FCC: STB proposal about open vs closed standards
March 3, 2016
By Colin Mann
FCC Chairman Tom Wheeler has refuted suggestions that the Commission’s proposal to introduce competition into the set-top box marketplace will require changes in the programming business practices of pay-TV providers or require consumers to purchase new boxes; nor will it harm minority programming opportunities, contending that the proposed rulemaking is about whether the standard for set-top boxes should be a closed standard or an open standard.
He made his comments in a Statement prior to his appearance before the US Senate Committee on Commerce, Science, and Transportation’s Hearing on ‘Oversight of the Federal Communications Commission’.
He said that one of the most consistent theme of his messages to Congress – or any audience – has been that ‘competition, competition, competition’ is the most effective tool for driving innovation and consumer benefits.
According to Wheeler, one area where competition is virtually non-existent and consumers are literally paying the price is the set-top box marketplace. “Today, 99 per cent of pay-TV customers lease set-top boxes from their video providers, paying an average of $231 a year. Even when the company has recovered the cost of the box, consumers must continue to pay a rental fee month after month. Collectively, these consumers are spending $20 billion annually. Senator Markey and Senator Blumenthal deserve recognition for shining a spotlight on this issue,” he noted.
“Last month, the Commission launched a proceeding to introduce competition into the set-top box marketplace, as Congress mandates. Specifically, we propose establishing open standards for video navigation devices like set-top boxes, the same way we have standards for cell phones and Wi-Fi routers. The new rules would set the stage to provide device manufacturers, software developers and others the information they need to introduce innovative new ways for consumers to access and enjoy their favourite shows and movies on their terms, while at the same time maintaining strong security, copyright and consumer protections,” he suggested.
“This proposal will not require changes in the programming business practices of pay-TV providers; it will not require consumers to purchase new boxes; and it will not harm minority programming opportunities. Again, this is all about whether the standard for set-top boxes should be a closed standard or an open standard,” he stated.