BeforetheFederalCommunicationsCommission
Washington,D.C.20554IntheMatterof )
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ImplementationofSection304oftheTelecommunicationsActof1996
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CSDocketNo.97‐80
CommercialAvailabilityofNavigationDevices
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CompatibilityBetweenCableSystemsandConsumerPremisesEquipment
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PPDocketNo.00‐67
COMMENTSOFPUBLICKNOWLEDGE,MEDIAACCESSPROJECT,ANDNEWAMERICAFOUNDATION
JohnBergmayer AnjaliBhat1818NSt.NW,Suite410WashingtonDC20036(202)861‐0020 PublicKnowledgeMatthewF.Wood1625KSt.NW,Suite1000WashingtonDC20006(202)232‐4300MediaAccessProjectBenjaminLennett1899LSt.NW,Suite400WashingtonDC20036(202)986‐2700NewAmericaFoundation June14,2010
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TABLEOFCONTENTS
SUMMARYANDINTRODUCTION……………………………………..………………………...…………3DISCUSSION…………………………………………………………………………………………………...……8
I. CableCARDIsVitalToIncreasingVideoDeviceCompetitionToday…………………………………………………………………………………………...……..8
II. TheCommissionShouldRequireGreaterTransparencyInCableCARDBillingThanItsCurrentRulesPropose…………………………………………………………..10
III. CableCARDSShouldNotRequireProfessionalInstallation………………………...13
IV. MultistreamCableCARDSShouldBeStandard…………………………………………..15
V. AnyCableCARDDeviceThatDoesNotHarmTheNetworkShouldBe
Certified………………………………………………………………………………………....….16
VI. Two‐WayCommunicationBetweenDevicesRemainsImportant,ButTheCommissionShouldAllowInterfacesOtherThanIEEE1394…………….….16
VII. TheCommissionShouldRequireCableOperatorsToAcceptABroadband
ReturnPathtoEnableTwo‐WayFunctionalityOnCableCARDDevices…18
VIII. CommonRelianceRemainsAnEssentialPrincipletoEnsureProperCableCARDSupport…………………………………………………………………………...20
CONCLUSION....…………………………………………………………………………………………………..22
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SUMMARYANDINTRODUCTION
TheCommissionhasadmittedthatitsattempttoimplementSection629of
theCommunicationsActhasfailed.1Thatattempthasnotsatisfactorilyfulfilledthe
promiseofCableCARD.Thissmall,cable‐suppliedpieceofelectronicscaneasilyslot
intoanycompatiblevideorecorder,television,PC,orotherdevice,andisdesigned
togivethemaccesstothefullrangeofcablecontent.ButtheCommissionallowed
thecableindustrytoconstructformidablebarrierstoadoptionanduseofsuch
technologybydevicemanufacturesandconsumers,whichsuppressedthesupplyof
andthedemandforCableCARDdevices.Itdoesnotmatterwhetherthecable
industryintendedtocreatebarrierstoentryorifthesebarriersarosefroma
genuineefforttoprotectconsumers.TheFCC’sapproachpermittedthesebarriers
andthusdidnotsatisfytheCommission’sstatutoryobligationtofostera
competitivemarketinvideodevices.
Consumersdeservebetterthantoday’shalf‐functioningCableCARDsystem.
ThecurrentregimedoesnotimplementthewillofCongress,preventseffective
competition,stiflesinnovation,andsaddlesconsumerswithunnecessarilyhigh
devicerentalfees.TheCommissiontoooftenhasbeenpersuadedbycable
operators’argumentsaboutshort‐termcostsavings,whileignoringthebigger
picture.Asinalltrulycompetitiveandcontestablemarkets,acompetitivemarket
forvideodeviceswoulddrivecostsdown,andwouldprovideproductsatevery1ImplementationofSection304oftheTelecommunicationsActof1996,FourthFurtherNoticeofProposedRulemaking,FCC10‐61,CSDocketNo.97‐80,Apr.21,2010¶1(hereafter“FNPRM”).
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pricepoint.Insteadoftakingthenecessarystepstocreatemarketconditionsthat
wouldallowcompetitiontothrive,theCommissioninsteadrepeatedlywaivedits
requirementthatallnavigationdevicesbeCableCARD‐based,thusensuringthat
compliantdeviceswouldberelegatedtonichestatusandunabletoachieve
economiesofscale.TheCommissionhasallowedthecableindustrytowithhold
supportfortwo‐wayservicesonCableCARDdevices.Ithasallowedthecable
industrytoobstructcompetitorswithanunnecessarilytime‐consumingand
expensivedevicecertification.Becauseofallofthis,thecableindustry’s
“predictions”thatconsumerswerenotinterestedinbuyingvideodevicesatretail,
andthatcompetitivelyprovidedvideodeviceswouldalwaysbemoreexpensive
thancable‐supplieddeviceswithoutCableCARDs,becameself‐fulfillingprophecies.
Thecableindustrynowpointstothelackofamarketduetothepresenceofthese
barrierstoentryasareasonfortheCommissiontogiveupandignorethelaw,.
