Cable companies still oppose the Federal Communications Commission's attempt to open up the set-top box market but seem to have resigned themselves to accepting some form of regulation.

Industry representatives met with FCC commissioners and staff yesterday to say they are willing to comply with a requirement to deploy applications for third-party set-top boxes using open standards. The apps would have to include all linear and on-demand TV content, but apparently they would not have to allow recording.

This isn't quite what the FCC says it wants. The commission proposed rules that would force pay-TV providers to make video programming—and the right to record video—available to the makers of third-party devices and software. Under the FCC's model, makers of third-party software and equipment could create their own user interfaces through which cable TV subscribers could access their programming. The solution would be similar to CableCard, but it wouldn't require a physical card.

Throughout the debate, cable companies have favored an "apps" model in which pay-TV operators could choose whether to build applications that bring their programming to third-party devices. Cable companies still aren't giving up on the apps approach, but now they say they would agree to rules that make it mandatory for large operators to build apps providing access to all the video customers subscribe to on a wide range of devices. Pay-TV companies with at least 1 million subscribers would have to follow the mandate.

Industry representatives told the FCC that they are open to the commission "enforcing an industry-wide commitment to develop and deploy video 'apps' that all large MVPDs [multichannel video programming distributors] would build to open HTML5 Web standards," they said in an ex parte filing released today. The filing describes meetings with FCC officials involving the cable industry's top lobbyist, National Cable & Telecommunications Association (NCTA) CEO Michael Powell, representatives of Comcast and AT&T/DirecTV, and reps from cable networks Vme TV, Revolt TV, and TV One.

FCC Commissioners Jessica Rosenworcel, Mignon Clyburn, and Michael O'Rielly participated in the meetings along with FCC staff members.

Cable company representatives argued that "consumers would benefit from more choice" under this proposal. "Under the new approach, consumers who want to watch their Pay TV service on different devices in the home could download a new Pay TV app to the smart TV, tablet, or other 'connected' device and start viewing without a cable set-top box. Because of satellite’s one-way architecture, satellite subscribers would need one gateway device from their satellite company to bring the signal to the home and provide features competitive with two-way services, but satellite providers would also offer downloadable HTML5 apps for third-party connected devices," the filing states.

As we noted, the FCC's proposal would go further than this, requiring programming itself be available to third parties so that they could offer different user interfaces. The FCC also says third-party devices should be able to record video, a point the industry proposal doesn't address. But the FCC is taking comments and could change its proposal before voting on a final version later this year.

Advocacy group: Cable proposal falls short

Advocacy group Public Knowledge, which supports the FCC's plan, said it is "encouraged that cable understands that consumers want to use the device of their choice, not just devices from manufacturers that have cut separate deals with their pay-TV provider."

But the group said the industry proposal falls short in a few ways. "The proposal does not allow for many features that consumers want, such as home recording, and it does not allow for true user interface competition," Public Knowledge Senior Staff Attorney John Bergmayer said in a statement sent to Ars. "Additionally, core aspects of the proposal are unclear, in particular, the precise mechanism by which MVPDs propose to provide apps for various hardware and software platforms, and whether consumers would need a broadband connection to access video programming instead of leveraging their existing pay TV connections.”

When asked for a response, the NCTA did not dispute Public Knowledge's analysis, but the organization noted there's still time for more "dialogue with the FCC on the details and we hope Public Knowledge will be part of that discussion.” The NCTA spokesperson said the new proposal "presented by a group of programmers and distributors responds to the comments from [FCC] Chairman [Tom] Wheeler inviting solutions for how to meet the important goals of expanding competition for video devices and freeing consumers from having to rent set-top boxes."

The proposal discussed in the meeting comes from the Future of TV Coalition, a group consisting mostly of pay-TV operators, their lobby groups, some programmers, and minority groups that have aligned with the cable industry. The NCTA provided us with a proposal outline and FAQ.

The proposal suggests a two-year deadline for providers to comply, the same timeframe the FCC proposed for its own plan. The industry-proposed requirement would then "extend for 5 years, and may be renewed by the Commission if warranted," while the FCC's plan does not have an expiration date.

"TV providers will license their apps without charge to third-party devices for their app stores—provided the device makers or app stores do not impose their own fees or surcharges," the industry proposal says. An NCTA spokesperson told Ars that customers won't have to pay extra to access the apps.

The apps would allow third-party devices to offer "integrated search" in which customers could "seamlessly search for and discover content from both pay-TV providers and online video services offering licensed content on the same device." But if a user selects pay-TV content, they would be taken to the pay-TV provider's application to watch it.

An FCC spokesperson released the following statement: “Chairman Wheeler is heartened that the industry has adopted the primary goal of our proposal, to promote greater competition and choice for consumers, and agree it is achievable. We all agree that third-party access to pay-TV content, integrated search and the protection of copyright, content security, consumer privacy and minority programmers are critical. There is a lot more work to do. We look forward to seeing additional details so we can determine whether their proposal fully meets all of the goals of our proceeding and the statute. We will continue to work with all stakeholders to develop rules that allow innovation to flourish and ensure consumers have real options for accessing the pay-tv programming they purchase."