially AllVid, a standard reviled by operators that puts a decoding device on the network to decrypt pay-TV signals for third-party devices like TiVo set-tops.
"The cable industry is continually trying to call this AllVid," Wheeler said at a Thursday press conference, covered by Ars Technica and other media. "It is not. It is not requiring a second box, it is about open standards versus closed standards. We need to have standards the same way we have standards developed for cell phones, standards developed for Bluetooth, standards developed for Wi-Fi, instead of the closed standards that exist for CableCard that have kept CableCard from being available as to those who might want to have competition."
On Wednesday, Wheeler issued a Notice of Proposed Rulemaking for new set-top box rules, which he said would free consumers from being forced to lease CPE from pay-TV operators.
Wheeler offered only a vague outline of a plan that he said will honor pay-TV security requirements and keep channel orders tied to programming agreements intact. But operators have largely assumed the worst.
In his Thursday press conference, Wheeler continued to use data supplied by opponents to set-top leasing, namely an oft-quoted study backed last year by Sen. Ed Markey of Massachusetts and Sen. Dick Blumenthal of Connecticut. That data was culled from highly redacted information sent by cable operators.
"On average, consumers are paying $231 a year to rent those boxes, collectively, about $20 billion a year," he said. "And by the way, did I mention they have no competitive choice when it comes to that situation?
Wheeler also quoted one of the letters he said he received from consumers, allegedly outraged over their pay-TV bill.
"It had always boggled my mind how a cable company could design and encrypt their system so that not only did I have to pay a monthly fee for service, but I was also required to pay a monthly fee for equipment to access that service," said an unidentified letter writer.
"The bottom line here is the American people get it," Wheeler added. "When it comes to set-top boxes, they have no meaningful options. They are literally paying the price for this lack of alternatives."
Meanwhile, the cable-industry backers continued to hammer away at Wheeler. For example, Michael Powell, president and CEO of the National Cable Telecommunications Association (NCTA), rendered a guest blog post on Re/code: "In a world where consumers want to get rid of set-top boxes, Wheeler's proposal reaches backward to breathe new life into the market for more boxes, using a pre-Internet, 20-year-old law minted in a time far, far before House of Cards, binge watching, YouTube and smartphones. This rear-view-mirror regulation is the wrong vision for the video future, and one should be surprised and alarmed that the FCC is peddling it," Powell said.
- read this Ars Technica story
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