[Federal Register Volume 85, Number 234 (Friday, December 4, 2020)]
[Rules and Regulations]
[Pages 78237-78239]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-25143]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 76

[MB Docket No. 16-42, CS Docket No. 97-80; FCC 20-124; FRS 17231]


Expanding Consumers' Video Navigation Choices; Commercial 
Availability of Navigation Devices

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: In this document, the Federal Communications Commission 
(Commission) eliminates outdated CableCARD support and reporting 
requirements and terminates related dockets.

DATES: Effective December 4, 2020.

FOR FURTHER INFORMATION CONTACT: For additional information on this 
proceeding, contact Brendan Murray, [email protected], of the 
Media Bureau, (202) 418-1573.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Report 
and Order, FCC 20-124, adopted and released on September 4, 2020. The 
full text of this document is available for public inspection via ECFS 
(http://www.fcc.gov/cgb/ecfs/). To request these documents in 
accessible formats (computer diskettes, large print, audio recording, 
and Braille), send an email to [email protected] or call the Commission's 
Consumer and Governmental Affairs Bureau at (202) 418-0530 (voice), 
(202) 418-0432 (TTY).

Synopsis

    In this Report and Order, we terminate a proceeding in which we 
sought comment on the adoption of new regulations for ``navigation 
devices''--devices that consumers use to access multichannel video 
programming and other services offered over multichannel video 
programming networks--and eliminate outdated CableCARD support and 
reporting requirements. Four years ago, the Commission published a 
notice of proposed rulemaking (NPRM) (81 FR 14033, March 16, 2016) that 
proposed a complex framework of regulations which would have required 
multichannel video programming distributors (MVPDs) to provide 
unbundled flows of programming information to third-party 
manufacturers, retailers, and software developers to enable them to 
create navigation devices in an attempt to assure a commercial market 
for navigation devices.\1\ However, the record submitted in response to 
the NPRM raises serious and significant questions about whether the 
proposed rules would adequately protect multichannel video programming 
content. Moreover, the record fails to convince us that the proposal is 
necessary to accomplish its intended goal, and we conclude that the 
proposed regulations do not reflect the past four years of substantial 
marketplace changes in the delivery and consumption of video 
programming. Separately, we eliminate the CableCARD consumer support 
rules and the requirement that large cable operators report to the 
Commission about support and deployment of CableCARD modules because 
these regulations no longer serve a useful purpose and thus are no 
longer necessary.
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    \1\ Expanding Consumers' Video Navigation Choices; Commercial 
Availability of Navigation Devices, MB Docket No. 16-42 and CS 
Docket No. 97-80, Notice of Proposed Rulemaking & Memorandum Opinion 
and Order, 31 FCC Rcd 1544, 1558-82, paras. 25-78 (2016).
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    Section 629 of the Communications Act of 1934, as amended (Act), 
directs the Commission to adopt regulations to assure the commercial 
availability of devices that consumers use to access multichannel video 
programming and other services offered over multichannel video 
programming networks. Section 629 further directs that the Commission 
shall not prescribe such regulations ``which would jeopardize the 
security of multichannel video programming and other services offered 
over multichannel video programming systems, or impede the legal rights 
of a provider of such services to prevent theft of service.'' Through a 
series of rulemakings, the Commission has adopted regulations intended 
to assure this commercial availability of devices. The bellwether 
requirement of these rulemakings, which led to the ``CableCARD'' 
standard, allows viewers to receive digital cable services by attaching 
their own equipment directly to the cable network. In 2005, to better 
monitor support for the then-nascent CableCARD technology, the 
Commission required the six largest cable operators to submit status 
reports to the Commission every 90 days that detail how these cable 
operators met ``their obligations to deploy and support CableCARD.'' 
(70 FR 36048, June 22, 2005).\2\ In 2010, the Commission adopted 
regulations to further ensure cable operator support for retail 
CableCARD devices. (76 FR 40263, July 8, 2011).\3\ In 2016, the 
Commission's NPRM proposed a new and complicated regulatory regime for 
navigation devices.\4\
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    \2\ Implementation of Section 304 of the Telecommunications Act 
of 1996: Commercial Availability of Navigation Devices, CS Docket 
No. 97-80, Second Report and Order, 20 FCC Rcd 6794, 6814-15, para. 
39 (2005) (2005 Report and Order).
    \3\ Implementation of Section 304 of the Telecommunications Act 
of 1996: Commercial Availability of Navigation Devices, CS Docket 
No. 97-80 and PP Docket No. 00-67, Third Report and Order and Order 
on Reconsideration, 25 FCC Rcd 14657 (Third Plug and Play Report and 
Order), recon. granted in part sua sponte, Order on Reconsideration, 
26 FCC Rcd 791 (2011).
    \4\ NPRM, 31 FCC Rcd at 1558-82, paras. 25-78.
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    We conclude that further Commission intervention in the navigation 
device marketplace is not necessary at this time. We have serious and 
unresolved concerns about the security of multichannel video 
programming and copyright licensing under the proposed rules. Moreover, 
we conclude that the record raises other substantial doubts about the 
wisdom and necessity of the complex regulations proposed in the NPRM. 
On the other hand, we find that the CableCARD consumer support rules no 
longer serve a useful purpose following the D.C. Circuit's 2013 
decision in Echostar Satellite L.L.C. v. FCC, 704 F.3d 992 (D.C. Cir. 
2013) (Echostar), and accordingly eliminate these rules. We also 
conclude that the 15-year-old CableCARD reporting requirement is no 
longer necessary.
    Closing the 2016 Proceeding. In 2016, the Commission sought comment 
on the need for new rules to implement section 629. We conclude that we 
need not adopt any new rules at this time. Although the NPRM 
tentatively concluded that the Commission ``should adopt new 
regulations to further section 629,'' \5\ there is substantial evidence 
in the record challenging that tentative conclusion. The consequences 
of adopting the proposed regulations could be substantial and 
detrimental to consumers, copyright holders, and MVPDs, and thus we are 
reluctant to adopt these additional regulations to implement section 
629, quite apart from the substantial doubts in the record as to 
whether they will help assure a commercial market for devices that

