NCTA Answers Critics of CableCard Stance

Washington -- The National Cable & Telecommunications
Association says it is not out to sabotage the half-million cable customers who
use retail set-tops.

The cable-industry trade group was responding to comments
filed by Public Knowledge, the Consumer Electronics Association and others in
the Federal Communications Commission's set-top proceeding about CableCards,
the removable hardware that separates the channel-surfing and conditional-access
security functions from set-tops per the agency's ban on integrated boxes.

The FCC was trying to drive a retail market in those boxes,
but has conceded the move has not worked.

Some of those commenters had used that false pretense to try
to impose new rules and obligations on the industry, the NCTA said.

The cable group said that it continues to support the 1% of
its customers who use the retail boxes, but that there was no reason to adopt the
CEA's suggestion that the cable operator provide more technical support for
those retail boxes.

"If a leased device is not working, operators can
support it, fix it, or replace it free of charge," said the NCTA in i0ts
comments. "If a retail device is not working, cable operators will ensure
that the CableCard is working, but the retail equipment is otherwise the
responsibility of the customer and the device manufacturer."

Public Knowledge argued that bundled-services deals that
include leased boxes undercut the retail market, but the NCTA said that
discount bundles "have benefited consumers with considerable savings, and
disassembling package discounts would undermine the very transactional
economies that help keep discounts deep."

The NCTA renewed its request that the ban on integrated
set-tops be lifted for newly leased boxes.

"The time has come to relieve cable operators of the
burden to deploy CableCards in all of their new leased boxes," it said.
Cable operators have deployed 21 million of the CableCard-enabled leased boxes,
compared to only 520,000 retail boxes.

"Requiring cable operators to install millions
more CableCards in additional leased devices ... will not revive the flagging
consumer and manufacturer interest in one-way devices that cannot access
video-on-demand and other two-way services," the NCTA said.

John Eggerton

Contributing editor John Eggerton has been an editor and/or writer on media regulation, legislation and policy for over four decades, including covering the FCC, FTC, Congress, the major media trade associations, and the federal courts. In addition to Multichannel News and Broadcasting + Cable, his work has appeared in Radio World, TV Technology, TV Fax, This Week in Consumer Electronics, Variety and the Encyclopedia Britannica.