ThemarketpowerofthelargestMVPDs(bothovercustomers,andas
purchasersandproducersofprogramming)meansthattailored,proactiverulesare
neededtopromotecompetition.Competitionhasbroughtlowerpricesand
innovationinallothermarketsfor“consumerpremisesequipment.”Afterall,the
telephonesandPCsweusetocommunicatearenotrentedfrom
telecommunicationscarriers,butpurchasedatretail.Attimes,theCommissionhas
hadtostepintopromotethiscompetition.BeforetheCommissionissuedthe
Carterfonedecision,andfolloweditupwiththePart68rules,AT&Tclaimedthata
competitivemarketfortelephoneswouldharmthenetwork,harmconsumers,and
driveupprices.Itsargumentswerefalsethen;cable’sarefalsenow.Theevidence
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showsthatcompetitionworks.Theburdenshouldbeoncabletodemonstratewhy
itsindustryisdifferentfromtheotheronesintheCommission’sjurisdiction.
AstheNationalBroadbandPlanfound,themorelimitedinnovationand
successonthe“thirdscreen”ofthetelevisionset–whencontrastedwithPCsand
mobiledevices–haslimitedbroadbandadoption.2Bringingnext‐generation
servicestoallhomesmeansthattheremustbecompetitionamongdevicesthatcan
easilycommunicatebothwithMVPDservicesandbroadband.Competitioninthe
marketforvideodeviceswillincreasethevalueofbroadbandtomanyconsumers
andensurethattheneedsofallconsumers—notjusttheyoungtech‐savvycrowd
withlotsofdisposableincome—aremet.
Thecoststoconsumersdonotcomeonlyintheformofrentalfees,norin
beingstuckwithexpensive,boringdevices.Therearealsotheopportunitycoststhat
affecttheeconomyasawhole,asthecompaniesandinnovatorswhowouldhave
enteredthemarketforcable‐connectedvideodeviceshavebeendiscouragedbythe
barrierstoentry,andbylimitedopportunitiesforsuccessinthefaceofcable
intransigenceandFCCinsouciance.Somecompanies(mostnotablyTiVo,butthere
areothers)havesloggedthroughtheproceduralandeconomicbarrierstoentryand
developedsuccessfulproductsthatdependonCableCARDregardless.Butthere
shouldbemorecompanieslikeTiVo.Thetechnologistswhowouldhavefounded
thenextTiVosawthebarrierstousingCableCARDandmovedon.SteveJobs
specificallycitedcableindustrytechnologybarriersasareasonthattheAppleTV
2CONNECTINGAMERICA:THENATIONALBROADBANDPLAN(2010)49‐50(hereafter“Plan”).
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didnotsupportTVtuningandrecording.3InsteadoflobbyingtheFCCtochangethe
rules,Appleworkedonotherthings.AlmostallInternetvideoandover‐the‐top
services—companieslikeRoku,Boxee,andVuze—aredesignedtobypasscable‐
suppliedvideo.Attemptingtointeroperatewiththemostpopularsourceof
programmingisjustnotworththelegal,financial,andcustomerservicehasslefor
eventhebrightestofengineers.Customersleasemoredevicesthantheypurchase,
andmanufacturersdonotproducemoredevices,becausetherulesarerigged
againstdevicecompetition.CableCARD’slimitedsuccessshouldnotbetakenas
evidencethat,uniquelyamongcommunicationsservices,cabledevicecompetitionis
undesirable.Ifthatweretrue,innovatorswouldnotspendsomuchtimeandeffort
tryingtocircumventthecurrentbarrierstointegratingdeviceswithprogramming.
ThelessonofCableCARDisthattheCommissionshouldnotdelegatetoanindustry
theobligationtocreatealevelplayingfieldthatsaidindustryperceivesas
fundamentallyopposedtoitsowneconomicinterests.
ThisproceedingisavitalfirststeptotheeventualrealizationoftheAllVid
system,whichwillbringthebenefitsofchoiceandinnovationtothecustomersofall
MVPDs.IthasbeenclearformanyyearsthattheprimaryobstaclestoCableCARD’s
successhavenotbeentechnological,butrelatedtobilling,support,and
certification.4TheworktheCommissiondoesinthisproceedingwillbedirectly
3RyanBlock,SteveJobsLivefromD2007,ENGADGET,May30,2007,http://www.engadget.com/2007/05/30/steve‐jobs‐live‐from‐d‐2007(“TheminuteyouhaveanSTByouhavegnarlyissues,CableCARD,OCAP...thatjustisn'tsomethingwewouldchoosetodoourselves.”).4TheBroadbandPlanindentifiedfourprimaryfactorsholdingbackCableCARD:accesstotwo‐waycontent,pricing,support,andcertification.Planat52.Whilethefirstoftheseispartlyatechnologicalissue,asdiscussedbelow,choosingan
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applicabletoAllVid.Evenso,thefactthatsomethingbetteriscomingdowntheroad
isnoexcuseforneglectingtofixwhatwehavetoday.Commenterslookforwardto
participatingintheAllVidproceeding.AllVidwilldothingsthatCableCARDcan
neverdo,suchassupportallMVPDs,andnotjustcable.Itisabettersolutionfora
convergedIPenvironment.ButitmaytaketimeformanufacturersandMVPDsto
deployAllViddevices,andatleastsomeCableCARD‐equippeddevicesareinthe
storesandinconsumers’homestoday.TheCommissioncanandshouldadopta
numberoftargetedfixestomaketheCableCARDregimeworkasinitiallyintended,
evenastheCommissionadvancesonAllVid.
