Puerto Rico Cable: HD/DVR Deployment Stalled Over Integrated Box Ban

People in Puerto Rico who buy HDTVs may find they cannot get HD service on cable, as local provider Choice Cable TV awaits an FCC waiver of the ban on integrated set-top boxes.

The integrated box ban, which took effect July 2007, prevents cable operators from deploying new boxes with both tuning and security functions. Instead, they need to deploy boxes with separable security functions, namely CableCard-enabled boxes. Operators may continue to deploy their old stocks of legacy set-top boxes, and may petition for a waiver to the ban.

Choice, the smallest of three main cable providers on the island, has sought a waiver of the ban since last July and has now run out of its stock of HD DVRs, it said in an FCC filing. So, the company “is effectively no longer able to deliver such services to new customers on a timely and predictable basis,” it said.

The territory’s delegate to Congress, Luis Fortuño, wrote FCC Chairman Kevin J. Martin some four months ago to express his “grave concern that the digital transition will be imperiled in significant portions of Puerto Rico unless the commission quickly takes action to grant [Choice’s] waiver,” according to the filing—one of seven that company has submitted to the commission in the past year.

Without the CableCard boxes—which can cost more than some HDTVs—Choice cannot add HD viewers, it said, and therefore cannot add HD programming.

“Since DirecTV does not offer HD service and Dish offers only a very limited HD package in Puerto Rico, the integration ban has shut down the availability of most HD to new [cable] customers altogether in much of Puerto Rico,” the company said. (According to Antennas Direct, 11 stations in Puerto Rico are broadcasting in digital.)

Kansas-based cable box refurbisher Adams Cable Equipment told the FCC that the refurbished boxes would cost only about what half of what the new CableCard boxes would go for if the refurbished boxes were still legal for U.S. deployment. The company has supplied refurbished boxes to operators in Puerto Rico and in Central and South America for about 10 years, but the commission grouped refurbished integrated boxes together with the new ones in a decision just days before the July 2007 ban took effect.

“The integration ban has brought an abrupt end to the availability of refurbished set-top boxes for Puerto Rican cable operators that have depended on them,” Michael Adams, chief operating officer of Adams Cable Equipment, told the FCC in a filing.

“Choice and others thought that refurbished boxes were not new [and therefore not subject to the ban], and there’s plenty of FCC precedent for that,” said Paul Hudson, Choice’s Washington counsel. “I think we’d have good case to go to court. But we’re hopeful that the commission will act very soon.”