New chair zaps FCC changes on set-top boxes

Out with the old, in with the new: Ajit Pai, President Trump’s new chair of the Federal Communications Commission, has reversed course,  revoking reports and investigations launched under previous leaders. Pai has criticized his predecessors’ “midnight regulations,” saying there were issued with little notice and discussion. But critics were quick to point out his revocations occurred in much the same way. 

Ignoring the politics, some of what Pai swept away will affect entertainment content, specifically access issues involving set-top boxes that consumers must rent—at much-criticized costs of hundreds of dollars annually—to get cable and satellite programs. The Obama Administration had wanted third-parties to provide the units, lowering their price and potentially opening more robust content options, such as through apps and streaming services.

Consumers, especially millennials, have been revolting against this technology, cutting the cord on the hefty costs of cable and satellite service. “Over-the-top content” from Netflix, Amazon, HBO, and others—as well as new technologies to deliver it—have made this possible. But the hope that consumers soon might be liberated from renting set-top boxes has been put off for who knows how long.

Streaming content sources typically have not included live sports, nor were network television shows available on streaming devices. But now, a content shift is under way. And the options, made available directly to streamers, especially through proprietary apps and subscription online services, are solid, including new shows and movies (please see HBO’s Game of Thrones  or its Westworld if you have been living under a rock).

What does this mean for the entertainment industry? As more content moves toward streaming and away from old-line cable and satellite providers, entertainment lawyers may need to be cutting new media deals for clients to adjust. As older content gets re-purposed for stand-alone channels, many licensors are confronting contracts that fail to address major technological changes. And what about advertisers? How will they approach their deals when “over the top” content lacks ads or permits consumers to fast-forward past them?