Whileagoodfirststep,theFNPRM’sproposedrulechangesdonotgofar
enough.ThenewrulesshoulddemonstratetheCommission’scommitmentto
makingCableCARDwork.Surgeryisneeded,notjustabandage.TheCommission
cannotallowthenextseveralyearstobecomeawaitinggameascablecontinuesto
delayeffectiveimplementationofCongressionalpolicy,thistimeusingthecoming
ofAllVidasanexcuse.TohelptheCommissionachievethisgoal,thesecomments
addresssomeoftheissuesraisedintheFNPRMandthensuggestdraftrulesthat
wouldbetterachievetheFNPRM’sstatedgoalofimprovingtheCableCARDregime.
TheCommissionmustbearinmindthatCableCARDisessentialtoincreasing
devicecompetitiontoday.Despitethefailuresanddelaysofthepastdecade,there
areCableCARDdevicesinthefield.TheCommissioncanachievequickresultswith
focusedrulesprovidingforgreatertransparency,whichwillenablecustomersto
makeinformedchoicesaboutthevaluepropositionofrentingversusbuying,andapproachtoallowCableCARDdevicestocommunicateupstreamisapolicyquestion.
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whichwilldiscourageunlawfulcross‐subsidization.TheCommissionmustremove
thelogisticalbarriersthatobstructtheuseofretaildevices,suchasthe
requirementsforprofessionalCableCARDinstallation,ortheprovisioningofsingle
streamratherthanmultistreamcards.Whilestillrecognizingthatstandard
interconnectioninterfacescanpromoteacompetitivemarketbyallowingdevices
fromdifferentsourcestoworktogether,theCommissioncanaddflexibilityby
allowingothermodern,IP‐capableinterfacestobeusedinsteadofjustIEEE1394.
Finally,itcanmakesurethatretaildevicescompeteonalevelplayingfield,by
requiringcableoperatorstosupportabroadbandreturnpathtoenableupstream
communication,andbyrethinkingitsproposaltoseverelyhampertheprincipleof
commonreliance.
DISCUSSION
I. CableCARDisVitaltoIncreasingVideoDeviceCompetitionToday
CableCARDexiststoday,andsimplefixestotheCommission’srulescan
knockdownsomeofthebarriersthathavelimitedthistechnology’ssuccess.The
Commissionmustrememberthiswhenitgathersdataaboutwhether“technical
developmentsoverthelastdecadehaveovertakentheCableCARDmodel.”5A
gatewayapproachismoreappropriatefortheheterogonousnetworksthatmakeup
theentireMVPDmarketplace,whichisonereasonthelimited‐functiongateway
approachproposedbytheAllVidNOIisamoreappropriatesolutionforthefuture.
But,astheCommissionpointsout,“thecableandconsumerelectronicsindustries
5FNPRM¶12.
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haveinvestedheavilyinthe[CableCARD]technology….”6TheCommissionshould
taketheseinvestmentsandrelianceinterestsintoaccountwhendeterminingapath
forward.7Furthermore,iftheCommissionistoachievethegoalsofSection629in
thenearterm,itmustfix,andnotabandon,theCableCARDsystem.
MostoftheflawswiththeCableCARDsystemarenottechnological,but
economic,procedural,andsupport‐related.Thesecanbeaddressedwithafew
targetedfixes,followedupbyproperenforcement.Manyofthesameissuesthatface
theCommissioninAllVidcontextfacetheCommissioninthisproceeding,andcan
beaddressednow.Here,theCommissionhastheopportunitytocraftrulesabout
customersupport,thatpreventcross‐subsidizationbetweencable‐operator
supplieddevicesandcableservice,andthatensurethatanynecessarydevice
certificationisquickandpainless.Forexample,underAllVid,ifMVPDsare
permittedtosupplytheirownCPEbeyondthegateway,theymustnotsubsidize
devicecostswithservicefees.ThesameistrueofCableCARD.Commenters
thereforeurgetheCommissiontomakethemostofthisopportunityandcraft
ambitiousbutworkablerulestopromoteatlastacompetitiveretailmarketfor
navigationdevices.
TheCommissionalsoaskswhetheritshouldcontinuetherequirementthat
NCTAandCEAfilequarterlyreportsonthestatusoftheirtwo‐waynegotiations.
ThisrequirementissymptomaticofthefailingsofthepreviousCableCARD
approach,whichreliedtoomuchoninter‐industrynegotiations,andthe6Id..7FCCv.FoxTelevisionStations,129S.Ct.1800,1811(2009)(agenciesmusttakefactssuchasrelianceinterestsintoaccountwhendeterminingwhethertochangetheirpolicies).
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Commissionshoulddropit.Whilevoluntaryandindustry‐ledstandards‐setting
proceduressometimesmaybepreferabletoFCCinvolvement,thesearenot
workablewhenthenegotiatingpartiesbelievetheyhaveopposinginterestsand
cannotachieveconsensus.Ratherthanrequiringsuchindustriestocontinuetheir
fruitless“negotiations,”theCommissionmustpreparetostepinandmakedecisions
astohowitwillcarryouttheCongressionalmandateofSection629.The
Commissioncannotdelegateitsresponsibilitiestoindustryandthendonothing
whenthisapproachfails.
