BEFORE THE Federal Communications Commission
WASHINGTON, D.C.
In the Matter of ) ) Implementation of Section 304 of the ) CS Docket No. 97-80 Telecommunications Act of 1996 ) ) Commercial Availability of Navigation Devices ) ) Compatibility Between Cable Systems and ) PP Docket No. 00-67 Consumer Electronics Equipment ) )
COMMENTS OF COMCAST CORPORATION
Kathryn A. Zachem James R. Coltharp COMCAST CORPORATION 2001 Pennsylvania Ave., NW Suite 500 Washington, D.C. 20006 (202) 379-7134
Joseph W. Waz, Jr. COMCAST CORPORATION One Comcast Center 1701 John F. Kennedy Boulevard Philadelphia, Pennsylvania 19103-2838
Jonathan Friedman Jessica D. Feinberg* WILLKIE FARR & GALLAGHER LLP 1875 K Street, N.W. Washington, DC 20006-1238 Attorneys for Comcast Corporation * Admitted only to the New York Bar; working under supervision of members of the D.C. Bar.
June 14, 2010
ii
TABLE OF CONTENTS
Page
I. INTRODUCTION AND SUMMARY..............................................................................1
II. NOTWITHSTANDING COMCAST’S STRONG AND SUBSTANTIAL SUPPORT FOR CABLECARDS, CONSUMERS HAVE SHOWN LITTLE INTEREST IN CABLECARD-ENABLED RETAIL DEVICES. ...........................................................5
A. Comcast Has Dedicated Substantial Resources In Support of CableCARD. ...........................................................................................................6
B. Notwithstanding These Substantial Efforts, The CableCARD Regime Has Not Been Successful In Creating A Retail Marketplace For Navigation Devices. ..............................................................................................10
III. COMCAST STRONGLY SUPPORTS THE PROPOSED EXEMPTION FOR ALL DTAs GIVEN THEIR SUBSTANTIAL PRO-CONSUMER BENEFITS AND THEIR IMPORTANCE TO THE CABLE INDUSTRY’S DIGITIZATION EFFORTS. ........................................................................................................................12
IV. COMCAST STRONGLY SUPPORTS COMMISSION POLICIES THAT ENCOURAGE DEPLOYMENT OF SDV, WHICH IS ANOTHER IMPORTANT PRO-CONSUMER WAY TO OPTIMIZE BANDWIDTH USE. ...............................17
V. COMCAST IS PREPARED TO WORK WITH THE COMMISSION ON FINE-TUNING CERTAIN OTHER PROPOSED CHANGES TO THE CABLECARD RULES. .............................................................................................................................21
A. CableCARD Self-Installations ............................................................................21
B. M-Cards ................................................................................................................24
C. CableCARD Billing..............................................................................................24
VI. THE COMMISSION SHOULD PROVIDE CABLE OPERATORS WITH GREATER FLEXIBILITY REGARDING THE OUTPUTS ON THEIR HD SET-TOP BOXES.....................................................................................................................27
VII. CONCLUSION ................................................................................................................33
BEFORE THE Federal Communications Commission
WASHINGTON, D.C.
In the Matter of ) ) Implementation of Section 304 of the ) CS Docket No. 97-80 Telecommunications Act of 1996 ) ) Commercial Availability of Navigation Devices ) ) Compatibility Between Cable Systems and ) PP Docket No. 00-67 Consumer Electronics Equipment ) )
COMMENTS OF COMCAST CORPORATION
Comcast Corporation (“Comcast”) hereby responds to the Fourth Further Notice of
Proposed Rulemaking (“Notice”)1 in the above-captioned proceedings, which seeks comment on
interim fixes to the CableCARD regime while, in its companion Notice of Inquiry (“AllVid
NOI”),2 the Commission explores longer-term measures for the retail navigation device
marketplace. Comcast welcomes the opportunity to comment on the proposals in the Notice.
I. INTRODUCTION AND SUMMARY
Comcast is the cable industry’s leading provider of CableCARDs to retail navigation
devices, and has invested substantial resources to make the experience of our CableCARD
1 In re Implementation of Section 304 of the Telecommunications Act of 1996; Commercial Availability of Navigation Devices; Compatibility Between Cable Systems and Consumer Electronics Equipment, Fourth Further Notice of Proposed Rulemaking, 25 FCC Rcd. 4303 (2010) (“Notice”).
2 In re Video Device Competition; Implementation of Section 304 of the Telecommunications Act of 1996; Commercial Availability of Navigation Devices; Compatibility Between Cable Systems and Consumer Electronics Equipment, Notice of Inquiry, 25 FCC Rcd. 4275 (2010) (“AllVid NOI”).
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customers as seamless and as hassle-free as possible. We generally make CableCARDs
available to these customers at no additional charge, provide extensive information on our web
site about CableCARDs and retail equipment options, and provide extensive training to our
customer service representatives and technicians with respect to CableCARD installations and
other CableCARD-related matters. We also give customers an option to self-install their
CableCARDs in a number of markets, and work closely with manufacturers of retail navigation
devices to ensure that product deployments go smoothly in our cable systems.
Notwithstanding these efforts, as the Commission recognizes in the Notice and
companion AllVid NOI, the current CableCARD regime has not fulfilled the goals of the
navigation device statute. There are a number of possible explanations for this situation.
Customers may prefer leasing equipment; CableCARD devices will not work in DBS and most
telco video systems, which now account for almost 40% of the multichannel video marketplace;
and most CableCARD-enabled retail devices today can only access one-way cable services,
while consumers have a growing appetite for video-on-demand and other interactive services.
Comcast appreciates the Commission’s interest in making limited “fixes” to the CableCARD
regime to improve the customer experience where possible, and, as detailed below, Comcast
supports a number of the proposals in the Notice. However, given that CableCARD devices
have not succeeded at retail and the Commission’s efforts to focus stakeholders on solutions that
apply across the multichannel video marketplace, Comcast urges the Commission to refrain from
imposing costly new CableCARD-related mandates on cable operators and their customers.
With respect to the specific proposals in the Notice, Comcast strongly supports the
Commission’s proposal to exempt all digital terminal adapters (“DTAs”) without recording
functionality from the integration ban. DTAs are critical to Comcast’s efforts to digitize its cable
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systems and reclaim analog bandwidth for faster Internet, more HD and Spanish-language
programming, and other digital services. Comcast provides our expanded basic customers with
up to two DTAs at no additional charge, and makes additional DTAs available at a very low
monthly charge. While standard-definition (“SD”) DTAs have played an important role in
Comcast’s digitization efforts -- thanks to the Commission’s grant of waivers of the integration
ban to several SD DTA models -- the SD DTA does not provide a complete solution for our
customers. As the Commission noted previously in its Cable One Waiver Order, high-definition
(“HD”) televisions are now commonplace in the marketplace, and SD DTAs cannot deliver HD
channels to these sets. By exempting HD DTAs from the integration ban, the Commission can
ensure that customers have a no-cost or low-cost way to access such channels. We believe that
HD DTAs would be a particularly attractive option for secondary TVs in the home, an increasing
number of which are HDTVs. Furthermore, the Commission can take this step without
impairing its retail goals. Common reliance is already assured with the deployment of almost 20
million CableCARD-enabled set-top boxes by cable operators, and HD DTAs do not compete
with the one-way devices sold at retail today, which include DVR, broadband connectivity, and
other more advanced capabilities.
