Cablevision taps S-A for digital boxes and headends

By Jeff Baumgartner
From The August 29, 2002 Edition Of CED Broadband Direct

Cablevision System Corp. has inked a deal to integrate Scientific-Atlanta Inc. digital set-tops and headend equipment to support the MSO’s ambitious digital cable service, iO: Interactive Optimum. Financial terms were not disclosed.

Cablevision said it will purchase an undisclosed number of S-A digital boxes, including the Explorer 4200, which will become available later this year. The MSO will also buy S-A digital headend equipment and license related headend and application software. Cablevision said it plans to begin deploying S-A boxes to new digital customers this fall.

The agreement could mark a significant shift in Cablevision’s digital platform strategy. S-A, for instance, marks Cablevision’s second source of digital set-tops. Sony Corp. was the first. News of a new Cablevision set-top vendor first bubbled to the surface on Aug. 8, when MSO executives disclosed that they had restructured Cablevision's hardware relationship with Sony and that, moving forward, would begin to work with other set-top vendors. Since then, S-A has been rumored to be the leading candidate.

The agreement also calls into question which conditional access system will support Cablevision’s digital service down the line. Currently, Cablevision’s digital conditional access supplier is NDS Group. S-A said it has signed a non-binding letter of intent to incorporate NDS conditional access technology into Explorer set-tops. However, S-A digital headends that Cablevision eventually puts on its broadband networks will support PowerKey, S-A's proprietary conditional access platform.

It was not known by press time whether Cablevision plans to operate parallel NDS and PowerKey networks or if it will eventually migrate all of its digital customers to the PowerKey platform. Cablevision officials were not immediately available for further comment Thursday afternoon.

Cablevision, in a press release, said the deal with S-A “will strengthen the foundation and scalability of iO’s sophisticated digital television service.”

The MSO reported earlier this month it had 42,700 digital subscribers at the end of the second quarter, and expects to have 3.4 million digital video-capable homes by the end of this year, and push that figure to 4.4 million by year-end 2003.