One of the most perplexing issues in communications policy, and perhaps the longest-running — already with a convoluted 20-year history — is that of the cable television set-top box (STB). Two decades ago, Congress mandated that the Federal Communications Commission (FCC) set rules requiring the “commercial availability” of “navigation devices” for video programming. Yet after a score of rulemakings, orders and appeals, little if anything has changed. Can it? We may finally be on the verge of a new era…but to understand why requires a brief excursion into history.
Nearly all consumers obtain their STBs from the cable system operator that also provides them linear television programming, local broadcast channels and often broadband Internet access as well. This captive, rental market is a lucrative one for cable firms and one that, as other DisCo commentators have observed, seems totally inconsistent with the evolution of most communications markets, which have exhibited vibrant innovation at the edge of the network. Why is it that a consumer can easily buy or finance (or get free from their carrier) a smartphone, WiFi router or other digital device with scores of features, functions and intuitive interfaces for their voice and data communications but not for consumption of television programming? Why is it that the cable TV industry has remained “relatively immune to the innovation bug”?
Part of the answer is the law itself. The 1996 legislative effort that gave birth to the commercial availability mandate was a compromise, one which sought to reassure cable operators against a risk of piracy by requiring that the FCC’s implementing regulations could not “jeopardize the security of multichannel video programming…, or impede the legal rights of a provider of such services to prevent theft of service.” Remember that in the 1980s, signal piracy was a pervasive problem with cable and satellite-delivered television programming. So at the time, this caveat seemed both appropriate and necessary, especially because the prevailing mode of signal protection, analog “scrambling,” had few if any practical alternatives.
As I’ve noted, however, with the transition from analog to digital cable transmission now complete, scrambling has been replaced by far more impervious digital authentication protocols for pay TV. Yet the law has still languished, and in one important way moved backwards.