House Bill Aims to Kill Set-Top Security Ban

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The cable industry cheered while TiVo jeered a bill proposed last Thursday (Sept. 26) by Reps. Robert Latta (R-Ohio) and Gene Green (D-Texas) looking to lift a ban on operator-supplied set-tops with integrated security that, by some estimates, has cost cable operators and consumers more than $1 billion.

The bill, expected to spur a years-long debate between the cable and consumer-electronics industries, is also designed to preserve the FCC’s ability to regulate set-top boxes in the future.

The integration ban, designed to spawn a retail box market, took effect in July 2007. Most operators responded by using the CableCard, which adds roughly $56 to the cost of a set-top. The CableCard failed on the retail front. According to the National Cable & Telecommunications Association, the top 10 cable operators have deployed 42 million modules in MSO-supplied boxes since the ban took effect, versus 603,000 in TiVos and other retail devices.

The NCTA and the American Cable Association, which have called on the FCC to end the set-top ban, both applauded the introduction of the bill. TiVo, which has pushed for a CableCard successor that could be applied to all pay TV operators, expressed disappointment. The ban has been “especially harmful to small cable operators,” ACA president and CEO Matthew Polka said in a statement, noting that the bill would not eliminate the requirement that operators support customers that use TiVo DVRs.

TiVo fears that the bill will put it at a disadvantage, and cause CableCard costs to rise due to declining volumes.

The bill “will eliminate competition to the industry’s own devices and force consumers to pay ever-higher rates to the cable industry to use their boxes,” Matt Zinn, senior vice president and general counsel, secretary and chief privacy officer at TiVo, said in a statement.

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