There have been quite a few announcements in recent months about cable’s progress towards deploying tru2way, but unfortunately, there continues to be some confusion in the blogosphere about the future of CableCARDs and exactly how tru2way devices will work.
For example, I see tru2way described as “CableCARD 2.0,” which is cute but not technically correct. I see questions about when there will be a “two-way CableCARD,” when in fact all CableCARDs are capable of accessing two-way cable services such as video-on-demand. I see people expressing expectations that the introduction of tru2way means that CableCARDs will go away, when in fact tru2way devices require use of CableCARDs.
It’s great to know that so many people are passionate about these issues, but the misinformation is a little frustrating.
I thought I would back up and walk through a very brief history of CableCARDs and tru2way, so as to hopefully clear up this confusion.
The Beginning of CableCARDs
In the Telecommunications Act of 1996, Congress sought to foster competition in the set-top box market by enacting a new provision of the Communications Act, section 629, whose purpose was to make set-top boxes available for retail purchase. Specifically, that provision called on the FCC to adopt rules to ensure the commercial availability of “navigation devices” (e.g., a set-top box). But you couldn’t jeopardize the signal security of the provider (e.g., your local cable operator).
The FCC determined that this could be accomplished by separating security (i.e., conditional access) from the function of the device. The security functions would instead reside in a separate security module that you would get from your local provider. These security modules were first known as Point-of-Deployment (POD) Modules and later were named CableCARDs.
An FCC order in 1998 required the cable industry to develop PODs which it did by 2000, but, for a variety of reasons, there were no retail devices built with which the PODs were intended to work. By December of 2002, a “Plug & Play” agreement was reached between major cable operators and major consumer electronics companies setting the stage for the release of the first wave of devices – such as digital “cable ready” television sets – which would work with CableCARDs. These DTVs could be sold (and moved) anywhere in the country and allowed cable subscribers to receive one-way digital cable services without the use of a set-top box by obtaining a CableCARD from his or her cable operator. CableCARDs allowed cable customers to view encrypted digital programming after being authorized to do so by the cable operator.
That “Plug and Play” agreement took effect in the Summer of 2004. As of August 2004, there were approximately 700 CableCARDs deployed by the top 10 MSOs. NCTA just reported new numbers to the FCC and we found that there are 372,000 CableCARDs that the top 10 operators have supplied to date to customers who requested them for Digital Cable Ready TV sets or other CableCARD-compliant products, such as some TiVo digital-video recorders.
In addition, as a result of the FCC’s “integration ban” requiring that cable operators use CableCARDs in their own leased set-top boxes, we just reported that major cable operators have deployed more than 6.2 million digital set-tops with CableCARD conditional-access systems since July 2007.
One-way versus two-way
It’s good to stop here and point out that the 2002 agreement was an agreement for building devices to access one-way cable services such as linear (e.g., TNT, ESPN) and premium (e.g., HBO, Showtime) digital channels, including high-definition channels, but not two-way (“interactive”) services such as video-on-demand.
The reasons for this are long and involved and include technical, business and legal issues, but the short answer is that the cable and CE industries decided to adopt a one-way agreement as a first step to a “two-way” agreement. But agreement on a two-way agreement proved to be much more difficult and complex than a one-way agreement.
In particular, two-way services involve high-value content and we have three affected industries: cable, content providers (such as studios) and consumer electronics manufacturers. Not all of the companies within each industry have all the same views and not all of these industries have the same views. It’s a hard thing to accomplish.
The Story of tru2way
Now, I need to back up one more time and point out that something else was going on at almost exactly the same time. In the fall of 1997, came the beginning of the cable industry’s OpenCable project. Its mission was to provide a set of hardware and software specifications for the next generation of cable’s set-top boxes and other two-way devices. The software involved was called the OpenCable Applications Platform or OCAP, now known as tru2way. The tru2way hardware and software forms the basis for interactivity in two-way retail devices, as well as cable operator devices, and is used in conjunction with – not as a substitute for – CableCARDs which are still needed to provide access to secure cable services.
These are two separate stories
Now, let’s put it all in context. CableCARDs came from a government mandate to separate security from “channel surfing” functionality in set-top boxes, making them available at retail. The CableCARD itself can handle one-way or two-way communication, but the first Digital Cable Ready sets were one-way, because that’s all that was negotiated.
Meanwhile, tru2way comes from a decade of development and was focused on developing specifications that would allow interactive services to be deployed – and interactive services are two-way by definition. Two-way Plug & Play negotiations have been going on for some time, since the one-way agreement was finally settled.
In the meantime, the tru2way specification emerged as an option for building two-way Digital Cable Ready devices. Major CE companies such as Panasonic, Samsung, LG, and Sony have agreed to use tru2way technology to build two-way Digital Cable Ready devices (IT companies such as Intel have also endorsed tru2way). And, as noted, tru2way devices still require a CableCARD for security.
After all, without such security, you can’t have content. Cable operators typically have contracts in place that they have to guarantee conditional access and other limits on unauthorized distribution.
So, there you go. It’s understandable that there’s confusion over CableCARDs. After all, customers with Digital Cable Ready devices represent probably less than 1% of cable customers. But I hope this post will serve to bring some clarity to the issue. If anyone wants a more detailed history, the best one I have seen can be found here.