Analog Slashed in Chicago

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The Windy City will be the test case for Comcast in flipping analog subscribers en masse over to digital cable.

On July 1, the nation's biggest multiple-system operator plans to eliminate the analog transmission of 38 channels on its expanded-basic tier throughout its Chicago systems.

The change will free up a broad chunk of bandwidth for new services — easily enough for, say, more than 100 new high-definition channels — but it also will require an unknown number of subscribers to have upgraded to digital set-tops by then.

ANALOG COUNT: 34

Rich Ruggiero, Comcast's vice president of communications and public affairs for the Chicago region, declined to say how many of the city's subscribers would be required to get new boxes but said it's a “distinct minority.”

In two of the cable operator's five areas in Chicago, he added, the standard cable offering has been all-digital for the last two years.

Moreover, Comcast isn't completely shutting off analog: It will still offer basic analog service (“B1” in industry parlance) with 34 channels. That tier will include local broadcast and public, education and government (PEG) channels, as well as The Weather Channel, C-SPAN, TV Guide Channel, QVC and a few others.

By keeping a limited set of channels on analog, Comcast won't necessarily force subscribers to get a digital set-top for every TV set in their house. To get an 80-plus-channel lineup, though, existing subscribers to analog expanded-basic cable will need to install a Motorola DCT-700 set-top.

The move, of course, heightens the risk of customer defections. Comcast is hoping to appease disgruntled subscribers by emphasizing benefits of all-digital service over analog, such as improved picture quality, access to an on-screen guide and video-on-demand services. It's also not charging an additional fee for the new set-top, nor is it raising rates to current analog customers.

Comcast has 1.8 million subscribers in Chicago and the surrounding suburbs. Once it completes moving to all-digital in the city, Comcast expects to make the same changes to suburban systems.

Chicago is the operator's first market undergoing a wide-scale migration of analog to digital. “This is a market-specific standardization of how service is delivered in Chicago,” senior director of corporate communications Jenni Moyer said.

But it won't be the last. Over all, at the end of 2006, about 52% of the MSO's video subscribers were digital. Comcast aims to have 75% of its video subscribers on digital cable service by the end of 2010 and to reach “all-digital service in subsequent years,” according to documents filed with the Federal Communications Commission.

In Chicago, eliminating the 38 analog channels will yield 228 Megahertz of spectrum, or enough to transmit 380 standard-definition digital channels, more than 100 HD channels or some mix of the two. In addition, Comcast could use spectrum to offer higher-speed Internet access.

“There's an opportunity for us down the road to do things like offer more high-definition programming, higher-speed Internet and on-demand,” Ruggiero said.

There may be a particular reason why Comcast Chicago has decided to cut over by July 1: That's also the date the FCC has mandated for operators to stop deploying set-tops that have integrated security features. After “seven-oh-seven,” as some have referred to it, most operators will need to roll out digital-cable set-tops with a removable CableCard for new subscribers (see Technology, page 28).

REDEPLOYABLE BOXES

Officially, Comcast officials said dropping the expanded analog tier in Chicago is unrelated to the FCC's integrated set-top ban.

But it's worth noting that by giving DCT-700s to existing analog customers, Comcast will end up with a greater number of field-deployed integrated set-top boxes. Under FCC rules, boxes that have already been put into service by July 1 may be redeployed for other customers if an operator chooses to do so.

Last year, Comcast filed for a waiver to the so-called integration ban for three set-top boxes — including the DCT-700 — but the FCC Media Bureau in January denied that request. Comcast has requested that all five FCC commissioners review that ruling; the agency has not indicated whether it will do so.

Which set-tops will Comcast be deploying in Chicago and elsewhere for new customers come July 1? “We'll operate consistently with what the FCC guidelines are at that time,” Comcast's Moyer said.

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