The Hill - Thinking Outside of the Cable Box

Op-Ed

By Anna Eshoo

What if you could save an average of $231 a year by eliminating the need to rent a cable box? You might think it's impossible and you'd be right for the most part. Today, 99 percent of cable and satellite customers pay a monthly equipment rental fee to their provider. Despite a law enacted two decades ago to ensure consumers have access to competitive set-top box alternatives, few options have emerged. And when they have, consumers have regularly faced challenges with installation or found that features they were accustomed to, such as Video on Demand, were missing.

It doesn't have to be this way.

Last month Federal Communications Commission (FCC) Chairman Tom Wheeler announced that he plans to place before the Commission a proposal for greater consumer choice in the set-top box marketplace. It's an idea I've encouraged as a longtime advocate for consumer choice and competition. His proposal will make it easier for consumers to buy a set-top box or app from someone other than their cable company, something strongly supported by many of the nation's most prominent consumer and public interest organizations. The proposal is technology neutral, meaning any company will be able to manufacture a set-top box or design an app and sell it to consumers. Should a consumer wish to continue renting their set-top box from their pay-TV provider, they can.

In Washington, D.C., the pay-TV industry is fighting to maintain the status quo, and why wouldn't they? Set-top box rental fees amount to $20 billion in revenue a year. While the cost of computers, televisions and mobile phones has dropped by 90 percent over the past two decades, the cost to rent these boxes has risen a whopping 185 percent. This dramatic increase--three times the increase in the Consumer Price Index (CPI)--is a market that is not competitive and ripe for reform.

The FCC's proposal will not only save consumers money, it will unleash innovative features and services that will put consumers in the driver's seat when it comes to how they watch their favorite video programming. For example, many consumers today need one set-top box for their cable programming and another box to watch Netflix or Hulu. The FCC's proposal will make it easier for companies to design a set-top box so consumers can access all of their favorite movies and shows through a single box. And if you want to eliminate your set-top box altogether, the FCC's proposal opens the door to a world in which this functionality could be built directly into your TV. Wheeler's proposal does all of this without infringing on copyright. It also preserves protections for privacy, emergency alerts, and children's advertising that consumers have counted on for years.

Very importantly, the FCC's proposal is an opportunity to enhance access to independent and minority programming, giving consumers the ability to choose between set-top boxes or apps with improved search functionality and user interfaces. This enhanced access will make it easier for diverse voices to reach consumers without the constraints set by large pay-TV providers. The Founder of Black Entertainment Television (BET), Robert L. Johnson recently wrote that the FCC's proposal represents the "best decision that the FCC has made to increase minority diversity in media content distribution since the Commission championed the tax certificate which allowed for the increase in minority ownership of media properties."

Despite the many consumer benefits of the FCC's proposal, the nation's pay-TV providers repeatedly argue that FCC action represents unnecessary government intervention and will only serve to stifle the exciting innovation taking place in the video marketplace. The truth is that providers have been singing the same tune for many years while consumers have had to pay more and more in their monthly bills and are left with few or no competitive choices.

It was nearly 50 years ago that the FCC took action to give consumers choice as to whether they wanted to rent their landline telephone from Ma Bell. Consumers not only saved money, but innovation thrived in the telephone market. Chairman Wheeler's proposal can bring about a similar revolutionary change for set-top boxes.

I'm rooting for the future.

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