A Note to the FCC – Call their bluff…

A couple years ago CBS threatened to pull the plug on High Def programming if the FCC didn’t push forward rules supporting the Broadcast Flag.

For those that don’t know, the Broadcast Flag is basically a digital switch that over the air broadcasters, the major broadcast networks, can set to potentially prevent viewers from recording their broadcasts. If they don’t want you copying their show to your Tivo/PVR hard drive, the switch could prevent it. Or they could set it so you could copy it one time, but not make any further copies.

When CBS made their threat, an argument could have been made that their content was needed to help speed up the adoption of HDTV. Back then, the HDTVs were more expensive, and if CBS stopped broadcasting in HD, it could have given potential buyers a reason not to buy a new HDTV.

Now the momentum has flipped. The HDTV cat is out of the bag. It’s not that the majority of homes have high def sets, they don’t and won’t for a good 5 years. However, the number of people who do have HDTVs LOVE THEM. When you have millions and millions of consumers who have paid their hard earned money for a product they love, the only thing that would happenif a network broadcaster pulled the plug on their HD feeds is that their would be a switchboard meltdown at that broadcaster and the number of complaints the FCC would get would dwarf the Janet Jackson response.

That’s on the national level.

On the local level, forgettaboutit. Every affiliate of that broadcaster would go through living hell. There are still a lot of HD viewers that get their signal from over the air feeds. These are the most outspoken consumers who call and give grief to an affiliate when a show is upconverted rather than shown in true HD. If a show isn’t shown at all in HD, the phones ring longer and the emails come quicker. If it’s a major event, it’s not suprising for the local station general manager to get threats of bodily harm. I can’t even imagine the hell that Fox affiliates that didn’t carry the SuperBowl went through from their viewers.

I’m telling you, there is no chance that the national network broadcasters pull back from HD. Their affiliates would revolt, side by side with their viewers in enough numbers, and with a loud enough voice, that the pain would last a long time.

But lets just say, for the sake of example that one of the network broadcasters did stop broadcasting in HD. They could do it in one of two ways. They could stop all of their broadcasting, which I don’t think they are stupid enough to do, or they could seperate their broadcasts. They could offer an HD feed to the cable and satellite distributors they already have HD deals with, and then offer only a low definition feed for over the air broadcasts.

The irony of the impact should make the FCC smile, if not blush.

By offering HD feeds only to cable and satellite, it would push viewers who had previously relied on antennas, but were buying a new HDTV (for those that don’t know, you can buy a 27″ HDTV ready set for under 300 dollars and falling now), or thatalready had an HDTV, towards signing up with an HD sat or cable provider for not just their HDTV, but also to support their analog TVs.

Anything that transitions TVs from receiving signalsover the air, via antenna reception to utilizing a digital cable or satellite box, pushs the analog to digital transition one baby step closer.

So if one of the networks threatensto pull their HD signal because of the broadcast flag…call their bluff.

The same applies to the Movie Industry. MPAA has been quoted as saying that “without the flag, high value content would migrate to where it could be protected.” Yeah right. Just like the music industry switched their content back from CDs to cassette tapes and LPs. I haven’t seen a movement on the part of the music industry to switch from DVDs and their digital image back to VHS… “where it could be protected”. The movie business complained about DVDs and threatened to not support them…until they started making more money from DVDs than theatrical release.

Protect the MPAA members from themselves and theirlies. It’s all BS. Call their bluff.

We don’t need the broacast flag. It accomplishes absolutely nothing other than to set a precedent that the content industry can intimidate the FCC.

That said, although the broadcast flag is bad for consumers in every possible way, it would be great for my content businesses. HDNet Films, 2929 Entertainment, Rysher Entertainment, The Dallas Mavericks, HDNet Productions, www.hd.net, every single content entity I have would benefit from the broadcast flag. Not because it would protect content, it wouldnt. Content doesnt needany special protections. There are enough laws on the books regarding theft that no special content laws are needed.