[[Page 78238]]

consumers can use to access multichannel video programming. In 
addition, the Commission last sought comment on these issues more than 
four years ago, and since then important changes have occurred in the 
video programming marketplace and delivery of those services via 
applications that run on subscriber-owned devices. Moreover, we note 
that since the record closed, the Government Accountability Office 
(GAO) concluded that the NPRM did not sufficiently analyze ``the extent 
to which internet-based providers affect consumer choice for video 
programming and what that change means for the importance of consumer 
choice for devices in the context of the Act.'' \6\
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    \5\ NPRM, 31 FCC Rcd at 1551, para. 13.
    \6\ U.S. Gov't Accountability Office, GAO-17-785, FCC Should 
Conduct Additional Analysis to Evaluate Need for Set-Top Box 
Regulation, at 22 (2017) (GAO Report).
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    Section 629(b) of the Act prohibits the Commission from adopting 
regulations under section 629 that would jeopardize the security of 
multichannel video programming. Several programmers, MVPDs, and the 
U.S. Copyright Office express serious concerns that the proposed rules 
and the applications-based alternative would jeopardize the security of 
programming and licensing contracts between programmers and MVPDs. 
Although we recognize that some commenters claim that the proposed 
rules would not interfere with programmers' copyright interests, we 
have ongoing concerns about the security risks and licensing issues the 
proposed rules could introduce. For instance, many commenters argue 
that the proposed rules would undermine anti-piracy protections, 
reducing the incentives of parties to invest in new content. In 
addition, the Commission's proposal could force MVPDs, programmers, and 
copyright holders to violate the copyright licensing contract 
obligations to which they agreed, leading to costly and time-consuming 
litigation. Further, the record also raises licensing concerns with 
respect to the applications-based alternative, as commenters contend 
that this approach might lead to content to be distributed on terms to 
which programmers have not agreed and object to Commission involvement 
in the licensing process. Accordingly, in light of section 629(b) and 
the impact the proposed rules could have on the video programming 
marketplace generally, including the availability and quality of 
programming, we find that we should not adopt the proposed rules or the 
applications-based alternative.
    We also note that it appears the policy goals that the Commission 
set forth in the NPRM are well underway to being met without additional 
Government regulation. The Commission stated in the 2016 NPRM that it 
wanted to ``let MVPD subscribers watch what they pay for wherever they 
want, however they want, and whenever they want, and pay less money to 
do so, making it as easy to buy an innovative means of accessing 
multichannel video programming (such as an app, smart TV, or set-top 
box) as it is to buy a cell phone or TV.'' \7\ And according to NCTA--
The internet & Television Association (NCTA), the nine largest MVPDs 
``support apps that can be used to watch their content on hundreds of 
millions of consumer-owned devices, such as smart TVs; tablets; 
streaming sticks and devices such as Apple TV, Roku, Google Chromecast, 
and Amazon Fire; smartphones; game consoles; and personal computers.'' 
\8\ Therefore, without Commission intervention, many MVPD subscribers 
can watch the services that they pay for wherever, however, and 
whenever they want on an array of innovative devices via many different 
applications. Given the current state of the video programming 
marketplace, we are concerned that adopting the proposals set forth in 
the NPRM would risk stifling innovation and deterring investment in 
