FCC approves changes to CableCARD rules

The Federal Communications Commission moved Thursday to open up the retail market for companies that provide cable set-top boxes and digital video recorders.

At Thursday's open meeting, the FCC issued an order that would promote competition in the marketplace for set-top boxes by ensuring retail devices such as TiVo have the same access to prescheduled programming as cable providers. The order would also make CableCARD pricing and billing more transparent, streamline the installation process, and ease requirements on manufacturers and operators upgrading their equipment.

"Our ultimate goal in this area is to unleash maximum innovation through the TV. We’ve seen significantly less innovation — fewer new devices, applications and services — on the digital TV platform than on the computer or mobile platforms," FCC Chairman Julius Genachowski said.

"There is also poor pricing transparency of CableCARDs because the cost of the card is often bundled with other equipment and service fees. As a result, consumers often don’t know what CableCARDs cost — making it difficult to make an informed decision whether to buy or lease a box," he added

“The FCC has finally remembered the set-top box — and America’s consumers will be the better for it,” said Matthew Zinn, senior vice president and general counsel of TiVo. Zinn praised the commission for removing pricing and installation hurdles that prevented consumers from choosing boxes other than those provided by the cable company.

Currently the overwhelming majority of digital cable subscribers lease a set-top box from their cable providers; the FCC originally designed its rules in hopes of spurring a retail market for the devices, but thus far it has not materialized as hoped. Rep. Edward Markey (D-Mass.) wrote to Genachowski last week urging him to simplify the CableCARD rules so users would be able to view content from the Web on their home televisions.

"Under our existing rules, it’s been more difficult for consumers to use set-top boxes bought at retail than to use boxes leased from the cable operator," Genachowski said. "And indeed only a tiny fraction of cable subscribers have chosen to buy a set-top box."

A trade group representing the cable industry also praised the FCC's action and pledged to work with TiVo and other retail cable box providers to create a new video device capable of seamlessly integrating content from multiple sources.

“We commend the Commission for its constructive approach in adopting sensible, targeted fixes to the current CableCARD rules that provide cable operators the necessary flexibility to continue improving the CableCARD experience for all of our customers," said the National Cable and Telecommunications Association in a statement.

“We agree with the Commission that implementing these changes — including increasing options for self-installation, providing more transparency and properly equipping technicians — will assist customers who use retail devices that rely on CableCARDs."