[opendtv] Re: 20041220 Mark's Monday Memo

  • From: Craig Birkmaier <craig@xxxxxxxxx>
  • To: opendtv@xxxxxxxxxxxxx
  • Date: Wed, 22 Dec 2004 09:59:02 -0500

At 10:57 AM -0500 12/21/04, Manfredi, Albert E wrote:
>This is IMO a very logical argument on the NCTA's part.
>But it would be equally logical to assume that an NCTA
>so concerned about the cost of providing STBs to households
>would have actively gone after some sort of "plug and
>play" agreement with CE manufacturers on their own,
>without being prodded on by the FCC. Isn't the same cost
>consideration valid for their own deployment of digital
>cable channels?

NO. The cost to deploy the infrastructure is largely the same (i.e. 
getting bits into the home), but competition for STBs impacts a 
significant profit center for cable, and the vendors who supply boxes 
to the cable companies. You can use the telephone instrument analogy 
here if you like, but the would be competitors in the STB market are 
operating at a disdvantage because of the ability of cable companies 
to integrate security (rather than using a security pod(card), and to 
provide boxes with two-way capabilities.

And there is a difference to consumers. They must invest in a 
competitive STB, spending the money up front, versus paying a monthly 
rental fee to the cable company. This is partially mitigated by the 
benefit of having the cable ready receiver integrated with the set.

Bottom line, the cable companies and their "proprietary vendors" make 
money on STBs.

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