Paul Gluckman

XM shares closed 5% higher Thurs. despite the company’s slashing its year-end subscriber target for the 2nd time in as many months. The reason given for the latest cut: XM has no firm idea when its plug & play receivers will comply with FCC power emission standards.

Comcast now has no plans to use the optional USB port on the Pace Chicago set-top “for home networking or any other purposes,” the cable provider told the FCC in an ex parte letter. The box is one of 4 low-cost, limited-function set- tops for which Comcast wants a CableCARD waiver. The letter addressed Media Bureau staff queries on the box’s potential for home networking. “As technology develops, the USB port might be used at some future point to support the networking of video and audio content within the home,” Comcast said. It restated a “scenario” from its waiver application describing video programming delivered from a “server device” -- such as a PVR-enabled set-top -- to a “client device” such as the Pace box, using the USB port. But “such an implementation does not currently exist and, even if it did, the server device in this architecture would have separate security once the integration ban goes into effect,” Comcast said. The Pace box only would receive standard-definition content from the server device, “just like it would receive VoD and linear programming from the network,” Comcast said: “Such a development, should it occur, would add to the options available to consumers and would serve the public interest.”

Substantive reactions to NTIA proposals for running the $1.5 billion DTV converter box subsidy program (CED July 25 p1) likely will have to await a Sept. 25 deadline for comments in the rulemaking, published Tues. in the Federal Register. The clue is the scant reaction so far among industry watchers, who say they've pored over the report, finding few surprises.

Only a household relying exclusively on over-the-air analog TV reception would qualify for a $40 coupon voucher redeemable toward purchase of a “certified” bare-bones DTV converter box under the long-awaited NTIA rulemaking released Mon. and scheduled for Federal Register publication today (Tues.). The agency was charged by Congress in DTV transition legislation with running the $1.5-billion subsidy program in advance of the Feb. 2009 analog cutoff. Comments on NTIA’s proposed rules are due in 60 days.

Charter became the 2nd cable operator, after Comcast, to seek a CableCARD waiver at the FCC, asking that low-cost, limited-function digital cable set-tops be exempted from a July 1, 2007, integration ban deadline. Like Comcast, Charter cited Commission declarations of willingness to entertain such waiver requests -- most recently on May 11, in oral arguments before the U.S. Appeals Court, D.C., where Charter petitioned to void the FCC integration ban order. Charter’s application seeks waivers on 7 models of set-top -- Comcast listed 3 -- none with capability for HD, PVR recording, multiple tuners or broadband Internet access, the filing said. Applying the integration ban to them “is not necessary to effectuate the supposed benefits of common reliance, and in fact such application would be counterproductive by inhibiting the development of new and improved digital services as well as video competition generally,” Charter said. All boxes cited cost less than $100 “and are designed to enable cable customers with analog TVs to access digitally delivered programming services and associated features,” it said. Charter still would support CableCARD on “mid-range” and high-end set-tops not covered by the waiver request, it said: “Charter estimates that such devices would collectively encompass more than half of all new Charter set-tops placed into service immediately after July 1, 2007, and would generally be leased to Charter’s highest-revenue, best customers.” CEA and some of its members are certain to oppose the Charter waiver request, as they did Comcast’s. But CEA members Panasonic and Thomson broke ranks and backed Comcast’s waiver request.

A recording industry suit alleging XM’s portable devices are tools for “massive wholesale infringement” of copyright (CD May 18 p9) was “filed literally in the teeth of, but without any reference to” the Audio Home Recording Act (AHRA), said CEA and the Home Recording Rights Coalition (HRRC). Their comments came in an amicus brief filed Mon. in U.S. Dist. Court, Manhattan.

Verizon’s FiOS TV is “precisely the type of innovative offering” that waivers of the July 1, 2007 integration ban on set-tops were designed for, the company said in a waiver request filed Tues. at the FCC. Like Comcast, which has sought a CableCARD waiver on low-cost cable set-tops (CD May 2 p4), Verizon said being forced to comply with the integration requirement would stifle innovation and siphon development money better spent elsewhere.

Satellite radio as an aftermarket category continues to suffer from average selling prices about 50% below a year ago, Audiovox CEO Patrick Lavelle told analysts in a Tues. quarterly earnings call. In May, Audiovox lost virtually all its XM sales when it stopped shipping the Audiovox Express receiver because its wireless FM modulator was found to exceed FCC power emission limits, he said. Sales “remain suspended,” pending FCC approval of a revised product Audiovox believes compliant, he said. Mobile electronics made up more of Audiovox’s mix in Q1, but sales fell about 10% from a year earlier on lower sales in satellite radio and a drop in the company’s Jensen and mobile video businesses, Lavelle said. This year, Audiovox will market “a very competitive” lineup in mobile electronics that incorporate MP3, iPod and satellite radio features, Lavelle said: “These units have higher average selling prices and carry better margins than the traditional head units that they replace.” In navigation products, Audiovox plans to bow 3 new GPS portables in the 2nd half priced at $399-$599, he said. The top of the line: a Jensen-branded model that’s a “key differentiator” from competitors, he said. Besides doubling as an XM plug-&-play receiver with XM realtime traffic reports, it also will have built-in MP3 functionality and accept an optional rear-observation camera interface, Lavelle said.

Unresolved HD Radio technical and regulatory issues -- including authorization of multicasting and datacasting -- may see action at the July 13 FCC open meeting. Commissioners also might weigh authorizing AM nighttime transmissions. HD Radio developer iBiquity Digital has visited often with FCC staff -- most recently on July 5 -- to tout progress bringing “HD2” multicasts online. Experimental authority endorsed by the FCC in March 2005 has let stations multicast since then. To date, the FCC has not acted on the NRSC-5 standard on which it sought comments in 2005. NRSC-5 has stirred controversy, in part because it doesn’t include an HDC codec iBiquity has kept under very tight wraps. In its latest update for FCC staff, iBiquity tallied 1,407 stations in 206 markets licensed for HD Radio, with 814 stations in 148 markets on the air and 249 stations in 49 markets multicasting, according to an ex parte filing at the FCC on the July 5 meeting. In a May 18 update, iBiquity said it had licensed 1,266 stations in 200 markets, of which 794 in 147 markets were on the air and 226 in 52 markets were multicasting. With audio flag bills under consideration in Congress, the FCC is seen as unlikely to act on HD Radio content protections that were the subject of a Commission inquiry issued with the last rulemaking.

Comcast called its own case “compelling” for fast FCC action on its CableCARD waiver request on low-cost, limited- capability set-tops (CD May 2 p4). Opponents “willfully ignore” past Commission statements that it “favorably” would entertain such requests (CD June 19 p6), the cable operator told the Commission in reply comments.