Comcast also urges the Commission to maintain its policy of promoting the deployment
of switched digital video (“SDV”). SDV provides another tool to help Comcast and other cable
operators to deliver programming channels in a more bandwidth efficient way, and thereby free
up bandwidth for faster Internet, more HD channels, and other services. Comcast will start
deploying SDV in several cable systems later this year, with plans to expand SDV to other
markets in subsequent years. We anticipate that these SDV deployments will result in the launch
of at least 50 additional HD channels, bringing the total number of HD channels in these systems
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to over 150. With respect to questions in the Notice about the Tuning Adapter, Comcast notes
that this solution, which was developed at TiVo’s request and will be deployed to our
unidirectional digital cable-ready product (“UDCP”) customers at no additional charge, provides
an adequate way for compatible UDCPs to access SDV channels. In light of this solution, and
the Commission’s tentative conclusion that CableCARD is a not a viable long-term solution,
Comcast recommends that the Commission refrain from imposing costly new mandates relating
to the delivery of SDV channels to UDCPs.
With respect to the Commission’s other CableCARD-related proposals, Comcast has had
a successful experience with CableCARD self-installations in a number of its markets, and could
support a requirement giving retail customers a self-installation option in markets where
customers can self-install leased set-top boxes. However, to the extent the Commission adopts
such a rule, Comcast asks that operators be given sufficient time to phase in such a self-
installation option, and that manufacturers be required to provide adequate support to self-
installers. Comcast has no objection to the Commission’s proposal to make M-Cards available
to customers who request them, but believes that the Commission’s billing-related proposals are
likely to generate significant consumer confusion without any countervailing benefits to the retail
marketplace. In any event, as noted, Comcast generally provides its CableCARDs to retail and
leased customers at no additional charge, and sees no benefit to imposing billing-related
requirements under such circumstances.
Regarding the interface proposals in the Notice, Comcast supports giving operators
greater flexibility in the outputs that they include in their HD set-top boxes. 1394 is a little used
technology that has been superseded in the marketplace by Ethernet, MoCA, USB, and other IP
connectors, and Comcast appreciates the Commission’s interest in expanding operators’ range of
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options with respect to these outputs. Comcast recommends that the Commission avoid
mandating the use of specific technologies and functionalities in this area, particularly given the
experience with the 1394 requirement. However, to the extent the Commission decides to
replace, rather than eliminate, the 1394 requirement, Comcast recommends that the Commission
include MoCA on its list of interfaces and accommodate the use of new connectors that might be
developed in the future. Comcast also believes that cable operators have strong incentives to
output content in industry standard formats, and the industry has made clear its strong
commitment to advancing home-networking solutions for its customers. Consequently, the
Commission should avoid mandating rules around interface functionality.
II. NOTWITHSTANDING COMCAST’S STRONG AND SUBSTANTIAL SUPPORT FOR CABLECARDS, CONSUMERS HAVE SHOWN LITTLE INTEREST IN CABLECARD-ENABLED RETAIL DEVICES.
Comcast is the cable industry’s leading provider of CableCARDs to retail devices. Of
the 489,000 CableCARDs deployed in TiVo DVRs and other retail devices by the ten largest
incumbent cable operators,3 almost 300,000 -- or 61% -- are deployed in Comcast cable
systems.4 These subscribers represent only slightly more than one percent of Comcast’s overall
subscriber base (i.e., 300,000 out of 24 million subscribers).5 Nonetheless, Comcast has worked
hard to make their experience as seamless and as hassle-free as possible. Ensuring customer
3 See Letter from Neal M. Goldberg, Vice President and General Counsel, NCTA, to Marlene H. Dortch, Secretary, FCC, CS Dkt. No. 97-80, at 1 (Mar. 31, 2010) (“NCTA CableCARD Report”). The ten largest incumbent cable operators serve approximately 90% of the cable subscribers in the country. Id.
4 See id., Comcast Report, Dec. 2009 - Feb. 2010.
5 There are some UDCP customers who take multiple CableCARDs, so the actual number of UDCP customers served by Comcast is less than 300,000, and as a result, the percentage of Comcast customers who are UDCP customers may be under 1%. However, for ease of reference, we assume for purposes of these comments that the number of UDCP customers is about 300,000.
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satisfaction is essential to success in today’s robustly competitive multichannel video
programming distributor (“MVPD”) marketplace, and this business imperative applies whether
our customers lease equipment or bring their own.
A. Comcast Has Dedicated Substantial Resources In Support of CableCARD.
When UDCPs were first deployed at retail in the mid-2000s, there were some occasional
compatibility issues with some UDCP device models,6 yet these types of compatibility issues are
largely a thing of the past. Comcast regularly coordinates with TiVo, Moxi, and other
manufacturers to identify potential issues before CableCARD products come to market. For
example, Comcast recently worked with TiVo prior to the launch of its new Premiere DVR,7
contributing to a relatively smooth rollout of this product in our markets. To the extent issues
arise after CableCARD devices are sold in the marketplace, we work with CE manufacturers to
resolve issues as quickly as possible, with as little inconvenience to the customer as possible.
These efforts have led to a strong and productive working relationship with
manufacturers of UDCPs and other retail navigation devices. Ceton Corporation, a developer of
an OpenCable Unidirectional Receiver (“OCUR”) device that can support CableCARD
functionality in a personal computer, recently told the Commission that “[o]n every occasion,
Comcast personnel have gone out of their way to be helpful and supportive, from setting up test
accounts, to getting us CableCARDs (which we lease), to helping diagnose problems with
6 See generally Ex Parte Letter from Neal M. Goldberg, General Counsel, NCTA, to Marlene H. Dortch, Secretary, FCC, CS Dkt. No. 97-80 (June 29, 2006).
7 See Todd Spangler, Comcast in Talks With TiVo About “Premiere,” Multichannel News (Mar. 3. 2010), available at http://www.multichannel.com/article/449644-Comcast_In_Talks_With_TiVo_About_Premiere_.php.
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interface to the head end systems.”8 With respect to the cable industry as a whole, the
manufacturer of the Moxi CableCARD-enabled DVR has noted that consumer electronics
(“CE”) manufacturers now have much better support for CableCARD devices from cable
operators than when UDCPs were first deployed.9
Comcast also has worked hard to improve the installation experience for its customers
with retail navigation devices. Consistent with the Commission’s rules, Comcast purchases a
sufficient supply of CableCARDs to meet demand from our retail customers.10 In addition, we
invest significant resources into training our technicians for CableCARD installations. Comcast
performs approximately 12,000 to 15,000 CableCARD installations per month across its entire
footprint, which translates into about 1.4% of our overall digital connections. And the
overwhelming majority of these CableCARD installations require only a single truck roll.11
Comcast also provides a self-installation option to retail customers in several of our markets, and
approximately half of our new CableCARD installations are self-installs.12 Comcast’s success
with self-installs is discussed in greater detail in Part V.A.
8 See Letter from Gary Hammer, President and CEO, Ceton Corp., to Marlene H. Dortch, Secretary, FCC, GN Dkt. No. 09-51, CS Dkt. No. 97-80, at 2 (Apr. 8, 2010) (“Ceton Letter”).
9 See Josh Wein, July 2007 CableCARD Deadline Yields Subtle Changes Two Years Later, Vendors Say, Comm. Daily (July 24, 2009) (quoting Diego CEO Greg Gurdof as saying that support for CableCARDs has been vastly improved); see also Cnet Conversations, Interview with Tom Rogers, CEO, TiVo (Apr. 15, 2010), available at http://news.cnet.com/8301-30966_3-20002650-262.html (noting that while the CableCARD world has not been friction-free, “it’s improved, it’s better”).
10 See 47 C.F.R. § 76.640(b)(3).
11 See NCTA CableCARD Report, Comcast Report, Dec. 2009-Feb.2010 (noting that the average number of truck rolls to install a CableCARD in Comcast systems is 1.09, and that installations cost an average of $25); see also Ceton Letter at 3 (noting that “Comcast in Seattle has become very proficient in pairing CableCARDs in third party devices”).
