FCC Ruling Ensures Higher Bills for Basic Cable Subscribers in Future

The FCC has ruled to allow the National Cable & Telecommunication Association's (NCTA) to scramble (encrypt) basic cable. While the cable companies claim that it is more cost-effective and easier for customers if they can scramble all signals sent to homes, the new ruling ensures that people who don't pay for basic cable can't access it without a cable box or CableCARD. If you are one of those people who are paying for a basic cable subscription—usually local channels and a few cable channels like CSPAN or CNN—the encryption of these channels means you will have to rent a cable box or CableCARD from your cable company. The FCC determined that "few" customers will be affected by the decision. However, they have created provisions to make it easier for households who currently connect their TVs or devices directly to the cable TV coaxial wall outlet.

Prior to this ruling, cable companies were permitted to scramble only premium channels. The FCC required cable companies to send out basic cable stations without encryption. These basic cable stations have been accessible using a TV or device equipped with a clear QAM (quadrature amplitude modulation) tuner. Once the basic cable tier is scrambled, media devices like Boxee Live TV, the Hauppauge recorder, Simple.TV, or TV-to-computer tuner adapters like EyeTV, will no longer be able to receive basic cable channels.

Free Boxes and Streaming TV Solutions
Cable customers and device manufacturers will not be left out in the cold when the cable companies switch to encrypted basic cable. The FCC has mandated a 3-year changeover period during which basic cable subscribers will be offered free solutions. The commission believes that few people will be affected because most cable subscribers already use a cable box to receive digital cable channels. More likely the change will affect people who connect a second or third television directly to cable.

If you are a basic cable subscriber (and you do not have a cable box) before your cable company's switch to scrambled channels, you will be offered a way to continue receiving basic cable at no additional cost. Note that if you have simply connected to the cable outlet but have not paid for that subscription, you will NOT be afforded this offer.

The FCC has ruled that the top six cable companies—Comcast, Time Warner Cable, Cox, Charter, Cablevision, and Bright House—must provide existing basic cable subscribers one of three options:

  1. The subscriber’s choice of a set-top box or CableCARD on up to two television sets without charge for two years from the date of encryption.
  2. Those customers who subscribe to a level of service above “basic only” but use an additional television set to access only the basic service tier will be given a choice of a set-top box or CableCard on one TV without charge for one year from the date of encryption.
  3. Existing subscribers who receive Medicaid will be able to receive a set-top box or CableCARD on up to two TVs without charge for five years from the date of encryption.

The cable companies must give you time to make your choice when they make the switch to scramble channels. Customers will be notified at least 30 days prior to the date of encryption and will have 120 days after that date to take advantage of the offer for free boxes, adapters, and/or CableCARDs.

The FCC will require the top six cable companies to make basic cable available for Boxee, Hauppauge, Simple TV, and other media streamers and devices. The cable companies must offer either a hardware or software solution. The hardware solution will be a converter box with "standard home networking capability" (i.e., a box that streams live TV) with a built-in Ethernet-Digital Transport Adapter (E-DTA). The E-DTA will convert the TV broadcasts to a digital stream that can be accessed by devices like the Boxee Box, Simple.TV, or Hauppauge.

Alternatively, cable companies can provide device manufacturers with a software upgrade that allows the device to receive live TV over IP. In other words, the device will be able to stream live TV directly from the cable set-top box when both are connected to the same home network—either wired or wirelessly.

While the cable companies are required to work with the device manufacturers, they will not be required to notify subscribers of the devices that will work with their services.

The FCC will not require smaller cable companies to provide free boxes. That means the 4400 of us who subscribe to BendBroadband cable service will have to pony up and pay for a new cable box. The FCC has decided that there are too few of us small basic cable subscribers and that they don't need to protect us.

Offer is Only for Existing Customers
The free box offer will only apply to existing basic cable subscribers and not new subscribers. The FCC addresses this issue in their ruling "We also reject calls from some commenters to require free equipment in perpetuity for existing subscribers, and not to limit free boxes to existing subscribers.The consumer protection measures we adopt are intended to mitigate the disruption that may be experienced by current cable subscribers. We do not agree that free equipment is necessary for new subscribers: given the movement to digital services, many subscribers have become accustomed to leasing set-top devices, and that trend seems likely to continue."

For background details about the FCC ruling, read Scrambled Cable, Anyone? For the entire text of the FCC ruling, see Commission Relaxes The Cable Encryption Prohibition.

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COMMENTS
Billy's picture

If I lived in a major metropolitian area and only had basic cable, I think it would be a no brainer to ditch those jerks for the free airwaves loaded with HD and multiple channels. A simple antenna in the attic and you are in business! This is the new golden age of free over the air TV.

Mark Fleischmann's picture
In reference to Billy's comment above, the reason many city dwellers need basic cable is that tall buildings block broadcast signals. So they are captives of the cable company if they want any television service at all. This is the position I'm in. The only alternative is internet TV and you can't assume all programming for local stations is available online. Most of it is not.
Dfrimdaq's picture

Thanks for bringing up the fact the OTA broadcast is difficult for some in my glass and steel downtown dwelling I've tried numerous antennas and the multipath signal is a great problem I'm lucky to receive 5 clear stations and I'm only a few miles from the tower. But I do agree this bad for the consumer in every way.

MatthewWeflen's picture

I live in Chicago, and was having trouble getting signals for weaker stations, probably due to blockage from high rise apartment buildings, and the interior location of our condo in its building. I bought the Winegard SS-3000, and it pulls in signals much better than my previous antennas. Your mileage may vary of course, but it's worth a try, and you can get it for $40-$50.

mdanderson's picture

Well there goes TCM for me. I am getting basic cable through my internet stream but it looks like I will not get anything now. I may try an OTA HD antenna so I can at least watch local stations, but I am not sure if an indoor one will work since I live in an apartment.

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