They all would benefit because we wouldn’t use the broadcast flag. While the big networks would create confusion and anger with their customers, our businesses could be the knight in shining armour and provide content in exactly the means consumers want it, unencumbered and available to watch, where and how they like.

Before I sign off, and since I’m high on the soap box, since I’ve touched on the subject of the analog to digital transition, let me make one point there that I think is being overlooked.

THe value of reclaiming the analog spectrum is not just in the 25 Billion dollars or more that could go into the government treasury from its sale, but also in the bandwidth that is freed up at cable MSOs. Most cable providers have nearly 80 analog channels chewing up their valuable bandwidth. AT approximately 38mbs PER CHANNEL, that’s nearly 3 Gigabytes of bandwidth that can be freed up to be used for digital applications. Those applications could be not only HD channels, but just as importantly, bandwidth for broadband connections. Free up 3GBs and you could see the bandwidth available to your house expand to unheard of levels.

So the transition from analog to digital tv is not just about television, it’s as much about expanding the broadband opportunities to every home passed by cable. That’s good for all of us.

33 thoughts on “A Note to the FCC – Call their bluff…

  1. Electronics firms got the message that Powell was serious about his plan for digital television. As Powell says, “Sometimes you play hardball.” Within four months, they had negotiated a deal with the cable industry over a lingering copy-protection dispute. But Hollywood demanded more.

    Comment by runescape money -

  2. Correct me if i’m wrong but, aren’t cable channels multi/broadcast? which would mean the 3Gbps is spread between however many households under the same distribution system, which would likely be thousands, so only bandwidth change is likely to be negligable?

    Comment by wow powerleveling -

  3. Thanks for being a voice of reason.

    Comment by whales -

  4. By the way: What are the Features and Benefits of Analog? What are the Features and Benefites of HDTV? Now compare.
    http://www.52z.com

    Comment by yxdown -

  5. We officially win:

    http://www.wired.com/news/politics/0,1283,67447,00.html
    http://www.theregister.co.uk/2005/05/07/broadcast_flag_shot_down/

    At least for now.

    Comment by thetorpedodog -

  6. Mark, as always your comments are right on. Every HD user should be thankful for what you have done to move the process forward.

    – DB

    Comment by David brown -

  7. Excellent article Mark. As an HDTV consumer and cable customer, I could not agree more with everything you have said here.

    Comment by Mike Morrell -

  8. I am by no means an expert to anything written above. In fact I ran into this site by reading a magazine called Wired. To tell you the truth I am 28 (almost 29) year old college student. No, I have not been going to college the last 10 years. I served 4 years of active duty in the Marine Corps. Anyway, after reading the above postings I keep running into a negative vibe. It also seems like nothing is really being accomplished. In my opinion for something like this to be accomplished you have to use your resources. Take the FCC head on your going to lose. Take the government head on your going to lose. You need to take the above postings and put it into laymen’s terms. Let the average Joe on the street understand what it is and what it does. Do you think I read Wired because I know all the technical information involved? Heck no! Half the time I have no idea what some of the terms mean. I read it because it informs me of all the cool technology out there that I could use to make my life easier, more enjoyable, and less expensive. You could call me an early adapter when I can afford the product or service. To get back to the point, to make this revolution possible you need to mass market this to teens all the way up to 40 year olds. Create a demand. Let this group pull this service from you. We may not be tech savvy like you but we (target market) have the power to get things accomplished. With Powell retiring from the FCC now is the perfect time to create this rush. With the availability of professional athletes and a great marketing plan, the FCC has no chance.

    By the way: What are the Features and Benefits of Analog? What are the Features and Benefites of HDTV? Now compare.

    JB

    Comment by JB -

  9. Amazing stuff, as a consumer it´s hard to keep up with all the new tech. sometimes.

    Comment by peter -

  10. As an HFC Data engineer for a major MSO, I can assure you that i would love to have that upstream analog spectrum available to me! Post 10 from Alex hit it on the head. While we certainly would love to charge for those digital subscribers, the public outcry from half of our system would be a catastrophe businesswise. We are squeezing what we can out of two 3.2 mhz upstream channels in this spectrum now because it is all we have available! 2,3, and 5 mbps symmetrical cable products would sell like no tomorrow on the commercial side, but we would be hard pressed to serve our residential growth and provide new products in the pipeline if we used all that spectrum up. Mark is right, this digital conversion cant come fast enough for us, and not for all the reasons you might think ….

