Douglas Crockford




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July 2004

This month's report focuses on Cable, DRM, and Intel.


Because of its maturity, the Cable Industry has a difficult time in acquiring new subscribers. HDTV turns out to be an effective tool for getting new customers and for increasing the subscriber fees from existing customers.

The Consumers who buy HDTV sets tend to be more affluent than average viewers simply because the sets are so expensive and virtually everyone already has an SD (standard definition) set. Also, since there is very little HDTV programming available by broadcast, this is an excellent opportunity to sell HDTV cable services.

Panasonic and 10 cable giants, including Comcast, are launching a $10 million ad campaign, pushing consumers to "make it a high-def summer". Consumers who buy a Panasonic HDTV monitor or set can get $100 credit on their Comcast cable bill in some markets.

I think it is very smart for Panasonic to co-market with the Cable companies.


The cable companies used to be highly competitive against each other. First there was competition to get the contract to wire a city. A city would somehow select a cable company after a period of furious campaigning and negotiation. Later, there was competition as the larger companies attempted to buy the smaller ones. During that phase in my town I saw Chambers bought by TCI, which was bought by AT&T, which was bought by Comcast.

Today the big MSOs (Multiple System Operators) tend not to compete against each other. They are all working together against Satellite and DVD and the Government. There is a great deal of cooperation in engineering and product design. This effort is focused in CableLabs, the cable industry's R&D facility near Denver. CableLabs is the host for the OpenCable initiative, which developed the specification for the POD (Point-of-Deployment) module, also known as the CableCard.

The big MSOs (Comcast, Time Warner Cable, Cox Communications, Charter Communications, Cablevision Systems) all offer CableCards for use with DCR DTV sets. Their websites do not mention support for user-owned STBs (Set Top Boxes). Some MSOs lease the cards. Others include the cards for free with the monthly subscription.

CableCard manufacturers must sign the PHILA (POD-Host Interface License Agreement). It has been signed by Advanced Digital Broadcast, Broadcom Corporation, Motorola Broadband Communications Sector, Pace Micro Technology PLC, Pioneer Cable and Communications Group, Samsung Electronics America, Inc., and Scientific-Atlanta, Inc. There have been 14 signers. Half have not agreed to announce their names. Currently none of them sell a STB with the CableCard interface. I have seen a demonstration of such a unit from Motorola, but they said that there is no demand for it, and the Cable Operators do not like it. It is unlikely that CableCard will see much adoption until Plug-and-Play II provides interactive services.

One of the goals of OpenCable is to allow Consumers to own and carry STBs from one system to another.

These hardware specifications define a removable security module that separates the cable operator's proprietary conditional access system from the retail digital cable device, thereby enabling portability of the host to other cable networks. This means that if a consumer purchases a set-top box or an integrated DTV in New York and then relocates to Los Angeles, that set-top box or integrated DTV will be operable with the new regional cable provider's equipment.

It appears that the technology to accomplish this exists, but the business conditions do not.


The OpenCable initiative has two key initiatives. The first is primarily hardware: the Plug-and-Play standards that allow DCR (Digital Cable Ready) DTV sets. The second is a vendor-independent software platform for extended client functionality. This is OCAP (OpenCable Applications Platform). OCAP is a portable, Java-based software platform for interactive cable applications. It is the key component of Play-and-Play II.

OCAP began in Europe as MHP (Multimedia Home Platform). It includes some standard Java libraries such as JMF (Java Multimedia Framework), JavaTV, and AWT (Awful Windowing Toolkit), customized for the Cable environment. OCAP does not intend to support the "Write once, run anywhere" portability of conventional Java implementations. It only wants to provide portability for Cable applications. It provides support for uniquely Cable features such as Object Carousel, in which data is streamed in a repeating sequence that might be many minutes long. OCAP includes the libraries java.* and org.ocap.*. It also includes the European libraries org.dvb.*, org.davic.*, and org.havi.*.

It also provides interfaces to the CableCard, including Conditional Access to some POD features, restricted by operator policy or by piracy prevention. These interfaces are proprietary, so applications requiring access to the CableCard might not be portable.

The Java Virtual Machine runs in the STB or DCR DTV set, not in the CableCard. This is unfortunate because all existing gear will be obsolete. It will not be possible to upgrade to OCAP by replacing the CableCard. The benefit is that a set will have some functionality even if a CableCard is not installed, allowing reception of standard and emergency programming.

OCAP will be used to implement the Interactive Program Guide, as well as all other interactive features. It will also be used to do local ad insertions, which potentially gives Cable a vastly more valuable advertising model than Broadcasting.

Not Exactly Cable Ready

A consumer report from the FCC, Compatibility of Cable TV and Digital TV Receivers – “Plug-and-Play”, gently warns consumers that they should avoid the current generation of Digital Cable Ready TV Sets:

The first generation of plug-and-play sets will be able to receive one-way programming only, including analog basic, digital basic, and digital premium cable programming. If you want to receive certain advanced digital cable services like video-on-demand, the cable operator enhanced program guide, or interactive data-enhanced television service, using a first generation set, you will need to use a set-top box. You may also need a set-top box to receive other cable operator-provided services, such as a personal video recorder.

