Rep. Pallone Concerned Wheeler Set-Top Plan 'Won't Work'

Add ranking House Energy & Commerce Committee member Frank Pallone (D-N.J.) to the list of those with concerns about FCC chairman Tom Wheeler's latest app-based approach to boosting set-top box price competition and online video.

Wheeler last week announced an approach that would have a standards body license MVPD-supplied video access apps, under FCC oversight.

Pallone is no fan of set-tops, which he calls "clunky, outdated and needlessly expensive," but he is no cheerleader for Wheeler's latest approach.

"While I commend Chairman Wheeler for working to solve this difficult issue, I’m concerned that this latest proposal will not work, particularly when it comes to licensing," he said in a statement. "Ultimately, I’m skeptical that the revised plan will benefit consumers.”

ISPs and studios have both complained about a licensing body.

In pressing Democratic commissioner Jessica Rosenworcel, whose vote Wheeler will need Sept. 29 when a vote is scheduled on the proposal, studios said they could not support any proposal that allowed the FCC or a licensing body to alter the terms or conditions in program licensing deals, saying that would be the equivalent of creating a compulsory copyright license, which the FCC isn't authorized to impose, they said.

ISPs are similarly opposed.

“We continue to have productive conversations with all stakeholders about Chairman Wheeler’s apps-based proposal to ensure consumers have the options they deserve – and that Congress mandated – to access the programming they already pay for," said FCC press secretary Kim Hart. "Under Chairman Wheeler’s proposal, licensing would work a lot like the CableCARD regime has for the past 20 years, with two important differences: programmers would have a seat at the table and the FCC would have limited oversight to ensure industry doesn’t act anti-competitively and limit consumer choice. In addition, the proposal prohibits altering terms of contracts between programmers and pay-tv providers.”

Wheeler has billed his app-based proposal as a boon to consumers, saying the free app would give them access to a plethora of programs and features. "Consumers will be able to use this app on the device of their choosing, whether that’s a streaming device, gaming console, or even your current smart TV," he said last week. "This proposal would also enable integrated search across platforms and services, while protecting content and privacy."

According to a source, Wheeler staffers were on the Hill Friday (Sept. 9) and Monday (Sept. 12) pitching the new proposal, arguing that the proposal does protect contracts and did not represent a shadow copyright office operating out of the commission, as some have asserted.

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.