Most people still watch TV via cable boxes rented from their cable providers. These fees cost consumers $19 billion across the industry and represent a major source of revenue for the cable companies. Captive customers have seen the price to rent a cable box increase up 185 percent since 1994, according to the Federal Communications Commission (FCC).
That’s what happens without competition, and as we all know, there’s not much competition among local cable providers.
If you subscribe to cable TV, you probably cringe at the monthly fee you pay to rent your cable box from the cable company. Cable subscribers like you and me pay $231 per year, on average, for set-top box rentals. When you’re already paying a hefty fee for a channel bundle, it seems like nickel-and-diming to be forced to rent the box. And that fee continues to go up for the same old equipment, no matter how out of date it gets and how much its clunky user interface lags behind that of streaming video services.
If you want to watch a variety of streaming digital video content, especially movies and shows without commercial interruption, you can supplement your cable box by purchasing a Roku box or another similar internet-connected streaming device to stream video to your TV. Or you can buy a “smart TV,” which allows you to stream Netflix or Amazon Video without another box. I have all these devices, plus five remotes, a cable box, and no single guide to consult about what’s on. It’s frustrating.
Wouldn’t it be great if you could buy one set-top box – or a smart TV – which allowed you to connect directly to the cable service you already pay for and to your Netflix, Amazon, PBS and other streaming services all at once? This is not a dream — companies have the tech wherewithal to do this now, if only cable companies would loosen their grip.
The FCC is developing a new proposal to usher in a new era of competition and consumer choice in the set-top box market, which would make it easier for consumers to choose how they watch cable TV. The commission will vote on the matter this week.
For decades, the landline telephone companies forced their customers to rent rotary dial telephones. Once that changed and consumers bought the phones of their choice, innovation grew and consumers saw their communications costs go down.
FCC Chairman Tom Wheeler has called for a software-based system, which would allow consumers to receive cable TV programming on any device – a setup box, television or computer. The solution would have to adhere to all the same privacy and copyright protections that cable services already follow.
A software-based solution is the answer to fostering competition in the set-top box market. The FCC tried before to give cable subscribers a way to use their own equipment and avoid leasing fees via a piece of hardware called a CableCARD. But while the idea was consumer-friendly, the cards, tightly controlled by cable providers, were not. After buying their own equipment, cable customers still had to pay monthly fees to use the CableCARDs. On top of that, they were hard to get and harder to get working. That’s why 99 percent of cable subscribers still rent a cable set-top box.
Consumer Action, the education and advocacy nonprofit organization I work for, supports the FCC’s new proposal because it shifts the choice back to consumers, allowing electronics makers to develop set-top boxes customers can choose based on the interface and criteria they value. This will be a huge improvement over the mind-boggling setups we have now.
My cable provider brings me good content that I like to watch, but I feel locked in by its double dipping on big bundles, set-top box rentals and ever increasing commercial interruptions. At Consumer Action, we can’t understand the cable industry’s objections to moving with the times and giving consumers a more seamless way to watch the content they pay for and enjoy.
If we can unlock the cable box and unleash the power of innovation and competition, who knows what new options, features and cost savings consumers will see in the coming years.