[Editor’s Note: Federal Communications Commission chairman Thomas Wheeler today released a compromise proposal hoping to get the cost of set-top box equipment down for millions of Americans forced to lease equipment to watch cable television.

Wheeler originally proposed requiring an open standard for set-top box equipment that would open the market to competition by allowing manufacturers to directly sell equipment to consumers and compete for their business. Cable operators, programmers, and various special interest groups that depend on financial contributions from those operators immediately launched an unprecedented pushback claiming set-top box reform was racist, anti-minority, promoted copyright theft, and was illegal and unconstitutional. Small cable operators claimed they might be driven out of business, and programmers claimed companies like Google might fundamentally change the channel lineup on new equipment that would leave them in a disadvantaged position.

In fact, the hundreds of millions of dollars in annual revenue earned by cable operators charging the same price for equipment fresh out of the box or handed down in beat up condition to the fifth customer in eight years was more likely the driving factor.

Mr. Wheeler capitulated and released a more modest proposal promising cable operators would be forced to offer free “apps” for devices like Roku and Apple TV. But cable operators will likely own and manage those apps and have direct control of authentication methods and anti-piracy measures that are likely to be proprietary. Still, apps like TWC TV which covers Time Warner Cable’s lineup on devices like Roku have allowed consumers to ditch expensive set-top equipment and irritating Digital Adapters that don’t function well and have almost tripled in price since their introduction. Making sure these apps provide comparable functionality with set-top boxes and are released to a variety of devices will be key to whether Wheeler’s proposal, delivered in full below courtesy of the Los Angeles Times, has a measurable impact on cable bills.]

FCC chairman: Here are the new proposed rules for set-top boxes

There’s never been a better time to watch television in America. We have more options than ever, and, with so much competition for eyeballs, studios and artists keep raising the bar for quality content. But when it comes to the set-top-box that delivers our pay-TV subscriptions, we have essentially no options, creating headaches and costing us serious money in rental fees. That makes no sense, which is why I’m sharing a proposal with my fellow commissioners at the Federal Communications Commission to change the system.

Wheeler’s compromise

Ninety-nine percent of pay-TV subscribers currently lease set-top boxes from their cable, satellite or telecommunications provider, paying an average of $231 a year for the privilege, according to a recent analysis. The collective tab is $20 billion annually in rental fees. In a recent study, 84% of consumers felt their cable bill was too high. What they may not realize is that every bill includes an add-on fee for their set-top boxes. We keep paying these charges even after the cost of the box has been recovered because we have no meaningful alternative.

Pay-TV providers will be required to provide apps — free of charge — that consumers can download to the device of their choosing.
Earlier this year, the FCC launched a process to unlock the set-top-box marketplace. We were motivated by the desire to give consumers relief, but we were also mandated to take action by Congress and the law, which says that consumers should be able to choose their preferred device to access pay-TV programming.
Over the past seven months, the Commission conducted an open proceeding where we heard from pay-TV providers, programmers, device and software manufacturers, consumers groups, and, most important, the American people. We listened.

Now, I am proposing rules that would end the set-top-box stranglehold. If adopted, consumers will no longer have to rent a set-top box, month after month. Instead, pay-TV providers will be required to provide apps – free of charge– that consumers can download to the device of their choosing to access all the programming and features they already paid for.

If you want to watch Comcast’s content through your Apple TV or Roku, you can. If you want to watch DirectTV’s offerings through your Xbox, you can. If you want to pipe Verizon’s service directly to your smart TV, you can. And if you want to watch your current pay-TV package on your current set-top box, you can do that, too. The choice is yours. No longer will you be forced to rent set-top boxes from your pay-TV provider.

One of the biggest benefits consumers will see is integrated search. The rules would require all pay-TV providers to enable the ability for consumers to search for pay-TV content alongside other sources of content. Just type in the name of a movie, and a list will come up with all the places it is scheduled for broadcast and where it can be streamed (like Amazon Prime or Hulu).

Integrated search also means expanded access to programming created by independent and diverse voices on the same platform as your pay-TV providers. Consumers will more easily find content even if it’s not on the pay-TV service to which they subscribe.

