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The FCC Grants Cable Companies the Rights to Scramble Basic Channels and Rent Thier Set-Top Boxes...

by on13 April 2013 1886 times
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Times they are a changing... There once was a time when the FCC working to make sure that the cable companies were not trying to take advantage of consumers. We saw them push a series of regulations that prohibited the cable companies that were also ISPs from throttling bandwidth. These were followed by more regulations that prevented the same companied from favoring their own services when it came to traffic caps. It really looked like the consumer had a friend in the FCC. Unfortunately all of that changed in the last few months. We have seen them reverse some of the same decisions that they made only a year ago. Now they have done it again and are allowing cable companies to force you to pay rent on the set-top boxes that are required to view premium channels.

Now I really do not have a problem with paying for a set-top box when I open an account or when I add HD channels to my service, but as I already pay a monthly fee just to view these I do take exception to being forced to pay a monthly fee just for the box that decrypted those channels. In most cases the addition of the rental fee will be a 30% increase in fees. I have to wonder what the regular fees are for if I have to pay for the box also. Considering the fact that the cable companies are the only place you can get the decryption boxes it is a little wrong to allow them this extra fee. If they would allow their party purchase of the boxes then I can see them giving you the option, but they do not and will not ever willingly give up that control.

Now as we have said it is bad enough that they are going to charge a rental fee for a set-top box for premium channels, but the FCC has also decided to allow them to encrypt basic channels (even the ones that you could get over the air). This means that no matter what level of service you get from the cable company you are going to be paying extra just to be able to view those channels. It also means that those of us that have run the cable directly into a TV or HTPC will find ourselves looking at a scrambled picture unless we buy a set-top box.

The funny thing is that the FCC and cable companies are claiming this is a win for the consumer. The logic is that it will be easier to turn off your service if you are away… It is possibly the worst excuse I have ever heard for handing away consumer rights. The real reason behind the move is probably more to do with home build DVRs. If you push an encrypted signal through a set-top box you can disallow someone with an HTPC from recording that channel. This helps out companies like Fox, ABC and other that are now developing their own streaming service for their content. They do not want you to be able to record it in high resolution and then potentially transfer it to someone else. Sure you can still do the same thing with a streaming website, but is not as good as directly from the station. Additionally, by forcing you to use the website they get the hits and ad revenue from both the ads on the site and the commercials that are dumped into the videos.

Now what is interesting is that we do fully expect most of the free streaming sites to move to a monthly subscription model in the next few months. It will be enough that most won’t consider it a bad move. We also would not be surprised to see companies like Comcast, Time Warner, Bright House AT&T and others start to buy up some of these companies in the very near future. We would guess that they are working very hard to make sure they can cover both markets in the same way they have done with phone, internet and TV services. These groups are businesses and want to make sure they can turn a healthy profit each year despite increased lobbying costs.

Make no mistake the FCC’s decision to allow cable companies to rent their set-top descramblers and to encrypt basic over the air channels is not good for consumers. It is meant to ensure a good revenue stream and to further control the content that these companies push over their lines. It is as simple as that although we have seen suggestion that this move was a concession to help offset the costs of monitoring that would be required soon.

FCC Document

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Last modified on 21 April 2013
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