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CEA Challenges Charter's FCC Set-Top Waiver

The Consumer Electronics Association asked the full
commission on Monday to reconsider the Media Bureau's grant of a conditional
waiver to Charter for set-tops with downloadable security.

In 2007, The FCC instituted the prohibition on set-tops that
combine channel surfing with security. Cable ops were required to use a
removable CableCARD security add-on, a move the FCC hoped would goose the
retail market, though it conceded at the time that a downloadable software
security option would be preferable to the hardware in the long run. It has
since conceded that the ban has not spurred that retail market.

In March, the
bureau granted the two-year waiver with a number of conditions,
but ones
CEA suggests are too aspirational to be effective.

In a petition to the FCC filed on Monday, the deadline for
the challenge, CEA asked the full commission to review and preferably rescind
the waiver. CEA said the bureau lacks the authority to relax the regulations.
It also argues that the waiver "establishes a basis for Charter and other
operators to assert to the commission and to a reviewing court that any
nominally "downloadable" security system" will do. That, CEA suggests,
could severely undercut the FCC's goal of "the commercial availability of
navigation devices from manufacturers and vendors not affiliated with cable

CEA argues that while Charter initially said it would
continue to support CableCARD hardware, the waiver does not require it to do
so, or to ensure that its downloadable security is compatible with retail
boxes. One of the conditions is that Charter attest that it is making
"good faith efforts" to negotiate the development of a compatible
set-top box, but it does not mandate a successful resolution.

"The bureau's order, like the Charter request, deals in
assumptions and hopes rather than in facts," said CEA, referring to that
and other conditions.

CEA said the waiver "exceeds both [the Media Bureau's]
own delegated authority and the Commission's legal authority," and sets a
dangerous precedent.

"The Commission cannot let stand this nullification of
law and regulation, without process or public comment. Unless the Commission
reviews and rescinds this Order, the Bureau will have erased the core
obligation of cable operators under Section 629 to support competitive devices,
without any factual or legal finding to support this result, or any Public

CEA representatives met with commission officials in the
past several weeks to argue that the waiver went too far -- in essence giving
Charter more than it had even asked for -- and that the fact that it does not
require the boxes with downloadable security also to be CableCARD compliant,
which Charter argued would be too expensive and delay the move to digital security,
will encourage others to seek the waivers and effectively eviscerate the
requirement of separating the security and surfing functions and the goal of
spurring a market in the retail set-tops.

CEAback in December asked the FCC to deny the waiver, calling its proposal a
"nominal and partial 'solution' that cannot fairly be projected to work in
the real world."

An FCC spokesperson was not available for
comment on the challenge.