NYC, Yonkers Weigh In On Cablevision Encryption Request
New York City Agency ‘Takes No Position' But Urges FCC to Include Three-Year Sunset Provision
Todd Spangler 10/22/2009 5:48:14 PM

New York City told the Federal Communications Commission that it "takes no position" on Cablevision Systems' request for a waiver of rules banning the encryption of basic broadcast channels, but urged the agency to adopt a three-year sunset provision if a waiver were granted.

Meanwhile, the City of Yonkers, which borders the Bronx, opposes Cablevision's request, describing it in an FCC filing as "only the latest in a line of actions by the cable operator to marginalize its basic cable subscribers in hopes of expanding its digital customer base." Yonkers is not covered by Cablevision's waiver request but the city said it expects that if the MSO is allowed to encrypt its basic tier in New York it will do the same elsewhere.

Asked to comment, Cablevision said in a statement, "This is a process and we look forward to addressing any issues or reservations through our formal response." Cablevision's reply is due Nov. 6.

Cablevision filed the waiver petition in August seeking an exemption to the agency's rules prohibiting the encryption of basic broadcast channels covering its New York City franchise areas, arguing that scrambling the full digital TV lineup would reduce its costs and deter signal theft.

The FCC's ban on encrypting basic broadcast TV signals is intended to allow consumers to view programming without the need for additional equipment.

Cablevision, in its original filing, argued that it has a high digital penetration rate -- about 94% of Cablevision's 3.1 million video customers have digital service -- so most customers already have the necessary equipment to view encrypted programming. Furthermore, Cablevision asserted, "Today's cable subscribers typically do not have an expectation -- or the capability -- of receiving digital-cable services without a set-top box."

The city's Department of Information Technology and Telecommunications, in a Oct. 22 filing, said Cablevision's reasoning would hold only if it continues to be the case that it's easier for consumers to get a set-top than to obtain the equipment to view non-encrypted digital programming in the clear.

In the future, "the bottleneck burden of acquiring a set-top box or similar operator-provided technology to access basic tier-only may affect a greater number of subscribers, warranting a future review of the issue Cablevision now raises," the DoITT said.

The City of Yonkers, in its Oct. 21 comments, complained that "Cablevision has continued to degrade its provision of basic cable services, first by removing PEG channels, then commercial channels, to a digital tier requiring additional equipment often at cost to subscribers." The benefits to Cablevision of a waiver, the city said, "do not outweigh the harm to its subscribers."

The DoITT filing is available here, while the Yonkers comments are here.

Cablevision said encrypting broadcast basic would allow it to perform connections and disconnections remotely, to eliminate many truck rolls and service appointments for new and discontinuing customers. According to the operator, last year it performed more than 1 million truck rolls associated with physically activating or deactivating service using drops to prevent against theft of unencrypted programming.

The FCC has granted waivers to the encryption ban to other cable operators, particularly where connects and disconnects occur frequently or where there's a high rate of disconnects for non-payment.