These rules will open the door for innovation, spurring new apps and devices, giving consumers even more choice and user control.

While our primary focus during this proceeding was to promote consumer choice and fulfill our congressional mandate, we recognize that protecting the legitimate copyright interests of content creators is also key to serving the public interest. To ensure that all copyright and licensing agreements will remain intact, the delivery of pay-TV programming will continue to be overseen by pay-TV providers from end-to-end. The proposed rules also maintain important protections regarding emergency alerting, accessibility and privacy.

Large pay-TV providers, which serve more than 90% of subscribers, will have two years to fully implement the new requirements.  Medium-sized providers will have an additional two years to comply, and the smallest providers would be exempt.

This is a golden era for watching television and video. By empowering consumers to access their content on their terms, it’s about to get cheaper — and even better.

On Monday, Stop the Cap! joined 21 other public interest organizations in sending a joint letter urging the Federal Communications Commission to deny Charter’s bid to take over Time Warner Cable and Bright House Networks. Late last week, the Wall Street Journal reported that FCC Chairman Tom Wheeler may be planning to circulate a draft order approving the $90 billion merger.

The Center for Media Justice, CREDO Action, Daily Kos, Demand Progress, Free Press and Presente.org were among the media justice, Internet rights and public interest groups calling on the FCC to reject this deal, which would create a national broadband duopoly.

Together, Charter and Comcast would control nearly two-thirds of the nation’s high-speed broadband subscribers and would offer service to nearly 80 percent of U.S. households. The letter notes that this substantial increase in market power, coupled with Charter’s $66 billion in debt, would give the company both the incentive and the heightened ability to raise prices at will. This would broaden the digital divide, hitting low-income communities the hardest.

Stop the Cap! earlier filed objections to the merger with the FCC and in two states seen as critical to the deal – New York and California. In our view, no cable merger has ever resulted in better service or lower prices for consumers. Such deals deliver handsome sums to executives and shareholders while saddling customers with relentless rate hikes and no improvement in service. Charter’s history is troubling and its ability to meet its financial obligations while saddled in debt is dubious. Charter declared bankruptcy in 2009, after accumulating $21.7 billion in debt accumulated from years of mergers and consolidation efforts. As credit markets tightened up, Charter’s ability to manage its debt fell apart. Now the company is back to its old modus operandi, piling up debt buying Time Warner Cable — a much larger operation, and trying to combine it with Bright House Networks, another cable operator prominent in Florida.

Earlier this year, several of the signers delivered petitions to the FCC from more than 300,000 Americans opposing the merger, and thousands have called the agency in recent days to weigh in against the deal. Political leaders including Senate Democratic Leader Harry Reid have spoken out about the merger’s many harms.

“Too many Washington insiders have given up on challenging this deal despite its serious harms,” said Free Press policy director Matt Wood. “Instead of forecasting its chances for approval, the groups signing this letter will keep fighting to block this merger, along with the guaranteed price increases it would foist on people and communities who can least afford it.

“If Charter gets this merger approved, nothing will stop it from raising its rates for high-speed broadband and video customers who have nowhere else to turn. Temporary promises and weak conditions aren’t going to preserve competition and choice in the long run, and they’re not going to do anything to stop these price hikes. The FCC is charged with promoting the public interest, and there’s no way in which this merger benefits the public. Higher prices and fewer choices won’t help anyone but the companies pitching this bad bargain.”

“If its takeover of Time Warner Cable goes through, Charter will have a broadband footprint as big as Comcast’s,” said Demand Progress executive director David Segal. “This would turn an industry that’s already too concentrated into a duopoly, paving the way for higher rates today and the eventual formation of a new cross-sector behemoth that controls content production and delivery.

“Americans increasingly understand that corporate concentration is jacking up prices and lowering quality for all sorts of basic goods and services. At a hearing of a Senate antitrust subcommittee this month, lawmakers made it clear that they see companies that are allegedly too big to fix in many industries, not just the banking sector. This FCC must now decide whether it wants to stem the swelling tide of concentration, or enable these monopolies.”

Free Press and Stop the Cap! contributed elements of this story.

