Cable Warns Again About Hybrid Boxes


The cable industry continues to wrangle with key political
and technical issues that it said could slow its interoperable digital set-top initiatives
if they are not resolved.

The National Cable Television Association and major cable
players reiterated their objections last week to the Federal Communications Commission's
inclusion of hybrid analog-digital set-top boxes under the FCC mandate for separating
security functions from nonsecurity functions in digital set-tops beginning next July.

Separately, cable and the broadcasting industry subtly
renewed their pressure on consumer-electronics manufacturers that are refusing to back
their endorsement of the so-called 5C Digital Transmission Content Protection technology
as the proposed copy-protection standard for digital-TV broadcasts over cable.

Cable also indicated that it would move ahead with 5C as
its copy-protection scheme for digital television regardless of whether
consumer-electronics manufacturers such as Thomson Consumer Electronics, Zenith
Electronics Corp. and Philips Consumer Electronics Co. decide to stick with their rival
protection proposals.

"We're at a point where we're moving forward with
5C," said Lisa Lee, director of the OpenCable project for Cable Television
Laboratories Inc. "We will continue to work through the standards process for that,
but we have to move forward. There's a lot of work to be done in the next year."

While the issues are not new, the recent statements
signaled that they remain far from resolution while deadlines for addressing them edge

In its semiannual report to the FCC on progress in creating
specifications for a separable point-of-deployment" digital security module and host
interface, the cable group said CableLabs was continuing its development of a
standards-based solution, but it would likely miss the commission's July 2000 deadline for
the analog portion.

The group -- which includes MSOs and key vendors such as
General Instrument Corp. and Scientific-Atlanta Inc. -- also reiterated its warning that
the OpenCable program, which was intended to make digital set-tops suitable for open
retail sale, could get bogged down if CableLabs has to keep expending resources to deal
with soon-obsolescent analog-technology issues.

"The addition of the requirement to handle analog
conditional access in a hybrid digital-analog set-top has already diverted significant
resources from the original OpenCable effort," the report read.

The renewed warning comes as CableLabs begins initial
testing this week of the PODs submitted so far by vendors -- the first step in lengthy
interoperability trials for OpenCable gear.

CableLabs will serve as the incubator for testing of the
scrambling and descrambling abilities of PODs submitted by GI; S-A; Philips; and
partnerships of SCM Microsystems Inc., NagraVision and Pioneer Digital Technologies; SCM
and NDS Ltd.; and SCM and Mindport.

Testers will also use host devices such as digital set-tops
and a TV with integrated set-top functionality submitted by Sony Corp.

Lee said CableLabs was working on a hybrid-box solution
based on the complete or abridged "EIA-105" standard. But the industry believes
the result will be an ungainly package sporting both a digital POD and an analog decoder
module, which manufacturers would be loath to produce because of its cost and their desire
to focus on the growing digital sector, instead of on the fading analog portion.

She echoed the industry's warning that the hybrid-box work
would take CableLabs' limited resources away from the primary digital set-top development
work, slowing the effort to make the July 2000 digital POD deadline. "I believe it
would put that deadline in jeopardy," she added.

As for copy protection, the NCTA and the National
Association of Broadcasters wrote FCC chairman William Kennard early this month to say
that they were meeting his targets for creating compatibility specifications between cable
boxes and digital TV sets in terms of the proposed interface and the method for protecting
the broadcast signal from unauthorized digital copying.

In noting that the NAB, the NCTA and the motion-picture
industry agreed on a combination of the IEEE-1394 "fire-wire" interface and 5C
copy-protection scheme, they acknowledged that consumer-electronics makers remained split
on the issue.

The group said it would continue meeting with
consumer-electronics companies to resolve the split, and it remained committed to
submitting cable-compatibility specifications by Oct. 31.

"While we understand that not all manufacturers
support this 1394/5C combination, we are hopeful that this will be agreed upon as part of
the requirements for a cable-ready TV," NCTA president Decker Anstrom said in his
July 1 letter to Kennard.

Thomson said it remains adamant that the smart-card-based
"XCA" copy-protection system it developed with Zenith is a less expensive, more
appropriate solution than 5C, which is based on chip sets embedded in set-tops.

"There needs to be continued agreement to work
together on the basic parameters of copy protection," Thomson spokesman Bob Arlen
said. "It could be that the answer to this is a series of business arrangements, and
not a lot of broad bilateral agreements on the part of the industry."