To: Sleeper who wrote (9359 ) 5/13/1999 7:11:00 PM From: Sleeper Respond to of 29970
Of interest...Possible loss of revenues. Comments, anyone? FCC, cable reach compromise Consumers will purchase own set-top boxes instead of paying a monthly fee WASHINGTON (Reuters) - Federal regulators Thursday adopted a compromise to speed competition for new high-tech cable boxes, expected to be the gateway to a host of services in coming years including high-speed Internet links, movies on demand and interactive television. Beginning next year, consumers will be able to purchase their own set-top boxes from electronics stores instead of being required to pay $2 or $3 a month to lease a box from their local cable company. The key to the new boxes will be a separate plug-in security module that cable operators will be required to provide, which will allow the equipment to operate. Security features ensure customers receive only the services they pay for. Thursday's compromise, approved by the Federal Communications Commission, exempts old-fashioned analog cable boxes from the rules the FCC adopted last year requiring a separate security component. Consumer electronics manufacturers and cable operators agreed that the expense of refitting analog boxes would needlessly delay the development of new digital and hybrid analog/digital boxes with separate security. Under rules required by the 1996 Telecommunications Act and adopted by the FCC last year, cable operators must provide separate security modules for boxes purchased in retail stores by July of next year. FCC rules forbid cable operators from providing on their own boxes with built-in security starting in 2005. Cable operators had asked to have the phase-out date extended or scrapped, but the FCC declined to change the date at Thursday's meeting. FCC Chairman William Kennard said he was pleased to see the cable and consumer electronics industries working together to meet the deadlines. "I'm glad that we're on track," Kennard said. Analog boxes generally provide only cable television channels. Cable operators are rapidly converting their networks to digital technology, allowing them to carry far more TV channels and offer new services, such as Internet access, through newer set-top boxes. The multifunctional set-top box of the future has been the focus of recent megadeals among cable and other communications players. Microsoft Corp. (MSFT) agreed to invest $5 billion in AT&T Corp. (MSFT) to get its Windows CE operating system on more of the boxes that AT&T plans to roll out to millions of its customers in coming years. Leading manufacturers of set-top boxes include Scientific-Atlanta Inc. (SFA) and General Instrument Corp. (GIC), but other companies could jump into the market if strong demand develops at the retail level. Manufacturers are expected to integrate the boxes into television sets, VCRs and other home-electronics devices.