NCTA's Powell Counts Ways He Doesn't Love Set-Top Proposal

Get complete coverage of the FCC's set-top proposal.

WASHINGTON — National Cable & Telecommunications Association president and CEO Michael Powell joined with TV One president Alfred Liggins to tell reporters just what was wrong with Federal Communications Commission chairman Tom Wheeler's proposal to "unlock" set-top box programming and data for access by third parties.

Liggins is co-chair, and NCTA a member, of the Future of Television coalition, which was launched to push back on the proposal.

In a lengthy conference call with reporters. Powell said the proposal was, at its base, government assistance to one set of big tech interests to get access to the intellectual property of others and monetize it without the obligation to negotiate terms, share in data collection or generate revenue from the content created by others.

"I think it very easy to abstractly describe how somehow going to provide an enormous among of either innovative access to consumers or dramatically decrease costs," he said. "We believe that that customer promise is pretty illusory and certainly not on solid ground."

Powell said that stories citing rising cable set-top costs -- often citing "selective or misdirected data," he said -- fail to take into account the cost of using that "other" cable box, compared with leasing equipment. He said to check out the cost of a TiVo box (TiVo backs the set-top proposal), which he said includes $299 for a first box, $150 for a second or third box, a $14.95 subscription for the life of the box. He said that means it is not a big cost improvement over a leased box, and may even cost more. 

Wheeler has said copyrights will continue to be protected, but Powell said the cable operators' and studios' recourse should not have to be to the courts.

Powell said the FCC's proposal will take six to seven years to come to fruition, by which time the world could a look a lot different. He also said it was focused on boxes, and could create the need for one or even two boxes to accommodate the disaggregation of cable content and info, as well as network reingineering costs that will be passed on to all consumers to accommodate the subset that opts for a third party device.

While backers of the FCC proposal say it will benefit diverse programmers by providing an additional platform, Liggins said that making content available to a Google device would allow that company to monetize content without compensation, threatening the business models of diverse nets including Revolt and El Rey, and Aspire and TV One.

On the issue of privacy, Multichannel News reported this week that the FCC is considering requiring third parties to self-certify that they will comply with privacy protections as a quid pro quo for getting access to cable set-top content.

Powell said that is of questionable legality and raised the issue of enforcement, citing Federal Trade Commission actions against Google and others over privacy promises apparently not kept.

Asked what the biggest threat to the cable business model the FCC proposal represented, Powell said that, for the operators, it is the cost in time and money to build, produce, and distribute boxes when the industry is moving away from them, and for the programmers, it will devalue their existing product.

He also pointed to the collection of Big Data that is the gold of digital commerce, which would be turned over toe Google and others, who would not be required to share in the economics of that data.

He said there is another issue, which is measuring viewership and the potential for Nielsen not be able to capture, and credit, viewing on the new devices. He called that a "thorny" problem.

John Eggerton

Contributing editor John Eggerton has been an editor and/or writer on media regulation, legislation and policy for over four decades, including covering the FCC, FTC, Congress, the major media trade associations, and the federal courts. In addition to Multichannel News and Broadcasting + Cable, his work has appeared in Radio World, TV Technology, TV Fax, This Week in Consumer Electronics, Variety and the Encyclopedia Britannica.