12 See NCTA CableCARD Report, Comcast Report, Dec. 2009-Feb. 2009 (stating that self-installations account for 46% of new CableCARD installations); House Subcommittee On Communication, Technology, and the
(footnote continued…)
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Our retail customers also benefit from our policy of generally providing CableCARDs to
our subscribers at no additional charge.13 This policy applies regardless of the number of devices
in the customer’s home. So, for example, if a customer has three TiVo Premiere DVRs in her
home, Comcast will provide three CableCARDs to that customer at no additional charge. The
one exception to our “no additional charge” policy involves subscribers who use certain older
model UDCPs with two CableCARD slots. In such cases, Comcast makes the first CableCARD
available at no additional charge, but charges for the second CableCARD. However, in such
cases, the second CableCARD is provided at a regulated equipment fee, whether or not the
market is subject to effective competition. On average, the charge for that second CableCARD
is approximately $1.50 per month.14
Comcast also aims to assist our retail customers (or would-be retail customers) by
providing extensive information to our customers about CableCARDs and their equipment
options. For example, Comcast’s website includes a series of “FAQs” about CableCARDs,15 and
our customer service representatives also are trained to field questions about CableCARDs. To
the extent a customer raises concerns that require more technical expertise, Comcast has senior
________________________ (…footnote continued)
Internet, Hearing on Competitive Availability of Navigation Devices, Testimony of Matthew Zinn, TiVo (Apr. 29, 2010), available at http://energycommerce.house.gov/Press_111/20100429/Zinn.Testimony.04.29.2010.pdf (commending Comcast’s success with self-installs in California).
13 See NCTA CableCARD Report, Comcast Report, Dec. 2009-Feb. 2009 (listing the monthly lease rate for initial CableCARD as $0.00).
14 See id. (listing the monthly lease rate for the additional CableCARD as $1.50).
15 See Comcast Customer Central, Top Cable TV FAQs, at http://customer.comcast.com/Pages/FAQListViewer.aspx?topic=Cable (last visited May 28, 2010); see also Comcast Customer Central, Cable TV, CableCARD FAQs, at http://customer.comcast.com/Pages/FAQListViewer.aspx?topic=Cable&folder=1d57bd4f-4607-409c-b5dd-95f2d79475cc (last visited May 28, 2010).
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engineers at the company who are well versed in CableCARD issues and can and do reach out to
their counterparts at TiVo and other manufacturers to troubleshoot technical problems as needed.
Beyond these measures, Comcast has made significant investments in support of the
tru2way platform and tru2way-enabled retail devices. As the Commission has noted, one reason
why a retail marketplace has not developed is that one-way retail devices were brought to market
just as consumer interest was growing in VOD and other interactive cable services that one-way
devices cannot access.16 Comcast and other operators worked closely with major CE
manufacturers to develop tru2way, a standardized middleware platform that enables retail
devices to access all cable services without a set-top box. The agreement between the industries
is embodied in a memorandum of understanding (“MOU”).17 Comcast has dedicated substantial
resources towards developing and implementing tru2way, and now supports tru2way in almost
90% of its cable headends, and has supported the availability of Panasonic’s tru2way DTV at
retail outlets in Chicago, Denver, and Atlanta.18 Despite these efforts, thus far there has been
little consumer interest in these tru2way devices.
16 See AllVid NOI ¶ 8; see also In re Oceanic Time Warner Cable et al., Order on Review, 24 FCC Rcd. 8716 ¶ 14 (2009) (“TWC-Cox SDV Order”) (noting that marketplace demand for UDCPs is “not strong”).
17 See Letter from Kathy A. Zachem, Vice President, Comcast Corporation, and Joel Wiginton, Vice President, Sony Electronics, Inc., to Marlene H. Dortch, Secretary, FCC, CS Dkt. No. 97-80 (June 10, 2008) (including copy of MOU). Major signatories include Comcast and other leading MSOs; CE manufacturers Sony, Panasonic, Samsung, LG, and Funai (known under brand names Philips, Magnavox, Sylvania, and Emerson); set-top makers ADB and Diego; and chip manufacturer Intel.
18 See Press Release, Comcast, Panasonic and Comcast Announce Products With tru2way Technology, (Jan. 7, 2008), available at http://www.comcast.com/About/PressRelease/PressReleaseDetail.ashx?PRID=719 ; Greg Tarr, Panasonic, Comcast Launch Tru2way TVs, TWICE (Oct. 15, 2008), available at http://www.twice.com/article/234241-Panasonic_Comcast_Launch_Tru2way_TVs.php.
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B. Notwithstanding These Substantial Efforts, The CableCARD Regime Has Not Been Successful In Creating A Retail Marketplace For Navigation Devices.
As the Commission concluded in the Notice, the CableCARD regime has not fulfilled the
goals of Section 629,19 but this is not for lack of effort on the part of Comcast and other cable
operators. There is little consumer interest in retail CableCARD-enabled devices; manufacturers
have largely abandoned these devices; and retailers are not stocking them either. There are a
range of possible explanations for this situation. For the example, the CableCARD regime
reflects a bygone era when cable operators were the dominant providers of MVPD services.
Today, in contrast, four of the ten largest MVPDs are either DBS or telephone companies, who
collectively serve almost 40 million customers and whose market share continues to grow while
cable’s market share continues to shrink.20 Consumers may have little interest in CableCARD
devices since they are not portable to DBS and most telco video providers.
Furthermore, consumers may prefer leased equipment over retail devices because leased
devices are available at regulated rates -- or at rates kept low in markets subject to effective
competition -- and can be upgraded when the next model is released.21 In contrast, retail
consumers must incur significant upfront costs in purchasing CableCARD devices and assume
the risk that the devices will become obsolete given the rapid pace of innovation in the MVPD
marketplace. Also, leased equipment makes it easier for customers to switch among MVPD
19 Notice ¶ 8; AllVid NOI ¶ 10.
20 See SNL Kagan, All Video by DMA -- 4th Quarter 2009 (2010) (detailing subscribership data for MVPD marketplace).
21 See Digital Recorders: Lease a Model in this Time of Transition, Consumer Reports, at 35 (Nov. 2006) (advising consumers that leasing “a DVR from a cable or satellite provider is the best way to go -- it’s convenient, and you need not worry about investing in obsolescent equipment”).
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providers. Because customers with leased equipment have not made the investment in retail
equipment, they can simply swap out one MVPD’s leased equipment for another MVPD’s leased
equipment if they elect to change providers.22
Lastly, as noted, at a time when consumers are demanding video-on-demand (“VOD”)
and other interactive services, most retail navigation devices sold at retail today are limited to
one-way functionality and therefore have very limited marketplace appeal.
In light of these and other shortcomings, Comcast agrees with the Commission’s tentative
conclusion in the Notice that the CableCARD regime is not a viable long-term approach,23 and
welcomes the Commission’s focus on new paths forward on video devices in the AllVid NOI. As
the Commission looks at fresh approaches, we also are prepared to work with the Commission in
the interim on certain modifications to the existing CableCARD rules, and take this opportunity
to comment on several of the proposals in the Notice. However, Comcast would not support
extensive new CableCARD mandates, which would be contrary to the Commission’s general
view that the CableCARD regime needs to be replaced, and would chill investment and
innovation in cable networks and equipment.
22 Comcast welcomes the Commission’s inquiry into the economics of “lease vs. buy” in its AllVid NOI. See AllVid NOI ¶¶ 39-41. Consumer preference for equipment leasing is not unique to the cable industry. DBS providers have largely migrated from a sale to a lease model for their equipment, without any apparent impact on their ability to attract new customers. See DirecTV Comments, GN Dkt. Nos. 09-47, 09-51, 09-137, CS Dkt. No. 97-80, at 10-12 (Dec. 22, 2009); NCTA Comments, GN Dkt. Nos. 09-47, 09-51, 09-137, CS Dkt. No. 97-80, at 5 (Dec. 22, 2009). Likewise, most high-speed Internet customers elect to lease modems despite the widespread retail availability of modems, and in the wireless space, consumers appear to prefer “buying” their handsets at provider-subsidized rates rather than buying unsubsidized handsets at full price. See, e.g., Scott Morrison, Google to Stop Online Sales of Nexus One, Wall St. J. (May 17, 2010) (noting that Google had discontinued direct sales of its Nexus One smart phone due to lackluster sales at its online store). In contrast, standalone retail DVRs manufactured by companies like TiVo have a penetration rate of about 1% of TV households. See SNL Kagan, Media Trends, at 163 (2009 ed.).