this sector and, thus, could ultimately detract from Congress's 
overarching goal for a fully competitive market for navigation devices.
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    \7\ NPRM, 31 FCC Rcd at 1551, para. 11.
    \8\ NCTA Comments, GN Docket No. 20-60, at 21-22.
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    The 2017 GAO Report recommended that we ``analyze how the ongoing 
evolution in the video programming market affects competition in the 
related market for set-top boxes and devices, including how it affects 
the extent to which consumer choice for devices to access MVPD content 
remains a relevant aspect of the competitive environment'' \9\ as part 
of our competition reports. We will continue to monitor the navigation 
marketplace to determine whether further regulation is necessary to 
assure a commercial market for navigation devices, consistent with the 
requirements of section 629.
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    \9\ GAO Report at 22-23.
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    CableCARD Support and Reporting Requirements. We are eliminating 
the CableCARD consumer support rules. We conclude that these rules no 
longer serve a useful purpose following the D.C. Circuit's 2013 
decision in Echostar. We acknowledge that the NPRM tentatively 
concluded that the CableCARD support rules continue to serve a useful 
purpose and should be retained. Nevertheless, after further 
consideration, we are unpersuaded by assertions that these rules remain 
necessary to ensure that consumers have retail alternatives to leased 
set-top boxes and that cable operators continue to support retail 
CableCARD devices during their expected lifetime. The CableCARD support 
rules were intended to help ``assure the development of a retail market 
for devices that can navigate cable services'' by ``improv[ing] 
consumers' experience with retail navigation devices . . . and 
CableCARDs.'' (76 FR 40263, July 8, 2011).\10\ However, during the ten 
years in which these rules have been in effect, consumer demand for 
retail CableCARD devices never developed as anticipated. Indeed, in the 
four years since the NPRM in this proceeding was issued, consumer 
demand for retail CableCARD devices has steadily declined. We agree 
with NCTA that this decline in demand is partially attributable to the 
growing popularity of MVPD applications. MVPD applications are 
ubiquitous today, and consumers have fully embraced the use of such 
applications to access video programming. We note that the CableCARD 
support rules were intended to help advance the market for retail 
navigation devices ``[u]ntil a successor technology is actually 
available.'' (76 FR 40265, July 8, 2011).\11\ MVPD applications are a 
new technology that is providing consumers an alternative to leased 
set-top boxes. Given that consumers have demonstrated a clear 
preference in recent years for applications over retail CableCARD 
devices, we expect that demand for retail CableCARD devices will only 
continue to fall. Accordingly, we conclude that retention of the 
CableCARD support rules is not necessary to ensure that consumers have 
retail alternatives to leased set-top boxes.
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    \10\ Third Plug and Play Order, 25 FCC Rcd at 14658, para. 1.
    \11\ Third Plug and Play Order, 25 FCC Rcd at 14662, para. 8.
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    We also find that retention of the CableCARD support rules is 
unnecessary to ensure that cable operators continue to support retail 
CableCARD devices during their expected lifetime. As NCTA points out, 
cable operators are still required to provide separable security, and 
industry complies with this obligation through the use of CableCARDs, 
even after Echostar eliminated the mandate that the CableCARD standard 
be used by all MVPDs in implementing the separation of security 
requirement. NCTA also

