It’s not a question of whether more television content will move to the Internet or whether IP transport will be used more in the future for video distribution. It’s two questions:

a) Are a lot of people canceling their cable subscriptions for cord-cutting alternatives?

b) Can you replace your cable subscription through online video?

In a previous post I attempted to answer these questions, but it’s quite simple: a) No. b) No.

This debate does show that consumers have more choices than ever before, which one would hope can finally put to an end to the view that insufficient competition exists. I might argue that cable subscriptions provide the best combination of services and value, but those who don’t agree clearly have many other options.

This week also brought two new pieces of evidence which tend to support the subscription model, one scientific in nature and one anecdotal.

Parks Associates released the All Eyes on Video study, which looks at “consumer use of and interest in video experiences.” From this WorldScreen.com article, the report found that “Less than 8 percent of U.S. broadband homes — about 5.5 million homes — are considering canceling their pay-TV subscriptions in favor of online video…”  This Broadband TV News article reports the profile of these consumers.

The households likely to switch or cancel their services watch a whopping 10 hours of online video each week, much higher than typical video consumers. They express strong interest in having online access to pay-TV channels (e.g., TV Everywhere), which highlights an opportunity for traditional pay-TV providers to solidify their base through the deployment of such features. Offline video consumption is also higher. Their median number of DVD rentals from the last six months is 18, compared to two rentals among other households.

Janko Roettgers, in this NewTeeVee post, thinks that the real winners will be DVD rental services like Netflix and Redbox, although it’s worth noting that the DVD business is going through its own problems right now and Netflix does not yet have a deep catalog of content that can be watched online through its Watch Instantly feature.

The Business Insider’s Dan Frommer quite famously cut the cord on cable, as noted as recently as this December 2009 article on the proposed Comcast-NBC deal:

Nielsen recently reported that although online video viewing has risen 35 percent in the past year, 99 percent of TV viewing is still done on a traditional TV. But that’s not the case for younger people, like my pal Dan Frommer. He’s 27 years old and works as a writer for a technology Web site. Frommer pulled the plug on cable TV in May 2008 and instead gets shows from the Internet via a Macintosh computer hooked to his LCD television. He can’t get everything he’d like to see, but he’s saved $1,500 on cable-TV fees. “I’m not going to let myself get ripped off for a bunch of garbage that I don’t watch anyway,” he says.

And here was the title of a Frommer post yesterday: Why I Caved, Bought Cable TV, And Gave Up On My ‘Hulu Household’. Read it for yourself, but you’ll find many of the issues I’ve discussed here before; high-definition television, live sporting events and the costs of high-quality TV productions all play a role.

Final note: I draw your attention to this Mari Silbey tweet from Monday. Roku, frequently mentioned as one of those great alternatives to subscribing to cable, has recently talked about how subscriptions will play a greater role going forward. In fact, they’re “looking to line up at least 100 content partners this year.”

Mari tweeted, “I’m sorry, but does no one else see the irony of Roku’s plans to bundle free hardware with subscription content? It’s called a cable set-top.”

The more things change…

The good news is that some cable operators receive high marks from consumers about the service they receive. While some cable companies are not viewed positively, there seems to be a general air against incumbents. In other words, when it comes to video service, the incumbent cable providers are not viewed as positively as newer competitors; however, when it comes to telephone service, cable is viewed more positively than traditional phone providers.

In addition, Consumer Reports’ reader survey points out something that’s been known for some time: Customers who take bundled service are happier with their provider. Since cable first rolled out Internet access and then telephone service – as well as services such as DVRs, HD and digital cable – we have seen the take rates increase dramatically for the new services. Consumers are getting more out of their cable subscriptions, and by bundling Internet access and phone with their video service, they’ve also been able to see savings.

Now for a few factual problems…

The article lumps together the services provided by the phone companies (AT&T’s U-verse & Verizon’s FiOS) as “fiber-optic service.” In fact, while Verizon has widely deployed fiber, AT&T is still using twisted copper pair. You may recall that cable has a hybrid fiber-coaxial infrastructure.

A sidebar of the costs of TV service completely bungles its analysis of the impact of CableCARDs, but more distressingly, the article gets its description of E911 wrong.

