Month: October 2014

My Insanely Long Field Guide To The War On CableCARD — Part II: STAVRA Section 203.

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When it comes to special interest sleaze, Section 203 of the Satellite Television Access and Viewer Rights Act (STAVRA) is just an absolute brilliant work of art. We like to talk about how much money cable throws around, about Comcast Chief Lobbyist David Cohen golfing with President Obama, yadda yadda yadda. But that is just crude muscle.  Getting a blatantly anti-consumer provision inserted in a pro-consumer bill behind the scenes, and getting it rammed through by a combination of obscurity, chicanery and log-rolling, is where that army of lobbyists earns their 6-and-7 digit salaries.

 

I gave the whole bloody history in The War on CableCARD Part I: More Background Than You Can Possibly Imagine. To review, Section 203 of Stavra (and its matching provision in the House STELLA 2014 bill) cripples CableCARD  by eliminating the “integration ban.” This effectively ends any hope third party devices will compete with the cable industry, and we remain stuck leasing digital video recorders (DVRs) and set-top boxes (STBs) and other equipment and services from cable operators rather than owning our own or using cheaper, better rival services. Consumers pay over $1 billion in rental fees annually to cable operators for equipment they could otherwise own. So eliminating the integration ban (and thus killing CableCARD) pretty much condemns consumers to keep getting gouged for the foreseeable future just when independent equipment like the TiVo Romaio is finally starting to take off.

 

To add to the special interest sleaze factor, Section 203 of STAVRA converts a pro-consumer bill (that was originally a lot more pro-consumer) into a billion dollar rip off of consumers for the profit of one of the most loathed industries in America. And it does so in such a subtle way that it is almost impossible to detect. AND it comes with a fake pro-consumer ‘solution’ so the cable industry (and, more importantly, members of Congress seeking cover) can claim to have the best interests of consumers at heart.

 

Happily, it has an easy fix and a champion to convert this back into an actually good pro-consumer bill and have this blow up all over the cable guys so that they will be hoist by their own petard. Oooh, such justice would be sweet. And eminently achievable.

 

If you want the short version of this, without the appreciation of all amazing special interest sleaziness, you can see these Public Knowledge blog posts: here, here, here and here. But if you want the full TotSF treatment with all the wonk and snark you’ve come to expect from yr hmbl obdn’t blogger, then see more below . . . .

 

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My Insanely Long Field Guide To The War On CableCARD — Part I: More Background Than You Can Possibly Imagine.

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We often talk about the power of cable lobbying in the context of big proceedings like network neutrality. But where the real power comes, and where consumers routinely get screwed the most, happens off-screen. Because people hardly ever know what is happening, cable lobbyists play an outsized role in working their magic and making it legal to find new ways to screw over subscribers. Nothing illustrates this better than the fight over the Satellite Television Access and Viewers Rights Act (STAVRA). As my Public Knowledge colleague John Bergmayer explains in this blog post, unless Congress passes STAVRA, a lot of satellite TV subscribers will lose access to some of their broadcast channels. Since Americans totally freak out if they cannot watch their favorite show, and channel this rage to their members of Congress, that makes STAVRA “must pass” legislation.

 

The cable industry lobbyists have managed to append this bill designed to protect consumers a little gift to themselves. Cable operators make over $1 billion a year on equipment rentals to subscribers. Section 203 of STAVRA eliminates the FCC rule (“the integration ban”) that makes it even vaguely possible at the moment for people to avoid these rip off rental fees and actually buy your own cable set top box (STB) or digital video recorder (DVR) using something called CableCARD.

 

From a policy wonk perspective, I have to say that Section 203 of STAVRA is a work of art. Unless you know what to look for, you will never find it by flipping through the bill. And unless you know the whole background on how the cable industry has frustrated the effort to get competition in the STB and cable device attachment business, you would never know how the cable arguments about how CableCARD doesn’t work are self-serving baloney. And, best of all, Section 203 contains a fake solution so members of Congress and the cable lobby can pretend this will make things better, rather than continue to screw consumers out of hundreds of millions of dollars in cable fees annually.

 

Hence the need for two insanely long posts. But since we are talking about consumer rip offs of over $1 billion a year, I kinda hope you will consider it worth reading. Here in Part I, I will give you everything you need to know about the history of how cable has ripped us off on equipment rental fees despite Congress passing two separate laws (here and here) to make it possible to actually own equipment and avoid this nonsense (which worked from 1992 until we went digital), what the heck the “integration ban” is, and why CableCARD — lame as it is — actually does make things mildly better and is picking up steam as a result of stuff the FCC did back in 2010.

