FCC Proposes Basic Cable Encryption, Cable Wants a Box on Every TV

December 5, 2011

As reported in Multi-channel news, the cable industry wants to encrypt the basic cable channels going to your home. The FCC’s Policy Division has proposed new rules that would end the current ban on encrypting basic cable channels which dates back to the 1990s. In another words, if you have a cable-ready TV (or VCR or TiVo), you don’t need a cable box or CableCard to receive the first block of channels which include your local stations. The cable industry is advocating for this change to help prevent theft of service and reduce the need for visits from the cable guy to activate or deactiavte service (saving costs and carbon emissions).

In its proposal, the FCC thinks the number of potentially impacted customers will be small. As a remedy, the FCC also proposes that the cable companies provide free cable boxes or CableCards for two televisions for two years for current basic-only subscribers or five years for qualifying low-income customers. Customers who simply have a second TV in another room without a cable box would be given a free one for one year.

The FCC appears to be giving more weight to the potential benefits for cable companies versus a minority of consumers. Their rationale is that since only a small numer of customers may be affected, it’s ok to make the change (among other reasons). I always thought the government was there to protect the rights of the minority, even if it’s basic cable subscribers. To be fair to the FCC, they have asked for feedback on how this change will affect citizens.

Both the Cities of Boston and New York have already supplied this feedback to the FCC. The City of Boston cited a number of concerns. For one, it believes that the FCC is underestimating the number of subscribers that will be affected by the change. Also, the change would be detrimental to Boston institutional users such as schools that can now access cable without equipment. Boston already negotiated free institutional access as part of the cable companies’ franchise agreement. Finally, the City of Boston finds fault with only having the FCC’s suggested limited-term remedies for consumers. If cable operators will enjoy the benefits long term, the City of Boston argues, then why should consumers have to pay additional for boxes in the long term.

The City of New York argues only for a temporary lifting of the ban given the rapid technology changes in consumer electronics. The City also suggests doubling the period for free equipment to access basic cable.

Finally, the Consumer Electronics Association (CEA), stated they oppose the lifting of the encryption ban. According to the CEA’s comments, they view the FCC proposal as reactive and piecemeal. The CEA believes the FCC needs to be looking at digital media and devices as a whole and the coming transition to IP (Internet based video).

The good news is that if the rule does pass and customers aren’t happy with it there are other choices. One choice is Verizon FIOS. I reached out to FIOS to see if they planned to encrypt their basic service if the FCC rules are changed. FIOS stated that they do not currently encrypt their basic tier and have not made any request to the FCC to do so. To read into the comment a bit, FIOS probably has no intention of implementing the encryption. However, given its fiber optic infrastructure, FIOS is not subject to the same theft of service that cable is susceptible to. 

However, FIOS is not an option for most US consumers. Also, given Verizon’s recent deal with the cable companies for wireless spectrum, it seems doubtful that FIOS will be expanding into new areas anytime soon.

The other choice is to go the antenna route. Unlike basic cable, there’s no monthly charge and you can get HD quality picture over the air. Another choice is to use Internet based video from a device like a Roku or Boxee. There’s no lack of movies or TV shows to watch from video streaming services. While some of the news and sports options are limited, some local TV stations have built apps to access their news broadcasts over the Internet.

The other unforeseen consequence is that the rule change may drive TVs out of the bedroom and guest rooms and folks will turn to alternate devices such as tablets and smart phones.

From what I can tell feedback can be submitted to the FCC until the end of the week. Also, I’ve set up a poll on our Facebook page so you can let us know if the encryption of basic cable will affect you. 

Tags: cable, CableCARD, FCC

3 Responses to FCC Proposes Basic Cable Encryption, Cable Wants a Box on Every TV

  1. Lmrowens-5 on December 7, 2011 at 8:43 am

    Well the only thing keeping me with my cable company over DirectTV is that I have 5 TVs, and cable is cheaper because I don't need set top boxes.  Require set tops on every TV and I'm jumping ship to DirectTV.  Be careful what you lobby for greedy cable companies.

  2. Smart TV Streaming on January 12, 2012 at 12:22 am

    If you are the manager or the owner of a cable TV company, what you should do in order to make things right for the entire company? What the company needs for its employees is through proper management. But why do we need proper management for a cable TV company? For example, if you run a gaming shop in a mall, your target is to get lots of customers to buy gaming consoles and gaming DVD’s as well. Proper management should be at present when it comes to selling game consoles and DVD’s, which needs its employees to be dedicated and serious on entertaining their customers in answering their questions.

  3. CableCARD Trials and Tribulations - Tech of the Hub on February 10, 2012 at 8:36 am

    [...] Trials and Tribulations February 10, 2012By Gabe GaglianoWhile in the works for some time, the FCC’s proposed change to encrypt all cable service is getting some attention again. Boxee recently posted a strongly worded note asserting that the [...]

Leave a Reply

Your email address will not be published. Required fields are marked *

Connect to the Hub

Support the Hub