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No more set-top box rentals? FCC chair sets vote on changes

The Federal Communications Commission will vote later this month on changes that would eliminate the need for pay-TV consumers to rent set-top boxes, potentially saving millions of American households about $230 a year each, agency officials said.

Consumers could be freed from having to rent set-top boxes such as this one.
Consumers could be freed from having to rent set-top boxes such as this one.Read moreASSOCIATED PRESS

The Federal Communications Commission will vote later this month on changes that would eliminate the need for pay-TV consumers to rent set-top boxes, potentially saving millions of American households about $230 a year each, agency officials said.

An FCC proposal that was circulated Thursday to top agency officials would force pay-TV operators to make available free apps that grant consumers access to their entertainment offerings and channels.

The apps would be loaded onto Roku boxes, Amazon Fire TV Sticks, Apple Inc. devices, or other platforms, including gaming consoles and smartphones, FCC officials said Thursday.

The changes also would enable integrated searches for content on traditional pay-TV services and internet-based streamers such as Netflix.

FCC Chairman Tom Wheeler has said the changes will make the set-top box market competitive and more innovative. He has scheduled the vote for Sept. 29.

Big telecom companies such as Comcast have lobbied in Washington against the changes, viewing them as a threat to a profitable part of their business. Set-top boxes are the devices through which Comcast, DirecTV, Verizon, and other providers deliver television services to homes.

Comcast also has spent heavily on developing and deploying its X1 set-top box, saying the device lowers customer churn and leads to higher sales of premium services. Wheeler's plan would undercut the X1.

Comcast spokeswoman Sena Fitzmaurice said that Wheeler backed away from an earlier proposal that could have broken apart cable- and satellite-TV services, but that the company still believed his proposal was flawed.

"[Wheeler] claims that his new proposal builds on the marketplace success of apps, but in reality it would stop the apps revolution dead in its tracks by imposing an overly complicated government licensing regime and heavy-handed regulation in a fast-moving technological space," Fitzmaurice said.

FCC officials say that nearly all pay-TV subscribers lease boxes from their pay-TV providers. The agency is under a congressional mandate in the 1996 Telecom Act to foster competition in the $20 billion cable-box industry.

Its last attempt at change, with so-called CableCard technology, was a disappointment and cost consumers about $1 billion over the last eight years, according to industry statistics. Regulators forced box makers to engineer all devices to take the CableCard technology whether it was used or not.

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