President Obama today pledged support for the Federal Communications Commission effort to give cable TV customers a greater choice of set-top boxes. Shortly after, the top cable lobby group expressed its displeasure, saying the White House's statement "may be good politics, but it's bad government."
The White House published a blog post this morning saying that cable TV subscribers shouldn't have to spend "nearly $1,000 over four years to lease a set of behind-the-times boxes." Americans should "have options to own a device for much less money that will integrate everything they want—including their cable or satellite content, as well as online streaming apps—in one, easier-to-use gadget," the White House said.
The FCC in February approved a Notice of Proposed Rulemaking (NPRM) that would force pay-TV companies to provide content and programming information to makers of third-party hardware and applications. This would create a software-based replacement for CableCard, allowing other companies to build set-top boxes or mobile applications that display a pay-TV subscriber's channels without a physical CableCard.
The FCC vote was 3-2, with FCC Chairman Tom Wheeler and other Democrats passing the item over objections from Republicans. The NPRM kicked off a months-long public comment period, and final rules could be issued before the end of this year.
Obama announced today that his administration is calling on the FCC to convert the NPRM into final rules that "open up set-top cable boxes to competition." The president also issued an executive order directing other departments and agencies to identify "specific, pro-competition executive actions that empower and inform consumers, workers, and entrepreneurs." Government agencies were instructed to report back to the White House on their progress within 60 days.
Consumer advocacy groups praised the White House's statement, but the National Cable & Telecommunications Association (NCTA) is mad at Obama.
"We are disappointed that White House political advisers are choosing to inject politics and inflammatory rhetoric into a regulatory proceeding by what is supposed to be an independent agency," wrote NCTA CEO Michael Powell, who was FCC chairman under President George W. Bush.
Cable companies and other broadband providers are also still angry that Obama urged the FCC to reclassify Internet providers as common carriers and enforce net neutrality rules.
The NCTA didn't point to any rule that bars the White House from offering input on an FCC proceeding. Powell himself received input from the Bush administration before a media ownership deregulation vote while he was chairman.
In the net neutrality proceeding, Wheeler said he considered the president's opinion, just as he considered input from 140 members of Congress and nearly 4 million Americans who submitted comments to the FCC.
While the NCTA urged the FCC to reject the president's advice, the lobby group said the FCC should listen to "members of Congress" who have "raised serious and genuine concerns about the FCC’s proposed set-top box mandate."
The FCC's set-top box proposal is unnecessary because companies like Apple, Amazon, Google, and Netflix are already providing competition in video services and devices, the NCTA argued. The lobby group also repeated its claims that the FCC's proposal will cause "copyright harms, damage to minority programmers, consumer loss of privacy protections and unnecessary costs to re-engineer networks." Wheeler has disputed those claims.
"Perhaps the strategists at the White House believe their intervention is good politics," Powell wrote. "But it is bad government, undermining the independence of the FCC and shattering any faith in impartiality and fundamental fairness. One would hope the FCC Commissioners would resist being annexed by the executive branch. But that hope is sadly faint."
The NCTA represents many companies, including top cable firms Comcast, Time Warner Cable, Cox, Charter, and Cablevision.
USTelecom, which represents AT&T, Verizon, and many smaller telcos, said the Obama administration's statement "irreparably compromised" the set-top box rulemaking process.
"When the president ‘calls upon’ his appointees and an agency chairman who serves at his pleasure to act in a particular way, he is ‘directing’ them, and all credibility in the independence of the agency and trust in the administrative process evaporates," the lobby group said.
Advocacy groups who praised today's White House statement on set-top boxes include the New America Foundation’s Open Technology Institute, the Consumer Video Choice Coalition, Public Knowledge, the Computer & Communications Industry Association, and Incompas (formerly COMPTEL).
“The president recognizes what consumers have long known: the market for set-top devices is broken," Open Technology Institute policy counsel Joshua Stager said. "The antiquated boxes that most consumers rent from their cable provider are needlessly overpriced, difficult to use, and drain more energy than a refrigerator. These are all signs of a failed market that needs more consumer choice and innovation."