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Broadcast Flag Burning

Is Sen. Daniel Inouye (D-Hawaii) trying to sabotage the broadcast flag?

Inouye is the top Democrat on the Senate Commerce Committee, which recently approved a telecommunications bill that would restore the FCC's ill-fated broadcast-flag rules. But a provision inserted at Inouye's behest could block the use of the technologies that TV manufacturers have already put into millions of products to comply with the FCC's requirements.

The flag regulations would require two things of any device that could tune in or decode a local digital TV station: the device would have to detect whether a program was flagged for protection, and if so, it would have to use an FCC-approved scrambling technique to stop the program from being shared online. The rules would impose new requirements on digital TV receivers, set-top boxes and computer peripherals, as well as changing the way devices talked to one another in a home entertainment network.

Many consumer-electronics and tech firms have acquiesced to the rules, despite some obvious shortcomings, because the FCC gave them sufficient flexibility to design their own technological solutions. A cluster of tech and consumer-electronics powerhouses, including Intel, Sony and Matsushita (which owns the Panasonic brand), had already developed technologies (including those know by the acronyms HDCP and DTCP) that could be used to enforce the broadcast flag regime. In fact, the only digital connectors used to link digital TV receivers to high-definition monitors and recorders today rely on HDCP and DTCP. Thus, any manufacturer wanting to build an HDTV monitor that can interoperate with other companies' products has to license the technologies, at least until a new type of connector or wireless link comes along with a different type of scrambling.

The Inouye provision, which is backed mainly by Philips, would bar the FCC from approving any scrambling technology that relies on the kind of license used for HDCP and DTCP. The rationale is that the licensing scheme deters some patent holders from obtaining royalties, and so is hostile to property rights. The effect would be to remove HDCP and DTCP from the FCC's list of approved technologies. Because so many devices already rely on HDCP and DTCP, the provision would prevent the broadcast flag from having any meaningful effect on consumers for years. The idea of crippling the broadcast flag for the forseeable future is appealing, but the notion of lawmakers meddling in tech firms' licensing choices is not.

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Times editorial writer Jon Healey pens opinion pieces about a variety of business issues, and blogs about technologies that are changing the entertainment industry's business model.

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