FCC’s Wheeler Says Cable Set-Top Box Proposal May Be Changed

(Bloomberg) -- Federal Communications Commission Chairman Tom Wheeler, facing criticism from colleagues and lawmakers of both parties, said Thursday he’s open to modifying his proposal to free consumers from needing to rent set-top boxes from their cable TV provider.

Hollywood studios and pay-TV providers led by Comcast Corp. and DirecTV owner AT&T Inc. have said Wheeler’s proposal is unacceptable because it would make the FCC an arbiter of licensing contracts, potentially squelching innovation. The FCC in a fact sheet described its role as ensuring contracts aren’t anti-competitive.

Wheeler, a Democrat, told a Senate Commerce Committee hearing that he is open to changing the provision.

“Let’s do it -- let’s get at it,” Wheeler said. “The door isn’t closed on anything.”

Fellow Democratic Commissioner Jessica Rosenworcel, whose vote may be needed because agency Republicans object to the proposal, told senators she has “some problems” with the licensing provision. The FCC may not have the necessary authority, Rosenworcel said. She said she would work toward a compromise “because I think bringing some change to the set-top box market would be a good thing for consumers."

The measure that aims to relieve consumers of paying an estimated $231 annually in box rental fees faces a Sept. 29 vote at the agency. It would require pay-TV companies to provide apps giving access to their programming to independent device makers.

Senator John Thune, the South Dakota Republican who is chairman of the Commerce Committee, said the FCC aims to “design and dictate the future of television apps," and Senator Bill Nelson, of Florida, the panel’s top Democrat, said Wheeler should work to meet industry’s concern.

President Barack Obama has called for set-top box changes as part of a suite of pro-competition reforms.