The FCC's proposal to revisit CableCard rules has elicited its first exchange of official documents between consumer groups and the cable industry, which continue to occupy separate realities.
In April, the FCC issued a public notice asking for comment on how to encourage the development of a retail set-top box market. Last week, consumer groups such as Free Press and Public Knowledge, along with TiVo and the CEA, filed comments, asking the FCC for a grab-bag of hopes and desires they posit will help create a more thriving retail market for set-tops.
The NCTA's document rebuts arguments consumer groups and the CEA have made in recent filings, including the charges that discounts for bundling are somehow responsible for the failure of a retail market to materialize.
One consumer group proposal suggests enshrining a certain set of interfaces in rules and regulations, which the NCTA reasonably argued hasn't worked in the past (FireWire, anyone?) and is likely to become outmoded at any time.
Meanwhile, TiVo and the CEA don't like Tuning Adapters that allow retail boxes like TiVo's DVR to work in cable systems that have deployed switched digital video. Their proposal, according to the NCTA, will "impose a new mandate exclusively on cable: To engineer a new Internet pathway to cable headends that will handle SDV signaling from third-party devices, in lieu of the tuning adapters that are working now over secure cable plant."
The NCTA said it was willing to consider the CEA's suggestion that instead of having consumers get CableCards directly from MSOs, that retailers get an allocation of cards they can hand out at the point of sale. The NCTA noted this would raise questions about who was to bear the cost, along with other business issues.
In other words, retailers are going to want to get a big inventory of CableCards from cable for free, and cable is going to object to that on the perfectly reasonable grounds that the cable industry should not have to subsidize the retail market, so why are we even bringing the subject up?
That's on top of the fact that CableCards thus far have been an unqualified failure. In the three years since the FCC made the CableCard mandatory, the 10 biggest operators have deployed more than 21 million boxes with CableCards and distributed only 520,000 CableCards for retail set-tops – a smidge over 2 percent of all set-tops installed in the last three years.
The NCTA suggested that rather than waste time with such short-term fixes to short-term problems, the discussion about all of these measures and others be folded into the discussion about the so-called AllVid device.
AllVid is a proposed gateway gadget that would also incorporate a sort of standalone hyper-CableCard that would work with any multichannel video programming distributor (MVPD). In the opinion of advocates such as Public Knowledge, the AllVid would automatically lead to a retail market for set-tops.
The NCTA previously offered provisional support for exploring the AllVid notion, providing that all MVPDs – cable, telco and satellite – be subject to the proposal.
The NCTA is undoubtedly aware that in the estimation of engineers who have considered the proposal, such a device could be created, but at a price that would be unambiguously prohibitive.
\Other interested parties have apparently come to the same conclusion, that an AllVid device at a consumer price point is chimerical, and have tried to distance themselves from it – though some of them are still interested in the option of having cable companies only being saddled with the burden. Free Press goes so far as to suggest that cable companies should have to distribute the things.