MSOs Deployed Only 3,000 Net New Standalone CableCards In Last Three Months

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The 10 biggest U.S. cable operators put a scant 3,000 net new standalone CableCards into service for customers with TiVo DVRs and other cable-ready devices in the last three months, according to the National Cable & Telecommunications Association, as customers turned in nearly as many CableCard devices as were requested.

At this point, the cable industry has deployed more than 30 million operator-supplied set-tops with the security cards, including a net of more than 700,000 in the most recent three-month period, versus just 585,000 standalone CableCards to date, according to the NCTA's quarterly filing with the FCC on Sept. 30.

Cable operators are subject to the Federal Communications Commission's so-called integrated set-top ban, which went into effect in July 2007.

The integrated set-top ban was supposed to foster better MSO support for retail devices that use CableCards, which handle authentication and decryption functions to access cable TV programming. But the policy has not resulted in the FCC's hoped-for surge in sales among third-party cable-ready navigation devices.

The NCTA has argued that the integrated set-top ban should be eradicated, saying it adds cost to operators while serving no purpose.

But far from eliminating the rules, the FCC has added new CableCard requirements, including: ensuring access to switched digital video by retail devices; prohibiting box-price discrimination; requiring that consumers have the option of self-installing CableCards; providing subscribers with information on the cost of retail set-tops vs. leased boxes; making it easier to get retail devices to market by streamlining testing and certification; and allowing cable operators to provide basic HD boxes with integrated security functions.

The FCC is currently considering a successor to the CableCard regime, dubbed "AllVid," which would force all multichannel video programming distributors -- including satellite and telco TV providers -- to deliver video to third-party hardware devices using a common set of technical interfaces.

Pay-TV operators oppose the AllVid proposal, arguing it would cost millions of dollars to meet the requirements, while at the same time subscription TV services are already becoming available on a host of IP-based HDTVs, set-tops, gaming consoles, smartphones and tablets.