II. TheCommissionShouldRequireGreaterTransparencyInCableCARDBillingThanItsCurrentRulesPropose
Theproposedrulesdonotgonearlyfarenoughinaddressingthelong‐
standingcross‐subsidization8andpricingissuesthathavekeptCableCARDdevices
fromachievingafullermeasureofsuccessinthemarketplace.Thesepracticeserect
barrierstoentry,harmconsumers,9andviolatethecleardirectivesofthestatute.
Indeed,ascommentersobservedinNovember:
8Forexample,RCNCable’spricelistincludesa“digitalconverter”aspartofthe$44.99“SignatureDigitalCable”package.SeeRCN,http://www.rcn.com/dc‐metro/digital‐cable‐tv/services‐and‐pricing(visitedJune11,2010).Thepackagecomeswith“45HDchannels.”Elsewhere,theRCNwebsiteliststhemonthlyrentalfeeforanHDconverterboxas$9.95permonth.RCN,http://www.rcn.com/dc‐metro/digital‐cable‐tv/equipment(visitedJune11,2010).RCN’ssitedoesnotindicatewhetheracustomerwhodoesnotrentanHDconverterboxfromtheMVPDcanget“SignatureDigitalCable”for$35.04permonth—i.e.,thecostofthevideoserviceminustheconverterboxfee.SavvyconsumerswhouseCableCARD‐enabledequipmentratherthanMVPD‐suppliedset‐topboxesmaybeabletonegotiatelowermonthlyrates.See,e.g.,MegMarco,“AskingComcasttoLowerYourMonthlyBillResultsinComcastLoweringYourMonthlyBill,”THECONSUMERIST,June22,2009,http://consumerist.com/2009/06/asking‐comcast‐to‐lower‐your‐bill‐results‐in‐comcast‐lowering‐your‐bill.html.However,thisinformationisusuallynotpublic.9TheaveragelifeofaTiVoDVRisfiveyears.SeeTiVoForm10‐Q,filedDecember9,2009,availableathttp://investor.tivo.com/phoenix.zhtml?c=106292&p=irol‐sec
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TheFCC’scurrentrulesallowcross‐subsidizationofvideodevicecoststhroughservicecharges,andthuslimittheabilityofthirdpartiestocompete….Section629statesthat“equipmentusedbyconsumerstoaccessmultichannelvideoprogrammingandotherservicesofferedovermultichannelvideoprogrammingsystems”maybeofferedtoconsumersbyMVPDs,butthatanychargesforsuchequipmentmustbe“separatelystatedandnotsubsidizedbychargesforanysuchservice.”However,contrarytothecleardirectiveofCongress,theFCChasadoptedrulesthatexpresslyallowsuchsubsidization.10
TheCommissionhaschosentointerpretaprovisionaboutaccountingpractices,
Section623(a)(7)(A),asnegatingSection629’sprohibitiononcross‐subsidization.11
TheCommissionhasnotproposedanyrulestoremedytheseunlawful,unfair,and
anticompetitivepractices,andhasneglectedtheNationalBroadbandPlan’s
recommendationthattheCommissionensurethatthereareequivalentand
(showingthatTiVorecognizesproductlifetimesubscriptionsover60months).AnormalpriceforaTiVoDVRisabout$300,whichtranslatesto$5permonth.Cableoperatorsofferset‐topboxrentalsatpricesinthe$4to$15dollarrange,withthelower‐endboxesgenerallylesscapablethantheconsumer‐owneddeviceswithamortizedcostsinthesamerange.Forexample,RCNCableoffersadigitalconverterfor$3.95amonth(foronedevice,withadditionaldevices$6.95permonth).ButtheirHDDVRcosts$14.95permonthtorent,whichamountsto$897over5years.SeeRCN,http://www.rcn.com/dc‐metro/digital‐cable‐tv/equipment(visitedJune11,2010).Bycontrast,onJune11,2010,aTiVoHDDVRwasavailableforpurchaseonBestBuy.comfor$299.99–one‐thirdthepriceofrentingasimilarboxforfiveyears.10PetitionforRulemakingofPublicKnowledge,FreePress,MediaAccessProject,ConsumersUnion,CCTVCenterforMedia&Democracy,andtheOpenTechnologyInitiativeofNewAmericaFoundation,filedDec.18,2009,at26‐27.11TheCommissionhasincorrectlyinterpretedSection623(a)(7)(A)oftheCableAct,47U.S.C.§543(a)(7)(A),asallowingsomekindsofcross‐subsidizationandbelow‐pricemarketing.See47C.F.R.§76.923(j)(“Acableoperatormayofferequipmentorinstallationatchargesbelow[cost],aslongasthoseofferingsarereasonableinscopeinrelationtotheoperator’soverallofferingsintheEquipmentBasketandnotunreasonablydiscriminatory.”).However,thelegislativehistoryofSection623indicatesthatthissectionwasaimedexplicitlyatpromotinga“broadband,two‐waytelecommunicationsinfrastructure,”H.R.Rep.No.104‐458,at167(1996)(Conf.Rep.),andthusshouldnotbereadinconflictwithSection629.However,oneoftheFCC’sruleimplementingSection629,47C.F.R.§76.1206,defersto47C.F.R.§76.923,improperlyallowingSection623tonullifySection629.
