Sorry, ISPs: The FCC finally has the dopes on the ropes

Despite this week's appeals court ruling, the cable industry fights on against an open internet, proposals to regulate set-top boxes, and privacy protections

From net neutrality to set-top boxes to privacy regulations, cable companies seem to be on the ropes in their bout with an uncharacteristically aggressive FCC intent on a pro-openness, pro-consumer agenda. But don't expect them to throw in the towel -- not when they have Congress and a bevy of lobbyists in their corner.

This week's net neutrality ruling was a win for everyone who championed the idea that ISPs should not function as gatekeepers, blocking or throttling the flow of information and content.

"The ruling is a victory for consumers and innovators who deserve unfettered access to the entire web," said FCC Chairman Tom Wheeler. "It ensures the internet remains a platform for unparalleled innovation, free expression, and economic growth."

Or as Stephen Colbert put it, "This ruling means that cable companies can't slow down streaming services and blah blah blah blah, whatever."

Game over, you say? No sooner had a federal court upheld the FCC's open internet regulations than the National Cable and Telecom Association called on "leaders in Congress to renew their efforts to craft meaningful legislation that can end ongoing uncertainty, promote network investment, and protect consumers."

Pounding away on that same theme, the CTIA vowed it would "pursue judicial and congressional options to ensure a regulatory framework that provides certainty for consumers, investors and innovators."

And AT&T said it would appeal the decision to the Supreme Court -- which has uncertainty issues of its own.

Many would argue that telecoms' refusal to give up a decade-long fight against an open internet is itself a major cause for uncertainty. "This decision should lay to rest what has become a needlessly contentious issue," said Gene Kimmelman, CEO of advocacy group Public Knowledge. "We hope that rather than refight old battles, Congress and the industry will turn toward the problem of ensuring that all Americans have access to broadband that is 'fast, fair and open.'"

What are the odds on that actually happening? You do the math -- bearing in mind that since net neutrality rules were passed in February 2015, Republican lawmakers have tried to pass more than a dozen bills or amendments to weaken or kill the regulations.

But an open internet is not the only punch in the FCC's arsenal. Wheeler, a former lobbyist for the telecom industry who was inducted into the Cable Hall of Fame in 2009, has gone from industry hero to turncoat since he was tapped to be FCC chairman. Now, with an eye on the clock, he's pushing hard to bring competition to the cable set-top-box market.

Consumers are being ripped off under the current system because they don't have an easy way to own their boxes like they do with computers, routers, smartphones, and every other electronic device. Congress recognized this and passed a law 20 years ago that empowered the FCC to fix the problem.

What happened? The agency allowed cable companies to keep some control, and today customers wanting to ditch their set-top box must obtain a descrambling device called a CableCARD that goes into devices like TiVOs. "But the CableCARD era has been riddled with endless examples of how cable companies frustrate consumer switching away from rented set-top boxes because they controlled the means to switch," the EFF says.

The FCC's Unlock the Box proposals "are designed to let ... subscribers watch what they pay for wherever they want, however they want, and whenever they want, and pay less money to do so, making it as easy to buy an innovative means of accessing multichannel video programming ... as it is to buy a cellphone or TV."

While no one expected cable companies to give up the $21 billion it makes each year off its set-top-box monopoly, their bob-and-weave aimed at obfuscating the issues has been worthy of Muhammad Ali.

Industry lobbyists have been "attacking the FCC's plan with a two-pronged approach," says TechDirt. Their low-blow tactics include paying for "an absolute torrent of hysterically misleading editorials that claim set-top competition will hurt consumers, scare the children, ramp up piracy, and knock the planet off of its orbital axis. The other prong of their attack involves a lobbying mainstay: throwing money at politicians to take positions they don't have the slightest actual understanding of."

Cue the industry's water boy -- er, Senate Majority Leader Mitch McConnell, who was quick to parrot the cable industry line that "the FCC would require existing programming distributors to provide the copyrighted programming they have licensed from content providers to third-party manufacturers and app developers, none of whom would be bound by the agreements to protect the content."

The FCC proposals are about promoting competition, not changing copyright law. But the cable, movie, and recording industries and their "parakeet allies" would rather "keep the conversation on their made-up version of copyright law," the EFF says. "According to the pseudo-copyright regime that Big Cable and Hollywood believe in, your television manufacturer needed a contract to show you a movie, your router needed a license to stream video data to your smartphone, and before you activated your personally built computer at home you would need a license to view content on the internet."

Although the shift away from the traditional cable box and legacy TV is already well underway, don't count cable companies out too soon. There's plenty of fight left in them -- and their army of lobbyists.

Copyright © 2016 IDG Communications, Inc.

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