The Federal Communications Commission has given cable television provider OneLink Communcations the go-ahead to begin scrambling the signal of its basic-service tier, paving the way for the company to overhaul its San Juan metropolitan area system.
As News is my Business reported exclusively in November, Onelink submitted a petition to the FCC, asking for a waiver to the rules that ban cable systems from encrypting basic-cable signals. However, upon analyzing the provider’s arguments — including its contention of significant cable signal theft in its service area — the federal regulatory agency granted the petition.
In its petition filed in October — to which 15 subscribers submitted comments at the FCC — OneLink noted that the federal agency had granted similar waivers to Liberty Cablevision of Puerto Rico Inc., and Centennial Puerto Rico Cable TV Corp., now Choice Cable, which faced similar issues.
OneLink noted that its cable theft problem is more severe than those faced by either Liberty or Choice, citing a theft audit conducted in 2004 showing that it had an estimated 9.9 percent rate of cable theft relative to the number of homes in its footprint — more than double the industry-wide rate of 4.97 percent found by the National Cable & Telecommunications Association that same year.
Furthermore, although a second audit in 2006 found that its theft rate had fallen to 6.9 percent of homes passed, OneLink said the total is still 39 percent higher than the national average of 4.97 percent.
“OneLink contends that the costs associated with disconnection and reconnection service calls, system repair and maintenance, and other administrative problems related to illegal connections result in significant financial outlay,” the FCC said as part of its rational for approving the request.
Ultimately, the carrier argued that encrypting the basic tier would eliminate the incentive to establish unauthorized connections.
Impact on customers
OneLink Communications provides cable television services — along with Internet and telephony — to customers in eight San Juan metropolitan area towns. As previously reported, the company was standing by for the FCC’s decision to set off its infrastructure overhaul, starting the first quarter of this year.
Converting the last of its remaining analog transmission infrastructure into a digital platform will cost OneLink about $1 million, company spokeswoman Layra Zapata said at the time.
Meanwhile, the change will also mean that OneLink customers who do not currently use a set-top converter box to receive their basic service signal will eventually have to go pick one up. In its petition to the FCC, OneLink said that there will be virtually no additional impact on customers as a result of encrypting the basic tier.
OneLink told the federal agency that it will offer up to two basic digital set-top boxes without charge for one year to each qualifying existing basic-only subscriber who did not previously have such equipment. OneLink will charge a reduced rate during the second year, according to the FCC document.
However, the company made no mention about the possibility of raising rates once the network goes completely digital.
See earlier story: http://bit.ly/eE0NBO
Business reporter with 25 years of experience writing for weekly and daily newspapers, as well as trade publications in Puerto Rico. My list of former employers includes Caribbean Business, The San Juan Star, and the Puerto Rico Daily Sun, among others. My areas of expertise include telecommunications, technology, retail, agriculture, tourism, banking and most other areas of the economy.