The switch to digital cable isn’t just yielding a multibillion spectrum auction, it’s also prompting cable companies and broadcasters to join forces and fight against a government mandate.
The government’s been worried about how cable subscribers would get their less-watched local broadcasts once the analog signals go dark next February. Enter the dual-carriage rules, which were put forth by the Federal Communications Commission last fall.
The rules dictated that unless a cable carrier was really small, and paid the legal fees to get an exemption, operators needed to carry certain programming (such as public access channels and local niche programming) in both dual and analog versions until all subscribers had a digital set-top box or TV capable of converting digital signals.
Cable companies don’t mind doing this for popular local broadcast channels, but smaller ones will take up twice the space on a cable network under these rules. Obviously cable companies, which already face capacity constraints, would like to choose how they allocate their capacity, rather than have the government mandate it.
The major cable operators represented by the National Cable and Telecommunications Association grudgingly agreed to the rules, but the American Cable Association, which represents smaller cable firms, came out against it. On Monday, six programmers representing cable channels including C-SPAN, Discovery Communications, The Weather Channel and Scripps Networks sued to stop the rules from going forward, saying that if it did, cable operators might have to dump their channels to make room for the duplicative signals.

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When it comes to Web video, short clips under three minutes still make up the vast majority of what people watch. But as the quality of video improves, more people will be willing to sit and watch streams of half-hour sitcoms, hour-long dramas, and maybe even entire movies. Already, there is some anecdotal evidence of this shift.
Move Networks—which powers the media players and back-end streaming infrastructure for ABC, ESPN360, Fox On-Demand, and the Discovery Channel—released the following data today for videos streamed from all its customers’ Websites collectively:
· So far in November, more than 100,000 new individuals are watching long-form video (anything 20 minutes or over) online each day, twice as many as in August.
· In November, the average session length is more than 50 minutes.
· In October 2007, more than 6 million people watched long form streaming video online.
· Since March 2007, Move has streamed almost 50 million hours of television.
These numbers still pale compared to actual TV, but as the growth continues they will start to attract even more advertising dollars than they do already.
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