Emergency 911 service varies among technologies. Fiber phone service uses the same long-proven location system as a landline phone. New cable-phone and other VoIP 911 services are less universally dependable.

The section on emergency phone use seems to confuse cable’s phone service, which transports your call over cable companies’ privately managed IP networks, with VoIP services such as Vonage, which use the public Internet for transport. The concern is that when a customer calls into a 911 operator, emergency responders should be able to know where the household is located – and that in the case of VoIP calls transport entirely over the public Internet, that may not be possible. Cable operators do not have this problem. As the article notes, phone service from cable or U-verse/FiOS may need to instead rely on a cell phone in the case of a power outage.

In a section on Internet speeds, the article argues that only 1 Mbps is necessary for most customers. That’s not a problem for cable customers, since the average standard speed typically exceeds 5 Mbps, but it seems a little silly to argue that very high speeds, such as cable is offering now through the DOCSIS 3.0 standard, are mostly a “marketing game.” Certainly, not everyone needs 50 to 105 Mbps, but I think 1 Mbps is hardly adequate these days.

I also found it telling that they buried the cord-cutting strategies at the back of the article. You can just rely on an antennae and over-the-air broadcast television, but if you have reception issues, then you’ll be out of luck. You can turn to the Internet, but content is limited there as well, and you’ll still need to subscribe to an Internet connection.

In the end, it seems like consumers are being serviced quite well by today’s vibrantly competitive marketplace.

On this blog, I have many times written about so-called “cord cutters” – people who have canceled their cable subscription in order receive movies and television shows over the Internet. CES was filled with talk of Netflix’s deal with Warner Bros, the Boxee box, the introduction of VUDU Apps, and more. Sessions with titles like Rethinking the Future of Creative Works and Defining Internet TV focused on emerging models for the distribution of content.

What struck me at CES – as I have also been reading in the blogosphere and the mainstream press for over a year – is that we’re moving away from the current model, where 85% of U.S. households get video through a Multichannel Video Distributor, to a new disintermediated world, where you’ll get content over the Internet directly from content creators. To hear some talk about it, the current model is a dinosaur and the sooner that the cable industry can figure that out and move on, the better.

But let’s note again that 85% of U.S. households get their television from cable, DBS (DirecTV & DISH) or from the phone companies (AT&T’s U-verse & Verizon’s FiOS). In December, NewTeeVee noted that Nielsen reports that “99 percent of video is watched on a TV in the U.S.”

Americans spent 129 hours and 16 minutes per month watching TV in the latest 3-month period, seven hours and 12 minutes watching time-shifted TV, and three hours and 24 minutes watching online video.

Things will undoubtedly change. But what might account for everyone not rushing to cancel their cable today?

One possible answer can be found by looking at the example of noted blogger Ben Drawbaugh. I don’t mean to pick on him, because he’s a nice guy, but when I last wrote about cord-cutting in December, he posted this comment:

For the most part I agree with the premise of your post, the notion that more than a small percentage of people will cut the cord and use legit streaming services is just crazy.

That being said, I do cancel my cable service in January and don’t feel the need to add it back until August. So yes, I pay $50 a month to Verizon to watch ESPN and the NFL Network — because college and pro football is worth $50 a month to me — but the rest of the crap on cable can wait. What I mean is that instead I subscribe to Netflix and wait another 5 months for Netflix to mail the first Burn Notice Disc to me. So in other words, Discs and OTA HD have everything I need for much less money.

Fair enough.

This week, though, Drawbuagh wrote a post entitled, “Canceling cable: the failed experiment.” He says that he needs to a subscription for work purposes, since he writes about cable technologies. Then, he says this:

The bottom line is that I love me some football in HD, so I can’t ever see myself going without cable year round, and with the hassle involved in canceling and signing back up, the $327 a year ($62 for 7 months minus $110 savings for signing a contract) I’d save just isn’t worth it… I suspect for many it just isn’t worth it either. Sure there is lots of content out there available via other legal means, but the bottom line is that when it comes down to it, cable really isn’t that bad of a deal considering all the HD viewing options you get for the price.

As I’ve said before, cord-cutting proponents love to suggest or outright claim that you can substitute online video for cable service, but there is much you can’t get online. One of those big categories is sports.

