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A Donald Trump presidency could overturn some of the controversial rulings established by the Federal Communications Commission (FCC) in recent years.
As president, Trump will appoint five FCC commissioners subject to confirmation by the US Senate, likely giving the Republican Party a 3-2 majority on the Commission. This means that recent FCC rulings and ongoing proposals, like the plan to reform set-top boxes, could be reversed, Ars Technica reports.
Current FCC chairman, Tom Wheeler, is expected to step down before January 20, when Donald Trump is sworn into office. He was appointed by the Obama administration, and it is typical for the FCC chairman to resign when there is a party shift in the White House. That said, Wheeler’s five-year term on the FCC doesn’t expire until November 2018, and he could theoretically stay on as a commissioner until then. Trump will be able to appoint a new chairperson in his place.
Here are some of the major policies passed under Wheeler’s chairmanship that could be rolled back or abandoned under the Trump administration:
- Reclassifying ISPs as common carriers. In a huge regulatory move for the FCC, broadband internet services, including mobile data services, were reclassified as a public utility. This gave the FCC a mandate to ensure that, like electricity and gas services, internet services were provided to everyone without discrimination. This ruling marked a major step for the FCC toward net neutrality.
- Net neutrality rules, or the Open Internet. This principle aims to make the internet fast, fair, and open for businesses and consumers. It prohibits internet providers and platforms from blocking and throttling the delivery of data, or entering into paid prioritization agreements — creating “fast lanes” — for data delivery, in an effort to create a level-playing field for accessing content. Trump has voiced his disapproval of net neutrality in the past.
- Stricter internet consumer privacy rules. The FCC recently established rules to give consumers more protections and control over how ISPs use and share their personal data. Broadband internet providers must notify customers of what personal data they collect, specify how this data is used and for what purpose, and identify the types of entities with which this data is shared. Additionally, consumers must opt-in for certain “sensitive” data be collected, and they're also able to opt-out in most cases.
- New proposed rules for set-top boxes. The proposal would enable customers to watch TV channels without renting a set-top box. It would force pay-TV companies to create free video apps that work on any device, and to provide universal search that allows users to find content across a range of video platforms via a single interface. The proposal threatens to disrupt the $20 billion set-top box rental market — 99% percent of pay-TV subscribers lease their set-top boxes and pay $231 a year, on average, to do so.
The Federal Communications Commission (FCC) is on a mission to increase competition in the pay-TV content space. To do this, the FCC plans to ultimately relieve consumers of their set-top boxes — the small box that enables cable or satellite television to be viewed — by providing TV apps that function across digital media devices.
Because pay-TV companies have faced minimal competition for their set-top box hardware, rental prices have been free to climb considerably over the last two decades. On average, US households are spending roughly $232 a year on set-top box rental fees. The new proposal would rid this cost.
Meanwhile, native tech companies have the most to gain from the proposal. Pay-TV providers would be mandated to create apps across streaming media players, further incentivizing consumers to purchase devices from Google, Apple, and Amazon, among others.
Dylan Mortensen, senior research analyst for BI Intelligence, Business Insider’s premium research service, has compiled a detailed report on the death of the set-top box that breaks down the most recent FCC set-top box proposal and outlines the major implications for key stakeholders and how the proposal will affect the pay-TV space moving forward.
Here are some key points from the report:
- There are three key implications of the FCC set-top box proposal, which Chairman Wheeler released in early September. Pay-TV providers would be required to provide free apps to consumers, pay-TV providers would be required to provide a universal search across all video content, and the FCC would administer licensing deals between pay-TV providers and content owners.
- The rental set-top box market is worth roughly $20 billion, according to US Senators Ed Markey and Richard Blumenthal. We estimate that Comcast alone generates over $1.7 billion per year from leasing set-top boxes.
- Native tech companies like Google, Apple, and Amazon, will see a greater presence in the living room through their streaming devices, should the proposal move forward.
- In addition to saving roughly $231 per household in annual set-top box charges, the proposal offers consumers greater choice in how they obtain pay-TV content.
In full, the report:
- Breaks down the FCC’s proposal to unlock the set-top box.
- Explores the impact the proposal has on major stakeholders.
- Forecasts the rental set-top box revenue for select pay-TV providers.
- Discusses opportunities the proposal presents for native tech companies.
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