Tuesday September 8, 2009 – Antonette Goroch
There’s been a lot of controversy in recent months over DtA STBs, but is it really much ado about nothing?
Cable operators, led by Comcast, are looking to DtAs (Digital-to-Analog adaptors) as a low cost way to transition networks to all digital, thereby reusing spectrum currently allocated to bandwidth hogging analog channels for more standard and HD digital channels. A key element of this cost savings is the lack of separable security in DtAs, eliminating costly CableCards and pushing prices below $50 per unit.
Of course, this is in direct contradiction to the 2007 FCC mandate requiring separable security in all digital STBs. Comcast has so far skirted this requirement by including no security at all---although reportedly an integrated security can be implemented by a software upgrade should Comcast decide to do so. Several vendors, however, sensing the enormous opportunity at hand, have applied to the FCC for temporary waivers from this requirement, saying DtAs are a transitional technology that will not impact the larger FCC goal of stimulating competition and a retail market for STBs. Such waivers would eliminate the need of operators to obtain waivers of their own, since the actual STBs would already be covered under the vendor waivers. Evolution Broadband, a supplier to several small rural operators, was the first to obtain a waiver in June, with the major players such as Motorola, Cisco and Pace soon following suit with their own applications.
The CEA, joined by several public interest groups, is crying foul, opposing these applications on the grounds that they will inhibit the adoption of both retail STB sales (since operators will favor the low cost DtAs over more expensive models), as well as tru2way products.
There are merits to both arguments. Should the FCC grant these waivers, the CEA argues that cable operators will favor these over more expensive models for quick digital upgrades argues. Indeed, DTC estimates more than 5 million DtAs shipped during 2008—almost a third of all U.S. shipments—and this will jump past 10 million in 2009.
But will this really inhibit the move to retail and advanced STBs?
In the short term, perhaps it will. In the long term, however, that’s not at all clear. DTC estimates that the market for DtA’s will be short-lived, perhaps three to five years, because they are a transitional technology. Now that the analog broadcast shift has occurred, new TVs will be all digital and won’t require a DtA to work with all digital networks. All digital networks, meanwhile will make it easier for cable operators to implement advanced services—which is in their interest to do. Advanced services, which will require both separable security and tru2way, are both more profitable and more competitive for ops. DtAs won’t likely inhibit cable ops from pushing these advanced services.. Rather, all digital networks will make it far easier for cable ops to offer them. And this will be a rising tide for all boats.
