Traditionally, all cable-TV subscribers have had the option, mandated by the FCC, of receiving an unencrypted basic tier of OTA (over the air) channels, which lets them receive the channels without renting a cable box or CableCard, provided the TV is equipped with a QAM tuner. But the cable industry has petitioned to change this rule, arguing that very few people subscribe only to the basic service tier in all-digital systems. As a result, "the overwhelming majority of subscribers to all-digital systems already have a set-top box or CableCard-equipped retail device and therefore would be unaffected by encryption of the basic service tier," according to the FCC.
In 2010, the FCC granted Cablevision/Optimum a waiver—for its New York franchise—of the non-encrypted-channels rule. This allowed it to require the use of a cable box to receive any channels on its service, on any TV. That means that some subscribers who had no cable box fees now have to rent those boxes from the company ($6.70 a month per box in New York.)
We contacted the FCC for some clarification and were told that it grants waivers to this rule on a case-by-case basis. Cablevision's waiver was approved for a number of reasons: It lets the company enable and disable cable service remotely, which saves money and improves customer service; but also, it "would provide an experimental benefit because the Commission could review the effect of encryption on Cablevision's subscribers." Thus far, Cablevision is the only major cable provider to receive the waiver (though it's also been granted to three providers in Puerto Rico and Waitsfield Cable in Vermont).
Cablevision is in the process of converting customers to cable-box-only service in the New York area. Its subscribers in New York City, Connecticut, and Long Island have already been transitioned; next is Westchester County and the Hudson Valley. "We are extending a variety of offers to our customers to help make this transition," said a company spokesman.
If you're receiving a basic tier of channels without a converter box or CableCard, you might wonder whether your cable provider will be granted the waiver, too. The FCC can't comment on petitions for waivers that are being considered. But to check on any FCC rule changes, you can go to the agency's Media Bureau website.
FCC Releases Digital Encryption NPRM