The Federal Communications Commission (FCC) has voted to allow a proposal for competition in the creation of set top boxes that are given by cable companies to provide access to the channels people watch on their television screens. Time Warner Cable, Optimum Online, Verizon, AT&T and other companies in the cable business are going to be effected by this vote.
Currently, consumers pay a rental fee for boxes that cannot connect to the internet and haven’t adapted to the new way people consume content. According to the FCC’s press release, “Ninety-nine percent of pay-TV subscribers have limited choices today and lease set-top boxes from their cable and satellite operators. Lack of competition has meant few choices and high prices for consumers – on average, $231 in rental fees annually for the average American household.”
Mignon Clyburn, who sits on the commission, released a statement in support of the proposal. She said “this item proposes, not adopts, but proposes, to provide a technology neutral means for consumers to choose how they interact with the multichannel video programming services they pay for. If a consumer wishes to purchase a device or application to access this programming, this proposal will empower that choice. If a consumer chooses to continue to rent a box or app from their MVPD, they have the option to do that too.”
Currently, a person with a cable box has to subscribe to a plan where they are given a set number of channels. The increase in price comes with more channels. The television, content, and technology sector are rapidly changing and the old ties that bound them together are breaking. Content providers (television networks) and set top providers (cable networks) are fighting over the structure of the deals. On the other hand, content providers are working with the technology industry to adjust to how people consume content. Television networks are fighting technology to some degree because the innovation is cannibalizing their business. The networks are also fighting consumers who are looking for flexibility to choose their channels in their package.
This approval comes on the heels of a growing “cut the cord” movement, which has cable companies worried about their future viability and current profitability. Some assume the approval of this proposal will continue to push towards flexibility in choice for consumers and chord cutting among the general public.
