Competition is good news for cable TV consumers

On Feb. 18, the Federal Communications Commission approved a measure opening a period of public comment on a proposal to require open standards in cable set-top boxes, thus setting the stage for a final vote later this year. If approved, the rule would require pay-TV providers to provide content and programming information to makers of third-party hardware and software, giving cable subscribers the option to stop renting their box from the cable provider.

One advantage of the change would be financial savings for consumers, who pay an average $231 a year in rental fees for set-top boxes, totaling about $20 billion in revenue for the cable companies, according to a study commissioned by Senators Edward J. Markey and Richard Blumenthal. It would also potentially drive more innovation by making the interface to their video content something consumers decide to buy rather than something cable providers dictate, both choosing the hardware and setting its price without any meaningful alternate options. Companies like Apple or Google, or other new entrants, could offer devices that would be able to integrate programming from a cable subscription a user already pays for.

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The cable companies are predictably opposed to this move, but their objections—including that the regulation would somehow impose additional costs on consumers—do not hold water. In fact, the existing situation, in which 99 percent of subscribers rent an expensive set-top box, reflects not consumer choice, but rather the absence of effective competition in the cable TV market. Until these companies are exposed to meaningful competition, we should not trust them to have consumer interests at heart and should support regulations bringing other players into the market.

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Lisa Weber
2 years 10 months ago
The same thing is true in the healthcare industry. Until the current industry is exposed to competition, it will continue to be a monumental rip-off for anyone needs healthcare. A person can live quite nicely without cable TV, but it can be hard to live well without healthcare.

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