Less than a week after ISIS-connected terrorists is Paris allegedly killed at least 129 people in a coordinated attack, false reports continue to be spread through news services and social media. It’s enough to make you cringe.

On Sunday, media outlets began turning their attention to a “contributor” piece appearing on Forbes‘ website that suggested terrorists may have used a popular game console connected to the Internet to discuss and plan the attack:

The hunt for those responsible (eight terrorists were killed Saturday night, but accomplices may still be at large) led to a number of raids in nearby Brussels. Evidence reportedly turned up included at least one PlayStation 4 console.

Belgian federal home affairs minister Jan Jambon said outright that the PS4 is used by ISIS agents to communicate, and was selected due to the fact that it’s notoriously hard to monitor. “PlayStation 4 is even more difficult to keep track of than WhatsApp,” he said.

After nearly 500,000 views of the Forbes article, the author admitted to a gaming publication that he got his story wrong. It has since been edited to remove several serious factual errors. How could Forbes have gotten the story so wrong?

Phillip Dampier

Forbes does not strictly edit the content of its large base of online contributors, which increasingly resembles the publishing model of the Huffington Post. As a result, Forbes‘ disavows (in small print) any editorial connection to their writers, claiming their opinions do not represent the venerable business publication. But few in the media seemed to pick up that disclaimer suggested some skepticism might be appropriate. Instead, the story spread unquestioned like wildfire.

By Monday, Kotaku attempted to set the record straight, verifying Jambon’s comments were actually delivered on Nov. 10, three days before the Paris attack and only from the context of Belgium’s generally perceived security weaknesses. Claims that a PlayStation 4 was allegedly seized from an attacker’s apartment have now been declared “an editing error,” and the author has backed even further away from his inference it was used to help coordinate the attack. That is a charitable way of saying the central thesis of the Forbes‘ story about the events in Paris was entirely wrong.

“This was actually a mistake that I’ve had to edit and correct,” Forbes‘ writer Paul Tassi told Kotaku on Monday. “I misread the minister’s statement, because even though he was specifically saying that PS4 was being used by ISIS to communicate, there is no public list of evidence list of what was found in the specific recent raids. I’ve edited the post to reflect that, and it was more meant to be about discussing why or how groups like ISIS can use consoles. It’s my fault, as I misinterpreted his statement.”

The idea that ordinary Internet-connected game consoles can be used to quietly coordinate major terror attacks proved irresistible catnip for cable news. CNN and MSNBC both discussed the implications of terrorists enabled with game consoles, while Fox News further amplified the claim to suggest government agencies might not be monitoring these communications, opening a national security risk. Fox News even coined the Paris attack a “Joystick Jihad,” removing one sentence from its initial report to correct claims of a seizure of the game console, but left the rest of its story intact:

“There is no doubt that terrorists and other underground networks are using PlayStation and other non-traditional means to communicate with each other,” said Paul Martini, CEO of cyber security specialist iboss Cybersecurity, in a statement emailed to FoxNews.com. The CEO noted that the languages and protocols that PlayStation uses to communicate over the Internet are much different from those used in web browsers and other apps. “They are typically encrypted communication channels that are built on custom-designed languages built for speed and security – since PlayStation involves multi-player Internet connected users, it’s very distributed, high speed and difficult to track and monitor,” Martini added.

Videogame network or terrorist digital meeting spot?

Friday evening’s attacks are being used by a variety of interest groups to push various agendas, ranging from promoting military intervention in Syria to stopping Syrian refugees from entering the United States. But privacy groups also fear Forbes‘ story will be used to argue for extended government surveillance beyond telephone calls, text messaging, and Internet traffic, into third-party private encrypted networks like Sony’s PlayStation Network. In 2013, whistleblower Edward Snowden claimed the NSA and CIA were already there.

British newspaper The Telegraph suggested Sony’s private network has hardly proven itself an impenetrable digital Fort Knox:

Sony doesn’t exactly have a great reputation for security. A hack of PSN in 2011 saw 77 million users affected by personal data theft, and a hack emerged in December last year that saw many personal details of celebrities and other public figures leaked.

