Telco, Cable Weigh In On FCC Waiver Calls

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Not surprisingly, telco and cable operators took quite divergent views of the FCC's decision Friday on a raft of set-top box rule waiver requests.

Verizon, which received a temprorary waiver of the FCC's July 1 deadline for separating out the security and navigation functions of the set-top boxes for its FiOS video service, said: "The Communications Act of 1996 allows a waiver from the rule for companies that provide a new or improved service. Verizon is a new entrant in the market and its FiOS TV service uses innovative fiber-optic technology in direct competition against incumbent cable operators."

"With today's waiver, Verizon will be able to continue its focus on deploying its competitive FiOS TV service and developing additional innovative features made possible by its unique technological approach. Verizon is rapidly building its new fiber-optic network, and FiOS TV service is now available to more than 3 million households in 11 states."

The FCC is trying to develop a retail market in digital set-tops and, after postponing the deadline several times, had set July 1 as the deadline for multichannel video providers to comply.

While it granted waivers to operators who would be all-digital by Febraury 2009, to IPTV providers--like Verizon--while it decides how to treat their boxes, and to a smaller operator unable to get the boxes in time, it denied ones to other smaller operators, as well as to the National Cable & Telecommunications Association and the nation's largest operator, Comcast.

NCTA was not pleased. "“The Commission’s 11th-hour action on the many long-standing waiver requests doesn’t bode well for consumers," said Senior VP Rob Stoddard. "There’s nothing in these decisions to stave off a $600 million set-top box tax likely to affect the great majority of cable customers while providing no benefit to consumers. In addition, customers are being treated differently based on the provider to which they subscribe, the unfortunate outcome of a flawed process.”

The American Cable Association called the decision "out of touch" with rural consumers, agreeing that it would raise the cost of boxes.

Asking Congress to take a look at the FCC, ACA President Matthew Polka said: “At a time when consumer prices are rising, it is inexplicable that the FCC Media Bureau would deny small cable operators’ waiver requests and force their subscribers to pay $2 to $3 or more per month for new cable boxes..."

"On the same day that the FCC Media Bureau rejects the waiver requests of small independent cable operators, the bureau grants relief to Verizon, one of the largest telecom companies in the world, who has $20 billion to provide new services to consumers in major cities.  Unfortunately, under the FCC Media Bureau’s decisions, once again big companies like Verizon are the winners, and smaller market cable companies and their consumers are the losers. "

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