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U.S. Appeals Court Upholds FCC Cable Order

ARLINGTON, VA. — The U.S. Court of Appeals for the D.C. Circuit upheld the Federal Communications Commission’s order to require common reliance on separate security functions in cable and consumer electronics products.

The ruling thwarted a petition filed by cable operators Advance/Newhouse and Charter Communications seeking to avoid the order because it violated a statutory requirement that the FCC’s regulations “shall not prohibit any multichannel video programming distributor from also offering converter boxes, interactive communications equipment, and other equipment used by consumers to access multichannel video programming and other services offered over multichannel video programming systems, to consumers.”

In addition, the cable companies said the FCC’s order was “arbitary and capricious” because it did not explain why the security integration ban was needed and how consumers would benefit from decreased equipment choice, and did not account for evidence of commercial availability of retail cable-ready navigation devices from multiple unaffiliated vendors.

The companies also charged that the rules unfairly targeted cable operators and not their satellite TV competitors, who have removed the ability of manufacturer partners to add innovations to receiving systems, since the FCC’s initial separable conditional access orders were implemented.

Consumer Electronics Association president/CEO Gary Shapiro celebrated the ruling, saying “the District Court finally said ‘enough is enough.’ Cable has waged a nonstop campaign to thwart the will of Congress and the FCC since these rules were enacted in 1998. In fact, the opinion cites overwhelming evidence of cable’s refusal to support consumers with CableCARDs.

“Today’s opinion sets the record straight: consumers are entitled to a broad array of products that can connect to cable systems featuring innovative new features for competitive prices. In the wake of the Court’s decision, we are hopeful that cable will stop its foot-dragging and comply with the law for the benefit of consumers.

“We now call on the FCC to deny all cable petitions to further thwart Congress and the FCC.”