DTV Primer

Chris Llana, Editor


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Further Cable TV Developments, Chapter 27

November 7, 2006

As the FCC wrestles with the fate of cable boxes, the various segments of the TV industry are scrambling to get their foot in the door before it is slammed shut. That's because the seemingly minor issue of whether a cable set-top-box can continue to integrate the security function is turning out to be a pivotal piece in the whole technology/business model for the delivery of video, voice, and date services to consumers' homes.

It's a little issue that's worth $billions to whoever can influence the regulatory structure to favor their own business plan.

The cable industry has been lobbying hard to keep their traditional/proprietary integrated set-top-boxes, which include both security and navigation functions. Congress in 1996 said the security and navigation functions had to be separated so that consumer electronics industry could sell boxes in competition with the cable companies, giving consumers choice. Not quite there yet.

The latest development came to light when last Thursday an industry group led by Sony (and including Pioneer, Intel, Microsoft, and the Consumer Electronics Association) met with the FCC to present a proposal they will soon be formally submitting. This compromise proposal is for third-party bi-directional digital cable products, and contains a comprehensive set of conditions that would have to be agreed to by the cable industry.

"Bi-directional" or two-way merely means that these boxes or other devices cannot only receive programming from the cable company, but they can also send information and requests from the box to the cable company's computers.

These proposed bi-directional cable products would give subscribers access to interactive services (such as video-on-demand), but they would not have to conform to the "OCAP" standard (OpenCable Applications Platform) the cable industry has been promoting (insisting on).

OCAP plug-and-play devices would supposedly all operate in cable systems across the country, making those boxes portable. The consumer electronics (CE) industry believes OCAP is structured in a way that favors the cable industry and will not allow CE manufacturers to build competitive devices, especially multi-function retail products.

The Sony/CE proposal would give CE manufacturers access to cable programming navigation or metadata information so that the CE retail products would be able to present a user interface that is comparable to what the cable company offers (eg. for interactive program guides, channel selection (either directly or by search criteria), video-on-demand operation, etc.).

The two sides (cable versus CE and IT industries) have not been terribly friendly over these issues, and the fact that the consumer electronics people are submitting this compromise proposal to the FCC just before the expected decision on set-top-box waivers is telling.

Don't expect a full resolution any time soon, but we might just see the government giving some guidance before the end of the year.

There does seem to be a trend for the direction things are moving. Bi-directional is in, but there seems to be some hope for one-way CableCARD users. The Sony/CE proposal raises the possibility that an "inherent" bi-directional capability in one-way CableCARDs could be unlocked, and these "one-way" devices could work with switched digital video technology with some modifications to the system.

Cable is never going to be the same.

You may have noticed that digital TVs have "QAM" (quadrature amplitude modulation) digital cable tuner/demodulators built in (along with ATSC/NTSC). The chips the TV makers use incorporate all three.

That means that digital TVs are digital-cable-ready in the same sense that virtually all analog TVs built in the last umpty-umpt years have been (analog) cable-ready. You could simply plug the cable into the back of your TV and tune in unencrypted cable channels (what you got with basic and standard analog cable service).

Digital TVs can tune in unencrypted (unscrambled) digital channels in the same way, so you shouldn't need a cable box at all unless you want premium channels like HBO or video-on-demand, etc. The twist is many cable companies are encrypting the digital/HD versions of those ordinary channels (eg. the digital/HD broadcast channels).

They charge more for digital channels (perhaps on the premise that all HD channels are "premium"), and in most cases don't offer the basic (least expensive) tier of channels in digital at all. If you want the digital/HD broadcast channels over cable, you have to subscribe to "digital cable" (which is actually cheaper for them to deliver than analog) and pay for the hundred-plus channels in their "standard" tier.

And because the digital/HD channels are likely scrambled, you can no longer simply plug the cable into the back of your TV. You need a CableCARD (which is uni-directional) or a digital/HD cable box to unscramble the signal.

That cable box is bi-directional these days, so that you can buy video-on-demand, pay-per-view, and so the cable company can implement switched digital video (SDV), a technology that lets them minimize the data they need to send out over their cables, thereby freeing up bandwidth that they can use for other services.

If you don't have a bi-directional cable box, and your cable company has implemented SDV, you may not be able to receive the high-def version of some programs, even if you're paying for the digital/HD service.

The cable industry no longer will be happy with people plugging the cable directly into the back of their analog OR digital TVs. Things are going to change. Exactly how is too early to say.