CEA to FCC: Deny Charter Set-Top Waiver and Come Up With Standard

Trade Group Says Commission Needs to Establish National Standard for All MVPDs
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The Consumer Electronics Association has asked the FCC to deny Charter's request for a waiver of the commission's ban on integrated digital set-top boxes, calling its proposal a "nominal and partial 'solution' that cannot fairly be projected to work in the real world."

"There is no considered FCC precedent for the open-ended evisceration of this regulation," CEA said in comments to the FCC Friday (Nov. 30) on Charter's request earlier this month for a two-year waiver of the prohibition. Charter says the waiver is necessary for the company to make the transition to all-digital networks and downloadable (software-based security).

The FCC back in 2007 instituted the prohibition on set-tops that combine channel surfing with security. Cable ops were required to use a removable CableCard security add-on, a move the FCC hoped would promote a retail market in boxes, though it conceded a downloadable software security option would be preferable to the hardware in the long-run.

Charter pointed out that it has 2.75 million CableCard set-tops deployed, so it has an incentive to continue to make sure its system works with the relative few CableCards -- 33,000 -- it says have been requested by customers for their retail boxes (the FCC has conceded that the prohibition has not led to a booming retail box market).

Charter said it plans to deploy boxes with a chip that would eventually be used for non-integrated downloadable security and one for traditional integrated security, to be used during the two-year transition period to downloadable security.

The FCC granted a similar waiver to Cablevision -- which CEA points out has now expired -- and has taken steps to promote the transition to all-digital cable, which frees up bandwidth for broadband, including lifting its ban on encryption of the digital basic tier. But CEA believes no waiver is warranted.

The association maintains that the cable industry's promise of a downloadable security standard interface, the functional equivalent of the CableCard hardware, has yet to materialize after years of promises, and that Charter's partially chip-based interim solution "affords access only to a single conditional access system, and only Charter systems are likely to be able to download software that uses the conditional access hardware in the chip."

According to CEA, the argument that the chip is available for others to license, even on the best of terms, is moot if "(1) other cable operators do not use the system that requires it and (2) it does not employ technology that is actually portable across operators."

In any event, according to CEO, the FCC should tackle the issue as a whole rather than through a piecemeal process of waivers: "If the FCC is to give any consideration to issues raised by Charter it should be in the context of a Commission rulemaking addressing the core issue that Charter purports to, but fails, to raise," said CEA, which is that "[i]n an all-digital and IP-delivery era, the FCC needs to identify a new, secure, open, and nationally standard interface between MVPD services and retail devices."

The commission set a Nov. 30 deadline for comment on Charter's request and a Dec. 10 deadline for replies.