The Return of the Subscription Model

But all this discussion may be for naught, because some new developments suggest that online video may be moving to a subscription model anyway, which puts us right back where we are today. Hulu may soon be charging a subscription fee for some of its content, as may Boxee. Brian Barrett at Gizmodo added up the numbers for your access to even get online, plus the subscription for services like Netflix, and concluded that you might end up paying “hundreds of dollars a month,” perhaps “nearly $1,000 a month.” Nicholas Carr, in a colorfully-titled post, also looks at the numbers and asks, “Now somebody remind me how we all came to think that information wants to be free.”

And yet, on that previously mentioned Rethinking the Future of Creative Works panel, the speakers couldn’t think of what the role of service providers (such as cable operators) might be in our connected future. The panel didn’t really answer an audience question on how all the content will be paid for. They didn’t really answer a question on why service providers would invest in infrastructure.

On another panel, Mitch Berman of ZillionTV said that claims that production values for movies and TV won’t be there without subscription model are overblown. On an FCC panel, Commissioner Robert M. McDowell reminded us that quality content costs money and that right now, the ways to cover those costs are through advertising or subscriptions. Even the NY Times has now announced a new plan to require some sort of subscription.

So, we may be moving to a Bright New Future a little more slowly than some are claiming. And it may be that subscriptions serve a purpose after all.

Time will tell.

For those unfamiliar with TV Everywhere, it is just one of several concepts, based on different technologies and business models, being developed for the online video marketplace.  TV Everywhere, specifically, would provide a new service at no extra charge to consumers who subscribe to a multichannel video programming service – whether provided by cable, satellite or telephone companies:  the ability to watch TV programs on PCs or laptops, and potentially other Internet-connected devices.  It could significantly increase the amount of high-value video content available online – something the FCC has said would help drive broadband adoption.

But Free Press’ theory seems to be that TV Everywhere poses a threat “to kill” online video competition because it would only be available to cable and other pay TV subscribers.  But they get it exactly backwards:  It is an effort to ensure more content than ever is distributed over the Internet at no extra charge to consumers.

Moreover, the TV Everywhere concept involves a multitude of competing program networks, most of which distribute their content on competing cable, satellite, telephone and online platforms.   As publicly announced, TV Everywhere envisions separate, bilateral agreements between one content company and one or more individual distributors.  It is purely vertical in nature – like any arrangement between a content company and a distributor.  As online video evolves, various distributors and content companies may – and likely will – come to widely varying bilateral arrangements.

It is no wonder that developing and implementing this concept isn’t easy, given the vast numbers of possible participants; however, calling any of this “collusion” is, to be kind, strange.  The fact that distribution of content requires a number of differing and competing parties to enter into a multitude of bilateral agreements is normal.  Contrary to Free Press’ suggestions, the antitrust laws do not prohibit, but encourage collaboration, even among competitors, that lead to innovation and new products and services for consumers.

Distributors do not have the ability to unilaterally decide how content is distributed.  Content owners, through individual business arrangements with a growing array of distributors, ultimately make those decisions – in much the same way every other sector of the economy works.  No single content owner or distributor is controlling this process or could do so.

What is remarkable about the online video industry, even at this early stage of development, is just how dynamic it is.  Content providers can elect to distribute their content through advertising models such as Hulu or subscription models such as iTunes.  MLB.TV will give you live programming, an online DVR, picture-in-picture, and much more for an annual fee.   Indeed, there are a growing number of “paid content” models emerging on the Internet—and a large and growing number of competitors using different models – from Netflix to Blockbuster to Vuze to Veoh to iReel to Sezmi to Apple TV to ESPN360 to VUDU to Miro, and on and on.

So, Free Press is really complaining about the decisions content owners make as to how their content should be distributed.  As it happens, many programmers rely on the subscriber-based license fees they receive from cable operators and other distributors to remain economically viable.  In order to sustain that model and continue investing and creating, many content owners may want to ensure that they are compensated for the viewing or use of their programs online.  There is nothing nefarious or mysterious about this:  Programmers invest tens of billions of dollars a year to produce high quality content; they have the right to experiment with different business models and determine how to recoup that investment in terms of distributing their content on different platforms.

