Broadcast Flag Through The Back Door — Yet Another Episode of “Outsourcing Big Brother.”

The Motion Picture Association of America has asked the FCC to give it a waiver of something called the “selectable output control” rules for cable boxes. As usual, this apparently minor request for a waiver of an obscure FCC regulation of unknown origin, governing a highly-technical and mind numbingly boring set of rules about cable set-top boxes, hides a bold power grab designed to rip off every owner of a Tivo, VCR, or other perfectly legal recording device available to consumers to engage in the legal practice of recording television programs to watch them later (“time shifting”).

For details on this latest effort to circumvent limits on government by outsourcing the process to an industry cartel, aka “outsourcing Big Brother,” see below . . . .

Briefly, this represents a way to recreate the broadcast flag by leveraging the highly consolidated cable market, and using the MPAA’s and cable operators’ “must have” programming to force any less willing cable and cable rivals (what we call “multichannel video programming distributors” or MVPDs — folks like satellite TV or FIOS) to go along.

As folks may recall, back in 2004, the FCC required that every consumer device capable of recording television programs must also accept digital codes “broadcast flag” that would allow anyone with a copyright interest in the programming to dictate to the machine whether it could or could not record the program, and if so under what rules (e.g., how long until the show expired and deleted itself, how many viewings to permit (before charging for more), whether to record only in low-resolution (and charge an additional fee for “high quality” recordings), and so forth). Happily, the D.C. Circuit struck down the FCC’s broadcast flag mandate in American Library Association v. FCC as beyond the FCC’s legal authority. Since then, the IP Mafia has made strenuous attempts to get new legislation authorizing a broadcast flag through Congress, each time meeting defeat at the hands of such crusaders for consumer rights and fundamental freedoms as the folks at Public Knowledge.

Unable to get a government mandate to force everyone to obey them, the MPAA has now apparently shifted tactics. Right now, FCC rules prevent cable operators from blocking any digital or analog outputs from a cable system to a connected consumer device — such as a rival set-top box or a rival digital video recorder (DVR). The MPAA wants the FCC to waive these rules. Then the MPAA and the cable industry could sit down together to negotiate a privatized version of the broadcast flag, which would no doubt be far more restrictive than anything the FCC would ever dare try to get away with in a public proceeding subject to the public interest standard and the threat of judicial review. Charge for every time you want to record something? Sure! Require that any DVR delete entries after one viewing or after seven days? Why not? Allow cable operators to insert new advertisements and limit the ability of people to fast forward through them? Hey, if you can swing the technology, be our guest. After all, no one responsible for protecting the rights of the public will be in the room. It’s all just business and private negotiations.

Despite the best efforts of cable lobbyists, Republican members of Congress, and the usual worshipers of the Gods of the Market Place to claim this market is “wildly competitive” and therefore alway acts in the best interests of consumers — a handful of cable and MVPD providers controls 90% of the relevant market. Since the largest of these (Comcast, Time Warner, DIRECTV) also have huge program content holdings, negotiations between the MPAA cartel and the key members of the cable/MVPD oligopoly should not present a problem. After that, forcing such a deal down the throats of any MVPDs or cable operators inclined to resist (such as Verizon or DISH) will be a simple matter of requiring them to “voluntarily” agree to the new broadcast flag standard or forgo all the “must have” programming held by the MPAA members (such as Disney), Time Warner, Comcast, Liberty Media (owner of DIRECTV) and the other parties to the agreement. Nor will electronics manufacturers refuse to integrate the new standards into devices — at least not if they want to sell any products. While they won’t like yet-another-tech-mandate, they need to stay in business. And hey, this is all just business and private negotiations, right? It’s not like it is their job to protect people’s rights.

And when we folks in the general public try to get the government — whose job it is to protect our rights — to do something, they will simply shrug and say “hey, free market at work — whaddaya expect us to do about it?”

Aaahhhhh…..those whacky industry lobbyist, they’re worth every penny — to the industry. Sucks to be us, tho. Like domestic spying and promoting the war with Iraq, the Bush Administration can get around restriction on government by creating a “market” where a handful of “responsible corporate citizens” do the work in exchange for such favors as the government can grant — like quicky merger approvals or pushing retroactive immunity when you get caught breaking the law to help out your buddies in power. Or, as I described in a speech to the ACLU a few years ago, this MPAA Petition for Waiver is yet another example of outsourcing Big Brother.

Which brings up an important reason of why I’m not a big believer in Libertarianism/limited government (or, as I occasionally like to call them, the worshipers of the Gods of the Marketplace), despite my fears about regulatory capture and the dangers of big government. As evidenced by this piece by Adam Theirer, a fair number of Libertarians who would oppose a government mandate have no problem when two cartels negotiate to achieve the same result. After all, that’s the marketplace at work, right? A philosophy that fears only government power as a threat to freedom does not see outsourcing Big Brother as an end-run but as a desirable policy choice — or at least not a reachable concern. By contrast, I consider myself a Progressive because I fear both government power and private power, and seek to find a balance between the two that maximizes individual freedom and the ability of everyone to have a genuine opportunity to participate in our society.

I wish I could take credit for spotting this effort by the MPAA to sneak a private broadcast flag through the FCC under cover of an innocuous waiver request, but I am totally indebted to the good folks at a good and thorough job explaining this that rather than provide my own in-depth wonky analysis of the waiver request and the rules, I will simply link to his posts here and here.

Stay tuned . . . .

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2 Comments

  1. AlexC says:

    Hey Harold,

    To be clear, broadcast flag is essentially a roach motel kind of technology–once the content goes in, it can’t come out, unless connected devices are all BF compliant, and compatible. The flag itself didn’t tell compliant devices anything other than “protect,” although it’s possible that the compliant devices could have taken it upon themselves to limit functionality.

    Selectable output control could have the effect of allowing the studios to dictate what a device could do with the content it received–more than a roach motel. Studios could come up with an “MPAA-connector” that device manufacturers would have to license to receive certain content, and the MPAA could dictate the specifications and capabilities of such a device.

    That’s the concern, because too often when electronics manufacturers have a “unique opportunity” to receive content, they cave and cripple their once consumer-friendly devices.

  2. Gary McGath says:

    As one of those “worshippers of the gods of the marketplace,” I suppose I should say something. Your major assumption is one which you slip by quickly and is very unconvincing: that makers of consumer electronics such as DVRs will voluntarily cripple their devices. That just doesn’t make any sense.

    Lately the words “Big Brother” have been applied to just about anything someone doesn’t like. Maybe this is because _1984_ doesn’t appear very much in the bookstores any more. The trivialization of the term trivializes the kind of totalitarian surveillance state which Orwell was writing about, and which continues to be a possibility.

    Government power and private power are different and asymmetric things. Private power is the power not to deal with you. Government power is the power to take everything you have, put you in a prison, or kill you.

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