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The FCC’s cable box proposal looks different to cable and tech companies

The FCC’s cable box proposal looks different to cable and tech companies


Will they ever speak the same language?

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Photo by Chip Somodevilla/Getty Images

Yesterday FCC Chairman Tom Wheeler shared a proposal that would make the cable set-top box world look a whole lot more like the mobile phone market. The idea is to give consumers more choice around the hardware they use when they sign up for TV service. The rules, he wrote in Re/code, would "create a framework for providing device manufacturers, software developers and others the information they need to introduce innovative new technologies, while at the same time maintaining strong security, copyright and consumer protections."

So is this good news or bad news? It depends. Silicon Valley players and cable operators are lining up their talking points and the Washington lobbies are getting together a game plan to convince you of either case.

Cable companies say rules would be unnecessary

For the most part, we already know the points each side will make. Cable companies say these rules would be completely unnecessary; they already build out apps for third-party products, including for Rokus and Xbox Ones, so there’s no need for them to directly open up a pipeline to their raw cable data. Third-party companies, however, say those apps aren’t great and stifle them from really competing in the cable TV world. You can read more on those points here.

We’ve reached out to some of the biggest stakeholders in this fight to ask their thoughts on the proposal. Predictably, the statements so far stick to established party lines.

Naturally, the cable companies have been the most vocal. They’re continuing to condemn the FCC’s proposal. AT&T, Time Warner Cable, and a coalition of multiple cable operators and media companies known as the Future of TV Coalition, spoke out. Their statements don’t exactly hide their industry’s disdain for regulation.

AT&T, for example, called the proposal "another disappointing example of an FCC that thinks it’s smarter than a highly competitive market" that will "discourage the very investment it claims to want."

Meanwhile, Time Warner CEO Robert Marcus said during the company’s earnings call today that this move represents "an attempt to create regulation that is really unnecessary, given the advances that have been made driven by marketplace forces."

Those advances he’s referring to are the industry’s apps, which it believes are the answer the FCC is looking to find with possible rules.

apps are the answer the FCC is looking to find

"Consumers can already access pay-TV programming right alongside streaming content on an ever-expanding universe of consumer-owned devices, from smart TVs, game consoles and streaming devices to laptops, tablets, and smartphones," the Future of TV Coalition said in a prepared statement. "This app-driven innovation is already happening — and it doesn’t require a government mandate that would increase consumer costs, strip viewers of privacy protections, and let third party device makers ignore the terms of carriage agreements between programmers and distributors."

We all know where the cable companies stand, so perhaps most intriguing is Silicon Valley’s lack of response. Most companies The Verge contacted in regards to the chairman’s proposal said "no comment" on the matter, or have not yet formulated their responses. This included Apple, Roku, Amazon, and Microsoft — all of whom have a vested interest in the TV world.

Apple, Roku, Amazon, and Microsoft all have a vested interest in the TV world

It’s possible this is because the proposal really just happened. There were rumblings of action eventually being taken, but not necessarily so soon and with so little warning. As such, tech companies are taking their time to sort out a direct response, and there’s no real rush. As Wheeler has said, Congress mandated 20 years ago that consumers should have this kind of choice, and yet, we’re still dealing with outdated technology from cable service providers.

In reality, this proposal, if passed, would greatly democratize cable television, and line up the access tech companies need in order to create the set-top boxes they’ve always wanted. Apple, for instance, wants its Apple TV to be the go-to device for TV-watching consumers. From it, they’d ideally be able to watch live TV, access programs, channel surf, and also browse Netflix and other apps. That dream has remained unattainable so far, and hindered by cable companies’ refusal to turn over direct cable access.

these could end up creating unwanted competition

But even if these rules could help solve that disagreement, they could also end up just creating more competition that might not be welcomed. Imagine Google deciding to, say, license Android as a platform in order to help set-top box makers design "smart" boxes. The field could quickly get crowded.

While most companies have stayed mum, some did offer their thoughts. TiVo, the one company that has played ball with Comcast (and actually uses the dated and forgotten CableCard standard), told The Verge that it is "looking to provide choice and lower cost options, and we think that will increase the desirability for cable service." General Counsel Matt Zinn said "consumers are obviously frustrated with the lack of choice, which led to cord cutting and cord shaving. This could persuade more people to stay with the cable bundles."

consumers are obviously frustrated

Google didn’t directly comment on the recent news, but left behind some clues of its stance when it commented on an FCC report last year. At the time, it wrote that there’s "much more at stake" than streamlined channel surfing when it come to reinventing top-set boxes and CableCard. "Innovation and competition in navigation devices will promote numerous policies important to the Commission," the company said.

Beyond those two companies, Silicon Valley produced nothing but silence.

It’s clear the cable companies have a vested interest in maintaining the status quo. It’s working out well for them and churning out profit. Meanwhile, tech companies have a vested interest in upending the norm to sell new, enhanced products. Ultimately, it comes down to consumers. That’s where the FCC’s vested interests lie.