Paul Gluckman

The FCC is giving serious consideration to imposing a mandatory deadline date on the marketing of DTV sets and other CE devices compliant with broadcast flag copy protection rules, but it hasn’t reached a consensus on what that date should be, sources at the Commission told us.

Two “overarching fatal flaws” of the proposed broadcast flag regulation are that it’s much too sweeping in its scope of content protection and would delegate “to private parties with enormous financial stakes in the outcome,” through govt. mandate, “the all-critical right to designate the technology and control the terms of its use,” Philips said in an ex parte filing at FCC.

A proposed broadcast flag “scheme” won’t “significantly protect” against unauthorized redistribution of DTV content, but would “suppress innovation, create massive enforcement problems” and stifle the DTV transition, consumer and public interest groups told the FCC. Consumers Union and Public Knowledge in a joint ex parte filing this week at the FCC -- submitted, they said, at the request of the Commission staff -- which sought the groups’ “critique” of MPAA-proposed broadcast flag rules in the wake of the agency’s recent adoption of a plug-&-play agreement on cable-DTV interoperability.

Although the outcome is uncertain in CEA’s suit before the U.S. Appeals Court, D.C., that seeks to invalidate the FCC mandate of DTV tuners in all NTSC receivers by July 2007, a court decision is likely before year-end, CEA Pres. Gary Shapiro told us in an interview.

IBiquity Digital said Tues. it had coined the name “HDC” (for “HD Codec") for the “revised” proprietary codec installed to fix AM audio quality artifacts that prompted the DAB subgroup of the National Radio Systems Committee to suspend its in-band, on-channel (IBOC) standardization effort in May. The subgroup’s chmn., Milford Smith of Greater Media, was quoted in the iBiquity announcement as saying “very serious consideration” would be given to resuming the standardization process as a result of “spectacular” improvements HDC would afford. It’s presumed the subgroup will announce formal resumption of standards setting following demonstrations of HDC planned for today (Wed.) at NPR studios in Washington. IBiquity CEO Robert Struble conceded his company had hoped to have receivers on store shelves by now. Referring to “the thousands” of receivers it had hoped would be sold in 2003, Struble said: “Clearly, that’s in jeopardy. But thus far, we're tracking very well for ‘04.” Struble also said iBiquity was “not that far off” from projections he made at last Jan. CES that 300 stations would be beaming HD Radio signals by year-end.

IBiquity Digital is winning rave reviews from those who have heard demonstrations of the proprietary new codec, which was installed to fix the AM audio quality artifacts that prompted the DAB subgroup of the National Radio Systems Committee (NRSC) to suspend its in-band, on-channel (IBOC) standardization effort in June. “The problem is fixed,” declared the subgroup’s chmn., Milford Smith, of Greater Media. He said he and others heard demonstrations of the new codec last week and were permitted by iBiquity to hear as many samples at whatever bit rates they wanted. The improvement in the AM IBOC signal was “spectacular,” Smith said, describing the quality was equal to or better than existing analog FM. For FM IBOC, the sound quality improvement meant the signal was “virtually indistinguishable” from that of the source CD, Smith said. He said he wasn’t sure what the developments would mean for resuming the standardization effort on AM IBOC, saying the subgroup hadn’t been asked by anyone to do that. Larger scale listening demonstrations are planned for this week at NPR studios in Washington, after which the subgroup may resume its activities, Smith said. IBiquity executives declined to discuss specifics of the new codec, saying a formal announcement was planned for early this week that would summarize the improvements. Sources familiar with the developments said the new codec was neither AAC nor PAC, but described it as a hybrid of the 2. We're told the new codec will be used for both AM and FM IBOC because there isn’t sufficient memory on chipsets to accommodate different coding systems.

XM Satellite Radio has been denied insurance payouts on $400 million in claims filed in the first quarter (CD April 3 p12) because of the continuing degradation of its 2 orbiting Boeing 702-class satellites, company executives told financial analysts in a conference call Thurs. on the release of 2nd-quarter results.

