STELA bill passes House; ends CableCard mandate

The House of Representatives has passed a version of STELA, the bill that reauthorizes DirecTV and Dish Network to continue to deliver out-of-market broadcast stations to viewers in rural areas that lack a local affiliate. This version notably also contains a rider that eliminates the integration ban for cable; in other words, CableCards will no longer be mandated.

Satellite Television Extension and Localism Act Reauthorization (STELAR), also includes provisions that ban broadcasters from banding together to negotiate retransmission consent deals with MVPDs. Smaller cable operators found themselves at a distinct negotiating disadvantage in such circumstances. They called the practice collusion, and the FCC and Congress apparently agreed.

The House adopted several provisions from the Senate version of this bill (called STAVRA). This version now goes to the Senate for final approval. Indications are that the Senate will automatically approve it and send it to the President to sign.

The integration ban was proposed by the consumer electronics industry as a means of stimulating a competitive retail set-top box market. The result was the CableCard, an inelegant engineering solution the cable industry chafed against. It was a miserable failure in the market, some claim because of a lack of promotion from a cable industry that didn’t want the thing in the first place.

The cable industry didn’t see promoting the CableCard as its responsibility. It was, after all, designed to benefit CE manufacturers, none of whom promoted it very vigorously either. TiVo, which initially stood to be the biggest beneficiary of CableCard, long ago moved on.

U.S. Representative Bob Latta, vice chairman of the House Communications and Technology Subcommittee, said in a statement, “I am especially pleased that this bill incorporated a bipartisan and pro-consumer provision to eliminate the current set-top box integration ban, similar to legislation I sponsored in the U.S. House with Congressman Gene Green. Repealing this outdated technological mandate will foster greater investment and innovation in the set-top box market.”

“STELAR’s passage in the U.S. Senate demonstrates how our two chambers can work together to pass meaningful policies. I urge the President to swiftly sign this bill into law, so these critical measures can take effect.”