Show Man: FCC Comes Through With 3 Integration Ban Waivers

FCC chmn Kevin Martin may have bought himself a little bit of goodwill before his appearance at the Cable Show this week, with the Media Bureau announcing Fri the approval of set-top ban waiver requests for Charter, GCI and Millennium Telcom. Of course, it’s not enough of a present to erase his a la carte, dual must-carry and 30% cable ownership cap proposals. (Now if the FCC had granted the NCTA‘s request to delay the integration ban until ops deploy a new downloadable security system or until 2010, Martin may have gotten some cheers from the crowd). The FCC chmn is slated to address attendees at the Las Vegas show’s opening general session today (1pm, Mandalay Bay, Ballroom J). News that Charter’s waiver was granted reached pres/CEO Neal Smit just before he began a 1Q all-employee meeting Fri at the MSO’s St Louis HQ. Charter shares closed up 7% Fri at $3.63. Nearly 300 days after Charter filed its waiver request, the Bureau ruled that it could continue to deploy 7 integrated set-tops after July 1, ’07 because of the financial hardship the ban would create (Charter told the FCC that it has more than $20bln in outstanding debt obligations, which is almost 11 times its annualized EBITDA). Under FCC rules, operators can only deploy set-tops with separable or downloadable security after July 1, ’07. In most instances, that means operators will have to deploy boxes with CableCARDs, even if consumers don’t want them. Under the waiver, Charter can keep deploying lower-cost Motorola DCT-700 and DCT-2500e; S- A‘s Explorer 940, Explorer 1840, and Explorer 3200; and Pace‘s "Chicago" DC501p and "Indiana" DC511p integrated set-top boxes until July 1, ’08. Charter can apply for an extension of the waiver if it believes financial difficulties warrant it. The Bureau also granted conditional waivers to Millennium Telcom and GCI based on their commitment to go all-digital before Feb 17, 2009. A similar waiver was granted to Bend Broadband in Jan. Cablevision also received a waiver in Jan that allows it to continue deploying its set-tops, which already provide separable security (just not through a CableCARD). Comcast‘s request to have certain low-end boxes waived was denied by the Bureau in Jan, with the MSO currently seeking a review of the decision by the full Commission. There are still dozens of waiver requests pending at the Commission, including NCTA’s and Verizon‘s.