FCC Considers Competition for TV Set-Top Boxes

May 9, 2016

FCC logoThe Federal Communications Commission (FCC) is considering adopting rules which would make it feasible for multiple manufacturers to build and sell to consumers set-top boxes for televisions.  At present, set-top boxes, the gateway for content and services to the televisions of the consuming public, are essentially controlled by the cable television service providers.  By opening this television gateway to effective competition, many observers believe that consumers will benefit from lower prices and more rapid innovation.

The set-top box is necessary equipment for access to cable television programming content and services.  Today, that equipment is essentially only available from the companies that provide cable television content.  Rental fees for access to the set-top boxes are routinely bundled with the monthly charges associated with the cable service, and over time those rental fees can become quite significant.

Matsuura Blakeley BannerThe FCC is considering adopting new rules which would require cable service providers to share certain critical information with all equipment manufacturers.  The new rules would require the cable service providers to share all information necessary to enable a variety of equipment manufacturers to design, build, and market set-top boxes that can function effectively with the cable services and their content.

The cable service providers have traditionally opposed greater competition for set-top box equipment.  They often argue that diversification of set-top box sources could reduce the quality of the equipment and degrade cable service quality, thus harming consumers.  General experience with regard to a variety of technologies strongly suggests, however, that open technical standards and the equipment competition that results from those open standards help to reduce costs to consumers and inspire more rapid technical innovation for the benefit of consumers.

There are many consumer electronics equipment providers that are well positioned to create and distribute effective and innovative set-top boxes, if the FCC adjusts it rules.  Potential set-top box providers include a variety of companies now associated with a range of products, including game consoles and computer equipment.  It seems likely that open competition in the set-top box marketplace will spur pricing adjustments and technical advances that will provide important benefits for consumers.

The FCC’s effort to facilitate development of a competitive environment for cable television set-top box equipment is an important action for the benefit of consumers.  If the FCC can foster development of effective competition for set-top equipment, consumers will most likely benefit from lower prices and enhanced product capabilities.  This ongoing action by the FCC is an important aspect of national efforts to extend the reach of digital content and services.