Time Warner Cable and CBS Corp. last week showed there is
digital life without must-carry when they announced the industry's first digital
television carriage agreement.
CBS Corp. will deliver all digital signals from its 14
owned broadcast stations to any upgraded Time Warner Cable systems that overlap with those
markets. Time Warner also said it will make available certain CBS special events in high
definition even in non-upgraded areas.
The news was heralded by cable as well as broadcast
interests, which don't typically see eye-to-eye on digital television issues,
especially when it comes to government-mandated must-carry.
The deal between Time Warner and CBS is an indication that
"the marketplace is working," said Jim Ewalt, executive vice president of the
Cable Telecommunications Association (CATA). "We're glad to see the situation
has been resolved without government intervention."
While the National Association of Broadcasters called the
deal a positive first step, it still favors digital must-carry.
"It's 14 down, 1570 to go," said spokesman
John Earnhardt, referring to the number of other local broadcast stations planning to
convert from analog to digital.
It's not clear how soon other cable operators and
broadcasters will strike similar carriage deals of their own or if other MSOs will also
agree to pass through HDTV signals unaltered. Time Warner has agreed to pass through
digital signals from CBS in the 1080I (interlace) HDTV format.
"Time Warner has always been very progressive on
HDTV," said Gary Shapiro, president of the Consumer Electronics Manufacturers
Association. "They respect their customers."
Shapiro added that although the carriage deal is a good
sign, "it doesn't mean the issue doesn't require government action."
The Federal Communications Commission has not yet
determined whether it will impose digital must-carry requirements on cable. The National
Cable Television Association is lobbying heavily against the idea.
A spokeswoman for Tele-Communications Inc. said the MSO is
waiting for industry standards on digital carriage agreements before it signs such deals.
In the meantime, TCI is setting up "swat teams" in each of its markets where
broadcasters have launched HDTV.
TCI technicians will make free service calls to install an
A/B switch for antenna service. The goal is to make sure customers who buy HDTV sets
"get the best signal they can without taxing the analog capacity for the rest of our
subscribers," the TCI spokeswoman said.
Because Time Warner is positioned with two-way,
750-megahertz networks in most of the metropolitan markets where it has signed digital
carriage agreements with CBS, problems of HDTV swallowing up precious cable spectrum -- an
issue boisterously raised by TCI chairman and CEO John Malone last spring -- are neatly
sidestepped.
James Chiddix, chief technical officer for Time Warner
Cable, said the carriage deal reinforces the benefits of the MSO's ongoing upgrade
strategy, now 70 percent complete.
"Frankly, we don't care" whether CBS opts
for standard definition multiplexes, 1080i or 720p [progressive] scan, or any other
format, Chiddix said.
As a first step, Time Warner will take the 8-VSB (vestigial
sideband) feed from a CBS station and assign it a UHF channel location on the cable plant.
At the home, the HDTV signal will pass through any residential set-top and be received
directly by the TV's tuner.
That's a short-term play that will be followed in the
first quarter of next year by HDTV-augmented digital set-tops made by Scientific-Atlanta
Inc. The boxes, announced by S-A in October, are pricey, at around $1,000 each.
That's O.K., said Chiddix, "because it's also a short-term play."
Since neither of those solutions resolves the issue of copy
protection, HDTV content developed by CBS will not be available on a pay-per-view basis
yet, Chiddix said.
Time Warner spokesman Mike Luftman said subscribers
won't be charged an additional fee to access the initial CBS HDTV signals, as long as
they already use an advanced analog set-top box. If not, the only additional charge will
be the monthly set-top rental fee for a new digital box.
The HDTV service is available now in about 50 percent of
Time Warner's New York system. The other markets where there is a large overlap
between Time Warner systems and CBS-owned stations include Los Angeles and Houston.
Luftman said Time Warner has some small operations in the Philadelphia market as well, and
will see that the HDTV signals are distributed there.
Luftman said he doesn't expect the systems to devote a
lot of communications effort to promote the initial HDTV launch because there are so few
HDTV sets available today.
In systems that have not yet been upgraded but are still
located in markets with CBS-owned stations, Time Warner will open its analog bandwidth up
to select National Football League games and other special events that CBS plans to
broadcast in high-definition.
In those non-upgraded areas, Luftman said, Time Warner
would have to pre-empt one channel -- most likely a barker channel or PPV feed -- to make
room for the HDTV event.
"We really need to do what we can to get this new
technology jumpstarted," said Luftman. "The quality of the audio and the video
is so high, it really transforms the viewing experience. It will ultimately win out
in the marketplace."