[[Page 78239]]

asserts that since there are tens of millions of CableCARDs currently 
deployed in cable operator-provided devices, ``[c]able operators have 
strong business incentives to ensure that CableCARDs continue to 
function properly.'' \12\ We agree and further find that competitive 
market forces should incentivize cable operators to continue to support 
retail CableCARD devices. Given the continuing decline in cable 
subscribership and the vast array of streaming service options 
available to consumers today, we expect that cable operators will make 
every effort to retain subscribers by continuing to support retail 
CableCARD devices, even in the absence of the CableCARD support rules. 
We further note that one of the major concerns leading to the adoption 
of the CableCARD support rules was the cable industry's poor 
performance with regard to subscriber premise installations of 
CableCARDs in retail devices. Cable subscribers have come to expect 
self-installation options and we think it is exceedingly unlikely that 
cable operators will revert to requiring professional installations for 
retail CableCARD devices, particularly in light of issues raised by the 
current coronavirus pandemic.
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    \12\ NCTA Comments at 173.
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    Finally, we conclude that it is appropriate to eliminate the 
requirement that the largest cable operators report about CableCARD 
support and deployment on a quarterly basis. Much of the information 
required to be included in the reports is either repetitious or has 
little relevance today, and the reports filed in recent years reveal 
few problems with CableCARD deployment and the processes for resolving 
CableCARD implementation problems are generally unchanged from report 
to report. Thus, we see little practical utility in continuing to 
require the cable operators to report this information. We accordingly 
conclude that the quarterly status reports are no longer necessary to 
ensure that cable operators support retail CableCARD devices and we 
eliminate them.
    Paperwork Reduction Act. This document does not contain any 
proposed, new, or modified information collection subject to the 
Paperwork Reduction Act of 1995 (PRA), Public Law 104-13. In addition, 
therefore, it does not contain any new or modified ``information 
collection burden for small business concerns with fewer than 25 
employees,'' pursuant to the Small Business Paperwork Relief Act of 
2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4).
    Final Regulatory Flexibility Act Analysis. The Report and Order 
interprets Section 629 of the Communications Act, 47 U.S.C. 549, and 
terminates the proceedings CS Docket No. 97-80 Commercial Availability 
of Navigation Devices and MB Docket No. 16-42 Expanding Consumers' 
Video Navigation Choices because of serious and significant questions 
about whether the proposed rules would protect programming outweigh the 
speculative benefits of proposed set-top box rules. The Report and 
Order also eliminates the CableCARD consumer support rules, concluding 
that these rules no longer serve a useful purpose following the D.C. 
Circuit's 2013 decision in Echostar. Finally, the Report and Order 
eliminates the requirement that the largest cable operators submit 
status reports to the Commission every 90 days that detail show the 
cable operators meet ``their obligations to deploy and support 
CableCARDs.'' (70 FR 36048, June 22, 2005).\13\
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    \13\ 2005 Report and Order, 20 FCC Rcd at 6814-15, para. 39.
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    Several commenters raised concerns that the proposed rules would be 
disproportionately and significantly burdensome on small MVPDs and 
asked the Commission to exempt small MVPDs from the final regulations. 
The Report and Order concludes, however, that the proposed rules should 
not be adopted and that the proceeding should be terminated. 
Accordingly, there is no need to address these comments.
    Pursuant to the Small Business Jobs Act of 2010, the Commission is 
required to respond to any comments filed by the Chief Counsel for 
Advocacy of the Small Business Administration, and to provide a 
detailed statement of any change made to the proposed rules as a result 
of those comments. The Chief Counsel filed comments expressing concern 
that ``that the FCC's proposed rules will be disproportionately and 
significantly burdensome for small [MVPDs]'' and urging the FCC to 
``exempt small MVPDs when it finalizes its new rules.'' \14\ The Report 
and Order concludes that the proposed rules should not be adopted and 
that the proceeding should be terminated. Accordingly, there is no need 
to respond to the comments of the Chief Counsel.
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    \14\ Letter from Darryl L. DePriest, Chief Counsel for Advocacy, 
U.S. Small Business Administration, Office of Advocacy, to Marlene 
H. Dortch, Secretary, FCC, MB Docket No. 16-42, at 1 (June 6. 2016).
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    The rule changes adopted herein will directly affect small cable 
television operators by eliminating the regulatory CableCARD support 
requirements.
    Ordering Clauses. For the reasons stated above, it is ordered that, 
pursuant to the authority found in sections 4(i), 4(j), 303(r), and 629 
of the Communications Act of 1934, as amended, 47 U.S.C. 154(i), 
154(j), 303(r), and 549 that this Report and Order is adopted. It is 
further ordered that the Commission's rules are amended as set forth 
below. It is further ordered should no petitions for reconsideration or 
petitions for judicial review be timely filed, CS Docket No. 97-80 and 
MB Docket No. 16-42 shall be terminated and the dockets closed. It is 
further ordered that the Commission shall send a copy of this Report 
and Order in a report to be sent to Congress and the Government 
Accountability Office pursuant to the Congressional Review Act, see 5 
U.S.C. 801(a)(1)(A).

List of Subjects in 47 CFR Part 76

    Administrative practice and procedure, Cable television, 
Communications, Equal employment opportunity, Internet, Political 
candidates, Reporting and recordkeeping requirements, 
Telecommunications.

Federal Communications Commission.
Marlene Dortch,
Secretary.

Final Rules

    For the reasons discussed in the preamble, the Federal 
Communications Commission amends 47 CFR part 76 as follows:

PART 76--MULTICHANNEL VIDEO AND CABLE TELEVISION SERVICE

0
1. The authority citation for part 76 continues to read as follows:
    Authority: 47 U.S.C. 151, 152, 153, 154, 301, 302, 302a, 303, 303a, 
307, 308, 309, 312, 315, 317, 325, 338, 339, 340, 341, 503, 521, 522, 
531, 532, 534, 535, 536, 537, 543, 544, 544a, 545, 548, 549, 552, 554, 
556, 558, 560, 561, 571, 572, 573.


0
2. Revise Sec.  76.1205 to read as follows:


Sec.  76.1205  Availability of interface information.

    Technical information concerning interface parameters that are 
needed to permit navigation devices to operate with multichannel video 
programming systems shall be provided by the system operator upon 
request in a timely manner.

[FR Doc. 2020-25143 Filed 12-3-20; 8:45 am]
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