23 Notice ¶ 12.
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III. COMCAST STRONGLY SUPPORTS THE PROPOSED EXEMPTION FOR ALL DTAs GIVEN THEIR SUBSTANTIAL PRO-CONSUMER BENEFITS AND THEIR IMPORTANCE TO THE CABLE INDUSTRY’S DIGITIZATION EFFORTS.
The Notice invites comment on a proposal to exempt all DTAs without recording
functionality from the Commission’s integration ban, and apply such relief to all cable systems.24
Comcast strongly supports this proposal. DTAs provide substantial benefits to consumers and
help advance the Commission’s digitization and broadband goals. We thus urge approval of the
DTA proposal.
Cable’s DBS and telco competitors, including DirecTV, Dish Network, Verizon, and
AT&T, already provide all-digital service. Yet traditional cable operators still have significant
numbers of analog customers and typically dedicate 50% or more of their plant to analog
channels. This situation represents a highly inefficient use of cable bandwidth as every analog
channel uses 6 MHz of bandwidth on the cable plant. In Comcast’s case, fewer than 20% of our
customers are analog-only, yet nearly 70% of the available bandwidth is dedicated to analog
service. To attract and retain customers in a highly competitive MVPD marketplace, Comcast
and other cable operators must move from analog to digital transmission, and deliver more
channels exclusively in digital format.
DTAs are critical to Comcast’s efforts to digitize its cable plant. We are aggressively
migrating all services above the limited basic tier of service to digital carriage only, eliminating
the analog format of expanded basic channels.25 This initiative requires that Comcast customers
24 Id. ¶ 22.
25 The limited basic tier of service typically includes local broadcast stations and public, educational, and government channels.
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have a digital device for each TV connected to Comcast service in order to receive programming
offered through tiers above the limited basic level of service.26 To accomplish this, Comcast is
using DTAs, which are small, one-way, low-cost adapters with a simple analog output and are
typically self-installed by the subscriber.
Comcast has completed these digital conversions across approximately 50% of our
footprint, and expects to complete the conversions in approximately 80% of our footprint by the
end of 2010. By digitizing analog channels in this way, Comcast can use the reclaimed analog
bandwidth for additional HD channels, more Spanish-language and other ethnic programming,
DOCSIS 3.0 deployments, and other innovative services.27 Comcast has now deployed
approximately 11 million DTAs supplied by four different manufacturers: Motorola, Cisco,
Thomson, and Pace.28
While SD DTAs have played an important role in Comcast’s digitization efforts to date,
they are not a complete solution because they cannot provide access to HD channels. An SD-
DTA on an HDTV set unnecessarily degrades the services otherwise available to a consumer.
The SD DTAs can only output channels in analog format. Customers can attach a splitter and
A/B switch as a workaround to get broadcast HD channels on their HDTV, but that is a
26 Comcast makes two DTAs available to expanded basic customers at no additional charge in markets where it is digitizing the expanded basic tier of service. 27 See Comcast Comments, MB Dkt. No. 07-269, at 20 (Aug. 28, 2009) (noting that its digitization effort in Portland, Oregon market resulted in 65 new HD channels, more than 20 new Spanish-language channels, and other digital services); see also id. at n.93 (noting similar channel additions in Comcast’s Bay Area systems).
28 Pursuant to the streamlined waiver process for low-cost, one-way digital set-top boxes established in the Evolution Broadband Waiver Order, the Media Bureau has granted several waivers of the Commission’s integration ban to manufacturers of SD DTAs. See, e.g., In re Motorola, Inc., et al., Requests for Waiver of Section 76.1204(a)(1) of the Commission’s Rules, Memorandum Opinion and Order, 24 FCC Rcd. 10939 (2009). These waivers, which allow for the use of integrated security in the DTAs, have been critical to deployment of DTAs by Comcast and other cable operators, and reflect the Commission’s determination that the availability of such low-cost box options are pro-consumer and serve the public interest.
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cumbersome process that most consumers avoid. Moreover, this workaround does not enable
access to non-broadcast HD channels. HD DTAs would improve the customers’ viewing
experience by enabling them to watch HD channels on their HDTVs, and would also likely help
accelerate adoption of HD technology. As the Commission explained in its Cable One Waiver
Order, there is “no reason to provide a regulatory incentive to deprive consumers of the HD-
quality programming they expected and paid for when they purchased their sets.”29
The simple fact is that HD is becoming “commonplace” in the video marketplace and can
no longer be considered an “advanced” service for purposes of the Commission’s set-top box
waiver polices.30 Today, HD is a standard feature for TVs sold at retails. Currently, 65% of TV
households have HDTVs -- up from just 27% in 2006.31 Further, there are more than 110 HD
networks, and all of the top-rated cable networks simulcast in HD and SD formats.32 In this
environment, it no longer makes sense to exempt only SD DTAs from the integration ban.
29 See In re Implementation of Section 304 of the Telecommunications Act of 1996; Commercial Availability of Navigation Devices; Cable One, Inc.’s Request for Waiver of Section 76.1204(a)(1) of the Commission’s Rules, Memorandum Opinion & Order, 24 FCC Rcd. 7882 ¶ 12 (2009) (“Cable One Waiver Order”).
30 Id.
31 See Press Release, CEA, Americans Spending More on Consumer Electronics, New CEA Study Finds (May 6, 2010) (“CEA May 6 Press Release”), available at http://www.ce.org/Press/CurrentNews/press_release_detail.asp?id=11900 (“Sixty-five percent of U.S. homes now own at least one HDTV.”); see also Jeff Clabaugh, HDTV Penetration Now Reaches 65%, Wash. Bus. J., May 6, 2010, available at http://washington.bizjournals.com/washington/stories/2010/05/03/daily61.html; HDTV Sales Lead Upswing in Purchase of Consumer Electronics, Says Study, Broad. Engineering, May 18, 2010, available at http://broadcastengineering.com/hdtv/hdtvs-sales-lead-upswing-0518/.
32 See NCTA, HDTV Networks, available at http://www.ncta.com/Organizations.aspx?type=orgtyp2&contentId=2907#&&CurrentPage=1 (last visited June 7, 2010); AV Sciences Forum, Official AVS National HD Channel Lineup (last updated May 10, 2010), available at http://www.avsforum.com/avs-vb/showthread.php?t=1058081; see also Cable Show Draws News of HD Channel Launches, Multichannel News, May 17, 2010, available at http://www.multichannel.com/article/452819-IN_BRIEF.php (“Programmers continue to add variety to multichannel providers’ high-definition lineups, with several announcing HD launches in coming weeks.”); Letter from Megan Delaney, VP & Senior Counsel, Charter Communications, to Marlene H. Dortch, Secretary, FCC, CS Dkt. No. 97-80, GN Dkt. Nos. 09-47 et al., at 1 (Apr. 14, 2010) (“All of the top-rated cable networks are simulcast in HD and SD formats.”).
