(Reuters) – The top U.S. communications regulator plans on Thursday to unveil a revised plan to allow about 100 million pay TV subscribers to replace expensive set-top boxes with less-costly apps that provide access to television and video programs, two people briefed on the plan said.
Federal Communications Commission Chairman Tom Wheeler proposed in January opening the $20 billion cable and satellite TV set-top box market to new competitors and allow consumers to access multiple content providers from a single app or device.
The plan, aimed at breaking the cable industry’s long grip on the lucrative pay TV market and lowering prices for consumers, drew fierce opposition from TV and content providers, including AT&T, Comcast and Twenty-First Century Fox.
The FCC has said Americans spend $20 billion a year to lease pay-TV boxes, or an average of $231 annually. Set-top box rental fees have jumped 185 percent since 1994, while the cost of TVs, computers and mobile phones has dropped 90 percent, the FCC has estimated.
The pay TV industry raised concerns over copyright, content licensing and privacy issues and made a counterproposal in June, offering to commit to creating its own apps to allow consumers to watch programs without needing to lease a box.
Wheeler’s revised plan is expected to include some components of the pay TV industry’s proposal, and to exempt some smaller cable providers from the new requirements. The plan is also expected to create a licensing body to oversee the pay-TV apps, according to industry filings with the FCC.
The revised application-based proposal is expected to come before the five-member commission for a vote on Sept. 29 at the commission’s next meeting, the sources briefed on the matter said.
Kim Hart, a spokeswoman for Wheeler, declined to comment.
Disney, CBS, Viacom, Time Warner, Scripps Networks and others met with Wheeler aides last week to discuss “a revised approach… that would ensure that all of programmers’ valuable content would remain inside of, and under the control of, apps developed exclusively by” cable and other pay-TV providers, according to a filing with the FCC this week.
These companies fear that rivals like Alphabet Inc or Apple Inc could create devices or apps and insert their own content or advertising in cable content.
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Wheeler’s January proposal would create a framework for device manufacturers and software developers to produce a single device or app to gain access to content from providers such as Netflix, Amazon.com, Hulu, Alphabet’s YouTube and a pay-TV company.
Wheeler has an aggressive agenda in the final months of the Obama administration. He wants the FCC to finalize a proposal to ensure privacy for broadband Internet users by barring providers from collecting user data without consent. He also wants to complete reforms of the $40 billion annual market for business data services known as special access lines.
