FOR IMMEDIATE RELEASE NEWS MEDIA CONTACTS:

November 4, 2003 Michelle Russo 202-418-2358

David Fiske 202-418-0513

##### FCC ADOPTS ANTI-PIRACY PROTECTION FOR DIGITAL TV

Broadcast Flag Prevents Mass Internet Distribution; Consumer Copying Not
Affected;

No New Equipment Needed

Washington, D.C. - Today, the Federal Communications Commission (FCC)
adopted an anti-piracy mechanism, also known as the "broadcast flag,"
for digital broadcast television. The goal of today's action is to
foster the transition to digital TV and forestall potential harm to the
viability of free, over-the-air broadcasting in the digital age. The FCC
said that consumers' ability to make digital copies will not be
affected; the broadcast flag seeks only to prevent mass distribution
over the Internet. Finally, the FCC said implementation of the broadcast
flag will not require consumers to purchase any new equipment.

Today's rules are targeted only at products that are capable of
receiving DTV signals over-the-air. These products must comply with the
broadcast flag requirements by July 1, 2005. Other products such as
digital VCRs, DVD players and personal computers that are not built with
digital tuners installed are not required to comply with the new rule.
In addition, the FCC explained that existing televisions, VCRs, DVD
players and related equipment will remain fully functional under the new
broadcast flag system.

In a *Report and Order* adopted today, the FCC permits use of the flag
at the discretion of the broadcaster. The FCC said that the current lack
of digital broadcast content protection could be a key impediment to the
DTV transition's progress. The absence of such content protection could
cause high value programming to migrate from broadcast television to
more secure platforms such as cable and satellite TV service. Reduced
availability of high value content on broadcast television could harm
the viability of free over-the-air television and slow the DTV
transition. The FCC declined to prohibit the use of the flag with regard
to certain types of programming, such as news or public affairs.

To facilitate adoption of broadcast flag technology in television
receivers and related equipment by 2005, the FCC established an interim
policy that allows proponents of a particular content protection or
recording technology to certify to the FCC that such technology is an
appropriate tool to give effect to the broadcast flag, subject to public
notice and objection. The FCC's interim certification decisions will be
guided by a series of objective criteria aimed at promoting innovation
in content protection technology.

\- more -

The FCC also adopted a *Further Notice of Proposed Rulemaking* (FNPRM)
seeking comment on a permanent objective process for the approval of
digital recording and output content protection technologies that will
foster innovation and marketplace competition.

A summary of the key issues is attached.

Action by the Commission, November 4, 2003, by Report and Order and
Further Notice of Proposed Rulemaking (FCC 03-273). Chairman Powell,
Commissioners Abernathy and Martin, with Commissioners Copps and
Adelstein approving in part and dissenting in part. Commissioners
Abernathy, Copps, and Adelstein issuing separate statements.

-FCC-

FNPRM Comments due: January 14, 2003

Reply Comments due: February 13, 2003

MB Docket 02-230

Media Bureau contacts: Rick Chessen, Susan Mort at 202-418-7200.

News about the Federal Communications Commission can also be found

on the Commission\'s web site [www.fcc.gov]{.underline}.

**[[FCC ADOPTS ANTI-PIRACY PROTECTIONS FOR DIGITAL
TV]{.underline}]{.smallcaps}**

**[Summary of Key Issues]{.smallcaps}**

**[What is the Broadcast Flag?]{.underline}**

-   The "broadcast flag" is a digital code that can be embedded into a
    digital broadcasting stream. It signals DTV reception equipment to
    limit the indiscriminate redistribution of digital broadcast
    content.

-   The broadcast flag will benefit consumers by ensuring continued
    access to high value programming content on free, over-the-air TV.

-   The broadcast flag protects consumers' use and enjoyment of
    broadcast video programming. The flag does not restrict copying in
    any way.

**[What types of programming are affected?]{.underline}**

-   The FCC allowed broadcasters to decide whether or not to include the
    flag with specific types of programming.

-   The FCC declined to prohibit the use of the flag with regard to
    certain types of programming, such as news or public affairs.

**[What types of equipment are affected?]{.underline}**

-   All existing equipment in use by consumers today will remain fully
    functional. Thus, consumers can continue to use existing equipment
    without purchasing new or additional equipment to receive and view
    broadcast television signals.

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-   The new rule requires that DTV reception devices containing
    demodulators recognize and give effect to the broadcast flag
    pursuant to certain compliance and robustness rules.

-   "Compliance" refers to what the covered demodulator can do with the
    broadcast content. If the flag is present, the content can be sent
    in one of several permissible ways, including (1) over an analog
    output, e.g. to existing analog equipment; or (2) over a digital
    output associated with an approved content protection or recording
    technology (this list of approved technologies is often referred to
    as "Table A").

-   "Robustness" refers to the ability to "hack" the system. The FCC
    adopted an "ordinary user" robustness standard that will afford
    consumer electronics, IT and PC manufacturers the maximum
    flexibility in innovation while ensuring adequate content security.

**[How does the broadcast flag affect cable TV and satellite TV
operators (i.e. MVPDs)?]{.underline}**

-   The FCC determined that multichannel video programming distributors
    (MVPDs), such as cable and satellite TV operators, should have the
    latitude to implement the flag as appropriate for their distribution
    platforms, whether it be through direct pass-through or by
    effectuating the flag's intent through their own conditional access
    system.

-   The FCC said that MVPDs may not assert greater redistribution
    control protection for digital broadcast content than that which the
    broadcaster has selected. In the case of content which a broadcaster
    has not marked with the flag, MVPDs must deliver that content to
    subscribers in a manner that reflects and gives effect to its
    unflagged status.

-   The FCC is seeking further comment on whether cable operators that
    retransmit DTV broadcasts may encrypt the digital basic tier in
    order to convey the presence of the flag through their conditional
    access system.

**[What is the interim policy for approving digital content protection
and recording technologies?]{.underline}**

-   The FCC established an interim policy allowing proponents of a
    particular content protection or recording technology to certify to
    the FCC that such technology is an appropriate tool to give effect
    to the broadcast flag, subject to public notice and objection.

-   This interim policy will enable the FCC to certify multiple
    compliant technologies in time for manufacturers to include flag
    technology in television receivers by 2005.

-   Under this interim process, proponents must submit to the FCC the
    following information:

    1.  a description of how the technology works, including its scope
        of redistribution;

    2.  the level of protection the technology affords content;

    3.  whether content owners, broadcasters, or equipment manufacturers
        have approved the technology for use; and

    4.  if the technology is to be offered publicly, a copy of its
        licensing terms.

        -   Upon review of the initial submission, the FCC will issue a
            public notice. If no objection is received within 20 days,
            the FCC will expeditiously issue a decision on the approval
            of the submission. If substantive objections are raised
            within 20 days, the proponent of the technology can issue a
            response within 10 days. The FCC will then make a decision
            as expeditiously as possible and expects such decision to be
            made no later than 90 days from the reply filing.

        -   The FCC said it expects any approved technologies that are
            publicly offered to be licensed on a reasonable and
            nondiscriminatory basis.  The FCC also encouraged the
            development of multiple technologies, such as digital rights
            management, software-based, and non-encryption alternatives
            that will promote consumer uses and access to content.

**[What is the permanent process for approving content protection and
recording technologies?]{.underline}**

-   The FCC determined that additional public comment is needed in order
    to formulate a permanent open, objective process for the approval of
    digital recording and output content protection technologies that
    will foster innovation and marketplace competition. The FCC
    initiated a *Further Notice of Proposed Rulemaking* to examine this
    issue in greater detail.

\- FCC -