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transparentpricesforCableCARD‐equippeddevicesasforcable‐suppliedset‐top
boxes.
TheCommissionmustensurethatnoeconomicbarriers,whetherexplicitor
implicit,standinthewayofthesuccessofCableCARD.Suchbarriersinhibitthe
developmentofacompetitivemarketplace,andkeeptheCommissionfromfulfilling
itsstatutoryduty.TheNationalBroadbandPlanrecommendedthattheCommission
“[e]stablishtransparentpricingforCableCARDsandoperator‐leasedset‐top
boxes.”12TocarryouttheadviceortheBroadbandPlanandfulfillSection629,in
additiontorequiringthatcableoperatorsseparateoutCableCARDrental‐feesfrom
set‐topboxrentalfeesforcustomerswholeaseanon‐integratedset‐topbox,the
Commissionmustrequirethatcableoperators(1)disclosethepriceoftheleased
boxalongsidethemonthlyrentalfee,13(2)disclosetocustomersoneachbillhow
muchtheyhavepaidinrentalfeesforthatboxtodate,and(3)expresslyinform
customersthattheyhavetheoptionofpurchasingacompetitivedeviceatretail.
Additionally,theFCCmustensurethatnoportionofanMVPD’sservicefeesgoesto
coverequipmentcosts—forexample,byrequiringthatdevicerentalfeescoverall
first‐partydeviceequipmentandsupportcostsincurredbytheMVPD.
Thesesimplerulescouldhavebroadimplications.Consumerscannotmake
rationaleconomicchoicesiftheydonothavethedatanecessarytodosobefore
12Planat52.13CableoperatorsshouldhavetheoptionofdisclosingeithertheMSRPoftheexactSKUthecustomerisrenting,orthewholesalepricethecableoperatorpaidforthedevice.
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them.Totheextentthat,accordingtosomeMVPDs,14consumers“prefer”tolease
ratherthanpurchasevideodevices,itislikelythatthispreferencewouldchange
withsuchinformationinhand.ThestoryofEsterStrogen,whopaidthousandsof
dollarsovertheyearstorentherblackrotarytelephone,iswell‐known.15Herstory
isoutrageousbecauseitcametolightinatimewhenacompetitiveretailmarketin
telephoneequipmentwaswell‐established.HadMrs.Strogenbeenpresentedwitha
runningtallyofherrentalfeesovertheyears,shemayhaverealizeditwasinher
bestintereststosimplypurchaseaphone.Similarly,ifcustomersarepresenteddata
onhowmuchtheyspendtorentdevicesfromthecablecompany,theymaychoose
topurchasedevicesinstead—orcablecompaniesmaystartofferinglowerfeesor
rent‐to‐ownoptions.
III. CableCARDsShouldNotRequireProfessionalInstallation
OneofthebiggestbarrierspreventingCableCARDdevicesfromtakinghold
inthemarketistherequirementimposedbymanycableoperatorsthatacable
technicianvisitthecustomer’shousetoinstalleachCableCARDdevice.Notonly
doesthecustomerhavetoarrangeavisitandwaitathomeforthetechnician.She
oftenmustpaythecableoperatortocarryoutitslegalobligationofsupportingnon‐
integrateddevices.
Thisisunfair,andthwartsthedevelopmentofacompetitivemarketby
makingretaildevicesmoredifficulttosetup.Italsomakesnosensetechnologically.14E.g.,CommentsofTimeWarnerCable–NBPPublicNotice#27,GNDocketNo.09‐51,filedDec.21,2009,at5(“WhilethesignificantmajorityofTWC’ssubscribersleaseset‐topboxestoday,thatresultsfromthemanyadvantagesoftheleasemodelratherthananypreferenceforthatmodelonTWC’spart.”).15WomanPaidThousandstoRentRotaryPhone,USATODAY,Sep.14,2006,http://www.usatoday.com/news/offbeat/2006‐09‐14‐phone_x.htm.
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AnyonewhocanuseanATM,orplugaUSBdriveintoalaptopcomputer,shouldbe
abletoinstallaCableCARD.CableCARDsarenothingmorethanasmallpieceof
electronicsthatslidesintoaslot.Indeed,manyofthesamecableoperatorswho
requireaprofessionalinstallationallowcustomerstoinstallandsetuptheirown
cablebroadbandmodems—amoresophisticatedandexpensivepieceoftechnology.