Media critics complain there is a danger that the demand for immediate news results in reporting information before it can be sufficiently sourced and verified. Elements of stories later proven wrong can remain a part of a story’s narrative, even when quickly discredited or changed as a result of newly obtained information. Examples of this are especially common on social media. Less serious examples include sharing photographs on Twitter and Facebook purporting to be from Paris that were actually taken months earlier. In other cases, depictions of solidarity with Paris from around the world were often misconstrued from other unrelated events. More serious are the false narratives that can damage a brand’s reputation, prod policy changes, or even fuel new laws, such as efforts to further extend surveillance.

While the corrections are helpful and appropriate, the rush to print first and verify later is becoming more common than ever. The Forbes’ author claimed he made a “reporting mistake” because he rushed to judgment connecting Jambon’s earlier statements to the Paris attacks. But that does not explain or justify his more important claim that a PlayStation 4 console was found as a result of the raid and his suggestion it was used to plan and coordinate a terrorist attack.

So our advice to Forbes‘ authors is simple. A story about a game console being used by terrorists was never just going to be treated as an interesting story angle. It would be used by the media, pundits, and officials to debate and discuss whether national security is at risk unless surveillance improves. Some will go as far to suggest controls on game consoles or new government authority to monitor the games and those playing them. Before we have that debate, let’s at least get the story right. We’ve seen the results of public policy changes based on flawed intelligence and erroneous media reports too often. Let’s not do that again.

Correction: Original story referenced “Kontaku,” which has been corrected to reflect the site’s actual name – Kotaku. Thanks to Mark E. for spotting the error.

David “I’m crushing your head” Cohen

Your boss authorized $32 million on lobbying for a $45 billion dollar merger deal that just went down in flames on your watch and you were the guy the company depended on to push it through. What do you do?

If you are Comcast vice president David Cohen, you pray for a press release signed by the CEO reaffirming trust in you.

Cohen can breathe a little easier because Brian Roberts, CEO of Comcast, did exactly that.

“There is nobody better than David Cohen,” Roberts wrote. “He’s incredible at what he does and we are beyond lucky that he helps passionately lead so many areas at Comcast. He is also a huge supporter of Philadelphia and has done so much for the community. I’m extremely proud to have him on our team.”

It could have been much worse for Cohen, whose contract (and $15 million annual salary) is up at the end of this year. He’s the fourth biggest earner at Comcast, but his stunning arrogance before Congress and the public may have helped nail the coffin shut on a merger worth tens of billions.

Some media outlets have called Cohen myopic, unable to see the building torrent of opposition from consumers, public interest groups, and even regulators.

The NY Post:

“They just lost a big battle. Does the company need a new general to supervise the Washington political strategy?” asked one source.

Comcast is already on the hunt for a new chief financial officer, with Michael Angelakis walking away to begin his own Comcast-backed private-equity fund before the deal imploded.

Comcast’s claims of “deal benefits” for consumers was perceived to be tissue-thin by legislators like Rep. Tony Cárdenas (D-Calif.), whose district would have seen Time Warner and Charter customers absorbed into the Comcast Dominion.

“[Cohen] was smothering us with attention but he was not answering our questions,” Cárdenas told The New York Times, adding in the early stages of the deal he was open to supporting it if his questions were addressed satisfactorily. “And I could not help but think that this is a $140 billion company with 130 lobbyists — and they are using all of that to the best of their ability to get us to go along.”

Comcast’s swaggering arrogance, condescending editorials, and dismissive attitude towards consumers questioning the deal rubbed a lot of lawmakers the wrong way.

Not only did Comcast offend lawmakers, but their all-important staffers as well. Staffers told the newspaper they felt Comcast was so convinced in the early stages that the deal would be approved that it was dismissing concerns about the transaction, or simply taking the conversation in a different direction when asked about them.

Elected officials associating themselves with Comcast, whose customer service on a good day is considered miserable, was also considered political poison. Few lawmakers were willing to publicly support foisting Comcast on their constituents. Local lawmakers in Time Warner Cable service areas who had no direct experience with Comcast customer service’s special touch of hell often did offer support, especially when a handsome check was sent weeks earlier. But voters with relatives or friends who loathed Comcast (practically everyone in America) were never fooled.