    IgnusFast

    Comment by IgnusFast -

  11. Mark,

    Why do you think Cable Broadcasters, Network Braodcasters, and MSO’s are not jumping on the Interactive eCommerce Television Advertisement band wagon that makes it possible to purchase the product being advertised with the click of a button your remote control?

    Why are the MSO’s and others fighting the technology that already exists that makes it possible to buy a song or album being played on MTV,CMT,VH1 and electronically download it to your PC, MP3 Player, Set Top Box etc?

    Considering that standards for this are already defined in the US, Europe, and asia as published on tvanytime.com, OCAP, and that that all the television and PVR/DVR manufacturers have prototypes, why is it that the MSO’s refuse to accomodate advertisers that want it?

    Has hd.net thought about deploying Interactive eCommerce Television and if so when, and if not why not?

    Comment by WebGlue -

  12. This is is the same FCC thats forcing Howard Stern off the air for “obscenity” – yet hes conquered the radio waves and has been doing it for years. You cannot overlook the fact that the FCC is politically connected, to a conservative republican administration, who probably gets lobbying money and donations from those so-called large networks who think they would benefit.

    Mark, I hope you show them that dollars and cents is not about trying to stifle technology to “protect”, and really its about giving consumers what they want. I’m sure the same technology lovers who have adopted HD already, also own TIVOs/DVRs – as the markets overlap, which will just ensure affiliates get all those complaints🙂 This has “D’oh” written all over it, glad you pointed it out.

    Comment by Adam Silverman -

  13. random: where are these <$300 HDTV of which you speak? the cheapest i can find is ~$500

    Comment by shane -

  14. Right on the money, Mark.

    It’s always amazed me that the same FCC that said “compete or die” to the telcos over VOIP was willing to bend over to the networks and foist this broadcast flag nonsense on us.

    Comment by Chuck -

  15. Mark,

    As usual, you are on the money. A brief excerpt from my recent article on the “Spectrum Wars” regarding HDTV.

    […]

    In April 2002, Powell proposed voluntary action in which broadcasters would provide either high-definition programming or multiple channels during half of their prime-time schedule; cable operators would carry more high-definition signals over their own digital pipes; and television manufacturers would build sets with digital tuners capable of receiving the new broadcasts.

    The broadcasters and cable operators agreed. But most of the TV makers balked. Gary Shapiro, head of the Consumer Electronics Association, said it made no sense to sell $200 digital tuners to everyone, when 9 out of 10 customers didn’t need them because they got their primary signal from cable or satellite. The manufacturer Zenith took a different view, because it held patents on the tuner. Besides having Wiley’s law firm in its corner, from 1999 to 2002 the company spent $700,000 lobbying just this single issue. Zenith’s efforts gave Powell the support he needed to turn his “voluntary” plan into a requirement in August 2002. The CEA sued to stop the requirement, but lost; by July 1, 2007, high-definition tuners will be included in all new television sets.

    Electronics firms got the message that Powell was serious about his plan for digital television. As Powell says, “Sometimes you play hardball.” Within four months, they had negotiated a deal with the cable industry over a lingering copy-protection dispute. But Hollywood demanded more. Concerned about Internet piracy, Disney and News Corp. pressed the FCC to mandate all computer manufacturers to build an anti-piracy tool, called a”broadcast flag,” into their product. Without the flag, Viacom threatened, it would pull all of its high-definition CBS programming off the air. Powell swallowed hard and, in November 2003, required that, too.

