Set-top setback



TV retailers and some set makers are backing away from a deal struck with the cable industry three weeks ago that was intended to remove the last major obstacle to rolling out cable-compatible digital sets.

Continuing disputes over the types of connections DTV sets will use to attach to set-top boxes, what labels should be used to differentiate sets that feature these interactive connections from those that don't, and the extent of copy-protection measures that DTV sets will have are greatly increasing the likelihood the FCC must step in to set rules for DTV-cable interoperability, according to agency sources.

Last week, Circuit City Stores, Sony and others asked the FCC to reject a labeling deal hammered out by the National Cable Television Association and the Consumer Electronics Association, arguing it would help cable systems roll out proprietary digital set-tops quickly and hurt chances for TVs incorporating competing technologies.