The U.S. House Subcommittee on Communications and Technology will hold a hearing tomorrow on legislation to reauthorize the Satellite Television Extension and Localism Act, commonly referred to as STELA. Sitting on the panel of witnesses will be NCTA President and CEO Michael Powell.
We expect the hearing to highlight several important issues, but two issues in particular stand out — repeal of the integration ban and reining in practices that today permit separately owned, local broadcasters to coordinate or jointly negotiate retransmission consent agreements.
For the unfamiliar, the integration ban is the rule that requires cable set-top boxes to use a CableCARD – a device about the size of a credit card that is inserted into your cable device and decrypts the content delivered to your home. We did a CableCARD integration ban explainer a few months ago, which you can check out here.
Since 2007, when the FCC required cable operators to stop using integrated set-top boxes and use CableCARDs instead, the integration ban has added over $1 billion in needless costs to subscribers. And on top of the added hardware expense, subscribers collectively foot the bill for roughly 500 million kilowatt hours consumed by CableCARDs each year. Eliminating the integration ban will reduce costs for consumers, cut set-top box energy consumption, and allow cable providers to compete on a level playing field with the many other video providers in the marketplace who aren’t subject to the integration ban.
In the video marketplace, competition is fierce. Content is accessible across multiple platforms operating on almost any device with a screen. With so much changing, cable should be freed from obligatory, expensive, and unnecessary rules like the integration ban and be allowed to compete fairly in the dynamic video marketplace. To really understand how inconsistent the integration ban is, just look at the chart below.
Another important element in the committee draft that could complement expected FCC action is the decision to rein in practices by which separately owned broadcast stations jointly negotiate carriage terms in retransmission consent negotiations. Under current law, some broadcasters have relied on legal loopholes that allow separately owned stations to unfairly leverage collective negotiating power in local markets. We have long explained how such joint negotiation harms consumers and are hopeful that greater attention from Congress and the FCC will bring an end to such practices.
The hearing will be held at 10:30 am. More information can be found on the Energy and Commerce Committee website.