Technology

President Obama presses for open market for cable boxes

President Barack Obama is throwing his weight behind an effort to give consumers more choice when it comes to the cable boxes that control which television channels they watch. Most TV subscribers lease boxes from their cable service provider.
President Barack Obama is throwing his weight behind an effort to give consumers more choice when it comes to the cable boxes that control which television channels they watch. Most TV subscribers lease boxes from their cable service provider. The Associated Press

President Barack Obama on Friday announced his support for opening the market for cable set-top boxes, singling out the devices in millions of homes as a clunky and outdated symbol of corporate power over consumers as he introduced a broad federal effort to increase competition.

In an unusual step, Obama weighed in personally on a pending proposal at the Federal Communications Commission, having his administration file comments that applauded the effort to loosen cable companies’ grip on the boxes and endorsing the move in an interview.

He said it was one example of the actions that government agencies should take in response to an executive order he signed Friday calling for proposals to promote competition and better protect consumers.

“The cable or satellite box is just one example of an area where, because it’s been tied to the provider and you rent it, and consumers spend billions of dollars on it every single year, there hasn’t been much innovation,” Obama told Yahoo Finance in an interview taped Thursday. “Our private sector thrives, and innovation is the hallmark of the United States — that’s our big comparative advantage with other countries — but it starts to become less effective and reduces both what consumers get and the kind of innovation we generate if we get closed systems or if people are gaming the system.”

The cable industry is opposed to the FCC proposal, calling it a giveaway to wealthy tech companies.

Obama’s announcements represent his latest moves to push back against the forces of consolidation and monopoly and to shift power away from large corporations in an array of industries.

The president’s aides gave no examples of the kinds of rules that Obama would like to see agencies propose in response to the executive order. Jason Furman, the chairman of Obama’s Council of Economic Advisers, said White House officials had already notified the agencies of the coming call for recommendations, so some of the regulations were already underway.

The administration can comment on any proposal by the FCC, an independent agency, but it does so sparingly, and it is rare for the president himself to speak out on a pending matter. In this case, his advisers said Obama felt that the issue merited his involvement because of its importance for consumers and the broad impact the changes could have on the cable market, one that touches many U.S. households.

The FCC proposal would allow subscribers to choose and buy the devices they use to view television programming, instead of leasing the boxes from their cable companies at an average annual cost of $231. The agency approved the plan in February, starting a 60-day comment period that closes in a week.

In comments submitted Friday, the National Telecommunications and Information Administration, part of the Commerce Department, urged the FCC to take a “measured and balanced” approach to injecting competition into the set-top-box market, including enabling alternative providers to provide their own user interfaces as well as other features and services on the devices.

The filing argued that the way set-top cable boxes now function goes against telecommunications laws requiring competition in the market, depriving 100 million U.S. families of choices.

Among the supporters of the set-top box proposal are technology companies such as Google, Amazon and Apple, which are eager to establish a broader foothold in the TV market. The cable industry is opposed, calling it a giveaway to wealthy tech companies.

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