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HD DTAs will provide a low-cost way for cable customers to access one-way
programming services. Currently, to access HD channels on an HDTV, customers must use a
CableCARD-enabled HD device, which typically costs far more than a DTA. At volume, HD
DTAs would likely cost less than $50 per device. At such a low price point, Comcast anticipates
that it would be able to provide HD DTAs to its HD customers at little or no additional cost --
similar to the pricing for the SD DTAs. HD DTAs would be a particularly attractive option for
the growing number of consumers with secondary HDTV sets in the home. The average
television household with an HDTV has 1.8 HDTV sets.33
It also bears emphasis that exempting HD DTAs will not adversely affect common
reliance or the retail marketplace for navigation devices. The Commission’s common reliance
goals have already been achieved with the deployment of almost 20 million CableCARD-
equipped set-top boxes by cable operators.34 And, with respect to the retail navigation devices,
the only UDCPs at retail today (those manufactured by TiVo and Moxi) rely on features beyond
HD capability for product and service differentiation, such as DVR capability, interactive TV
applications, and access to Internet content from Netflix, Amazon, Blockbuster and other
sources.35 In short, as the Commission concluded in the Cable One Waiver Order, exempting
33 See CEA May 6 Press Release.
34 See NCTA CableCARD Report at 1.
35 See TiVo, Inc., at http://www.tivo.com/products/tivo-premiere/premiere-compare.html#tab (comparing the functionality of TiVo DVRs with cable set-top boxes); Moxi, Moxi 3-Tuner HD DVR, at http://moxi.com/us/moxi_dvr.html (detailing features of Moxi DVRs).
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one-way HD devices from the integration ban is “unlikely to present a significant impediment to
the development of a competitive retail market for navigation devices.”36
The Commission seeks comment on whether it should limit the proposed DTA exemption
to small-capacity cable systems as a way to avoid potential effects on the retail marketplace for
navigation devices.37 As noted, Comcast does not believe there would be any impact on the
retail marketplace, so there is no potential harm to mitigate. In any event, the Commission
should not limit the scope of the proposed exemption. Doing so would impede cable’s
digitization efforts and thereby conflict with the Commission’s broadband goals. There simply is
no basis for limiting the above-described pro-consumer benefits to small-capacity cable systems,
which constitute only 8% of all cable systems38 and serve an even smaller percentage of cable
subscribers. Moreover, such a limitation would be self-defeating. As Cable One’s recent
experience in its Dyersburg, Tennessee cable system illustrates, an operator cannot achieve scale
economies if deployments are limited to a small subscriber base and, as a result, cannot provide
the HD DTAs to consumers at little to no additional charge.39 Plainly, the better and pro-
consumer course would be to make the exemption available to all cable systems.
36 Cable One Waiver Order ¶ 13.
37 Notice ¶ 22.
38 See, e.g., Letter from Michael V. Pulli, Pace Americas, to Marlene H. Dortch, Secretary, FCC, CS Dkt. No. 97-80, GN Dkt. Nos. 09-47 et al., at 2 (Apr. 13, 2010); Letter from Megan Delaney, VP & Senior Counsel, Charter Communications, to Marlene H. Dortch, Secretary, FCC, CS Dkt. No. 97-80, GN Dkt. Nos. 09-47 et al., at 2 (Apr. 14, 2010) (“Charter's small-capacity cable systems pass only 7% of all the homes Charter passes and serve an even smaller percentage of all of [its] cable subscribers.”).
39 See Letter from Arthur H. Harding, Counsel to Cable One, to Marlene H. Dortch, Secretary, FCC, CS Dkt. No. 97-80, at 2 (Feb. 25, 2010) (asking the Commission to expand Cable One’s waiver relief to more cable systems because the waiver for the Dyersburg system is “too small to meet the $50 price point necessary to offer such devices to consumers for $0-1 per box . . .”).
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IV. COMCAST STRONGLY SUPPORTS COMMISSION POLICIES THAT ENCOURAGE DEPLOYMENT OF SDV, WHICH IS ANOTHER IMPORTANT PRO-CONSUMER WAY TO OPTIMIZE BANDWIDTH USE.
The Notice also invites comment on switched digital video (“SDV”) and the adequacy of
the Tuning Adapter as a way for UDCPs to access channels delivered on an SDV basis.40 As
explained in greater detail below, Comcast will start deploying SDV in a limited number of
markets this year, with additional deployments planned for subsequent years. Comcast will be
providing Tuning Adapters to subscribers with CableCARD-enabled TiVo devices and other
devices compatible with the Tuning Adapter at no additional charge to these subscribers.
Comcast strongly believes that the Tuning Adapter is an adequate solution for UDCPs, and urges
the Commission not to mandate the development of an alternative solution.
As explained above, DTAs are Comcast’s primary means of boosting the bandwidth
efficiency of our cable plant. However, Comcast requires additional bandwidth-conservation
tools to meet the ever growing demands on our network as a result of the launch of more HD
channels, the deployment of faster Internet speeds, and the rollout of innovative services like 3-D
television. SDV will provide a complement to our DTA-related efforts.
SDV is a technology that enables cable operators to send a TV channel to a set-top box
only when the set-top box is tuned to the channel. It is a two-way technology. When the
customer tunes to an SDV channel, the box sends a request upstream to the cable headend, and
the channel is then delivered downstream to the box. This is different from how traditional cable
works, where all channels are broadcast to all homes at all times, regardless of whether anyone in
a neighborhood is watching.
40 Notice ¶ 14.
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Like DTAs, SDV technology helps operators improve the bandwidth efficiency of their
networks. In contrast to the traditional architecture, SDV enables operators to allocate
bandwidth based on usage levels. Channels that are heavily viewed continue to be delivered on a
broadcast basis, while more lightly viewed channels can be delivered on an SDV basis (similar to
how VOD services are delivered today). SDV thereby enables the cable network to be even
more responsive to the preferences of its customers through more effective bandwidth utilization
and can be used to expand channels in addition to reducing bandwidth usage by current lightly-
viewed channels. As the Commission has also explained, SDV can free up bandwidth for faster
Internet speeds,41 and will support the Commission’s goal of promoting diversity in cable
systems by allowing MVPDs to carry more independent programming.
Comcast plans to start deploying SDV later this year in a limited number of systems, and
more broadly in 2011-2012. We anticipate that SDV will result in the launch of at least 50
additional HD channels, bringing the total number of HD channels in these systems to over 150.
Moreover, as SDV capacity increases over time, Comcast will be able to launch additional niche-
interest and ethnic channels. In cable systems that utilize SDV, the small percentage of
customers who use CableCARD-enabled TiVo or Moxi devices will need a Tuning Adapter to
access all of the new SDV-delivered channels, and customers with UDCPs that are not
compatible with the Tuning Adapter will need an HD set-top box to access these channels.42 Our
41 See TWC-Cox SDV Order ¶ 13 (noting that, among other things, the reclamation of cable bandwidth through SDV would “facilitate the deployment of advanced broadband technologies such as DOCSIS 3.0 as well as expand broadband capabilities”).
42 The Commission has made clear SDV deployments do not violate the navigation device or plug-and-play rules, regardless of whether SDV is used for new or migrated channels. See id. ¶ 1.
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notifications to customers and local franchising authorities in these markets explain the different
equipment options that are available to UDCP customers.
The Notice seeks comment on the adequacy of the Tuning Adapter for UDCP
customers.43 As the Commission explains, the Tuning Adapter was developed by TiVo and the
cable industry as a way to provide SDV channels to UDCPs. The Tuning Adapter will work
with any UDCP that has a USB port and can accept the necessary firmware to interoperate with
the device. Tuning Adapters have been built by both Cisco and Motorola, and have been
deployed thus far by Time Warner Cable, Cox, and certain other cable operators.
Comcast has trialed Tuning Adapters in certain cable systems, and will provide Tuning
Adapters at no additional charge to UDCP customers using TiVo devices or other compatible
UDCP devices. As noted, the notifications that Comcast is mailing to its UDCP customers and
to LFAs about our SDV deployments reference the Tuning Adapter option as well as other
equipment options for UDCP customers (such as leasing a set-top box). Comcast will use self-
installations as the default option for Tuning Adapter installations, but customers can request
professional installation, which will be provided at no additional charge.
