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Lawmakers Say Lock That Box

Mari Silbey
1/27/2017
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Set-top regulation was effectively dead the minute Donald Trump was elected to the presidency. But just in case anyone had any lingering doubts, members of the House Committee on Energy and Commerce have written a letter asking newly minted FCC Chairman Ajit Pai to close the docket on the proceeding once known as Unlock the Box.

I've been pretty clear on my own feelings about the set-top regulation mess. As I said last September, it would have been nice if someone had legally defined video streams early on as separate from every other part of a pay-TV service, including the user interface, advertising deals and features like social media integration. While pay-TV providers want to be more than just the conduit for video content, it would be ideal for consumers if any third party could build its own user experience around the pay-TV bundle. (See FCC's New Pay-TV Plan: Shove It Up Your App.)

That said, it seems evident that the Federal Communications Commission (FCC) was fighting a losing battle on this one. Video content is tangled up with other pay-TV features, and untangling it is messy. The FCC could have mandated one of several approaches for disentangling the two, but the result would have been industry uproar and likely some serious obstructionism in the implementation phase. (Hint: remember CableCARD.)


Want to know more about video and TV market trends? Check out our dedicated video services content channel here on Light Reading.


So was the whole Unlock the Box effort a waste of time?

Way back in 2015, Google (Nasdaq: GOOG)'s Milo Medin said that even without a compromise solution he thought the regulatory process "was worthwhile if it catalyzes some definition of the problem." (See DSTAC: 2 Opposing Views on the Future of TV.)

I'd go a step further and say it was worthwhile if for no other reason than that it opened up some discussions to the public that would otherwise have only happened behind closed doors. At the end of the day, that's a big part of what regulatory oversight is about. Oversight and open discussion are not just intended as a way to react to market activities, but as a way to make companies think twice about overstepping reasonable boundaries in the future.

And as a reporter, I'm certainly in favor of gaining access to more information. Even if many companies would prefer I didn't.

— Mari Silbey, Senior Editor, Cable/Video, Light Reading

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KBode
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KBode,
User Rank: Light Sabre
1/29/2017 | 2:13:28 PM
Re: Potential CableCARD Part 2 Narrowly Averted
"And after 15 years, CableCARD completely failed in bringing third-party competition to set-top boxes."

It was a combination though of the FCC's rules and enforcement being inconsistent, and cable companies often making installations expensive and cumbersome. Some of the installation nightmares I've heard from Comcast and other cable customers were comedic.

I still think the FCC may be better served spending its regulatory calories on the biggest problem that faces the streaming market: the lack of overall competition and the net neutrality and other shenanigans that result. 

Points to the cable industry's massive disinformation campaign against this latest plan though, that was pretty impressive (cable box competition harms minorities, kills copyright, hurts babies and children!)
Director62529
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Director62529,
User Rank: Light Beer
1/28/2017 | 8:49:35 AM
Potential CableCARD Part 2 Narrowly Averted
Great editorial Mari! My view is that a potential debacle like the CableCARD was narrowly averted. Though well-intentioned, CableCARD actually increased the cost of equipment and increased electricity usage because of separable security versus integration which is much more cost-effective and efficient. And after 15 years, CableCARD completely failed in bringing third-party competition to set-top boxes. Think of all the innovation that could have been developed with the hundreds of millions of dollars used to develop the CableCARD standard and CableCARD equipment - we could have had 3D hologram entertainment by now! I think it is absurd that the federal government delves this deep into home entertainment. No one is being forced to purchase a service and rent set-top boxes in order to watch Game of Thrones or The Walking Dead or Thursday Night Football. If I don't like the total price from Comcast, then I shop around at Verizon, DirecTV, and Dish. Or I can cut the cable altogether, watch the prime networks over-the-air and watch special content over NetFlix, Amazon, and/or Hulu. Pretty soon 5G wireless networks will provide enough bandwidth at a low enough cost that everyone could stream their custom video content to their devices without coaxial cables or fiber to their homes. MVPDs have their work cut out to compete with alternative broadband access technologies, let alone trying to implement another federal mandate.
msilbey
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msilbey,
User Rank: Blogger
1/27/2017 | 3:11:13 PM
Re: Maybe not so bad
Yes and no. Yes, we're slowly but surely moving toward IP video. However, operators still maintain that third parties have to make their own individual deals with content providers in order to build an experience around bundles of pay-tv content. This is hardly a life and death matter, but it does preclude somebody new getting into the business without a lot of capital to make content deals. That's going to limit UI innovation. If a startup wants to bring a new UI to market, it will have to go through the operators, or get big enough to license popular content directly. 
Duh!
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Duh!,
User Rank: Blogger
1/27/2017 | 1:16:22 PM
Maybe not so bad
One of the very few cogent arguments against "Unlock the Box" is that it's solving yesterday's problem.  The next opportunity for another turnover at the FCC is in four years. How much traditional cable TV is going to be left?
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