Wheeler: Open to Set-Top Plan Changes

Rosenworcel says she doesn't think FCC has authority over licensing
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FCC Chairman Tom Wheeler told the Senate Thursday that he is still open to changes in the FCC's new app-based set-top plan. That came in response, as well as in advance of, concerns expressed by various legislators.

In a Senate Commerce Committee oversight hearing, Wheeler said that they were probably "90%" there on the set-top box item and cited at least one provision -- on contracts between programmers and MVPDs that he said programmers had sought -- that he is willing to pull out if it helps.

Democratic Sens. Bill Nelson (Fla.), Claire McCaskill (Mo.) and Amy Klobuchar (Minn.) all expressed concerns, including Klobuchar about the impact of the proposal on independent programmers. Wheeler countered to Klobuchar that the Writers Guild of America West backed the plan and its impact on independent programmers and that others independents did as well.

Related: Sen. Nelson: Set-Top Plan Needs Work

McCaskill said that she had rarely seen such unanimous criticism of an item, suggesting that signaled that more work clearly needed to be done.

At the hearing, Wheeler quoted Rosenworcel's comment about the need to act on set-tops for consumers. But when asked for her take about the set-top plan, Rosenworcel said that that while set-tops were clunky and expensive -- she said that was her personal as well as professional position -- she had problems with the FCC getting "too involved in licensing schemes" adding that she did not think the FCC had the authority.

Rosenworcel's vote will be needed to approve the item, since the Republicans oppose it in its current form.

Sen. Brian Schatz (D-Hawaii) pressed Wheeler on his openness to modifying the proposal to address what he said were stakeholder's legitimate concerns. Wheeler said he was, so long as it stays true ot the congressional mandate -- to create navigation device competition.

Standing up for Wheeler's proposal was Sen. Ed Markey (D-Mass.). He held up a set-top wrapped in chains and compared that with an Amazon fire stick the size of a pack of gum.

He said the box had not changed and that 100 million pay TV households can't watch their pay programming on the Fire stick.

He said only the FCC can do something about the problem, and that its proposal would free consumers from exorbitant rental fees. "That lack of choice has to end now, Markey said.

Markey asked if Wheeler could find a solution in the next 14 days. Wheeler said he hoped the "significant departure" from structure but not principle that the new apps-based proposal represents, is an indication of how he is willing and seeking to resolve remaining concerns, while chopping the chains from the box.

Wheeler said Comcast is shipping 40,000 of those (chained) boxes a day.

Sen. John Thune (D-S.D.) pointed out that Amazon had registered its own problems with the proposal. He quoted their comment that the proposal would delay competition.

Markey said that was a concern about licensing, and that the licensing board issue could be worked out.

Sen. Richard Blumenthal (D-Conn.), who teamed with Markey to push for set-top reform, also said his state's consumers would stand to save millions of dollars from the FCC set-top proposal.

He said the proposal would simply enforce a law that has been unenforced since the 1990's. He called it a classic inside-the-Beltway vs. consumer issue and labelled set-tops "dollar devourers."

But one industry source pointed out that the law also prevents the FCC from doing some things that the proposal's critics say it would do, per below:

"The Commission shall not prescribe regulations under subsection (a) of this section which would jeopardize security of multichannel video programming and other services offered over multichannel video programming systems, or impede the legal rights of a provider of such services to prevent theft of service."

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