Comcast estimates that Tuning Adapter deployments are likely to cost us in the tens of
million of dollars if many of our UDCP customers elect this equipment option. Comcast is
making these expenditures in fulfillment of the cable industry’s commitments to TiVo. As the
Notice acknowledges,44 TiVo endorsed the Tuning Adapter solution in a filing with the
43 Notice ¶ 14.
44 Id. ¶ 14 & n.36.
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Commission in 2007,45 and Comcast has coordinated with TiVo in planning for its SDV
deployments.
The Notice also invites comment on TiVo’s “IP backchannel” proposal to deliver SDV
channels to UDCPs.46 Comcast believes the Tuning Adapter is an adequate solution to enable
UDCP customers to access SDV channels, and we are incurring significant expense to make that
option available to those customers, consistent with the cable industry’s commitments to TiVo.
UDCP customers constitute a small fraction of Comcast’s overall customer base (about 1%). We
have concerns about having to dedicate substantial engineering and other resources to develop a
new solution for UDCP customers when the Tuning Adapter works perfectly well.47 We also
note that tru2way provides a proven and standardized way for CE manufacturers to make their
CableCARD devices SDV-compatible, and the Panasonic tru2way DTVs available at retail in
certain markets can support SDV.48
In light of the above-discussed existing marketplace solutions, Comcast urges the
Commission not to impose new, costly obligations relating to the delivery of SDV channels to 45 See Letter from Neal M. Goldberg, Vice President and General Counsel, NCTA, to Marlene H. Dortch, Secretary, Federal Communications Commission (Nov. 30, 2007) attaching Letter from Henry Goldberg, Attorney, TiVo Inc., to Marlene H. Dortch, Secretary, FCC (Nov. 27, 2007); NCTA, TiVo Press Release, NCTA and TiVo Announce Switched Digital Solution for HD DVRs (Nov. 26, 2007).
46 Notice ¶ 14.
47 TiVo has worked with RCN and SeaChange to develop a backchannel solution for delivering VOD content to TiVo DVRs in certain RCN cable systems, but this is not a standardized industry-wide solution and does not involve delivery of SDV channels. See Steve Donohue, RCN to Expand TiVo ‘Premiere’ Rollout, Light Reading, May 5, 2010, at http://www.lightreading.com/document.asp?doc_id=191448&site=lr_cable (noting that “TiVo's box will also be able to provide access to RCN's video-on-demand (VOD) thanks to earlier integration work TiVo did with SeaChange International Inc., which happens to be RCN's primary VOD partner”).
48 Comcast, which includes TiVo’s user interface in leased set-top boxes in its Boston market, is now working with TiVo to port the user interface to the tru2way platform. See Steve Donohue, TiVo Building tru2way version of New Interface, Light Reading, Mar. 3, 2010, available at http://www.lightreading.com/document.asp?doc_id=188664&site=lr_cable.
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UDCPs. The Commission has previously concluded that its navigation device rules are not
intended to constrain cable innovation,49 nor are they designed to shield CE devices indefinitely
from technological change and consumer preferences. As the Notice and companion AllVid NOI
recognize, the marketplace has largely bypassed UDCPs -- notwithstanding the cable industry’s
substantial and ongoing investment in CableCARD and the Tuning Adapter. We agree with the
Commission that it is time that stakeholders focus their efforts on fresh alternatives.
V. COMCAST IS PREPARED TO WORK WITH THE COMMISSION ON FINE-TUNING CERTAIN OTHER PROPOSED CHANGES TO THE CABLECARD RULES.
The Notice proposes a number of rules that would affect self-installations for
CableCARDs, billing for CableCARD-enabled devices, and deployment of M-Cards. Comcast
responds to each of these proposals.
A. CableCARD Self-Installations
The Notice proposes requiring operators to allow subscribers to install CableCARDs in
retail devices if the operator allows its subscribers to self-install leased STBs.50 As noted,
Comcast already permits CableCARD self-installations for retail devices in several markets, and
is willing to explore with the Commission and CE manufacturers ways to expand this option to
49 See TWC-Cox SDV Order ¶ 11 (the “UDCP rules were not intended to provide access to bi-directional services or to freeze all one-way cable programming services in perpetuity”); In re Implementation of Section 304 of the Telecommunications Act of 1996: Commercial Availability of Navigation Devices, Second Report and Order, 20 FCC Rcd 6794, 6809 ¶ 30 (2005) (“It is not our intent to force cable operators to develop and deploy new products and services in tandem with consumer electronics manufacturers. Cable operators are free to innovate and introduce new products and services without regard to whether consumer electronics manufacturers are positioned to deploy substantially similar products and services.”).
50 Notice ¶ 16.
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additional markets where customers can self-install their leased STBs. Self-installations help
Comcast cut down on truck roll costs and thereby provide savings for our customers and for us.51
Comcast’s experience has been that CableCARD self-installations can be a relatively
straightforward, hassle-free process and have been well-received by our CableCARD customers.
Comcast’s Seattle market typifies this experience. In Seattle, customers can pick up
CableCARDs at Comcast service centers in the market. While there, a service representative
will review step-by-step the installation process for CableCARDs, and answer any questions that
the customer might have. Typically, once the customer has brought the CableCARD home, the
customer will follow the set-up instructions included in the owners manual for the TiVo DVR or
other CableCARD-enabled retail device. During this set-up process, the customer will be
prompted to insert the CableCARD into the retail device, and he or she will go through the
process of “pairing” the two devices. The TV will display the “pairing” numbers, and the
customer will call in that information to a Comcast Seattle customer service representative, who
will then activate the CableCARD.
In most cases, the self-installation process will run smoothly, and the CableCARD-
enabled device will typically start receiving channels after a short authentication process is
completed. In the event that problems arise during the installation, the Comcast customer service
representative will troubleshoot the issue with the customer. For example, the customer may
receive an error message indicating that the device was not properly activated. In that case, the
customer service representative will send a different activation signal to the device to cure the
51 For example, approximately 80% of our customers opt to self-install their DTAs. See Comcast Q1 2010 Earnings Call Transcript at 5 (Apr. 28, 2010). Excluding DTAs, approximately 43% of our digital set-top box installations are self-installations.
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problem. Other times, the pairing numbers are entered incorrectly into Comcast’s system, and
the customer service representative needs to re-enter the numbers to complete the activation
process. If the issue cannot be resolved by the customer service representative, then the
customer is given the option of returning to the service center to obtain a new CableCARD or
scheduling a professional installation. In some cases, our customer service representative will
refer the customer to TiVo or the relevant CE manufacturer for resolution of the issue,
particularly if the customer reports receiving certain types of error messages during the
installation process.
Comcast’s Seattle market has had a very positive experience with CableCARD self-
installations. Customers like the ease and flexibility of the self-installation option. Our Seattle
system reports that several hundred customers elect this option every month although a majority
continue to prefer professional installations.
Should the Commission adopt rules in this area, Comcast asks that any such requirements
be phased in to give cable operators a reasonable amount of time to plan and implement a self-
installation option for retail customers. We also urge that the Commission make the self-
installation option contingent on CE manufacturers providing adequate support for self-
installations of CableCARDs in their retail navigation devices. Such support should include, at a
minimum: (1) CableCARD installation instructions in the owner manuals, (2) phone and other
technical support in the event that an installation problem requires involvement by the
manufacturer, and (3) customer access to any necessary software upgrades. As noted, Comcast’s
experience has been that CE manufacturers today, such as TiVo and Moxi, generally provide this
level of support, but there can be no assurance that new entrants into the retail marketplace will
adopt similar measures.
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The Notice also proposes that, with respect to professional CableCARD installations, the
operator must ensure that the technician arrives with no fewer than the number of CableCARDs
requested by the customer.52 Comcast has no objection to this proposal. Comcast technicians
generally bring multiple CableCARDs for professional installations to avoid having to make
return visits. Comcast is not aware of situations where its technicians arrive without an adequate
number of CableCARDs for the job.
