The most prominent cable companies in the United States have been engaged with the Federal Communications Commission (FCC) in an argument about the future of cable boxes. The federal agency had already thrown a severe proposal that would end the existing monopoly over these home cable boxes, but cable providers are trying to resist it. They proposed the regulators a digital app which would allow the users to throw away the physical devices.
With Comcast at the Vanguard, cable companies presented the FCC with a counter-proposal. They told the commissioners that they were willing to ditch the cable boxes and go to the digital platform. In that scenario, companies with more than a million subscribers would be forced to work on an online app to replace the physical hardware in its duties. In a Netflix-like way, users would be able to interact with the company via web-browser, and most likely, phone app. However, under their terms, every business still have full and total control on their products.
On the other hand, the FCC has said its intentions are to break the monopoly cable companies have over what citizens of the United States get to see on cable T.V. To do so, the federal agency proposed the members of this industry to open the box and let anyone create interfaces and offer options. According to the members of this committee, more competition would bring reduced prices and more importantly, more options to the users.
Moreover, President Barack Obama gave this motion impulse as he issued an executive order that would take away from cable companies the extreme control they have over these boxes. If this passes, a new era of cable boxes will open as many businesses would enter the arena and offer something unique.
“The president’s support for set-top box competition virtually ensures that consumers will finally see a $15 billion-per-year rip-off exploded by new electronic devices streaming innovative video services that challenge cable monopolies,” said Gene Kimmelman, chief executive of the consumer group Public Knowledge.
— Mike Wendy (@polisoniccom) June 15, 2016
The FCC’s final decision could cost cable providers a lot of money
There has been a lot of controversy around this little, usually black, rectangular devices that sits on almost 50 million people’s living rooms. Most people hate them while others are used to them, but there is one thing that nobody can deny, they are money dispensers. According to official reports, each of these devices cost more than $200 a year because users don’t get to buy it, they are forced to rent it.
Yes, it might seem like nothing, but cable provider’s primary income is not the service per se, it is the profitable little boxes that people have to rent to enjoy their cable plan. It is simple, more than 50 million users are paying rent for a cable box, and the patron understandably does not want to lose this massive source of income.
Moreover, service providers have no competition. They are the only ones allowed to market the devices. When the authorities realized how bad the industry was, they started to work on regulations which set off alarms on many offices. Cable providers formed a strong coalition which began an all-out marketing attack on what the FCC was doing, but it is 2016, and people are fed up with having to deal with a piece of the past in their living rooms, they want something new that is worth their money.
“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,” read a post by the National Cable and Telecommunications Association.
But these companies have been around for a long time, and after struggling a lot, they realized you can catch more flies with honey than with vinegar. When they noticed their control on cable boxes had its days counted, they faced the commissioners with this app that would switch their power from a piece of hardware to a digital program.
The digital solution did not come without any opposition. For some people, it might seem that cable companies are finally working together with federal authorities to give their users the best possible service, but a lot of people are not buying it. For instance, Netflix and Amazon said this was only a way to buy more time so that cable companies could find a way out of the regulations.
What is the best option for the user, the app or the ‘open box’?
According to the White House, throwing the box to an open and competitive market would greatly benefit both the users and the people that work in that area. On an article posted on the White House’s page, they explained that users are dealing with outdated and overpriced devices. And what’s more, they don’t get to see what they want to.
The article also refers to little entrepreneurs that want to give quality service and how they are “squeezed” by bigger competitors. Representing this motion are Jason Furman and Jeffrey Zients who are openly blaming the anti-competitive behavior of big corporations of these and many other problems.
— Fight for the Future (@fightfortheftr) June 14, 2016
The FCC will have the last word, and they will determine if the American cable consumer gets a broader and more diverse market where to pick from or a digital substitution of the box that will be totally ready in about a year.
Source: Ars Technica