Voluntary Pact Should Replace CableCARD Rules, Says Cable Attorney

A voluntary agreement in the cable industry would be a better replacement for CableCARD rules vacated by the EchoStar decision than new regulations, said Davis Wright cable attorney Paul Glist on a panel at the Practising Law Institute’s Broadband and Cable Industry Law conference Tuesday.

Glist, a longtime opponent of CableCARD who has represented several large cable companies, said an agreement similar to one recently reached on energy efficiency standards for set-top boxes would be better able to keep up with the pace of new technology than would new rules. Reinstating CableCARD rules would “repeat the old mistake that the federal register can handle the pace of technology,” he said.

The voluntary agreement on set-top box energy efficiency led to the Department of Energy dropping its own proceeding to regulate the matter because the agreement was so “comprehensive,” Glist said. “We found a way to meet the goal of prescriptive regulation without retarding innovation,” he said. Both the energy rules contemplated by DOE and the CableCARD rules stifle innovation because they force companies experimenting with new solutions to ask regulators for waivers, he said. Those waivers tip off the competition and take a long time to get approved, causing innovators to lose “first mover” status, Glist said. By allowing industry to set its own standards, regulations can keep up with technology, he said. But he conceded that industry action on such matters was usually spurred by “the sword” -- the threat of regulation. “I think it’s fine for government to hold the sword over us,” he said.

Voluntary agreements of the type advocated by Glist are in line with FCC Chairman Tom Wheeler’s philosophy, said FCC Media Bureau Chief Engineer Alison Naplokh. Wheeler has “embraced the idea” of a “sliding scale” of how much the commission should pressure industry versus leaving room for voluntary agreement, said Naplokh. Wheeler wants to find voluntary agreements “wherever possible,” she said, carefully pointing out that Wheeler hasn’t weighed in on CableCARD issues.

Requiring companies that use unlicensed spectrum to pay for it the way they do licensed spectrum would also stifle innovation, said NCTA Senior Vice President-Law and Regulatory Policy Rick Chessen in a panel on the spread of cable wireless. Because users of unlicensed spectrum don’t expect exclusive use of the spectrum the way they do in the unlicensed sphere, they shouldn’t be expected to pay to use it, said Time Warner Cable Vice President-Federal Legislative Affairs Rachel Welch. Though cable companies are large, their hot spots don’t enjoy any more protection from interference than a small business Wi-Fi connection, she said. It would also be difficult to require companies like TWC to pay without requiring the same of small businesses, she said. “You may want to go after incumbent carriers but where do you stop?” she asked.

With skyrocketing Wi-Fi use, the nation is experiencing an unlicensed spectrum crunch as well as a licensed one, said Chessen. Without freeing up more wireless spectrum, the Wi-Fi devices will run into increasing trouble connecting by 2015 as the spectrum gets more crowded, he said.