FCC to End Cable Company Control over Set-Top Box Market

With a series of new rules that favor the tech industry, the FCC plans to end cable company control over set-top box market. According to the new legislation, consumers will be the ones to pick which types of cable set-top boxes to purchase.

Currently, consumers are forced into buying the boxes directly from their cable providers for an average lease fee of $231 every year.

The rules, which were unveiled Wednesday, were criticized by cable companies, but hailed by the tech industry. Nevertheless, the FCC said that the change was not designed to benefit a particular industry. New rules are needed to improve consumers’ experience,

Tom Wheeler, head of the FCC, said that it was time to allow innovators enter the set-top-box market. According to the agency’s official reports, prices for the cable boxes jumped nearly 200 percent in the last two decades while prices for other electronics have remained flat or even plunged.

The FCC announced that the new rules would be voted upon on Feb. 18 by the commission’s five members. It is worth noting that three commissioners are from the Democratic party, while the rest are Republicans.

Tech giants have long sought a TV experience that mixes Internet, smartphones, and apps. To date, Netflix and Amazon offered video-streaming options that convinced cable TV viewers to cut the cord for good.

Under the new regulations, cable companies and satellite providers will be forced to allow independent cable set-top box makers have access to their programming. Today, companies usually impose so many limitations on rival device makers that 99 percent of devices are leased from the cable industry.

A recent report shows that the cable set-top box market generates about $20 billion every year from the rentals alone. One of the backers of the new rules Sen. Edward Markey believes that the market should be shaped by consumers rather than by established cable and satellite companies.

Though the new rules do not mean that customers will no longer pay the cable industry for its programming, media representatives are concerned that the new regulations would kill their business’ profitability by destroying contracts between them and cable providers for the rights to broadcast programming.

Image Source: Flickr