As much as Free Press would like to suggest that something is radically different in this case, the TV Everywhere model would be nothing more than content owners extending their copyright licenses to allow multichannel video providers to make their programming available online.

 The fact that market participants are experimenting with models in addition to fee or advertiser-supported models is not a sign of anti-competitive conduct.  It is a sign of a dynamic and rapidly-changing market in which no one knows the ultimate outcome.  Free Press may prefer one video distribution model over another.  But that is for the marketplace – and content owners exercising their rights to distribute their content in the manner they choose – to sort out.  A model that would give consumers the option to get more value – by access to online content – as part of the TV subscription they already pay for is something that consumers should have the right to embrace or reject.

While cord-cutting is definitely a trend that the entire media industry is watching, many of the articles and blog posts covering this say something like: “Tired of paying so much for cable? Cancel your subscription and turn to the Internet to serve your needs!” The direct implication of this is that you can get all the stuff you currently watch on cable television – or via DBS (DirecTV & DISH) or from the phone companies (AT&T’s U-verse & Verizon’s FiOS) – just by going online.

But all this coverage ignores the fact that you can’t do this. You can get some cable programming online, but not most of it.

Let’s focus in on a couple key elements.

From an October 29 article in the Washington Post:

[Cord-cutting] was a somewhat easy thing for us to do. We don’t watch that much TV in the first place, and most of what we do view is on the [over-the-air broadcast] networks anyway…

If you look at this post I wrote in November of last year, you’ll note the same thing: A lot of cord-cutting proponents don’t watch much television and what they do watch is from broadcast television (generally easy to find online).

From the New York Times on December 9:

…Boxee easily allows access to the Netflix streaming service, which offers up thousands of movies and television shows (just not always the most popular options).

Anyone who’s actually used Netflix’s “Watch Instantly” feature, as I have, knows that you can see older movies and some TV shows but not any of the current cable shows generating water-cooler discussion. And you don’t get any access to new hit movies.

This HuffPo post, while also proclaiming the wonders of cord-cutting, charges that major cable operators “have been pressuring TV programming networks to keep their shows off the Internet,” implying that they should be provided for free.  Perhaps the writer may be unaware that cable programmers have a dual revenue stream: They get some money from advertisers (which is based on the number of homes they’re carried in) and some money from cable operators and other multichannel video providers (called carriage fees).

Online advertising revenue has not been as lucrative yet as television has been. And multichannel video providers would undoubtedly not want to pay as much for a product that is being given away for free online.

And is this really such a good deal for consumers? The Times notes:

If you watch premium-cable television shows, you can pay more than $40 for the season of a single show. But even that is less than one month of cable.

Wait.  $40 for a season of a single show?

I’m paying Comcast about 100 bucks a month for video service, but it’s a very robust package that includes hundreds of viewing options, including multiple premium services. SNL Kagan reports that the average price for digital cable (which 67% of cable subscribers now take) is about $60 a month. I probably watch about three hours daily, for about 90 hours a month. The latest “Three Screens” report from Nielsen reports that Americans are watching an average of 31 hours and 19 minutes of live television per week or 125+ hours a month.

So, one cable show via iTunes for $40; two shows are $80. I happen to watch a lot more than two cable shows.

All this gives me a cost-cutting idea!

Anybody who knows me knows I don’t care about sports. Not professional, collegiate or amateur athletics. Given that situation, I guess I should cancel my subscription to Sports Illustrated, huh?

Yeah, I’m kidding, because I don’t have such a subscription. But it illustrates a good rule for some people: If you’re not interested in watching cable programming, you probably shouldn’t subscribe to cable television.

Online video viewing is small, but growing. The statistics are dwarfed by the amount of television delivered via traditional methods, and the number of video subscribers continues to grow. In all likelihood, those figures will shift over time. But it’s not there yet.

It’s ironic, because lots of people like cable TV precisely because of the programming. Back in the early Seventies, when I was a kid, we had cable for clear reception. By the Eighties, we had it for all the great new channels: Nickelodeon, MTV, A&E, CNN. If this service is of no value to you, then it’s wise to not subscribe. But you’re not going to duplicate the experience through your computer – not yet, anyway.

