Capricious Commentary By Steve Effros When particularly outrageous or seemingly mindless decisions are made by government officials (yes, it does happen from time to time) or agencies, the usual next step is a court appeal challenging “arbitrary and capricious” actions. The problem we have with the FCC leadership these days is that the things being done are not “arbitrary”—they are cable-centric and intentional! They are also, however, totally “capricious.” If you check the dictionary definition of “capricious” you will see that it means taking actions based on whim, not on reasoned thought. That appears to be a perfect definition of what is going on with the “DTV Transition” as it relates to cable television. Look at what is, or is not, being considered and you just have to wonder where the “expertise” of this “expert agency” has gone. There is general consensus both in political and regulatory circles that the DTV transition date of Feb 2009 is going to create major problems for many consumers as the government requires broadcasters to stop delivering analog broadcast signals in favor of digital signals. Consumers, millions of them, will still have only analog-capable TV sets. So the government is going to pay close to a billion dollars to subsidize special tuners to take the digital signals and make them analog compatible for those folks who buy the boxes. Cable operators could do that in one simple step for their customers by converting the digital signal at the headend to analog and delivering it. So what is the Chairman of the FCC doing? He’s trying any way he can to push all cable systems to be “all digital” by that 2009 date! That requires many millions of additional set top boxes to be put in homes that don’t now need them. Prices would go up. Cable has long been criticized for raising prices, but what has the FCC done to mitigate those price increases? Well, they required “separable security” for leased cable boxes! In other words, we have to use more expensive technology to deliver exactly the same service on boxes the consumer never owns based on the totally unproved notion that this will spur retail sales. Prices will go up. Broadcasters, supported by the Chairman, have demanded that there be “no degradation” in their new digital signal, and claim the only way to do that is to require cable to deliver “all bits.” However, compression technologies have been used successfully for years, and television pictures, including HD, look just fine. Thankfully, the Commission just voted not to play that game. What’s ironic about the “degradation” issue, and whimsical, is that we’re now hearing ads from consumer electronics stores saying that for an extra $80 to $175, customers can get an “expert” to come out to their home and properly “calibrate” the new television set they just bought! Translation: the television sets the FCC has required to be built for digital reception are not properly tuned when sold. The picture, even if the cable industry sends a “perfect” one to the home, is degraded by almost any set a consumer buys! Can that be fixed? Yes, manufacturers could be required to properly calibrate sets before sale. Will the FCC do that? They’re not even considering it! The Chairman seems singularly focused on rules relating to cable delivery. The result: the price for properly tuned new sets will go up to the consumer, and the consumer, again, gets no additional benefit. Sound familiar? That’s the way this Commission’s leadership seems to deal with the DTV transition and cable. Not arbitrary, but definitely capricious.

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