AT&Ts plans to invest $500 million in an Internet video service (AT&T joins crowded field with online video plans, Modbee.com, April 22) are further evidence that 1990s-era regulations that single out the cable industry have outlived their usefulness and that Congress should consider repeal. As companies like Apple, Google and Amazon introduce innovative devices for viewing online video from Apple TV to Google Chromecast FCC rules developed in 1998 are preventing traditional cable companies from developing smaller, less costly and more energy-efficient cable boxes to keep pace.
These rules force cable companies to place the central nervous system of the cable box on a removable cardlike device. The FCC intended to foster alternatives to renting a cable box and some 600,000 customers choose to use devices like a TiVo to channel surf but the millions who still rent their boxes have absorbed over $1 billion in additional costs related to the rule over the last six years while missing out on high-tech advancements common among Internet devices.
When the government mandates specific technologies rather than promoting R&D from job-creating small businesses, we can expect lackluster results. With cable companies losing more than 10 million subscribers to satellite providers, phone companies and now Google Fiber (who are all exempt from the CableCARD rule) and a number of homes cutting the cord altogether, its the right time for Congress to undo this costly and unsuccessful rule.
CEO Minority Business RoundTable