FCC Hits Back at AT&T Criticism of Set-top Move, Which DOJ Says It Backs
The war of words over draft FCC proposed rules on untying set-top boxes from the multichannel video programming distributors that often provide the boxes to MVPD customers (see 1601270064) escalated Wednesday. After AT&T slammed Google over the Internet company's transition plan and by extension the FCC for considering it, the Justice Department emailed us a statement backing the commission's tack. That statement was the subject (see 1602030055) of a Communications Daily Bulletin. The FCC likewise defended its plan.
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Also Wednesday, Incompas, like Google a member of a coalition backing a move away from mostly connecting encrypted pay-TV content with subscribers' devices only through an MVPD-provided set-top (see 1602010058), in turn slammed AT&T's critique of Google and its allies. Google itself declined to comment.
DOJ welcomes the FCC's coming NPRM "into whether new set-top box rules may better unlock the power of consumer choice,” said Assistant Attorney General Bill Baer of Justice’s Antitrust Division. “The set-top box rules that are currently in place were designed for a marketplace of old technologies and traditional business models. The FCC is right to examine the issue and we look forward to participating in the effort to ensure that the benefits of competition and innovation reach American consumers.”
Earlier Wednesday, AT&T slammed Google and "its affiliated proponents" of a new technology mandate for MVPDs to ensure commercial availability of navigation devices consumers use for pay-TV services. "Based upon press coverage, the FCC seems enamored with that misguided proposal," an AT&T blog post said. "Instead of just listening to a few favored companies hoping to game the system solely for their own financial advantage, the FCC should take a look around at the abundance of competitive options the market is delivering to consumers." MVPDs and their set-top box allies have panned a draft NPRM that would help untie set-tops from pay TV so it would be easier for other devices to get encrypted video that now often is delivered via set-top.
Google and allies want to take AT&T's "competitive service and repackage it as their own, without ever having to negotiate with us or with the content owners with whom we had to negotiate to create our service offering," wrote Stacy Fuller, AT&T vice president-federal regulatory. "It’s akin to the FCC mandating that we get access to Google’s home page (and all of the contract rights and algorithms that go with it) so that we can redesign and rebrand it as our own." The Google proposal wouldn't make third-party manufacturers honor licensing terms agreed to by programmers and MVPDs, wrote Fuller. "It’s time for the FCC to put consumers, not special interests, first, and reject Google’s ill-conceived proposal."
An FCC spokesman asked why 99 percent of pay-TV customers lease set-tops from their cable, satellite or telco providers. "Because there are few meaningful alternatives," the FCC representative emailed. "Consumers should have more choices for innovative ways to access the content they pay for on the device or app they prefer. The Chairman’s proposal allows any company, innovator or app developer to bring more competition to the market and choice to consumers.”
Incompas, to which Google referred us for comment, said "it's not surprising to see AT&T fighting to keep the monopoly of the set[-]top box in place." The company "fought to keep customers tied to the black rotary dial phone too," Incompas CEO Chip Pickering said in an emailed statement. "Once competition opened the phone market, equipment prices dropped and innovation soared. Tom Wheeler and the FCC's unlock the box plan will do the same in the video market and provide consumer relief."