Forexample,aComcastcustomersupportwebpagecurrentlysaysthat“Atthistime,
professionalinstallation[ofaCableCARD]byaComcasttechnicianisrequired.”16
ButComcast(alongwithmostothercablebroadbandproviders)allowsacustomer
toinstallherowncablemodempurchasedatretail.17Nocableoperatorwhohas
compliedwiththeCommission’sexistingrulesandiscommittedtosupporting
CableCARDs,asthelawrequires,isjustifiedinrequiringaprofessionalinstallation
foraCableCARD.SucharequirementfliesinthefaceoftheveryreasonCableCARD
exists:toallowacustomertopurchaseadeviceatretailandthenuseitwhenshe
getshome.Customersshouldnothavetopayforcableoperator’sfailuretofollow
thelaw.Therefore,theCommissionshouldatminimumenactarulestatingthata
cableoperatorwhocontinuestorequireaprofessionalinstallationforaCableCARD
maynotchargeeitherfortheinstallationorthevisit.18
16ComcastCustomerCentral,http://customer.comcast.com/(S(jpyel145o0gn5555bbdhwajx))/Pages/FAQViewer.aspx?Guid=cb9a7fbf‐e86a‐45ef‐b630‐2f747075d847(visitedJune7,2010).17Comcastevenmaintainsalistofcompatibleequipment.Comcast,CableDevices,http://mydeviceinfo.comcast.net.18Ifacustomerrequestsaprofessionalinstallation,thecableoperatormaychargeforatmostonevisit,butnothingfortheinstallationitself.
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IV. MultistreamCableCARDsShouldBeStandard
Manystandardcableoperator‐suppliedset‐topboxestodaycantune
multiplestreamsofprogrammingononedevice.AnotherbarriertoCableCARD’s
successhasbeenthedifficultyinconfiguringmanyCableCARD‐equippeddevicesto
dothis.SinglestreamCableCARDsdonotofferthisability,andthusadevicewith
onlyonesinglestreamCableCARDcanneverbefunctionallyequivalenttoacable‐
suppliedmultistreamdevice.UnlesstheCommissionrequiresthatcableoperators
providetheirCableCARDcustomerswithmultistreamcapabilities,itwillbenotbe
fulfillingitsstatutoryresponsibilities,andwillfallshortoftheNationalBroadband
Plan’srecommendationthattheCommissionmakesurethatretaildeviceshave
“equalaccesstolinearchannels.”19Acompetitivemarketrequiresthatthird‐party
deviceshaveaccesstothecompleterangeoffeaturesthatcable‐supplieddevices
have.Thus,theCommissionmustgofurtherthanmerelyrequiringthatcable
operators“offer”multistreamCableCARDs.20Multistreamcardsshouldbethe
default,andsinglestreamcardsshouldbeprovidedonlyifnecessary.Ingeneral,a
cableoperatorshouldchargethesamerentalfeeforamultistreamCableCARDas
forasinglestreamcard.IftherentalfeeforamultistreamCableCARDismorethan
thatforasinglestreamcard,thisdifferencemustbeduetoactualequipment
costs—andinnocaseshoulditcostmoretoleaseasinglemultistreamcardthan
multiplesinglestreamcards.21
19Planat52.20FNPRM,¶17.21Additionally,someCableCARDdevicescanusemultiplesinglestreamcardstogivethemmultistreamcapability.Theleasefeesformultiplesinglestreamcards
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V. AnyCableCARDDeviceThatDoesNotHarmtheNetworkShouldBeCertified
Devicecertificationisasignificantbarriertocompanieswhomaywishto
produceCableCARDdevices.Thus,theCommissionseekscommentonstreamlining
CableCARDdevicecertification.Itproposestogenerallylimitdevicecertificationto
thestandardsoftheCableLabs“Uni‐DirectionalReceivingDevice:Conformance
Checklist:PICSProforma.”Thisisagoodidea,andwillmakesurethatcertification
isatechnicalmatter,andnotameansforthecertificationbodytoexertinfluence
overtheentirehomemediaecosystem.Toclarifythislatterpoint,theCommission
shouldstatethatcertificationshouldbeguidedbyasimpleprinciple:any
functioningdevicethatdoesnotharmthenetworkshouldbeapproved.
VI. TwoWayCommunicationBetweenDevicesRemainsImportant,ButtheCommissionShouldAllowInterfacesOtherthanIEEE1394
TheCommissioncanlowerthecostofnon‐integrated,commonrelianceset‐
topboxesifitliftstherequirementthattheseboxessupportIEEE1394.22While
promotinginteroperabilitybetweendevicesintheconsumer’shomeremainsinthe
publicinterest,modern,IP‐enabledinterfacesareabetterroutetothatgoal.23By
droppingtheIEEE1394requirement,theCommissioncanhaveitscakeandeatit
too;loweringthecostofdevicesintheshorttermwithoutsabotagingthe
emergenceofacompetitiveretailmarketplaceforinteroperabledevices.
installedinasingledeviceshouldnotexceedtheleasefeeforasinglemultistreamcard.22FNPRM¶19.23Ingeneral,commenterspreferthattheCommissionpickastandardratherthanprovidearangeofoptionsthatmayleadtoincompatibilitiesamongdevices.However,thenon‐1394interfacesproposedbytheCommissionarewidely‐enoughdeployedthat,inthecircumstances,providingseveralchoicesisnotinappropriate.
