The FCC rejects Comcast's appeal to be exempt cable regulations

The FCC is taking a bigger stance in the cable industry than previously expected. Starting on July 1st, 2007, cable service providers who also sell set-top boxes will not be allowed to directly link (PDF) the set-top boxes to service operators. In a nutshell, third party set-top box manufacturers -- including Cablevision, who filed motion for the request -- will be allowed to sell devices for customers who already have cable, a process that was previously impossible due to the proprietary nature of existing set-top devices.

Comcast tried to appeal an FCC decision on the new regulation, asking the FCC to exempt it from the regulations on July 1st. The FCC turned down Comcast's request, claiming "The Bureau denied Comcast’s request for a permanent waiver from the integration ban
but granted Comcast leave to file an amended waiver request. Comcast's permanent waiver
request, if granted, would exempt a vast majority of the set-top boxes being placed into service today and in the future."

According to the FCC, the new regulations will help open the playing field for set-top box makers and cable providers as well. The regulations will also help those jumping on the CableCARD bandwagon. Once the regulations kick in, all set-top boxes shipping after July 1st will be open to any CableCARD from any service provider in the U.S. Previously, users were concerned with the CableCARD standard and how it would affect their ability to change boxes or service providers.

The new FCC ruling will not only open the doors for companies wanting to produce set-top boxes, but also for TV manufacturers who want to integrate CableCARD options into their TV sets. Many consumers feel the pinch when they are required to purchase or rent a CableCARD tuner while also paying fees for a set-top DVR box.

With Comcast's appeal thrown out the window, the company called the FCC ruling "regrettable," and said that if the FCC allowed more companies to make set-top boxes, it would only cause consumers to spend more. Of course, Comcast has a strong interest in protecting its market-share. The National Cable & Telecommunication Association, the industry lobbying group that supports Comcast and other service providers, said that consumers will pay roughly $600 million USD more per year for CableCARDs -- averaging about $2 to $3 per card.

Despite complaints by Comcast and other cable providers, FCC chairman Kevin Martin said that the cable industry is the only market where the FCC regulates but prices continue to increase from the providers. Yet Comcast argues, saying that "the rejection of this waiver means millions of American consumers won't have the opportunity to enter the age of digital television easily and affordably."

"So, I think the same thing of the music industry. They can't say that they're losing money, you know what I'm saying. They just probably don't have the same surplus that they had." -- Wu-Tang Clan founder RZA

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