Ending a long dispute, the Federal Communications Commission ruled Thursday that Time Warner Cable is not required to transmit an electronic program guide (EPG) embedded in analog TV signals by Gemstar-TV Guide International Inc.
The unanimous decision was a clear setback for Gemstar, which filed a complaint with the FCC early last year when Time Warner began stripping the company's EPG on cable systems in multiple states.
Time Warner was quick to declare victory and promised that it had no intention of using the FCC's ruling to block Gemstar's EPG.
"We have no plans to do that … because we want to focus on having some productive discussions with them now that the issue is resolved," said Time Warner spokesman Mike Luftman.
Gemstar spokeswoman Lauren Snyder declined to comment. But on Nov. 27, the company's chairman Henry Yuen sent a letter to FCC chairman Michael Powell saying he was "deeply concerned" that the FCC was about to rule in favor of Time Warner. He offered to fly to Washington to brief Powell personally on how a decision supporting Time Warner would bring "significant harm to millions of innocent consumers."
Gemstar, the dominant on-screen navigation provider, sought a ruling from the FCC that Time Warner was required to carry its EPGs when inserted into the vertical blanking interval (VBI) of analog broadcast signals under the agency's must-carry rules.
Consumers can only view the EPG information through TV sets or video recorders equipped with Gemstar's guide technology.
Gemstar claimed that by stripping its free service, Time Warner was attempting to force cable subscribers to pay for a Time Warner-provided EPG.
Time Warner urged the FCC to rule that Gemstar's EPGs were not entitled to such carriage and that cable operators could remove them from the analog signal. Time Warner said EPG carriage should be the outcome of private negotiations between the companies.
The issue erupted in March 2000 when Gemstar accused Time Warner of illegally stripping the EPG on nine cable systems in eight states. Time Warner subsequently reversed its decision and stopped stripping the signal, to give the FCC time to settle the dispute.
In the decision, the FCC said cable operators are required to carry program-related material in the VBI accompanying the primary video service of local TV stations that elect must-carry.
But the agency said the services offered by Gemstar's EPG — including programming information on numerous cable system channels along with promotions and advertising — went far beyond the FCC's three-part test for determining whether it met the definition of program related. According to that test, program-related material must focus on the show currently being viewed.