New App-Based AllVid Proposal Smokes-out Google & Public Knowledge’s Agenda

Are the FCC’s set-top-box proposed rules really about unlocking the set-top-box to competition or are they really about advancing Google and Public Knowledge’s real agenda – forced unlocking of the licensing and copyright protections of the underlying video programming that generates ~$200b in annual revenues?

In response to the FCC Chairman’s request for an alternative approach to the FCC’s current AllVid proposed rules, the Pay TV coalition has proposed an app-based solution that solves all of the FCC’s publicly-stated problems with cable set-top boxes.

In a nutshell, the proposed alternative replaces the hardware of the cable set-top box with a downloadable app with an open-standard software interfacethat third-party manufacturers can use to create a competing searchable navigation device. This alternative: (1) ensures American consumers can eliminate and not pay for a cable set-top box from a pay TV provider; (2) enables competition for third-party hardware-based “navigation devices” that the law requires, via an “open-standard” HTML5 app/interface; (3) ensures industry-wide, binding enforceable obligations; (4) accelerates the implementation timeline to two-years; and (5) maintains the technical and security features necessary to deliver FCC-required consumer protections for privacy, children’s programming and accessibility; and lawful content protections of copyrights, contracts, advertising, presentation and promotional terms.

Simply, while this alternative proposal clearly “unlocks the box,” it does not unlock or abrogate the statutory FCC consumer video protections for privacy, children or diversity associated with the video programming, and it does not unlock or abrogate TV providers’ contractual commercial licenses for the use of their valuable property.

If the FCC’s proposal is really about “unlocking the box” and complying with the law, then this proposal fulfills both the FCC’s and the law’s goals.

That’s because the law requires the “competitive availability of navigation devices” by adopting “regulations to assure commercial availability… of converter boxes, interactive communications equipment, and other equipment used by consumers to access multichannel programming.” [Bold added.]

The law plainly requires that “devices” (equipment/hardware) be competitively available, it does not require that all pay TV video programming content be given away for free to competitors to change, devalue and/or monetize however they want without regard to the programming’s associated contracts, licenses or copyrights.

To the contrary, the law plainly states: “The Commission shall not prescribe regulations… 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.”

The fault-line here is apparently that the law has been misrepresented to require competitive availability of not just the navigation device, but also the underlying video programming content, even though Congress made plain in the above section of the law, that the FCC shall not prescribe regulations that endanger the “protection of system security” that protects the valuable video programming at the heart of the system, and consequently that prevents “theft of service.”

If the FCC’s proposal is really about “unlocking the box” and complying with the law, then the app proposal will smoke out Google and Public Knowledge’s real agenda, which is unlocking “the video programming itself” that generates ~$200b a year in annual revenues, so that this immense value cannot be protected from piracy, wholesale theft, or severe devaluation to force licensing concessions. They believe information wants to be free, and should be free of cost.

The apparent ruse here is claiming that a competitive navigation device needs to have direct access to the actual “flow” of all “the video programming itself” in order to design a competitive navigation device. [See NPRM, p. 2, Para 2, first sub-bullet.] It does not.

Such an extraordinary tech mandate to grant third-parties with free direct access to “the video programming itself” is unnecessary, unlawful, destructive, and wrong.

It would be analogous to the U.S. Treasury dictating via regulatory mandates that all American banks must give all of the coins and bills in their various bank vaults to their non-bank competitors so they can design and offer competitive “coin and bill sorters!”

Or it would be analogous to the Commerce Department dictating that all of the Nation’s Big Box stores, like WalMart, Target, Best Buy, Costco, etc. must physically give and deliver to Amazon, and every other shopping website competitor, an actual physical sample of every single one of the tens of thousands of products in their stores’ inventory, so that online Big Box store competitors could design better ways to display others’ products for sale by, and for, those who don’t own the product inventory!

The only reason for dictating that all pay TV providers must provide all of “the video programming itself” to the physical custody of navigation device competitors’ own cloud data centers, is if one thinks that “the video programming itself” should practically be stripped of any property, licensing, brand, or contractual rights – i.e. Google-YouTube’s and Public Knowledge’s longstanding policy aspirations that all information must be free online.

The only reason one forces others against their will and rights to “unlock” the container that protects their most valuable property, is because the one using force, wants the protected property to be taken by, or given to, others than the rightful owners.

In sum, since the pay TV coalition’s proposal largely solves all the problems that the law and the FCC publicly claim they want to solve here, the remaining public debate should shift to why the FCC, Google, Public Knowledge, et al, think it lawful, good public policy or legitimate for the FCC, under the guise of set-top-box competition, to mandate de facto expropriation and transfer of “the video programming itself,” for free to competitors to redistribute, repurpose, and monetize for themselves, under the FCC’s de facto imprimatur.

Simply, ditch the obsolete box, and use modern apps to enable the FCC to continue to protect consumers from harm, and enable pay TV providers to protect “the video programming itself” from mass expropriation and piracy as the law requires.

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Scott Cleland served as Deputy U.S. Coordinator for International Communications & Information Policy in the George H. W. Bush Administration. He is President of Precursor LLC, an emergent enterprise risk consultancy for Fortune 500 companies, some of which are Google competitors, and Chairman of NetCompetition, a pro-competition e-forum supported by broadband interests. He is also author of “Search & Destroy: Why You Can’t Trust Google Inc.” Cleland has testified before both the Senate and House antitrust subcommittees on Google and also before the relevant House oversight subcommittee on Google’s privacy problems.

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