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Charter Starts Retail Box Talks

Negotiating With CE Company To Make Retail Device That Uses Charter’s New Downloadable Security Platform 11/07/2013 10:44 AM Eastern

Charter Communications has kicked off talks with at least one consumer electronics manufacturer about building a set-top for retail sale that can use the MSO’s new downloadable conditional access system.

Entering in “good faith negotiations” with a CE manufacture along those retail lines was a key condition laid out by the Federal Communications Commission in April when it granted Charter a temporary waiver to deploy dual-security set-tops that integrate the MSO’s legacy conditional access system and run the new, downloadable version. The waiver prevents Charter from having to develop a more expensive dual-security box that would use a CableCARD for the legacy security system and prolong the operator’s all-digital upgrade.

In a document submitted to the FCC on October 30 and signed by Charter CEO Tom Rutledge, Charter said those discussions were underway. “I hereby certify that Charter is engaged in good faith negotiations with a consumer electronics manufacturer that intends to develop a set-top box or comparable video device to be sold at retail in the United States that utilizes Charter’s downloadable security and can be used by a Charter customer on all of Charter’s cable systems,” Rutledge wrote.

Charter has not yet revealed which company or companies it has engaged with respect to developing a box that can be sold at retail. According to multiple industry sources, Samsung and Humax are the likeliest candidates to develop such a device for Charter, but no final decisions have been made. Samsung, meanwhile, revved up its retail set-top game last month with the launch of a $149 IP-connected CableCARD device that can deliver an MSO’s linear digital TV service alongside over-the-top apps from Netflix and others.

Samsung and Humax, sources add, are also angling to develop Charter’s next-gen, IP-capable “World Box,” a leased device that use the new downloadable security system and be capable of supporting the MSO’s cloud-based user interface, which is slated for initial tests in Ft. Worth, Texas, and other apps and services piped in via the network that would work in tandem with the device’s HTML5 browser.

Humax and Samsung have already been selected by Cablevision Systems to develop a new “Future Services Portal” device that will also use HTML5, support the MSO’s cloud-based UI, and run a downloadable security system that is believed to be closely mimicking the one Charter is getting ready to deploy.

At least one other supplier has confirmed it will pitch in with Charter’s analog-reclamation plan, which includes its move to the new security platform.

Speaking on the Arris Group third quarter earnings call late last month, chairman and CEO  Bob Stanzione said Arris will supply a box to Charter that will play a role in the MSO’s all-digital migration plan. He didn’t provide further details, including whether Arris has been tapped to develop the initial dual-security box that will be used during the transition phase to the downloadable security system or if it will be among the suppliers for the coming World Box.

Stanzione told Multichannel News last month that Arris, which closed its acquisition of Motorola Home in April, has inked a deal that will allow it to use the Motorola brand for an additional two years. “We’ll absolutely stay in retail,” Stanzione said at the time. “I think retail is a business we ought to grow because I think a lot of these in home devices are going to end up being self-install and we want to have a retail presence.”

September