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GATEWAY, OR FUNCTIONAL EQUIVALENT?

3/22/2010 12:47 PM Eastern

NOTHING LIKE THE FEDERAL COMMUNICATIONS COMMISSION’S 360-
page National Broadband Plan last Tuesday (March 16) to eviscerate
an otherwise sunny day.

If you’re a set-top person, go directly to page 51. Chapter
four is mandatory reading. Brace yourself for violent sputtering
— whether you’re rooted in cable, telco or satellite video.

Recommendation 4.12 seeks a mandatory shift, by 2012, to
“gateways.” (“Gateway” is the Internet-y way of saying “set-top
box.”)

Quoting from the FCC Plan: “A gateway device should
allow consumer electronics manufacturers to develop, sell
and support network neutral devices that access content from
the network independently from MVPDs or any third parties.
Specifically, third-party manufacturers should not be limited
in their ability to innovate in the user interface of their devices,
by MVPD requirements.”

Translation: Smells like another attempt by the consumerelectronics
side to usurp video content and first-screen navigation.
Change the architecture of all video distributors. Change
the business models. Simple! Make it so that CE manufacturers
can sell TVs, with content, and a guide to navigate that content.

And if you continue to do it your way, video distributors, make
it so that everyone else can do it your way too, if they so desire.

This story stretches back 25 years, to analog. Multiport,
anyone?

There is one glimmer of hope in 4.12, in the words “equivalent
functionality.” This could mean set-tops, increasingly
rigged with broadband IP connections anyway. Or the cloud.
Or whatever it turns out to be.

The second FCC recommendation (4.13): Mandatory, accelerated
rules to make cable fix any remaining CableCard
problems. By autumn of this year.

Translation: Hello, TiVo. This sounds just like you! Almost
word for word.

How a cable-specific recommendation wriggled into a plan
that is otherwise all-inclusive is one of many puzzlers about
4.13.

Consider: If you’re a cable operator in the United States, it is
against federal law to install a digital box without a CableCard.
CableCards exemplify federally-mandated “innovation.”

So far, the capital cost for cable to launch 20 or so million
CableCard-equipped boxes is pushing past $1.2 billion.

Only cable was commanded to perform this “innovation.”
Not telco, not satellite. CE was in, but they pulled out. Yet
somehow, the absence of a retail market for set-tops is cable’s
fault.

If hope springs eternal, there are two pieces of “good news”
in the set-top part of the proposed FCC plan. (This is “good
news” like learning you’ll get to keep one eye, and maybe your
left big toe. For balance.)

One: Everybody who sells multichannel video is in this cauldron.
Not just cable. For once.

Two: What’s next is probably a “Notice of Inquiry.” That’s better
than what could’ve happened: Go directly to rulemaking.

 

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