The FCC needs to adopt the cable-CE “plug-and-play” agreement in its “entirety” and not defer action on encoding rules proposed as part of that accord, the NCTA and Thomson said in separate ex parte filings at the Commission. Postponing consideration of the encoding rules contained in the DTV interoperability agreement reached last Dec. (CD Dec 20 p1) would “disserve the public interest” and derail ongoing negotiations on bidirectional DTV devices, said NCTA. NCTA said applying same encoding rules to all multichannel video program distributors (MVPDs) “would enable cable operators to provide their customers with high-value digital content that they might otherwise not be able to obtain.” Thomson emphasized “the centrality of the encoding rules to the DFAST licensing scheme from the perspective of both the consumer electronics industry and consumers’ recording expectations.” Thomson said making DFAST license available to manufacturers would be difficult without Commission adoption of encoding rules. NCTA and Thomson filings summarized phone conversations their representatives had with Stacy Robinson, mass media legal adviser to FCC Comr. Abernathy, responding to her questions whether Commission should proceed with action on plug-and-play agreement and defer consideration of encoding rules until later. Robinson told us her queries only were part of “information gathering” effort. Robinson said her questions to NCTA, Thomson and other cable and CE interests were spurred by Electronic Frontier Foundation (EFF) proposal to consider “all the technical stuff” first on plug-and-play, and deal with encoding rules later. According to an EFF ex parte filing at FCC in late June, the group’s representatives met with Commission staff June 18 and repeated its call to “protect the public by declaring a moratorium on the activation of digital content protection capabilities” until the FCC completed an evaluation whether “proposed uses of content protection technologies by MVPDs are in the public interest.”

Thomson “intends to fully meet” the FCC’s mandate that at least 50% of the 36” or larger TV sets sold be equipped with ATSC tuners by July 1 next year, David Arland, dir. of public & trade relations, told the Commission Fri. Thomson also urged Commission to set same July 1, 2004, deadline requiring DTV stations to transmit at full power. In response to a request by FCC Media Bureau Chief Kenneth Ferree for progress reports on key points of the DTV transition, Arland said his company also was developing products “that will ensure that we meet the other requirements of the digital tuner/decoder mandate from 2004 through 2007.” However, he said Thomson believed “a critical element of meeting this mandate” was rapid FCC approval of the cable-consumer electronics “plug-and-play” agreement: “We anticipate that the majority of consumers who will be shopping for HDTV sets will be expecting ‘cable-ready’ products that work seamlessly with existing cable networks.” Arland told us that Thomson and other CE makers were “disturbed” to learn at the recent NCTA show that the FCC planned no action on plug-and-play before Sept. Given that timetable, Arland said, “the window is closing fast” on makers’ ability to provide a comprehensive cable-ready solution in time for the July 2004 tuner deadline. Arland said Thomson “is just not willing to take the risk” of building full cable functionality into DTV decoders mandated for July 2004 on chance that negotiated agreement on plug- and-play will be changed. Arland’s letter said “successive generations of DTV products are improving” as makers gain more and more “real world experience with DTV transmissions and the various factors required to adequately receive, process and display digital audio and video signals… Those improvements come without govt. intervention but rather in the presence of a much more powerful motivation -- competitive pressure.” But Arland said such advances in receiver performance could go only so far: “Regrettably, most local broadcasters are NOT transmitting their digital TV signals at full power.” He said the Commission’s most recent figures indicated only 25% of commercial broadcast stations were on the air with DTV transmission signal “that covers their analog station service areas. This raises the prospect that a very significant number of homes that receive a station’s analog signal cannot receive that station’s digital signal.” Arland said “the suggestion by many broadcasters that ‘insensitive receivers’ are somehow to blame for poor consumer reception of digital TV signals misses the real problem, which, Thomson respectfully suggests lies not with receiver sensitivity but rather by a lack of commitment of the broadcasting community to transmit their digital TV signals at full power.”

“We think things are on track” for rollout this year of in-band on-channel (IBOC) digital radio, iBiquity Digital COO Jeffrey Jury told us Wed., a day after saying AM audio quality issues would force receiver introductions to be scrapped until 2004 (CD May 21 p12). Having said the IBOC rollout remains on track for this year, Jury said “we do have to work through the issues of AM audio quality, but we're confident that we're going to be able to work through this in time for our partners to keep on their schedules.” Blaming any statement to the contrary on “a good-faith disconnect” on his part, Jury said he had been trying to “express some caution that if we don’t work through this in time, it’s going to impact things” for a 2003 introduction. Kenwood Senior Vp Bob Law said there had been no change in the company’s production schedule for IBOC receivers in which production is set to begin in Aug. for product destined to reach retail shelves by Sept.