Set-Top Specs Hit Deadline, Digital Copy Issues Linger

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The cable industry said it remains on track to meet federal
mandates for retail availability of OpenCable digital set-top boxes with the public
release of five interim technical specifications.

Although a gulf remains between cable and some
consumer-electronics manufacturers over how to provide copyright protection for digital
content accessed over cable, the industry said the five OpenCable specs released Oct. 29
advance the preliminary specs that have gotten vendors started on making actual product.

"Realistically, we needed to get a stable
specification together in this kind of time frame if we wanted people to build devices
ready for the market in July 2000," said Donald Dulchinos, recently appointed head of
the OpenCable project at Cable Television Laboratories Inc.

OpenCable is the CableLabs initiative to create protocols
for advanced digital-cable set-tops that operate with standards-based cable systems from
any other manufacturer.

With the federal government mandate that cable set-tops be
made available at retail, interoperability is a critical element to ensure that consumers
can use their set-tops in any cable system and install them with "plug-and-play"
ease.

The interim specifications released by CableLabs are
intended to be stable enough for manufacturers to create product based on them. They will
be tweaked into final, "released" specs based largely on data gathered in the
ongoing, rigorous interoperability testing by vendors with CableLabs.

The five protocols define the OpenCable network interface
between the headend and an OpenCable set-top; the interface between the host device (a
set-top or TV with integrated set-top functions) and the point-of-deployment security
module (POD); and other features of one-direction and two-direction set-tops.

CableLabs also released a draft specification for the
system being used by the host and POD to prevent unauthorized digital-content copying,
based on the so-called 5C technology backed by cable, the Motion Picture Association of
America, the National Association of Broadcasters and much of the consumer-electronics
industry.

The National Cable Television Association had assured
Federal Communications Commission chairman William Kennard in May that by Oct. 31, it
would provide solutions for issues with consumer-electronics makers over compatibility
between digital-TV receivers and cable systems.

Those solutions were to be based on a combination of 5C and
the Institute of Electrical and Electronics Engineers' 1394 "fire-wire"
standard for a high-speed interface between cable set-tops and digital-TV sets.

In a Nov. 1 letter to Kennard, NCTA president Robert Sachs
reiterated cable's intention to move ahead with the 1394-5C plan, pointing to the
OpenCable specs released just days before.

"As a result of this commitment, the cable industry
remains on target to begin to deploy set-top boxes that will contain the IEEE 1394
interface and the 5C content-protection technology in the third quarter of calendar-year
2000," Sachs wrote.

But he also noted that the requirement for a 1394-5C
interface on any digital-TV sets with integrated cable set-top functionality remained a
"material area of disagreement between the cable and consumer-electronics
industries."

Several major TV manufacturers -- notably Thomson Consumer
Electronics, Zenith Electronics Corp. and Philips Consumer Electronics Co. -- oppose the
5C scheme in favor of alternatives that they argue would give less power to content
producers in cutting off consumers' access to digital content.

Thomson and Zenith support a smart-card-based protection
scheme called "XCA" that they developed jointly.

Thomson spokesman James Harper said the company had no
comment on the retention of 1394-5C plans in the OpenCable specs, but he noted that it
would be some time before Thomson was producing integrated OpenCable-compliant digital-TV
sets anyway.

Dulchinos emphasized that manufacturers willing to use
1394-5C needed to move ahead with their product development, adding that with the support
cable already had for the technology, it was confident about moving ahead with its spec.

"We've sort of, as of last week, really
recommitted to" the 1394-5C scheme, Dulchinos said. "Companies that want to work
with cable will need to do that."

Sachs also noted continuing work between cable and the
consumer-electronics industry on the development of digital TVs, with integrated cable
set-top functions, RF-performance specifications, video performance and the specific
electromechanical resources needed for reliable POD implementation among the remaining
issues.

He added that technicians were mulling the method cable and
TV manufacturers will use to support closed-captioning of digital programming -- an issue
the FCC is currently considering in a rulemaking proceeding.

Meanwhile, availability of digital programming continues to
creep higher among cable competitors.

The copy-protection issue didn't prevent DirecTV Inc.
from going forward with its new high-definition TV pay-per-view channel, which launched in
late October. Not all Hollywood studios are as concerned about copy protection as others,
DirecTV senior vice president of programming Stephanie Campbell said. "There's
no problem today with HDTV sets because there's no output."

She added that when it comes to copy protection,
"Everyone wants a solution sooner, rather than later."

Campbell noted that a move from analog to HDTV entails
changing the very way people watch television, including changing the screen aspect ratio
they watch.

EchoStar Communications Corp. spokesman Marc Lumpkin said
the direct-broadcast satellite company plans to begin selling an HDTV modulator this
month. The component will connect a Dish Network model "5000" DBS receiver with
a digital television. He conceded that the modulator is targeted to the early adopter who
doesn't want to wait for high-definition programming.

EchoStar plans to offer Home Box Office's HDTV feed
free-of-charge to subscribers who already take an HBO package. But Dish Network
subscribers would need dishes pointed at the 61.5 degrees west orbital location.

Ultimately, the company plans to offer HDTV at either its
119 or 110 degrees west full-CONUS (continental United States) orbital slots, which will
both be visible with a Dish 5000 system. The company has not yet determined a plan for
digital-broadcast signals if local-to-local legislation allows it.

Also last week, CBS News said it would begin producing its
new weekday morning program, The Early Show, in standard-definition digital format
using new high-definition cameras from Sony Corp. Later, the equipment will be used to
produce the show in HDTV.

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