Digital-Only Cable Future May Not Be Far Off for Comcast
Digital-only cable for Comcast subscribers may not be far off, Executive Vice President David Cohen told lawmakers, but the company regrets how it handled a recent move of public-access channels from analog in Michigan. He apologized for the company’s failure to clearly inform people about requiring its approximately 450,000 analog subscribers in the state to get digital set-top boxes to keep watching the channels. House Telecommunications Subcommittee Chairman Edward Markey, D-Mass., and other legislators at a Tuesday hearing said cable operators and new video entrants such as AT&T must make public-access channels widely available in high quality.
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Moving public, educational and government channels (PEG) to digital cable and off analog service has drawn “many consumer complaints,” Markey said. He wants the switch to be as smooth as possible, he added. House Commerce Committee Chairman John Dingell, D-Mich., said such changes could “impose additional costs on consumers or make it more difficult for them to locate PEG programming.” He said pay- TV subscribers should be able to record shows on PEG channels, which an AT&T executive said isn’t possible with the company’s own DVR. “These are matters of grave concern,” Dingell said.
Pay-TV’s digital transition will mean “growing pains along the way,” but “the benefits are great” to subscribers, said Rep. Fred Upton, R-Mich. Rep. Cliff Stearns, R-Fla., said companies should be able to switch customers to digital cable, to reduce spectrum use. “Let the cable companies have an opportunity to provide innovation and provide more channels through digital rather than through the analog spectrum,” he said. “For this innovation to continue, we've got to allow the companies to innovate and not put handcuffs on them,” Stearns said. One analog channel uses the same cable system capacity as three high-definition channels or a 42 Mbps broadband service, he added.
Concerns about analog PEG channels will go away because all subscribers soon will get digital cable, Cohen said. “In a few years this is going to be irrelevant because everyone is going to have digital equipment,” he testified. “During this transition, we are working hard to accommodate consumer demand for more broadband intensive services” by compressing signals and using switched video, he said. “Our recent experience in Michigan is atypical” because of the many PEG channels in some communities and because Comcast has no plans to change the public access lineups in many other systems, added Cohen. Dearborn and other cities in Michigan sued the company over the move and persuaded a court to issue a stay. “That is not the way we want to do business, in Michigan or the rest of the country, and I want to apologize for that,” Cohen said. “We are now engaged in friendly and what I am sure will be fruitful discussions” with Michigan municipal officials. Dearborn Mayor John O'Reilly said he thinks the dispute can be settled: “I think it’s really just a business decision and it can be negotiated and it can be worked out.”
Providing PEG programming only in digital is a small piece of Comcast’s strategy to improve video quality and more efficiently manage bandwidth, Cohen said. Comcast’s major competitors -- AT&T, DirecTV, EchoStar and Verizon -- are all-digital, he said. “If established cable operators are unduly restrained in our digital transition, it will weaken our competitive posture and, ironically, it will ultimately harm PEG programmers,” he said in prepared comments. “The transition to a digital platform is inevitable.” Most Comcast customers have digital equipment, and that figure has increased dramatically, to more than 60 percent in the third quarter, he added.
AT&T is working with towns to improve the company’s U- verse IPTV service and deal with service complaints, said Gail Torreano, president of the company’s Michigan operations. U-verse can’t caption PEG programming unless the city does it before sending it to the company, she said. Although U-verse subscribers can’t use an AT&T DVR to record PEG shows, they can do that with a TiVo or other device of their own, she said. “We do understand the importance of PEG.”