It started out great, in the first couple of paragraphs. I was saying "you
tell'em!" Then in the middle it devolves to FUD. And then at the end, again
makes good sense.
First he says the STB is a thing of the past (true). Then he seems to follow it
up with, in so many words, "but utterly essential for the survival of MVPDs and
content owners" (clearly FUD, or Internet TV would be unable to exist).
Can't have it both ways, Commissioner. The STB cannot simultaneously be a thing
of the past, but proprietary STBs essential for the future.
Okay, then he addresses the VMVPD definition proposal, worrying that OTT sites
MUST become VMVPDs. Aside from the fact that this is not the case, how does he
miss that OTT sites can happily exist without relying on the proprietary STB he
thinks are essential?
And then, back to "right on!" Starting with:
"This entire item is about trying to superimpose a 1990s concept on the current
technology, when the basic idea itself is no longer relevant due to the
innovations now available."
So in sum, this is a mixed message. He should have stayed on topic, lambasting
Wheeler for thinking that STBs are the future, and not confusing matters by
pretending that proprietary STBs are the only way to secure content. The bottom
line remains the same, though. I agree with O'Reilly that the FCC can simply do
nothing. The mandatory proprietary STBs are disappearing on their own.
Bert
------------------------------------------
http://transition.fcc.gov/Daily_Releases/Daily_Business/2016/db0218/FCC-16-18A6.pdf
DISSENTING STATEMENT OF
COMMISSIONER MICHAEL O'RIELLY
Re: Expanding Consumers' Video Navigation Choices, MB Docket No. 16-42;
Commercial Availability of Navigation Devices, CS Docket No. 97-80.
Over the years, I have spent considerable time on the policy issues involving
set top boxes. Past experience, along with surveying the current video
landscape, has led me to conclude that set top boxes are a relic of the past.
They are already well on their way to the fate of the video rental store. So
why, in 2016, would the Commission be doing a set top box item? If the idea of
an agency maintaining its regulatory control by placing outdated regulations on
new technologies sounds familiar, you may be on the right track.
In recent weeks we have been subjected to a steady stream of hype about this
item "unlocking the box." Let it never be said that this Commission's
propagandists have a hard time staying on message, but this particular
catchphrase only papers over the destructive results to come in the video
marketplace if the Commission proceeds to adopt the rules proposed today. This
proposal would be harmful, to some extent, for consumers as well as almost
every type of business involved in producing or distributing video content, in
many predictable ways, to say nothing of unpredicted and unpredictable effects.
It could open multichannel video programming distributor ("MVPD") networks to
serious security vulnerabilities, exposing them to potential network damage and
content theft. It could strip content producers of their rights to control the
distribution and presentation of their content. It could ultimately subject
over-the-top ("OTT") providers to the same regime, as I will discuss later.
Worst of all, it would certainly devalue the content produced by programmers
large and small, by enabling anyone capable of writing a compliant app to turn
on a free stream of video content painstakingly cobbled together by an MVPD at
great expense - the ultimate free-rider problem. MVPDs, broadcasters, and
independent programmers alike would all lose some incentives to keep doing what
they do, and some would opt for the sidelines, leaving consumers with fewer
video options.
The Commission's response to most of these concerns boils down to: "trust us,
it will be OK." Or rather, trust currently non-existent entities like "an
organization that is not affiliated with MVPDs" to come up with a security
system that will protect content, and trust "open standards bodies" to set up
acceptable specifications for any app developer to interact directly with an
MVPD's network. Trust "marketplace forces" to keep presentation standards and
advertising intact. (Interesting that this is the only issue the majority
believes should be left to the marketplace to decide). The item is forced onto
a few detours from its prescriptive path, resigned to merely seek comment on
such basic questions as "whether licensing can ensure adherence to copy control
and other rights information ... and adequate content protection." Can it even
be done? We don't know. Yet somehow, despite all of the open questions about
who, how, where, and when, the majority has so much faith in the ability of
outside, unformed entities to save the day that the item tentatively concludes
that there should be a two-year deadline for compliance with all of the new
rules. This is regulation by pure speculation.
The statutory authority on which this fantasy rests is equally as far-fetched.
The section that discusses authority will long live as a testament to the level
of absurdity that can be achieved in four short paragraphs when two defenseless
statutes fall down a rabbit hole into a land where words have no meaning. While
billed as an attempt to enhance competition in the set top box market, the item
shoots miles beyond that narrow frame on the very first page, redefining
statutory terms plainly referring to hardware, such as "navigation device,"
"interactive communications equipment," and "other equipment" to mean either
hardware or software (including apps). I don't know how much clearer the terms
"device" or "equipment" could be in their intent to reference tangible,
physical hardware. If those words don't work to restrict the Commission, are
there any that ever could? And I don't think that anyone here believes for a
second that STELAR could ever have made it out of a single Congressional
committee in 2014 if the members had known it would be interpreted to allow the
FCC to force MVPDs to stream all of their content for free to any app developer
willing to jump through a few hoops.
Getting back to the original question: why this proposal? The rationale stated
is to achieve parity among competing interfaces, but at first glance anyone can
see that the exact opposite is what would result. The free content flow
mandated by this item would be a one way street from MVPDs to OTTs. In order to
ever have parity, in order for an MVPD's interface to ever be competitive with
an OTT solution that integrates video from the MVPD and other services, OTTs
would need to be bound by the same rules and sending all their content to the
MVPDs for free, and indeed, to each other for free. In fact, I was told that at
one of the early DSTAC meetings this idea was brought up. It was quickly
dismissed as outside the scope of both STELAR and the Commission's Title VI
authority. So no one here is talking about making the one way street a two
way... or are we?
Just as with a 3D movie you need to look through both the red and blue sides of
the glasses to see the whole picture, to make any sense of this item it must be
viewed together with its other half, the Commission's proposal to reclassify
OTTs as MVPDs. If both of these NPRMs are followed to their logical
conclusions, an entire class of innovators who bear no similarities to MVPDs,
except that they also offer video, will be redefined as MVPDs and subsumed into
Title VI. Meanwhile, all MVPDs, whether existing or newly minted, will be
forced to provide all of their content to each other under an FCC mandated
scheme. And providing the "three flows" to all comers will be only the
beginning of the new regulatory burdens on OTTs captured by Title VI. Who wins?
Why, the FCC, of course.
This entire item is about trying to superimpose a 1990s concept on the current
technology, when the basic idea itself is no longer relevant due to the
innovations now available. Set top boxes, or navigation devices, effectively
have been overtaken by events, or OBE. Today's consumers want access to video
on any device they own. In response, content providers are meeting this demand
through numerous offerings, including over-the-top and Internet-based apps.
Isn't it telling that consumers can already watch video from multiple sources
on all of their devices without a FCC mandated set top box regime? They can
even stream what they are watching between devices. The video marketplace seems
to be doing just fine. And yet, somehow when it comes to an MVPD subscription
video service, we need to step in and regulate the interface? Nonsense.
Instead, I argue that we should embrace the future, not the past. The
application economy is weakening the MVPD video package formula as we speak. In
fact, it's no longer about channels at all. Many consumers are watching
programming by the individual program or even shorter segments. The entire
video industry is moving away from a box mentality and as such we should
reconsider the need for regulation to maintain a competitive set top box
marketplace.
Change is a real challenge when the goal is to maintain control over the future
using the paradigms of the past. As we have seen, the pursuit of this goal can
lead to policy proposals based on Orwellian statutory interpretations and
substantive thin air. But given the choice between disruptive technologies and
disruptive regulations, no one should have any doubt which side I'm on.
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