Cable era begins with a yawn

Last week, an FCC mandate went into effect that requires cable TV providers to distribute electronic cards that can be plugged into slots on new large screen television sets to allow access to encrypted digital programs. But as with many new technologies, there’s a big “gotcha.”

The problem is that the new cable cards — unlike set-top boxes — provide only one-way signals: from the cable provider to customers’ homes. Consumers with televisions that use the cards will not be able to receive video-on-demand, interactive program guides and other services that require two-way signals. Those services are now the most lucrative for cable operators.

As with much of the DTV transition, the cable card plug-and-play initiative thus far has failed to live up to the industry hype. Television manufacturers have predicted the cable card option will be attractive to as many 50 million-cable customers who do not subscribe to digital programs and are looking for an easy way to receive digital services.

But some analysts have questioned the value of the cards and whether the market will embrace the technology. Bruce Leichtman, president of the Leichtman Research Group, which tracks the cable industry, told the New York Times that consumers don’t hate their set-top boxes. According to Leichtman, consumers are not interested in digital television.

Because the cards allow only one-way signals, television manufacturers and retailers are unable, or unwilling, to predict the demand for cable cards. Few companies, though, expect a run on the new card-ready sets.

Cable cards alone won’t be enough to motivate people to buy a new television or sign up for a digital programming package, said Page Shaper, director of marketing for new products at Charter Communications, a major cable provider in Denver. “When it’s two-way, the story changes.”

Back to the top