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McCain: HDTV Policy Is in Disarray

5/17/1998 8:00 PM Eastern

Washington -- Senate Commerce Committee chairman John
McCain (R-Ariz.) said last week that high-definition-television policy was in "severe
disarray," fueled in part by comments made two weeks ago at the National Show in
Atlanta by Tele-Communications Inc. chairman and CEO John Malone.

"What we thought was an agreement among everybody as
to what level of picture people are going to get is now in severe disarray. It needs to be
brought back into focus," McCain said.

Malone said the 1080-interlace display format chosen by CBS
and NBC was a "spectrum hog," and TCI would refuse to carry pro-1080i
broadcasters unless it was forced to by the federal government.

Malone said he supports either the 480-progressive format
chosen by Fox or the 780p format chosen by ABC.

"You can't have three different levels of
transmission and expect everybody to understand it, or anybody to even manufacture it. So
we've got a big problem, and I think it's got to be worked out," McCain
said.

McCain pledged to hold a hearing on the issue at some
point.

McCain's reaction was mild compared to that of Rep.
Billy Tauzin (R-La.), who said Malone's comments might force him to introduce a bill
requiring cable carriage of 1080i signals.

Tauzin pounced on Malone's comments because his
derogatory statements about 1080i were widely perceived as reneging on a 1080i-carriage
promise made to Tauzin's Telecommunications Subcommittee last month by TCI president
and chief operating officer Leo J. Hindery Jr.

Stephen Effros, president of the Cable Telecommunications
Association (CATA), said there was no daylight between the statements made by the TCI
chieftains.

"TCI did not change any position between what Leo
Hindery said in Congress and what John Malone said [in Atlanta]," Effros said.

He said cable's pledge is to deploy set-top equipment
that can pass through a 1080i signal and process the signal at some point.

"What John Malone said is, 'But that doesn't
mean that I am going to carry [1080i],'" Effros said. "There is a
difference between compatibility and carriage, and people are missing that totally."

An NBC source, however, said TCI has promised in private
talks to carry 1080i signals.

"We've had negotiations with TCI on an ongoing
basis, and we were left with the belief and the understanding that they would at least
carry and pass through a 1080i signal," an NBC source said.

At least two-dozen TV stations are planning to begin
digital broadcasts in November. Malone said he hoped to reach carriage deals with Fox, ABC
and possibly NBC. But he was less optimistic about a deal with CBS.

The Federal Communications Commission has ordered TV
stations that are owned by or affiliated with the four major networks to begin digital
transmission in May 1999.

FCC chairman William Kennard said two weeks ago that he was
willing to give cable operators and broadcasters some time to negotiate a solution to
cable carriage of digital TV signals.

But he warned that the commission would have to step in if
the parties can't reach a deal that coincides with the launch of digital TV.

McCain said he was taken aback by Malone's comments
because he thought that all parities had agreed to carry the various display formats when
the FCC was debating the issue.

"I'm disappointed because I thought that when we
adopted the so-called universal standards, everything was taken care of," McCain
said.

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