From: frank.kennedy@u2u.lonestar.org (Frank Kennedy) 
Newsgroups: rec.video.satellite
Subject: FCC Docket           3/15
Date: 4 Jan 93 22:32:00 GMT
Distribution: world
Organization: USER-TO-USER PCBoard (214)492-6565 (USR DS v32bis)
Reply-To: frank.kennedy@u2u.lonestar.org (Frank Kennedy) 

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          program services.

               The same legislation grants the FCC authority to  determine

          the circumstances in which scrambling and encryption are

          appropriate.5  Although the Cable Act of 1992 pays only limited

          attention to the particular concerns of dish owners, members  of

          Congress were aware of the serious problems related to satellite

          dish decoders.  This is evident from the letter sent to the

          Commission by Congressmen Edward J. Markey and C. Thomas McMillen

          in which they requested that the Commission review the  issues

          raised in this proceeding.

               HSD viewers are on the front line as the United States heads

          toward direct broadcasting satellite (DBS) transmission and  the

          introduction of digital video technology.  Dish owners are  the

          first market targeted by TCI in its new digital venture.  In

          addition, HSD owners are likely to be regarded as an  unwanted

          group of independents, and a target market, by upcoming DBS

          owners.















          4. Cable Act of 1992, Sec. 12 Regulation of Carriage Reguirements.

          5. Cable Act of 1992, Sec. 17(b)(2) Consumer Electronics Eguipment
          Compatibility; Scrambling and Encryption.
          III.  GIC's DECODER MONOPOLY

          A. Contributions to the Historical Record

               Historically, the adoption of the GIC VC  II  encryption

          standard by HBO and other programmers has  created  unnecessary

          hardships and expense for HSD consumers.  Since signal encryption

          started in 1986, GIC has controlled the encryption  technology,

          manufacturing and supply of decoder modules; it has also

          controlled the price, terms and conditions of sale, the

          authorization of programming, repair and encryption changeovers

          of consumer modules.  The only competition GIC encounters  as  a

          monopoly manufacturer is in the manufacture of integrated

          receiver decoders (IRD)s.  Even here, up until 1992,  GIC  had

          significant control over competitors' design due to its  patent

          for VC II module designs.

               Since the inception of satellite encryption, the call  for

          competition in the decoder marketplace has grown  louder  and

          louder.  HSD owners for more than seven years have sought

          government action to limit GIC's market power and  have  worked

          hard to provide as much specific, relevant information  to  the

          Commission as possible.6

               Although the Commission previously has denied requests for
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Newsgroups: rec.video.satellite