Video services

Cox, Fiber Muni in Set-Top Scrape

7:15 PM -- Cox Communications Inc. is questioning whether Lafayette Utilities System (LUS) should be allowed a set-top waiver for its IPTV service.

Cox's comments could be viewed as a way to slow down competition in the region. After all, it did pick Lafayette for its first deployment of Docsis 3.0, and both operators are battling for Louisiana broadband customers in general. But Cox says its case is more about providing "equal footing." (See Cox Unleashes Wideband.)

Here's what's happening: In January, LUS launched a $110 million fiber-to-the-home (FTTH) system that eventually will offer symmetrical 100 Mbit/s Internet and digital and analog video services to about 57,000 homes, schools, and businesses in the Lafayette area. LUS, a municipally owned service provider, followed in late March by petitioning the Federal Communications Commission (FCC) for a waiver so that it could continue using IPTV set-tops with integrated security -- something the Commission banned in July 2007. (See Countdown to 'Seven-Oh-Seven'.)

Dozens of other service providers, including several offering IPTV, were awarded temporary relief on the condition that they migrate to an all-digital platform by Feb. 17, 2009, the original date of the U.S. broadcast digital TV transition (now extended to June 12 for some stations). (See Verizon & Others Get Their Waivers and Broadcasters Rally 'Round June 12 .)

"Had the LUS system been in operation in 2007 or 2008, LUS would have sought a waiver then, and it would presumably have received one," the operator argues.

Cox's comments, filed May 14, say a waiver would be inconsistent with previous waiver awards. For example, Cox notes that the temporary omnibus waiver granted in July 2007 was based on a pledge to go all digital -- but LUS still offers two video tiers in analog.

LUS's response is to ask the FCC to clarify the conditions for such waivers. "If the Commission intended 'all-digital' service to mean 'only' digital service, then this would create a problem for LUS and its subscribers. In that event, LUS would respectfully request that the Commission waive this requirement as applied to LUS."

Cox also argues that the muni's request is beyond the scope of previously granted waivers, since LUS isn't specifying an end date for its waiver, nor does it point to any specific device models that it wants to apply to the waiver.

LUS claims that its vendor partners, including Motorola Inc. (NYSE: MOT), have sought out technology that would allow LUS to separate the security and navigation functions for its IPTV service, with no luck.

LUS's filing did not document which Motorola boxes it's using, but evidence indicates that the operator is using some models in the vendor's VIP IPTV set-top family, which AT&T Inc. (NYSE: T) also uses to power some of its U-verse footprint.

Those models don't support slots for CableCARDs, the removable security modules that most U.S. MSOs are using in order to comply with the FCC integrated security ban. Some models support removable SmartCards, but the FCC has already ruled that Cablevision Systems Corp. (NYSE: CVC)'s SmartCard implementation does not fully conform with the security mandate, so that option is probably out. (See Son of 'Waiver Central' , Cablevision Seeks Extended Security Waiver, and Order Up! .)

So what happens if LUS loses? One possibility: it may be forced to develop or retrofit a security system that complies with the integrated security ban, which would cost both time and money.

LUS has not responded to a request for further comment.

— Jeff Baumgartner, Site Editor, Cable Digital News

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