17
However,theCommissionhasstatedthatoneofthefunctionsofthebi‐
directionalinterfacemightbetodelivervideo.24Commenterssupportthat
requirement.Butwiththatinmind,theCommissionshouldclarifythatonly
interfacesthatoffersufficientbandwidthtostreamHDvideomaybeused.While
evenolderspecificationslike802.11gunderidealconditionsaresuitablefor
streamingHDvideo,spectrumcongestionandpropagationissuescanreduceWiFi
throughput.Therefore,theCommissionshouldspecifythatonlyadual‐band(2.4
GHzand5GHz)802.11n(orlater)WiFiinterfacemeetsitsrequirements.By
requiringdual‐bandsupport,theCommissionwillensurethatlegacydevicesdonot
degradetheperformanceofstreamingvideo.25
Additionally,theCommissionshouldconsiderwhetheritshouldrequirethat
anyinterfacebecapableofIPcommunication.Ithasalreadydeterminedthat
enablingIPconnectivityamonghomemediadevicesisinthepublicinterest.The
newinterfacestheCommissionspecifies,EthernetandWiFi,areIPtechnologies.26
ButuseofUSB3.0willnotprovideIP“outofthebox,”withoutrequiringadditional
softwaresupport.Topromotestandardization,theCommissionshouldrequirethat
anyinterfacebecapableoftwo‐wayIPcommunication.
24FNPRM¶21.25Ifan802.11gdeviceisoperatingonthesamenetworkandfrequencyasan802.11ndevice,the802.11ndevicefallsbackto802.11goperation.Dual‐bandWiFinetworksallowfor802.11ndevicestooperateontherelativelylegacy‐free5GHzband.26IEEE1394supportsIP,amongotherprotocols,andforpresentpurposesisan“IPinterface.”
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VII. TheCommissionShouldRequireCableOperatorsToAcceptaBroadbandReturnPathtoEnableTwoWayFunctionalityonCableCARDDevices
TheCommissionrecognizesthatthird‐partyvideodevicesusingCableCARDs
mustbeabletosignalupstreamaseasilyasMVPD‐suppliedequipment.27Without
thiscapability,third‐partydeviceshavenoaccesstoon‐demandandinteractive
content.Butperhapsmorecritically,withthedevelopmentofswitcheddigital
channels(whichareonlysentalongthewirewhenacustomerwantstowatch
them),wholechannelsofprogrammingwouldbeunavailabletoCableCARD
customerswithouttwo‐waycommunicationcapabilitybetweendevicesandthe
cableheadend.Thelackofastandardmethodforupstreamcommunication,
therefore,isthelargesttechnologicalbarrierpreventingCableCARDdevicesfrom
achievingfeatureparitywithcable‐supplieddevices.
Asitstands,aconsumerusingatypicalCableCARDdevicehasnouniform
waytotelltheheadendtobeginsendingachanneloranon‐demandprogram.The
Commissionhasaskedforcommentontwoapproachestoremedythisproblemand
carryouttheNationalBroadbandPlan’srecommendationthatthird‐partydevices
shouldhave“equalaccesstolinearchannels”:The“tuningadapter”approach,and
theout‐of‐band‐signalingapproach.Thetuningadapterapproachhasbeentried,
anditisnotsatisfactory.Asdeployed,thetuningadapteramountstonothingless
thanaset‐topboxinandofitself.28TheverypurposeofSection629istoprevent
27FNPRM¶14.28LetterfromMattZinn,SeniorVicePresident,TiVo,toMarleneH.Dortch,Secretary,FederalCommunicationsCommissionat2,CSDocket97‐80(Feb.17,2010)(statingthatthetuningadapterisa“modifiedcable‐suppliedset‐topbox”).IftheCommissiondoeschooseatuningadapterapproach,itshouldensurethatit
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consumersfromhavingtorelyoncable‐suppliedequipmentinordertoaccesscable
programming.Itwouldcontravenethestatute’sintentiftheCommissionnow
requiredcustomerstouseacable‐suppliedboxtoaccesscertaintypesof
programming.
Thetuningadapterapproachwouldrequirethatcableoperatorssupplyand
supportanewclassofdevicesinconsumers’homes,inadditiontoCableCARD.
Deploymentissuescouldhamperthesuccessoftuningadapters.Inadditionto
needingtohaveanadequatesupplyoftheseadaptersonhandinadditionto
CableCARDS,theadaptersaremorecomplexthanaCableCARD,andthisadded
complexitymightmakeself‐installationmoredifficult.TheCommissionwouldneed
toestablishrulesgoverningthesaleorleaseoftuningadapters,andthecostof
leasingatuningadapterplusaCableCARDmightreducetheattractivenessofretail
third‐partydevices,whichoftencompetewithMVPD‐suppliedofferingsbybeing
cheaperinthelongrunthanaggregateequipmentfees.Additionally,thisdocketis
alreadyrepletewithreportsfromcustomerswhohavenotbeenabletogettheir
tuningadapterstofunctionproperly.29Therefore,commenterssupportTiVo’sout‐
of‐bandcommunicationapproach.
Theout‐of‐bandapproachisfarbetter.Thisrequiresthataconsumerattach
aCableCARDdevicetoabroadbandconnection,insteadofallowingforupstream
signalingonthecabletelevisionsystemitself.(Itisessentialthatsucha
doesnothavetheseobviousflaws.Forexample,theadaptermustbenolargerthanatypicalUSBdongle,anditmustnotrequireitsownindependentpowersupply.29See,e.g.,CommentofGregFriedman,CSDocket97‐80,filedApr.27,2010(“Ihavehadmanyissueswithcablecardandtuningadaptersnotperformingaswellasmysetopbox,includingmysettopboxwithcablecard.”).