 

In Part II, I will cover the current fight over the Section 203 of STAVRA, what makes Section 203 such an amazing work of art and how Senator Ed Markey (D-MA) is standing up for consumers on this. With help, Markey can actually flip this around and convert this from a gift to the cable industry to something that would genuinely help consumers by making the promise of stand alone STBs and other cable equipment real. But, at a minimum, Markey needs help getting the bad provision stripped from the bill so we can at least keep what we have and keep working to make it better.

 

Part I with all the background you need to understand Part II below. You can find Part II by clicking here.

 

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President Obama Says Some Good Things About Net Neutrality and Intellectual Property.

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Everyone likes to get mad at President Obama these days. So I figured I would briefly highlight some good things Obama said during this Town Hall Meeting last week while I was off doing the Jewish holiday thing. After the holiday, I saw an email with the subject: “Obama Talks About Net Neutrality & Intellectual Property.”

 

I am sufficiently weird that “Obama Talks About Net Neutrality and Intellectual Property” is probably the most irresistible clickbait headline for me that I can think of, so of course I was hooked.

 

Speaking of clickbait, more below . . . .

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Wheeler: “We Now Return To Our Transition of the Phone System Already In Progress.”

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In the last two days, Federal Communications Commission (FCC) Chairman Tom Wheeler has made back-to-back speeches that on their surface appear as dissimilar as could be. First, he gave this speech at the Fall 2014 COMPTEL Show. The next day, he gave this speech at the 32nd Annual Everett Parker Lecture. Dig a little deeper, however (and keep in mind what I have previously said about Tom Wheeler signaling what he wants to do if anyone actually pays attention) you notice some startling commonalities between these two speeches. Notably, this is the first time Wheeler has brought up the transition of the phone network in a serious way in a long time. And, in both speeches he made it very clear that transition of the phone system to an all IP platform does not end the FCC’s role.

ITo summarize my take aways:

1. Wheeler wants to shift the FCC back into working on the IP Transition despite the fact that AT&T is not going to have its pilot project ready until the second half of 2015. It is, after all, the thing he came to the FCC to do in the first place before net neutrality and Comcast/TWC essentially hijacked 2014.

 

2. While the nature and form of regulation will change, the FCC will continue to play a critical role — during the transition and after the transition — both in promoting competition and protecting consumers.

 

3. That Network Compact Wheeler keeps talking about? He really means it. When he leaves the FCC, he wants to leave an agency that still protects network users under this fundamental set of values.

 

A bit more below . . .

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Forbearance Redux — Still Easy Peasy

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As the groundswell for reclassifying broadband as a Title II telecommunications service grows, the arguments against reclassification have grown increasingly shrill and desperate. Like Democrats frantically emailing supporters to try to hold the Senate, the National Cable Telecommunications Association (NCTA), has been flooding DC radio stations with advertising denouncing public infrastructure and calling for the privatization of our roadways in an effort to whip up anti-Title II sentiment (I notice their newfound embrace of Ayn Rand does not include repeal of poll attachment subsidies). As I’ve noted previously, only inside-the-beltway does anyone think “death to public roads, death to your right to clean water, and lets deregulate energy so we can have the lights flicker when the wind blows” is a winning argument. But panic does things to people . . .

 

Which brings me back to the arguments about “forbearance.” I blogged last July that the FCC can forbear fairly easily from any provisions of the Communications Act it thinks shouldn’t apply to broadband if it reclassifies broadband as Title II. As my employer Public Knowledge has pointed out at length in our official comments, this is neither necessary or good policy. Most of the provisions the anti-Title II crowd point to as potentially crushing the spirit out of Broadband Equestria (“Broadband Is Magic!”) have been effectively deregulated already for traditional telephone service, and other provisions actually support good stuff like Universal Service Fund or privacy rights for consumers. Nevertheless, if the FCC feels the need to indulge in broad forbearance, it has the authority to do so.

 

Needless to say, those invested in portraying reclassification as The Death Of Freedom As We Know It do not take kindly to having their nonsense called out in plain English, with lots of links to the relevant documents. Some folks have therefore devoted some considerable effort in the last few months to explaining why, all cited evidence to the contrary, forbearing from Title II would be Utterly Impossible.

 

So I find myself once again revisiting this topic. Happily, the arguments break down into 2 basic categories:

 

  1. None of the precedent I cited applies anymore because of the “Qwest Forbearance.”

 

  1. There is something magical and exceptional about broadband that makes it impossible to forbear here where it would be contrary to the interests of the carriers, but forbearance would be easy-peasy in any case where carriers want forbearance.

As I shall explain below, argument #1 relies on a fundamental misunderstanding of how administrative law works (and a failure to read any recent forbearance cases, which address this issue squarely and reject this argument), whereas argument #2 relies on a fundamental (and rather self-serving) misunderstanding of how the forbearance statute works.

 

More below . . .

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