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Digital-cable devices could hit retail

Consumer electronics companies could soon start selling home entertainment products that are digital-cable ready, if the FCC gives its OK, according to research firm ABI.

The dynamics of the cable set-top-box industry are set to change, if the Federal Communications Commission approves an agreement between cable companies and consumer electronics makers, according to a report from research firm ABI.

Last month, a bill was introduced in the House of Representatives that would require the FCC to adopt a proposal for a digital TV standard developed by dozens of cable operators and consumer electronics companies. The proposal pushes for a national "plug-and-play" standard for digital TVs that would not require set-top boxes. Its approval would mean that cable subscribers could directly connect integrated digital TV receivers to their cable systems to receive programming. The proposal would also let consumer electronics makers sell retail products such as digital video recorders that are also digital-cable ready.

"The traditional set-top-box vendors will start to build solutions that are retail consumer-friendly, while the traditional consumer electronics vendors will encroach onto the set-top turf by offering DVD recorders, game consoles and (digital video recorders) that are digital-cable ready," Vamsi Sistla, a senior analyst with ABI, said in a statement.

If cable companies do not adapt to changing technology and business models, Sistla said, then consumer electronics companies like Sony, Toshiba and Samsung will be in a position to steal their market share.

ABI, a New York-based market researcher, predicts that by the end of 2004, just under 1 million set-top and satellite receivers that are high-definition-TV enabled will be in use in North America.