20
requirementwouldworkonanybroadbandconnection—i.e.,notonlyoncable
broadband.)Itwouldonlyrequireminimalinfrastructurechangesbycable
operators,toreceivethebroadbandsignals,andtoallowcommunicationbetween
thebroadbandsignalingequipmentandtheheadend.Especiallygiventhat
broadband‐capableCableCARDdevicesarealreadyavailable,theout‐of‐band
communicationapproachismorelikelytoachievetheCommission’sgoalsthanthe
tuningadapterapproach.Theout‐of‐bandapproachissimplerandwouldgenerate
fewerdeploymentandsupportissues.However,inadditiontoestablishing
standardsonhowtheout‐of‐bandapproachwillfunction,theCommissionshould
seekdataastohowmanybuyersofthird‐partyCableCARDdevicesareableto
attachatelevisionset‐topboxtobroadband,ifthisisrequiredtoallowtwo‐way
communication.
VIII. CommonRelianceRemainsanEssentialPrincipletoEnsureProperCableCARDSupport
Thecommonrelianceprinciplehasreceivedinsufficientsupportinpast
Commissiondecisions,butthatprincipleshouldnotbeabandoned.Itisakeyto
removingacableoperator’sabilityandincentivetodiscriminateagainstCableCARD
users,byensuringthatcableoperatorsuseCableCARDfortheset‐topboxesthey
leasetocustomers.ThismakessurethatCableCARDisnotatechnologythatonly
theircompetitorsuse,andallowsCableCARDtechnologytoreceivefirstclass
supportandoperatewithfewertechnicalglitches.
Commonrelianceneverbecameareality.TheCommission’s“integration
ban”waslongdelayed,andwhilecableoperatorsfollowedittosomeextent,itwas
weakenedbytheexcessivegrantofwaiversto“lowcost,noncompliant”devicesthat
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didnotuseCableCARDtechnology.30Whileintendedtosavecustomersmoney,
thesewaiverssimplyensuredthatcompliantdevicescouldnotachievethe
economiesofscaleneededtobringtheircostsdown.Furthermore,anyshort‐term
savings(assumingtheyevenwerepassedalongtocustomers)weremorethan
offsetbytheeffectthesewaivershad:stuntingthemarketfornavigationdevices,
thusensuringthatmostconsumerswouldcontinuetopayarentalfeefortheirset‐
topboxes,whichtheywouldnotbeabletotakewiththemfromonecablesystemto
another.
Ifthegoalofthisproceedingisto“fixCableCARD,”theCommissionshould
notdropthecommonreliancerequirementbyamendingtherulestoallowcable
operatorstodeployHD‐capable,integratedset‐topboxes.Itisnotenoughforthe
CommissiontomerelysaythatcableoperatorsmustsupportCableCARD,whenit
couldadoptrulesthatmakeitnearcertainthattheywould.Commonreliance,if
implementedandnotwaivedawayforallcomers,coulddothat.
However,theCommissionshouldnotbeblindtotherealitiesofthecable
marketplace.Itisprobablethatcompliantdevicescouldachievethenecessary
economiesofscaletobringtheircostsdowniftheyweredeployedjustbythe
largestMSOs.31Forthisreason,iftheCommissiondoeselecttoeliminatecommon
30PetitionforReconsiderationofPublicKnowledge,FreePress,MediaAccessProject,NewAmericaFoundation,OpenTechnologyInstitute,andU.S.PIRG,CSR‐7902‐Z,filedJune29,2009,availableathttp://www.publicknowledge.org/pdf/pk‐etal‐evolution‐recon‐20090629.pdf(askingtheCommissiontoreconsidertheordereliminatingtheprincipleofcommonreliancefor“lowcostlimitedcapability”devices).31EvenconsideringthatthesecondandthirdlargestMVPDsarenotcable,thetopfivecableoperatorscontrolmorethanhalfoftheentireMVPDmarketplace.Annual
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reliancerequirementsforsomeset‐topboxes,itshouldlimittheapplicabilityofany
waiverstosmallercablesystemswithanactivatedcapacityof522MHzorless.Ifit
doesthis,however,theCommissionshouldestablishastreamlinedcomplaintand
enforcementmechanismtoensurethatthesesmallercableoperatorsproperly
supportCableCARD.Suchacomplaintandenforcementmechanismwouldnotbe
overlyburdensomefortheCommissiontoimplementbecauseoftherelativelysmall
customerbaseofthesmallercableoperators.
CONCLUSION
TheCommissionhasmovedtheballforwardonvideodevicecompetition
significantly.IfitcraftsrulesthatensureproperCableCARDsupport,itcanachieve
measurableresultsinthenearterm.
RespectfullySubmitted,PublicKnowledgeMediaAccessProjectNewAmericaFoundation
By:/s/JohnBergmayer/s/AnjaliBhat1818NSt.NW,Suite410WashingtonDC20036(202)861‐0020PublicKnowledge/s/MatthewF.Wood1625KSt.NW,Suite1000WashingtonDC20006(202)232‐4300MediaAccessProjectAssessmentoftheStatusofCompetitionintheMarketfortheDeliveryofVideoProgramming,ThirteenAnnualReport,24FCCRcd.542,687(2009).
23
/s/BenjaminLennett1899LSt,Suite400WashingtonDC20036(202)986‐2700NewAmericaFoundation
June14,2010