UPDATE: For more on the economics of buying programming “à la carte,” such as from iTunes or Amazon, see here and here. Bottom line: Buying individuals programs is a great cost savings, provided you watch very little TV.

There are plenty of freedom-loving Americans who love the Constitution. Some of them even carry around copies of that document. And yet, even among these hardcore fans, there is often a misunderstanding of the First Amendment to the U.S. Constitution.

Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.

There are many circumstances under which individuals may claim a violation of their First Amendment rights. Someone may lose employment after saying something in the press. A person may not be allowed to appear on a television broadcast. A student might be suspended for something written in the newspaper of a private college. These might be unjust situations, but they are not governed by the First Amendment, which says that the government may not abridge freedom of speech.  What the First Amendment guarantees is that the government doesn’t get to decide who gets to speak and who doesn’t.

In his speech, Kyle McSlarrow says:

…urging the government to impose rules that supposedly promote First Amendment values is too often used to justify regulations that instead threaten First Amendment rights.   By its plain terms and history, the First Amendment is a limitation on government power, not an empowerment of government.  Making these arguments is, ironically, almost proof that First Amendment rights are being implicated.

It’s also important to note that there are many who seem to think that the cable industry is a special case. They argue that cable’s infrastructure was built with government funding and is therefore a public utility and subject to common carrier regulation. All of these assertions are factually incorrect. To quote a previous post:

To be sure, our video services are subject to government regulation – at the federal, state and local levels – but we aren’t like telephone companies (which built their systems with captive ratepayers and a government-guaranteed rate of return) or even radio and television broadcasters (who were given public airwaves for free, but in return had to adhere to certain “public interest” requirements).  Our industry had no government-guaranteed return or government-granted public airwaves – to the extent we used any public resources, we paid for our rights-of-way with local franchise fees. Indeed, the cable industry built analog networks, our new digital networks, our cable modem and digital phone services with private risk capital with no assured return.

Some might argue that, because the FCC has previously regulated speech on the broadcast networks, such an approach would be appropriate in the Internet Age. But note what Kyle said in his address:

…in this case, the FCC is not engaged in the allocation of the public airwaves.  The bandwidth we’re talking about is capacity on private transmission facilities constructed by ISPs.  Imposing regulations that prevent providers from using “too much” capacity for speech-related services not even associated with Internet access should cause all sorts of First Amendment and Fifth Amendment Takings alarm bells to go off.

Finally, it’s not just the cable operators that would be affected. The other concern about the government deciding to involve itself in these debates – which should properly been seen as technology discussions – is that we don’t know what future applications might be developed or how they might need the network to be structured in order to work most effectively.

To quote from Kyle’s speech:

Not all content providers may need the same speed, prioritization of data and quality of service as, say, providers of high-definition video, or maybe 3D video or who-knows-what-else may be invented by application providers.  But ISPs can’t prioritize all content, due to the physical limitations of their systems.  And it may be entirely too costly (as well as unnecessary and inefficient) to offer the same quality of service that a video game service requires to every single content provider.  And so the effect of such a rule would be simply to prevent the offering of the services consumers might want that require such special treatment.

Or to quote one of my earlier blog posts:

If you want a dumb pipe, with every bit treated the same, that will significantly affect telemedicine and other advanced services which may require priority treatment. If creating some method of optimized delivery was such a terrible thing, what does this say about services like Akamai, that help make content distribution more efficient, benefiting both consumers and content producers?

Really, all we’re saying here is that these are very complicated issues and we hope that the government treads lightly as it contemplates taking action.

• Americans watch an average of 31 hours and 19 minutes of live television per week
• On average, only 31 minutes of time shifted video and 22 minutes of Internet video are consumed
• Even men age 18-24 (rumored to have dropped out of TV viewing altogether) watched 22 hours and 44 minutes of traditional TV versus just 35 minutes of web video

These numbers may come as a surprise given the number of people in tech media who have proclaimed live television and cable dead simply based on their own viewing habits.  The facts, however, continue to show that consumers find great value in television programming and likely the time spent together enjoying it.

Twenty years ago, our industry founded Cable in the Classroom (CIC), which over the past decade has brought free broadband service to thousands of schools and community libraries.

