If the FCC falls asleep at the digital TV transition switch, the agency will find Congress running the show, lawmakers threatened yesterday in a Senate Commerce Committee hearing on the topic. "The worst thing you can do is to let us run it. But if you don’t run it, we will run it,” committee chairman Daniel K. Inouye (D-Hawaii), commented.

FCC chairman Kevin Martin deflected criticism by asserting that his agency is devoting significant resources to ensure a smooth transition and has been actively promoting consumer awareness, including outreach to seniors, minority groups and non-English speakers, rural communities and people with disabilities. He also said TV stations will be required by the FCC to air PSAs on the DTV transition several times a day, including primetime.

Martin also poked at the cable industry by hyping "multicast must-carry" as the best way to ensure a success DTV transition by requiring cable operators to carry all channels a broadcaster offers after the analog cut-off in Feb. 2009.

NCTA president and CEO Kyle McSlarrow, in turn, talked up the cable industry’s DTV consumer campaign and told the hearing that the FCC’s must-carry provisions will particularly hurt rural and small operators, who should receive a clear-cut exemption from the FCC’s dual carriage rules instead of having to apply for waivers.

Martin later told reporters after the hearing that "program access issues" are holding up the FCC’s review of Liberty Media‘s $11 billion deal to assume ownership of DirecTV. [More on yesterday’s DTV hearing: AP | Reuters | Congressional Quarterly | Cable Digital News | Hollywood Reporter]

Separately, Martin has circulated a proposal to drop media ownership limits, including repealing the FCC’s current rule barring ownership of a newspaper and TV or radio station in the same market.

"The proposal appears to have the support of a majority of the five commission members," agency officials tell the New York Times, which adds "it is not clear that Martin would proceed with a sweeping deregulatory approach on a 3-2 vote — something his predecessor (Michael Copps) tried without success." AP has more.

While the FCC‘s head was on the Hill outlining his view on cable’s DTV role, the National Cable and Telecommunications Association held a briefing in New York to explain its opposition to the Consumer Electronics Association‘s DCR+ proposal for two-way "plug and play" TVs, and promote the cable industry’s preferred CableLabs’ OpenCable Platform (or OCAP) initiative.

Time Warner Cable SVP for new product development Kevin Leddy knocked the CEA’s plan as anti-innovation and expensive, requiring a multimillion-dollar "re-architecting of our networking" that would be passed on to customers. Leddy also said about 15,000 OpenCable boxes have been deployed to date.

CEA senior director and regulatory counsel Julie Kearney countered that not all manufacturers will embrace OCAP so the DCR+ (digital cable ready) proposal is a compromise solution. NCTA VP and general counsel Neal Goldberg said an FCC ruling could come next month. More in PC Magazine.

And while CEA counsel Kearney was arguing against OCAP in Manhattan, CEA president and CEO Gary Shapiro yesterday challenged CNN anchor Lou Dobbs to an on-air duel — er, debate — over free trade.

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