In the past few weeks, this blog has addressed the issue of encryption of cable’s basic programming tier.
We’ve pointed out that such encryption would reduce the need for technicians to visit customers’ homes for installations and disconnections. We’ve argued that deploying physical filters at consumers’ homes to control authorization is a very inefficient and backwards-looking approach.
Now, some of cable’s top executives have sent a letter to the FCC to argue that it only makes sense for the Commission to eliminate the prohibition on encryption of the basic tier for all-digital cable systems.
This rule was originally adopted at a time when satellite service was just beginning, telephone companies were not yet providing video services and the Internet was not a place to watch video.
Back then, cable was an analog service and most cable customers could only access about 60-80 channels on their TVs without a set-top box. Since then, cable operators have moved to digitize and largely encrypt their channel lineups, so only the 20 or so basic tier channels (i.e., over-the-air broadcast signals, PEG channels, and a few other channels) can be accessed without a set-top box or CableCARD-enabled device.
In this digital environment, the overwhelming majority of digital cable customers already have set-top boxes or retail CableCARD devices to access encrypted services. In cable systems that go all-digital, nearly 100% of customers will have such equipment, so elimination of the encryption prohibition will be a non-event.
As the executives state in the letter:
…for the very small percentage of customers in all-digital systems who receive basic tier services without equipment, we have made clear our support for transitional equipment measures to help ease the potential impact. As you know, the Commission granted Cablevision a waiver of the encryption rule in part to get real-world experience about the effect of encrypting the basic tier. Cablevision’s experience in its New York City system confirms that very few customers will be impacted by basic tier encryption. In that system, fewer than 0.1% of subscribers requested equipment under the conditions in the waiver order, demonstrating that the overwhelming majority of subscribers already had set-top boxes or retail CableCARD devices in their homes to access encrypted programming.
This change will be a critical part of the move toward all-digital networks. It will free up cable bandwidth for faster broadband, more high-definition channels, more VOD choices, and other services that customers are demanding in today’s competitive marketplace.
It’s notable that the basic tier encryption prohibition applies only to cable. Satellite and IPTV providers encrypt all of their programming, as do online video distributors. In today’s world, it is unfair and unreasonable to single out cable as the sole video platform that is prohibited by law from fully encrypting its video programming services.
We hope that the FCC will agree and make this change to the rule.