In recent years, our industry has also focused on the digital divide and how to promote broadband adoption.  Cox Communications, for example, has participated in a widely praised program in Santa Barbara, California, in which it provides discounted broadband service to children who participate in the National School Lunch program, together with partners who provide discounted or free computers.

Even though broadband is available to more than 90% of the households in the United States, almost one-third of those households don’t take the service.  Why?  Well, recent studies by the Pew Research Center demonstrate there is no single reason, and some of the multiple reasons – such as understanding the relevance of broadband, digital literacy, computer ownership, and affordability – likely overlap.

Several months ago, with the strong encouragement of FCC Chairman Julius Genachowski, we started working with the FCC’s broadband team to explore how we might help.  They were critical to helping with the data necessary to determine how to really focus in on a concept that could provide the maximum benefit.  Chairman Genachowski and Blair Levin, Executive Director of the FCC’s Omnibus Broadband Initiative, were very supportive of developing a proposal that would help low-income households that do not currently receive broadband.

The A+ pilot program builds on the experience of Cox Communications’ Santa Barbara initiative, by proposing a two-year, public-private partnership designed to promote sustainable broadband adoption for a vitally important-but-vulnerable population – middle school-aged children in low income households that do not currently receive broadband service.  The program is called Adoption Plus because it is a comprehensive approach that treats broadband adoption as a multi-faceted problem that requires multi-faceted solutions.  Barriers to adoption – e.g., relevance, digital literacy, computer ownership, affordability – are interwoven and cannot be resolved in isolation.

The goal of the A+ program is to help give millions of students the opportunity to become digital citizens of the 21st Century by driving sustainable broadband adoption and positively and materially affecting educational outcomes.

Here is how it would work (a more detailed summary can be found at NCTA’s website):

• A+ would promote the adoption of broadband service to households that do not currently receive it, by offering comprehensive digital media literacy education, discounted computers, and discounted home broadband service to households representing up to 3.5 million American children in grades 6 through 9 who are eligible to receive a free or reduced-cost meal through the National School Lunch Program.
• We propose that school districts administer the program, apply for federal funding, and partner with non-profit corporations promoting digital media literacy, computer manufacturers and/or retailers, and cable and other broadband Internet Service Providers (ISPs).
• Perhaps the most important role of the school districts is to implement digital media literacy programs, including online safety training, and training on how to use computers and broadband.  Including administration costs, we recommend that $100 million of federal funding be used for school districts which apply to set up an A+ program.
• We also anticipate that computer manufacturers would supply discounted computers as partners in A+, but ask the government to consider whether and to what extent federal funding is appropriate to help further discount the cost of computers.
• For each eligible household, participating ISPs would provide free installation of broadband service; a 50 percent discount off the monthly subscription cost of their entry level broadband service; and a 50 percent discount off the cost of modem equipment, whether purchased or rented.
• It is important to note that, while we recommend federal funding for digital media literacy training and administration of this program by school districts, we are not seeking any government funding of the ISPs’ contribution to A+.

While the A+ program is open to other broadband ISPs who wish to participate, so far, all of the cable ISPs represented on NCTA’s Board of Directors have agreed to participate in the A+ program as outlined above.  Those companies also have committed to air public service announcements explaining and promoting local A+ programs.  We estimate the value of the cable ISP contribution to the A+ program, with full student participation, at well over $500 million.

Our industry will continue to creatively harness the power of technology, including broadband, for educational purposes in other ways as well.

For example, A&E Television Networks, through HISTORY, has partnered with more than a dozen major cable operators around the country in creating Take a Veteran to School Day, where veterans are welcomed into local schools for special assemblies and oral history projects – a program that was recognized by President Obama at the White House just a few weeks ago.  And Viacom has partnered with the Bill & Melinda Gates Foundation in the Get Schooled initiative to identify effective approaches to increase high school and college graduation rates, improve post secondary readiness and promote the fundamental importance of education.

