FCC Issues Text of Set-top Rules

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Washington -- The Federal Communications Commission issued
the formal text of its "navigational-device" report and order last week, and
industry experts said that after digesting the weighty, 140-plus-page tome, they found no
major surprises.

As expected, the FCC made no delineation between analog and
digital devices, meaning that operators have until 2005 to stop supplying boxes to
consumers that include embedded security. Boxes that are already field-deployed at that
time do not have to be replaced.

"I would be surprised if anybody was surprised"
by the text of the rules, said Jeff Krauss, a telecommunications consultant based in
Rockville, Md.

Krauss said the industry was awaiting details on two key
issues: What the word "new" meant in relation to boxes deployed after 2005, and
what the specifics were on analog devices.

The FCC's decision not to require operators to remove
embedded-security set-tops after the 2005 sunset answered the first question. As for
analog, operators do need to shift premium programming onto digital tiers after 2005, or
to use analog "decoder interfaces" to resolve scrambling issues.