    Everything seemed to be falling into place. Powell wanted to gift-wrap the digital-TV package for Congress and go down in history as the FCC chairman who wrestled down the broadcasters and won the spectrum back for the American people. Today, 1,430 of the 1,748 local television stations are digital, and most of them are delivering the HDTV broadcasts that the networks are finally providing. The electronics industry last year sold 7.2 million digital TVs, most of them high-definition — a 75 percent increase over 2003. But the venom between broadcasters and cable operators still stood in the way of completing this digital migration.

    [more…]

    from http://nationaljournal.com/about/njweekly/stories/2005/0218njsp.htm

    Comment by Drew Clark -

  16. Michael,

    If the Cable Companies are doing their job for their shareholders, they will maximize the utilization of the resources that they control for maximum profit. If that means providing additional channels that they can charge a premium for they will do that. If that means utilizing any excess cable capacity for broadband bandwidth they will do that. If that makes them more competitive with other broadband providers then who is to say that the motivation was proactive or defensive? Also as technology advances, other uses may be found for the excess cable capacity so using it for additional broadband capacity isn’t necessarily the correct choice, just the obvious one.

    Comment by David -

  17. On the point at the tail end of your post, regarding freeing up capacity at the CableCos…not sure they’d proactively use it for more broadband bandwidth, but only defensively as they see the telcos use more bandwidth at lower price point as a competitive tool.

    Comment by MIchael Parekh -

  18. Mark,

    I need an HDTV and never found one close to $300, especially not at 27″. Any clue where I can find one ? I have the HD box already.

    Comment by Dominic Massaro -

  19. Thanks for being a voice of reason.
    There are people in this country who appreciate your stance.

    Comment by mcallahan@michelswaldron.com -

  20. Pawnd.

    http://www.dslreports.com/shownews/60652

    Comment by Justin Y. -

  21. Alex,

    I agree. Perhaps I was just unclear. My only point was that it was basically unrelated to everything that he said before. It’s certainly a fair observation. I just wanted to be clear that really it was unrelated to the broadcast flag.

    IIRC at one point there was a company working on a very inexpensive digital to analog converter for just that reason. For instance the stations that are now analog would be sent digitally (but without any CA measures). The device would then act like a very low end cablebox.

    Oh well..

    Cheers,
    Steve

    Comment by Steve -

  22. Right on, Mark. I have to agree.

    I know that local MSO’s would love to get rid of analog cable boxes, but not to free up bandwidth. They want to charge fees for their digital boxes, usually about $5/month. And my MSO loves raising rates. It’s their specialty.

    Now I personally would love to see my MSO get rid of all analog boxes, and make everyone digital, since it would give me better quality on my current analog channels, which look like sh*t on my HD set, and would hopefully allow them to offer more HD content (such as HDNet, which we still do not get, Cablevision, are you listening?) But I see it as a long hard road. Think of the family that may have 5-10 sets in their house, and needing to get a converter on their cable ready sets would be costly. From that prospective, do you really need 10 HBO’s in the kitchen?

    Comment by thaug -

  23. There’s been a discussion about this issue also at Prof. Felten’s blog… http://www.freedom-to-tinker.com/archives/000771.html

    Comment by Robert Young -

  24. Steve –

    Mark didn’t say that the analog channels were broadcast channels – simply that most cable companies carry 80 analog channels. As you say, cable companies COULD reclaim the analog bandwidth now, but that would require switching every single customer to a digital cable box, including those that don’t use any box at all right now. These total over 60% of all cable households – aorund 60MM total.

    Cable companies are counting on people paying incremental amounts for digital to make up for the tens of billions of dollars the industry has spent in the last few years to upgrade to digital. They’re unlikely to give it away simply to reclaim the spectrum, especially since so many of their customers simply aren’t interested in switching over.

    Comment by Alex -

  25. BRAVO MARK! I’m tired of the FCC playing moral cop and treating us all like 3 year old criminals – unable to make our own moral decisions and needing protection against our inner pirate.

    As a shareholder/taxpayer in our government, I’m also tired as hell of them holding up this digital transition. As you so elloquently put it, they’re sitting on billions of OUR dollars.

