Research

Wheeler formally pitches revised app-based set-top proposal, includes integrated search

Share
Wheeler formally pitches revised app-based set-top proposal, includes integrated search

The Federal Communications Commission will vote later this month on reforms that would eliminate the need for pay-TV consumers to rent set-top boxes, potentially saving millions of American households about $230 a year each, agency officials said.

The revised application-based proposal is expected to come before the five-member commission for a vote on September 29 at the commission's next meeting, the sources briefed on the matter said.

A consortium of cable service providers is continuing the fight against the FCC's embattled set-top box proposal, which would open up competition in the industry by allowing licensing agreements for new devices to stream cable TV.

The devices have always been used to fashion cable signals into TV programming, but more independent suppliers are coming up with new devices that could offer more, including integrated search of cable subscriptions and online streaming-video services, including Netflix and Hulu. Back in February, the commission voted to propose an open standard for set-top boxes, meaning cable companies would have to provide their content to makers of third-party devices.

The plan, first proposed in January and updated on Thursday, is aimed at ending the cable industry's long domination of the $20-billion-a-year set-top box market and lowering prices for consumers.

An expanded version of this report appears on WSJ.com. This means that if Comcast's set-top box allows its customers to record content or fast-forward through content or start over in the midst of a live show, the app has to do the same.

If approved, large providers, which the FCC says covers 95 percent of subscribers, would have to create the apps within two years and medium-sized companies will have to comply within four years. Pay-TV providers would be required to provide their apps to platforms like Roku, Apple iOS, Windows and Android, the FCC said.

An FCC proposal circulated Thursday to top agency officials would force pay-TV operators to make available free apps that grant consumers access to their entertainment offerings and channels.

Its last attempt at reform, with so-called CableCard technology, was a disappointment and cost consumers about $1 billion over the last eight years, according to industry statistics.

Disney, CBS, Viacom, Time Warner Inc, Scripps Networks Inc and others met with Wheeler aides last week to discuss "a revised approach. that would ensure that all of programmers' valuable content would remain inside of, and under the control of, apps developed exclusively by" cable and other pay-TV providers, according to a filing with the FCC this week.

The consumer advocacy group Common Cause applauded the proposed rules, tweeting a "Kudos" to Wheeler and the commission and writing that the campaign, known as Unlock the Box, will "save consumers money, unleash innovation, and promote diversity". Still, "I think it's great and a lot better than what we have now", he said.

Share