CableLabs Chief Counters Allegations

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Cable Television Laboratories Inc. president and CEO Dick Green has fired
back against allegations that the licensing agreement for future retail digital
set-top-box technology runs counter to consumers' interests.

In a letter Monday to Sen. Patrick Leahy (D-Vt.), chairman of the Senate
Judiciary Committee, Green refuted allegations that the cable industry,
set-top-box makers and digital-TV makers taking part in the 'Point of
Deployment-Host Interface License Agreement' (PHILA) were conspiring in secret
to create a digital delivery system that could deny consumers' traditional right
to record programs, turn off consumers' TV sets at will and disable
first-generation TV sets.

The licensing agreement is part of CableLabs' OpenCable specifications
initiative to create digital set-top boxes that can be sold at retail.

The OpenCable specification calls for point-of-deployment cards containing
the access authentication. Cable operators would issue these cards, which could
be inserted into OpenCable digital boxes to synch them up with cable operators'
systems.

To access the OpenCable technology, electronics manufacturers must sign the
PHILA licensing agreement and agree not to disclose its terms.

On March 14, Home Recording Rights Coalition chairman Gary Shapiro sent a
letter to the committee arguing that the PHILA terms should be made public. The
coalition is an advocacy group consisting of consumers, retailers, manufacturers
and professional servicers of consumer-electronics products.

Shapiro, who doubles as president and CEO of the Consumer Electronics
Association, argued that the PHILA agreement gives
content providers and cable operators the power to dictate how consumers use
content.

'Once given this power, a movie studio, or cable or satellite operator, could
simply turn off any interface at will, effectively making the consumer home
network a part of its own distribution system,' Shapiro said in the letter.

But Green countered in his letter, 'This portrait is highly inflammatory and
inaccurate.'

He argued that the PHILA license provides the technology tools for the POD
cards, but it does not dictate what rules the systems use to protect or restrict
digital content, nor does it require that content be copy-restricted.

'It is not CableLabs' role to institute a single business arrangement to
replace thousands of detailed bilateral business arrangements,' Green wrote.
'Congress and the courts will always have the responsibility to define content
owners' rights with respect to making copies of their works (such as home
copying or time shifting).'

As for the possibility that selectable output-control elements could be used
to switch off TV sets remotely, Green argued that this element is used to govern
devices with multiple outputs, including 1394 fire wire, and it is part of
necessary security to prevent. And there is no effort to strand or disable older
digital-TV models.

'Cable operators have no business reason to disable customers' reception of
programs and thereby reduce their subscriber count and revenue,' he argued.
'Cable operators' incentives are to sell programming, not to disable it.'

Finally, Green noted that the PHILA process itself has been done in public
view. So far, Motorola Inc., Scientific-Atlanta Inc. and Pace Micro Technology
plc have signed the PHILA agreement.

'There is nothing secret or suspicious about these ordinary procedures. To
dispel any doubt, we have posted the current version of PHILA to our Web site
(http://www.opencable.com/documents.html),
and we will periodically update it as modifications are adopted in bilateral
negotiations,' Green wrote.

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