Negotiations are underway between the cable and consumer electronics industries to establish standards that would permit plug-and-play sets to provide advanced two-way services as well.

FCC has an obligation to not mislead the Public. At the same time, it does not want to offend Cable and CE by rejecting the DCR standard that it asked them to produce.

Not Exactly Digital Broadcasting

The broadcasters have long been worried about the reception quality of DTV. For example, Nat Ostroff, VP of New Technology at Sinclair Broadcast Group, once said "if you can't receive this indoors with a simple antenna, it ain't gonna work." I agree with this statement. Currently, someone buying a DTV set cannot be confident that the set will pick up all of the area's DTV signals, even with an expensive roof antenna. This has been a significant factor in the slow adoption of DTV sets. There are experts telling consumers to "steer clear" of broadcast DTV.

Later this year Zenith will begin delivering an improved 8-VSB tuner chip. This may help significantly, but reception will continue to be uncertain for perhaps a third of homes in any market.


SDMI (Secure Digital Music Initiative) brought together more than 200 companies and organizations representing information technology, consumer electronics, security technology, the worldwide recording industry, and Internet service providers. SDMI's charter was to develop technology specifications that protect the playing, storing, and distributing of digital music.

On September 6, 2000, SDMI issued "An Open Letter to the Digital Community", inviting people to attempt to crack certain technologies they were considering for use in their DRM system. They set up a web site where music samples and some other information could be downloaded to aid in analyzing the technologies.

Professor Edward Felton of Princeton lead a team of researchers that analyzed the watermarked clips and successfully modified them so that the watermarks could no longer be detected, while maintaining a level of audio quality satisfactory to SDMI. Defeating the Verance watermarking technologies shows that the overall SDMI DRM system does not work.

Professor Felton intended to present the findings at the Information Hiding conference, co-sponsored by the Naval Research Laboratory. But rather than pay Professor Felton's team the prize for meeting the challenge, the RIAA, SDMI and Verance collectively threatened to sue Felton if he presented his findings, or otherwise disclosed how he circumvented the SDMI. The basis of SDMI's threaten lawsuit was that Felton was not allowed to publish or present the results because it would violate the DMCA's anti-circumvention statute.

This was the last time that any DRM system subjected itself to a public challenge.


Intel is a major force in Digital Media Technology, particularly in DRM systems. Intel has good reasons for its interest in Media, which dates back at least as far as its acquisition of Digital Video Interactive technology from RCA Sarnoff Laboratories in 1986.

Intel's Digital Home Revolution will be used to sell its other products, including multithreaded CPUs, the PCI Express bus, and the ExpressCard. Intel is involved in, and is usually among the founders of, several technology development and licensing groups including DVD Copy Control Association, Trusted Computing Group, Digital Transfer Licensing Authority (5C), 4C Entity, Digital Content Protection, LLC, Secure Digital Music Initiative, Open Mobile Alliance, Digital Living Network Alliance, Advanced Access Content System, Copy Protection Technology Working Group, and Broadcast Protection Discussion Group. All of these activities may be anti-competitive, but the government is currently tolerant, even encouraging. Most of these appear to have begun at the CPTWG. There is tension between creators and consumers of content. Intel wants to establish the middle ground, and so become the Center of the Universe.

Intel has a fundamental problem with Moore's Law. Microcomputer systems have gotten much more powerful than most people need. It order to encourage people to continue to periodically replace their computers, Intel needs to find and popularize applications that need more processing power. Digital video is such an application.

Like Microsoft, they want to extend their reach beyond PCs, both to increase their business and to prevent the threat that a New Media Platform could displace PCs.

They may also enjoy the royalty revenue from the Standards they develop.

Intel attempted to enter the Consumer Electronics market with products like the Intel Pocket Concert Audio Player, an iPod like device. Intel closed that business in 2001. It also closed Intel Media Services, a streaming media business. Intel's strategy is now to capture the Studios and CE with its silicon.

Intel's relationship with Microsoft has always been, and continues be, a difficult one. From Intel's perspective, Microsoft's incompetence has long been a nuisance, and is particularly troublesome with respect to DRM. Microsoft has demonstrated that it is unable to keep viruses and other attacks out of the PC. Certainly it cannot be expected to withstand the efforts of a PC's owner to get at the content. This is a problem for Intel because it wants the PC to be at the center of the Digital Home. Intel's solution will be to put DRM into silicon. Incoming media will be encrypted by disc controllers and network interfaces and decrypted by video DACs. Microsoft's software will never see media in the clear because it cannot be trusted to protect it.

In order for this to work, Intel must convince Consumers to replace their computers. This will be difficult because the current generation of computers is quite powerful and doesn't need upgrading. For the first time, Intel will be trying to compel consumers to replace their computers with new computers that are less powerful than the previous generation. The incentive will be access to movies from the Studios in HD.

The Digital Transition [2004 - 2005]