“They talked a lot about the benefits, and how much they were going to invest in Time Warner Cable and improve the service it provided,” said one senior Senate staff aide, who spoke on the condition of anonymity because he was not authorized to speak publicly. “But every time you talked about industry consolidation and the incentive they would have to leverage their market power to hurt competition, they gave us unsatisfactory answers.”

Politicians asked to publicly support the deal characterized their sentiment as “leery” in polite company.

Rep. Maxine Waters (D-Calif.) was unwilling to victimize her constituents by replacing two bad cable companies – Time Warner Cable and Charter with one horrible alternative – Comcast.

“No amount of public-interest commitments to diversity would remedy the consumer harm a merged Comcast-Time Warner would have caused to millions of Americans across the country,” Ms. Waters said.

Other lawmakers who already understood Comcast as the Hurricane Katrina of cable companies got into storm shelters early.

“There are limits as to how effective even the best advocate can be with a losing case,” said Senator Richard Blumenthal, Democrat of Connecticut, who was critical of the deal from the start, “as this merger would have further enhanced this company’s incentive, its means and its history of abuse of market power.”

Comcast even cynically attempted to color and race match lobbyists with legislators, believing the shared ethnic heritage would be an added incentive.

The New York Times:

Comcast, for example, assigned Juan Otero, a former Department of Homeland Security official who serves on the board of the Congressional Hispanic Caucus Institute and now works as a Comcast lobbyist, to be the point person to work with Mr. Cárdenas.

Meanwhile, Jennifer Stewart, an African-American lobbyist on the Congressional Black Caucus Institute board, was assigned to work with Marc Veasey, Democrat of Texas, who is also black. She personally appealed to Mr. Veasey’s staff, urging that he not sign a letter last August questioning the deal, according to an email obtained by The New York Times, citing the company’s work on behalf of the minority community. (Mr. Veasey still signed a related letter.)

Comcast also asked Jordan Goldstein, a former official at the Federal Communications Commission who is now a Comcast regulatory affairs executive, to work with Mr. Blumenthal’s office. Mr. Goldstein had previously developed a working relationship with Joel Kelsey, a legislative assistant in charge of reviewing the matter for the senator, who is a member of the Senate Commerce Committee.

In a major victory for consumers and public interest groups, the Federal Communications Commission this week will unveil fundamental changes in the oversight of high-speed Internet service, regulating it in the public interest as a public utility.

According to a report in the Wall Street Journal, FCC chairman Thomas Wheeler plans to include robust Net Neutrality protection in the proposal, insisting the agency has a right to oversee providers’ traffic management practices when they impact customers.

Central to the proposal is redefining broadband away from the current, barely regulated “information service” category that has allowed telecom companies to successfully challenge the FCC in court on almost every attempt to oversee broadband Internet service. Wheeler’s plan is expected to reclassify broadband as a “telecommunications service,” which will subject providers to more regulator scrutiny.

The FCC is expected to specifically prohibit providers from blocking, slowing down, or speeding up individual websites in return for financial compensation. The ban on “Internet fast lanes” and “toll booths” will protect Internet startups that would otherwise face an immediate disadvantage from well-heeled competitors that can afford to pay for enhanced access to customers.

But despite claims from Net Neutrality opponents, Wheeler is not expected to impose a one-size-fits-all regulatory regime over broadband. Instead, he prefers to reserve regulatory powers to police individual disputes such as those between Netflix, Comcast, Verizon and other providers which caused traffic slowdowns for consumers in 2014 until paid peering agreements were finalized, compensating ISPs for handling Netflix streaming video content.

Providers fear that reclassifying broadband under Title II rules could subject them to future oversight of practices like usage-based billing, usage caps, speed throttling, broadband pricing and availability. But the Obama Administration is on record opposing price regulation of broadband, and few expect the FCC will adopt a micromanagement approach to broadband oversight.

Wheeler’s proposal is likely to win a majority vote from the three Democratic commissioners. Opposition is a virtual certainty from the Republican minority.

The telecom industry promises whatever rules are adopted will face an immediate challenge in court.