B. M-Cards
The Notice seeks comment on a proposal to require operators to offer M-Cards to
customers who request them.53 Comcast has no objection to this proposal. Comcast and other
cable operators started deploying M-Cards in 2007, and we only purchase M-Cards today.
Consequently, Comcast can meet customer requests for an M-Card. In contrast, Comcast
understands that S-Cards are no longer manufactured, and Comcast keeps them in inventory
primarily for older-model UDCPs that only work with S-Cards.
C. CableCARD Billing
The Notice invites comment on a proposal to require cable operators to “include a charge
for the CableCARD as a separate line item in the subscriber’s bill.”54 Comcast supports the
Commission’s goal of transparent pricing, and we believe that we already meet this goal. As
noted, in almost all cases, Comcast provides one CableCARD per outlet at no additional charge,
52 Notice ¶ 16.
53 Id. ¶ 17.
54 Id. ¶ 15.
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whether the customer leases the set-top box or owns a UDCP. Only UDCPs that use a second
CableCARD are subject to a modest, regulated monthly CableCARD charge.55
To the extent Comcast charges for CableCARDs, those rates are calculated using the
equipment averaging methods authorized in Section 623(a)(7) of the Communications Act and
codified in Section 76.923 of the Commission’s rules.56 On average, Comcast charges about
$1.50 for UDCP customers to lease a second CableCARD for their device.57 Comcast includes
CableCARD pricing information on its website58 and in its annual rate card. And, with respect to
a UDCP customer who pays for the second CableCARD, the CableCARD charge appears on the
customer’s monthly bill.
The Commission also seeks comment on its legal authority to impose its CableCARD
billing proposal.59 Section 623 limits the scope of the Commission’s authority in this area to
rate-regulated cable systems.60 In contrast, those cable systems that have been deemed subject to
effective competition (or that have been exempted from rate regulation by state franchising laws)
55 A limited subset of legacy UDCPs require two CableCARDs. These particular device models were sold before the availability of the M-Card, so two CableCARDs (rather than a single M-Card) are needed to tune multiple channels at the same time. As noted, the M-Card has become the standard CableCARD supported in both leased and retail devices, so the relative percentage of legacy devices that require two CableCARDs is declining as these devices wear out or are replaced with M-Card-compatible devices.
56 See 47 U.S.C. § 543(a)(7); 47 C.F.R. § 76.923.
57 See NCTA CableCARD Report, Comcast Report, Dec. 2009-Feb. 2010.
58 Comcast, Customer Central, Billing FAQs, How Much Will I be Charged to Use a CableCARD?, at http://customer.comcast.com/Pages/FAQViewer.aspx?seoid=charge-to-use-CableCARD&fss=cableCARD (last visited May 28, 2010).
59 Notice ¶ 15.
60 See 47 U.S.C. § 543(b)(3) (establishing basic service tier rate regulations for equipment). The Act specifically notes that “[s]uch regulations shall be designed to achieve the goal of protecting subscribers of any cable system that is not subject to effective competition.” Id. § 543(b)(1) (emphasis added).
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are not subject to rate regulation.61 Furthermore, Section 623 mandates that the Commission
permit cable operators to use equipment averaging.62 Any CableCARD-related billing
requirements would have to take account of these statutory provisions.
Beyond these statutory considerations, Comcast is concerned that mandating a separate
CableCARD line-item for customers who lease their set-top boxes is likely to create consumer
confusion. Most of these customers are unaware that their set-top boxes include a CableCARD
and may think that the line-item charge is a price increase. Furthermore, it is unclear how such a
separate line item for CableCARDs will promote consumer interest in CableCARD-enabled
retail devices. Consumers must pay hundreds of dollars to buy such devices at retail and can also
incur recurring monthly charges for DVR service. In light of these significant outlays, and the
fact that UDCPs have shown very little marketplace appeal, it seems questionable that a small
CableCARD charge (or, in Comcast’s case, no CableCARD charge at all) on a customer’s
monthly bill would entice many (or any) lease customers to buy a UDCP.
To the extent that the Commission decides to adopt CableCARD billing rules, it should
ensure that any such requirements are fully consistent with the mandates in Section 623, and
clarify that the rule does not apply in cases where the operator does not impose an additional
CableCARD charge for similarly-situated lease and retail customers. Such a “no-charge” policy
achieves the Commission’s goal of providing equivalent CableCARD pricing for lease and retail
61 See In re Implementation of Section 304 of the Telecommunications Act of 1996; Commercial Availability of Navigation Devices, Report and Order, 13 FCC Rcd. 14775 ¶¶ 85-99 (1998) (“1998 Navigation Device Order”) (finding that the anti-subsidy provision of Section 629(a) of the Act and section 76.923 of the FCC’s rules, which require that charges for devices and equipment be separately stated from and not subsidized by charges for service, does not apply to markets subject to effective competition).
62 See 47 U.S.C. § 543(a)(7).
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customers since almost all lease and retail devices use a single CableCARD. Under such an
approach, Comcast would continue to separately state the CableCARD charge for the small and
shrinking number of UDCP customers who use a second CableCARD in their device.
VI. THE COMMISSION SHOULD PROVIDE CABLE OPERATORS WITH GREATER FLEXIBILITY REGARDING THE OUTPUTS ON THEIR HD SET-TOP BOXES.
The Notice seeks comment on proposals relating to the interface requirements for
operator-supplied HD set-top boxes.63 Under the Commission’s current rules, cable operators
must include 1394 and HDMI outputs on their HD boxes, and meet certain other technical
requirements with respect to the 1394 connector.64 The Notice proposes to modify its 1394 Rule
to require operators to include one of four interfaces on their HD STBs, including: (1) 1394, (2)
Ethernet, (3) Wi-Fi, or (4) USB 3.0.65 In addition, the Notice proposes that these interfaces
should be able to receive remote-control commands from a connected device and deliver video in
any industry standard format, such as MPEG-2 or MPEG-4.66
Comcast supports the Commission’s efforts to give operators more flexibility with
respect to the outputs used in their HD boxes. At the time the Commission adopted the 1394
Rule in its 2003 Plug-and-Play Order,67 1394 was the only digital connector in the marketplace
63 Notice ¶¶ 19-21.
64 See 47 C.F.R. § 76.640(b)(4).
65 Notice ¶ 20.
66 Id. ¶ 21.
67 See Implementation of Section 304 of the Telecommunications Act of 1996; Commercial Availability of Navigation Devices; Compatibility Between Cable Systems and Consumer Electronics Equipment, Second Report and Order and Second Further Notice of Proposed Rulemaking, 18 FCC Rcd. 20885 (2003) (“Plug-and-Play Order”).
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that enabled the recording of copy-protected digital content. Pursuant to the Commission’s rule,
which reflected a negotiated compromise between the cable and CE industries, a 1394-equipped
device can select and record channels and perform other remote control commands via the 1394
connection to the HD set-top box.68 Comcast has fully complied with the 1394 requirement, and
has thus far deployed millions of HD boxes that include the 1394 connector.
However, as numerous parties have explained to the Commission over the last year, 1394
remains a little-used technology and has been superseded in the marketplace by Ethernet, MoCA,
USB, Wi-Fi, and other IP-based interfaces.69 As Verizon advised the Commission, “virtually no
home entertainment products that receive content from set-top boxes and other consumer
electronics devices rely on the 1394 interface for recording or home networking,”70 and Intel
describes the 1394 connector as an “electronic bridge to nowhere.”71 Moreover, to the extent
that consumers want a device for recording cable programming, most elect to lease an HD/DVR
from their MVPD, rather than purchase a standalone DVR at retail.
With respect to the specific proposal in the Notice, Comcast urges the Commission to
consider letting marketplace forces and consumer preferences dictate the types of connectors 68 47 C.F.R. § 76.640(b)(4)(iii).