With the nation’s new emphasis on science, technology, engineering, and mathematics (STEM) education, major cable companies have stepped up with new commitments, such as the $100 million Connect a Million Minds initiative launched in November by Time Warner Cable, to introduce young people to opportunities and resources that inspire them to develop the STEM skills that will help solve our economic, environmental, and community challenges of the future. Discovery Communications is supporting STEM education by offering a commercial-free programming block for middle schoolers on the Science Channel, and through Discovery Education, which will provide STEM Connect, a new broadband delivered curriculum-based career development resource helping students link their science, math, engineering and technology education to their future careers. President Obama recently recognized both Time Warner Cable and Discovery in a White House announcement on STEM initiatives.    Earlier this year, Comcast teamed with One Economy to launch the Comcast Digital Connectors program in more than 20 markets nationwide, an initiative designed to teach broadband technologies to young people ages 14-21 from diverse, low-income backgrounds, who then put that knowledge to work in their local communities.

And Cablevision offers teachers important tools for using broadband and interactive technology as part of its Power to Learn program.

There are many other examples of creative initiatives that recognize how broadband can positively affect education of America’s children.  What they have in common is an understanding that partnerships and collaboration among interested stakeholders is required for success.  A+ is an ambitious step forward in this tradition, and we look forward to working with interested government agencies and other stakeholders to make it a reality.

First, I appreciate Ars giving me the opportunity to provide a guest post on the issue of Selectable Output Control.  And, like someone lost in the desert, I suppose I should just be grateful for a cup of water and take Ars’ agreement that this issue really isn’t about “hobbling” consumers’ equipment – despite what SOC opponents have been arguing for months.

But Matthew Lasar’s response now shifts the debate from hobbling existing TVs to the inevitable slippery slope: If the FCC grants a waiver for early release movies, Ars argues that next will come use of SOC for the “Big Game” (which won’t likely involve my Washington Redskins), a key episode of Mad Men (perhaps where Don divorces Betty and moves in with Peggy because she has a TV that works with SOC), and, Lord knows, it will then be used to provide exclusive showings of a film of the JFK assassination  that will prove that the Zapruder film was part of the “cover-up.”

But the truth is that there is no studio-cable-DBS cabal to deny consumers viewing opportunities; rather, we’d like to give our customers content they would not otherwise receive without our ability to use SOC.  Forgotten now is that the cable industry supported the adoption of the FCC ban on SOC as part of a compromise with the consumer electronics industry in which both industries recommended one-way Plug & Play rules to the FCC. We did so while recognizing – as did the consumer electronics industry and the FCC – that waivers would be granted upon a showing that the public interest would be served by waiving the rule, for example where the waiver proponent demonstrates that the content is a “new business model” advantageous to consumers. Therefore, the FCC must decide in each particular case whether SOC should be permitted. To me, it is crazy that the government is in this business of deciding outputs/inputs at all.  But the FCC’s role ensures there isn’t a slippery slope; the proponent of a waiver must prove each time that the proposed service is something beneficial to consumers.

Putting aside the debate over the use (or abuse) of SOC, I have a particular concern with the claim that our television services are part of some “public network” akin to the public switched telephone network and therefore subject to some special regulation which restricts our business in ways not allowed with regard to other businesses. To be sure, our video services are subject to government regulation – at the federal, state and local levels – but we aren’t like telephone companies (which built their systems with captive ratepayers and a government-guaranteed rate of return) or even radio and television broadcasters (who were given public airwaves for free, but in return had to adhere to certain “public interest” requirements).  Our industry had no government-guaranteed return or government-granted public airwaves – to the extent we used any public resources, we paid for our rights-of-way with local franchise fees. Indeed, the cable industry built analog networks, our new digital networks, our cable modem and digital phone services with private risk capital with no assured return.

If the goal is innovation to meet rapidly-changing consumer demands, the old-style public utility model is exactly the wrong way to go.

Again, I appreciate the opportunity to engage in a discussion with Ars and its readers and look forward to more in the future.

The participants will debate the motion “A network neutrality law is necessary.“ Arguing for the motion will be Professor Tim Wu, venture capitalist Brad Burnham and Professor Nicholas Economides. Presenting the case against the motion will be James Assey, Robert Quinn (AT&T’s Senior Vice President of Federal Regulatory) and Professor Christopher Yoo.

The event will be streamed live this evening at 8:00 p.m. A podcast will be available afterwards at Tech Debate’s website.

James Assey did a bit of debating on net neutrality and other telecom topics at the Personal Democracy Forum back in July. You can read a write-up of that conversation or watch a video of the proceedings.