    Comment by Joe S -

  26. word to that

    Comment by jwill -

  27. Couple points of clarification — your first paragraph is basically wrong. The broadcast flag is distribution protection NOT copy or access protection. The BF has enough that’s bad; there’s no need to attribute other bad qualities to it.

    Your analysis is a bit wonky too. I have this feeling that the government might, uh, take back the digital frequency from the stations if they stop using it. After all, it was one of the reasons they got such a discount on them.😉

    Your cable modem point is a bit off too. The majority of the analog channels aren’t broadcast channels. This is something that the cable people could do now. They just don’t.

    Comment by Steve -

  28. “Free up 3GBs and you could see the bandwidth available to your house expand to unheard of levels.”

    Correct me if i’m wrong but, aren’t cable channels multi/broadcast? which would mean the 3Gbps is spread between however many households under the same distribution system, which would likely be thousands, so only bandwidth change is likely to be negligable?

    Now, pedant mode on, can you quote figures in Gbps (not GB or gigabytes). I’m sure you’re well aware of the difference between bits and bytes (I certainly feel high on my soapbox preaching to a tech billionaire about it)

    Comment by Adam -

  29. Tell me if I’m violating anything.

    Weekly I do the following.

    On my PC I backup my registry. I then install Replay Music which allows me to record 25 music tracks before purchase/registration. I use MusicMatch (paid service) and add 25 songs to my playlist. And then I record the streaming song tracks.

    Then, I uninstall replay music, re-apply my registry and repeat the next weekend when I have time.

    I use the recorded MP3’s for my MP3 player as well as serve up the jukebox as a streaming server for my home network so I can enjoy my music from other systems in my house.

    Lastly, I have a wireless video system, so Tivo’d Desparate Housewives can be viewed from the family room instead of my bedroom. Because the 8:00 Sportscenter’s on there.

    Comment by PSC -

  30. Dear Brian,

    We CAN push back! And we ARE! That’s why the so-called entertainment biz is seemingly chronically in a tizzy. Computer technology has fast-created a plethora of previously unimaginable opportunities for “the rest of us”. This new reality tends to tick off a few lazy uncreative monopolists.

    Drip by drip, the so-called media industry is losing its mystique, and ultimately, its power. Indie student films often look as good as – if not better – than a lot of what we see on TV, and the situation is similar with music and radio. Bloggers and niche news sites oftentimes have more credibility and currency than journalists.

    Of course, independent anime producers like us are creating hi-def productions, independently, with software and desktops.

    http://sosohot.com/Shadowbane_Melano_Filmworks.wmv

    and I certainly don’t think the Cartoon Network puts us to shame. =)

    The only thing the MPAA’s/RIAA’s/etc. have is mass resources and the very false appearance of invincibility. If they don’t adapt to the new landscape, they’ll eventually become shells of their glorious unbridled mythical past. They can’t fight the entire world on their own terms. Nobody can.

    Admittedly, this process will take a generation or two, but it’s coming. No doubt about it.

    Comment by Charles -

  31. What I don’t get is how everyone can be so adamantly opposed to this, yet it still seems likely to go off without a hitch. You, me, TiVo, the entire web community, politicians, the media, and the general public (who know about it) all think the broadcast flag is evil and the FCC should burn, but nothing is happening. Why should TiVo and the like even have to go to the FCC to have stuff approved?

    If the content industry can intimidate the FCC, why can’t people who are on our side of things push back?

    Comment by Brian -

  32. The Flag goes up in July. I appretiate you stance on this Mark. You understand what consumers want. It’s definately not more regulation.

    The EFF has some good info about it at:

    http://www.eff.org/IP/Video/HDTV/

    Comment by Scott Griffith -

  33. looks like the courts may rule against the whole idea of flags

    http://news.com.com/Court+questions+FCCs+broadcast+flag+rules/2100-1030_3-5585533.html?tag=nefd.top

    which would be a step in the right direction by the courts to add some sanity to the federal regulatory committies and making sure they dont overstep thier bounds.

    Comment by Matt -

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