69 See, e.g., In re Intel Corporation’s Petition for Waiver of 47 C.F.R. § 76.640(b)(4), Petition for Waiver, CS Dkt. No. 97-80, CSR-8229-Z (Oct. 7, 2009) (“Intel Petition”); In re TiVo Inc.’s Petition for Clarification or Waiver of 47 C.F.R. § 76.640(b)(4), Petition for Clarification or Waiver, CS Dkt. No. 97-80, (Nov. 6, 2009) (“TiVo Petition”) (noting that the TiVo DVRs sold at retail do not include a 1394 interface); In re Motorola, Inc.’s Request for Waiver of 47 C.F.R. § 76.640(b)(4), Request for Waiver, CSR-8251-Z, CS Dkt. No. 97-80 (Nov. 25, 2009) (“Motorola Request”); In re ADB’s Petition for Waiver of 47 C.F.R. § 76.640(b)(4) (Feb. 19, 2010); In Re Nagravision’s Request for Waiver (Mar. 25, 2010) (seeking waiver of integration ban and 1394 requirement with respect to HD DTAs).
70 Verizon Comments, CSR-8251-Z, CS Dkt. No. 97-80, at 2 (Feb. 22, 2010).
71 Intel Petition at 8-9; see also CEA Comments, CSR-8251-Z, CS Dkt. No. 97-80, at 2, 4 (Feb. 22, 2010) (describing the 1394 rule as “an obsolete prescriptive measure” and noting that “home networking has migrated to technologies based on Internet protocols”).
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included on operator-supplied HD STBs, rather than mandating specific output technologies. As
the history of the 1394 requirement demonstrates, the marketplace is evolving very rapidly, and
it is impossible to predict whether specific technologies that are used today will be supplanted by
other technologies in the future. By giving operators greater flexibility in this area, the
Commission will enable operators to assess and meet marketplace demand for particular
connectors and thereby serve the interests of consumers.
Should the Commission nonetheless decides to replace, rather than eliminate, the 1394
requirement, Comcast urges the Commission to make the list of approved technologies as
expansive as possible. For example, the Commission should add MoCA to the list given the
growing use of that technology in the marketplace,72 and give operators the added flexibility to
use other interfaces that enable distribution of video programming in the customer’s home.
With respect to the Commission’s proposal that operator-supplied HD set-top boxes
output content in standard industry formats, Comcast again suggests that the Commission avoid
specific technical requirements. Comcast has strong incentives to ensure that its set-top boxes
output content in formats that can be understood by other devices in the customer’s home, such
as IP or MPEG format, particularly as it continues to pursue initiatives like TV Everywhere to
deliver content to as many devices as possible. Nonetheless, it is impossible to predict how
video formats will change in coming years, and there is a risk that any rules in this area would be
overtaken by marketplace innovations.
72 See, e.g., Tamara Chuang, Cable TV (Really) Does Want to Offer Multi-Room DVRs, The Gadgetress, Feb. 12, 2010, at http://gadgetress.freedomblogging.com/2010/02/12/cable-tv-really-does-want-to-offer-multi-room-dvrs/36213/ (“ABI Research . . . projects that there will be 15 million next-generation set-top boxes in the market by 2014. These 15 million boxes will have [MoCA], a technology that uses existing coaxial cables to send video to devices throughout the home.”). Indeed, the AllVid NOI specifically seeks comment on the use of MoCA as the physical connector between an AllVid adapter and smart video devices in the home. AllVid NOI ¶ 26.
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As to whether “these interfaces should be able to receive remote-control commands from
a connected device,”73 Comcast recommends that the Commission refrain from imposing new
mandates in this regard, or at least defer consideration of the issue to its AllVid NOI proceeding.
The remote control commands in the 1394 rule were based on preexisting industry standards, and
were further negotiated by the cable and CE industries as part of the 2002 plug-and-play
agreement.74 Comcast has been working within DLNA on remote control commands for
Ethernet and Wi-Fi connections between and among DLNA-compatible devices, but there are
generally no industry standards in this area (in contrast to the situation with 1394) and certainly
no inter-industry consensus around possible Commission regulations in this area. In any event, it
would take well beyond January 2011, the proposed date in the Notice, to develop any such
consensus approach, and the experience with 1394 suggests that mandating remote control
commands or additional interface functionality is unlikely to have an impact on consumer
acceptance or rejection of a particular interface technology.
It also bears emphasis that there are significant differences between defining remote
control commands in the 1394 environment and such commands in a home-networking
environment. 1394 was developed as an interface for connecting proximate devices in series,
and remote control commands codified in the Commission’s 1394 rule enable one device (such
as a standalone DVR) to control tuning, muting, and certain other basic functions in the
connected set-top box. In contrast, home networks connect physically separated devices in
73 Notice ¶ 21.
74 See Plug-and-Play Order ¶¶ 24-26; see also Letter from Carl Vogel, President and CEO, Charter Communications, et al., to Michael K. Powell, Chairman, FCC, CS Dkt. No. 97-80, PP Dkt. No. 00-67 (Dec. 19, 2002) (providing inter-industry agreement on one-way plug-and-play issues).
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parallel, and remote control commands in that context aim primarily to address a different set of
issues. For example, the DLNA effort defines mechanisms for discovering and sharing content
between and among multiple devices in a home network. In such an environment, multiple
devices can be making requests of another device at the same time, and solutions must be
developed for managing resource conflicts and other issues.75 As noted, Comcast is working
with other stakeholders in DLNA to address such issues in the MVPD ecosystem, but these
efforts are still in development.
The cable industry made clear in its submission of video device principles to the
Commission that it is committed to giving consumers the ability to network content in the
home,76 and numerous operators, including Comcast, have deployed or are planning to deploy
home-networking solutions. Nonetheless, to the extent the Commission is examining possible
ways to enable networking of content to other devices in the home via its “remote control
command” proposal, the Commission has already invited comment on home-networking
solutions for all MVPDs -- not just cable operators -- in its AllVid NOI and risks prejudging those
issues by adopting cable-specific rules in the Notice.
Finally, Comcast urges the Commission to exempt DTAs from any interface
requirements. In its Cable One Waiver Order, the Commission, on its own motion, waived the
1394 rule as it related to the HD DTAs at issue, noting that “the additional cost [of the 1394
Rule] would be inconsistent with the purpose of the [waiver] grant, i.e., to provide a low-cost HD
75 The AllVid NOI invites comment on these types of issues. See, e.g., AllVid NOI ¶ 33 (inviting comment on resource conflicts in home network).
76 See Letter from Kyle McSlarrow, President and CEO, NCTA, to Julius Genachowski, Chairman, FCC, NBP Public Notice #27; GN Dkt. Nos. 09-47, 09-51, 09-137; CS Dkt. No. 97-80, at 1 (Mar. 12, 2010) (presenting video device principles).
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box for consumers.”77 Establishing a general exemption from any interface requirements for HD
DTAs would provide similar benefits to consumers by helping to keep down the cost of the
devices.
77 Cable One Waiver Order ¶ 16 n.42.
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VII. CONCLUSION
Comcast urges the Commission to adopt the recommendations set forth in these
comments. Comcast believes there are a number of helpful proposals in the Notice that, if
adopted or modified as suggested in these comments, will provide benefits to consumers and
encourage continued investment and innovation in cable networks and equipment.
Respectfully submitted, /s/ Kathryn A. Zachem
Joseph W. Waz, Jr. COMCAST CORPORATION One Comcast Center 1701 John F. Kennedy Boulevard Philadelphia, Pennsylvania 19103-2838
Kathryn A. Zachem James R. Coltharp COMCAST CORPORATION, 2001 Pennsylvania Ave., NW Suite 500 Washington, D.C. 20006 (202) 379-7134
Jonathan Friedman Jessica D. Feinberg* WILLKIE FARR & GALLAGHER LLP 1875 K Street, N.W. Washington, DC 20006-1238 Attorneys for Comcast Corporation * Admitted only to the New York Bar; working under supervision of members of the D.C. Bar.
June 14, 2010