Digital television suffers many plagues, but none afflicts broadcasters more than one simple fact: DTV won't work with cable.
Why is such a clear problem so hard to solve?
The various industry groups bickering over the question offer conflicting answers. But there's one point nobody can argue: Until the 70% of Americans who rely on cable for their TV signals can get DTV through their local MSO, the digital transition will languish on life support.
Frustrated by the logjam created by the stubbornness of TV manufacturers, Hollywood, the cable industry and broadcasters, FCC Chairman William Kennard appears to finally be moving ahead with his long-standing threat to set government rules for cable/DTV interoperability if industry negotiators can't get the job done themselves. Kennard has ordered FCC staffers to draft proposed interoperability standards and will put the plans to a vote of the commissioners at the agency's next meeting, on Sept. 14.
Setting the rules for cable-ready DTV sets won't fix all the bugs hindering the digital rollout. Big questions will still linger over the ability of the current U.S. digital-transmission standard to offer acceptable indoor reception and the extent to which cable companies are obligated to carry stations' dual analog and digital signals and multicast DTV programming.
Broadcasters' commitment to high-definition and other top-quality digital programming is also in question, as many appear to be neglecting development of DTV programming to gear up for datacasting and other non-video services.
But even without those lingering concerns, cable compatibility will finally give broadcasters access to the bulk of American viewers and offer them a chance to test what type of digital programming audiences want.
"If the FCC is finally ready to act, it can't act too soon or too strongly," says Lynn Claudy, technology chief for the National Association of Broadcasters. "The marketplace on its own is not solving the problem."
Today, 64% of U.S. TV households are passed by signals from at least one of the 151 stations now transmitting DTV programming. But that statistic is almost meaningless because more than two-thirds of Americans rely on cable for TV reception. What's more, fewer than 50,000 viewers have purchased receivers necessary to watch over-the-air DTV broadcasts.
Even with FCC action this month, Claudy questions whether there is time to get cable-ready sets on the market by the Christmas shopping season.
Despite Kennard's determination to keep his agency out of the standard-setting game, to impatient broadcasters' relief, he has decided that the time for waiting is over. Topping his agenda will be tackling the thorny copy-protection issues that have made Hollywood dead set against letting TV stations and cable programmers offer the high-definition movies deemed essential to drive viewer demand for digital programming.
At the September meeting, the FCC chair is also aiming to:
- Formally establish the interconnection standard required for cable customers to plug sets straight into cable lines without using a set-top box.
- Set technical specifications for transmitting ancillary information, such as broadcasters' electronic program guides.
- Spell out how set makers should differentiate between sets that offer advanced interactive services and those that simply offer digital pictures.
The biggest fight right now is over two types of licenses that will be used to control which programs may be copied and how often. The Motion Picture Association of America is fighting to limit which programs may be copied and how many times. Hollywood wants digital basic and extended cable to be copied and watched only once for time-shifting viewers. Pay-per-view and video-on-demand would be permitted no recording other than pauses. Programming offered free over the air would not be subject to restrictions.
To enforce the requirements, MPAA insists that digital sets and recording equipment include the so called 5-C copy-protection equipment, named for the five companies that developed the technology: Sony, Matsushita, Intel, Hitachi and Toshiba.
Equipment makers balk at the 5-C license arrangement pushed by MPAA, because it would require copy equipment to honor reproduction limitations encoded into programming by content owners.
Similarly, retailers led by Circuit City are resisting a separate license that cable systems would issue to equipment makers that sell their own digital set-top boxes. Those licenses also would require manufacturers to honor the same type of restrictions in order to use the interface needed to work with cable-system security modules to block unauthorized access to programming. They say viewers should have the same right to add digital programming to their permanent libraries as they have in analog settings. "Hollywood and the cable industry are arguing that any home taping is a theft of services. That's a revolutionary argument," says Michael Petricone, technology-policy director for the Consumer Electronics Association.
But MPAA officials, who would not speak on the record for this article, counter in their filings to the FCC that "there is no historical precedent for high-definition unprotected programming" and that court rulings shielding analog taping apply only to low-resolution content.
The FCC also will have to settle a few issues some industry groups once thought were resolved. For instance, a May deal between CableLabs, the cable industry's technology-development arm, and CEA for specifications needed to connect retail set-top boxes and direct-to-cable TVs to cable systems is now in question. Broadcasters condemned the idea immediately, and equipment makers backed away a few weeks later.
CEA officials say their members will be hurt because CableLabs is too slow in developing "middleware" programs necessary if retail interactive set-top boxes are to communicate with cable systems. (Middleware is needed because cable-operating system codes are being kept proprietary.) "Right now, the equipment we can provide is not comparable to what cable systems are providing themselves," Petricone complains.
Cable-industry officials who brokered the deal with CEA are dismayed by the change of heart. "This was meant to be a binding agreement, and we think it should stand," says Daniel Brenner, general counsel for the National Cable Television Association.
Broadcasters argue that the plan doesn't adequately spell out the specifications needed if TVs are to circumvent set-top boxes altogether and connect directly to the cable line. "The delay is keeping cable-ready sets from coming out in the foreseeable future," says the NAB's Claudy.
The NAB is also resisting the CEA/ CableLabs deal on labeling for the two types of DTV sets that will be sold: "cable connect," which would offer only the plain service of conventional DTV programming, and "cable interactive," which would feature the so-called firewire connection that allows viewers to use interactive services.
Although officials from the various industry groups say they don't yet have a handle on where the FCC will come down on any of the major disputes, that the FCC is acting at all is a victory for broadcasters. "Without regulatory involvement that un-jams the roadblock," says Claudy, "quick production of cable-ready DTV sets is simply not going to happen."