The WasteWatcher: The Staff Blog of Citizens Against Government Waste

Set-Top Box Proposal Takes Center Stage

The WasteWatcher is the staff blog of Citizens Against Government Waste (CAGW) and the Council for Citizens Against Government Waste (CCAGW). For questions, contact blog@cagw.org.


Technology innovations are great, and the advancement of the electronics industry over the past 20 years has been astounding.  However, when the federal government steps in to mandate technology, typically progress comes to a halt.  Such is the case with the set-top box.  The cable industry has been in the process of moving away from using these dusty dinosaurs of video viewing by developing apps that consumers will be able to load on any device to view their programming.  Sounds great, right?

The Federal Communications Commission (FCC) doesn’t seem to agree, and it is with that thought in mind that the agency is slated to vote on September 29, 2016, to mandate technological standards on both set-top devices and potentially any associated viewing apps.  The FCC’s original proposal, released on February 18, 2016, created angst not only for the video distributors, but also for content creators, and with good reason. 

One might ask why there is such a rush to mandate technical requirements and risk intellectual property rights by pushing forward this set-top box proposal.  According to FCC Chairman Tom Wheeler, the average American household spends around $231 per year to rent a set-top box, and he finds this price a bit high.  Consumers have been seeking to eliminate the box altogether, and the industry has already been responding by developing apps to do just that.  However, the FCC has ignored the progress being made through technology, and instead has taken on the task of mandating requirements for set-top boxes, which include the sharing of licensed content to third party box manufacturers.  Citizens Against Government Waste (CAGW) President Tom Schatz noted that the original proposed rules set the stage for government mandates on technology; suggest that the marketplace is uncompetitive; abrogates intellectual property rights; and, opens the door to increased video piracy.  

On June 16, 2016, several multi-channel video programming distributors (MVPD’s) offered an alternative to the Chairman’s proposed rule, which maintains the FCC’s enforcement requirements on MVPDs with a market-driven app solution, protects the rights of content creators, and eliminates the need for consumers to continue renting set-top boxes once implemented.  It appears that the Chairman has taken note, and gone back to the drawing board to develop a new proposal for set-top boxes, which will be voted on at the FCC’s September 29 meeting.  While snippets of the new proposed rules have been bandied about, much about this proposal is unknown.  However, one item that has been discussed is the possible creation of a new Copyright Office within the FCC.  This office could potentially duplicate much of the work already being performed by the U.S. Copyright Office, and hypothetically leave content creators at risk of having their existing and future licensing agreements with MVPDs stripped away and given to third parties without their consent. 

At a September 15, 2016 hearing before the Senate Commerce, Science, and Transportation, several members of Congress asked Chairman Wheeler to be more transparent about the latest iteration of the FCC’s set-top box proposal, and share with the public the details that are currently being reviewed at the Commission.  Again, on September 22, 2016, several Members of Congress asked FCC Chairman Wheeler to issue a new notice of proposed rulemaking since it appears that the proposal being voted on sounds significantly different from that proposed in February. 

The FCC should consider these members’ requests in order to be completely transparent and open about what is being decided for the future of television viewing.  All stakeholders, including consumers, copyright holders, device manufacturers, and the television industry should be provided an opportunity to weigh in on the changes before a final vote on the new regulations occurs. 

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