Customers See Red After Cable TV Company Scrambles Signal

A recent decision by Continental Cablevision to scramble its entire cable TV signal in the Hollywood/Mid-Wilshire area has altered the viewing habits of thousands of residents and drawn a rash of protests from paying customers who are experiencing what amounts to a downgrading of their video equipment.

Continental said it was forced to scramble the signal because of the unusually high theft rate it was experiencing. The company estimates that there were 28,000 non-paying users in the affected area of Los Angeles, compared to 58,000 paying customers. The rough boundaries of the scrambled area are the Santa Monica Freeway on the south, downtown Los Angeles on the east, Franklin Boulevard on the north and the West Hollywood and Beverly Hills borders to the west.

“This is the only way we could secure our system,” Continental Vice President John Gibbs said. “People were taking our signal and hooking up their cable-ready TVs. We began scrambling at the origination point and descrambling in the home.”

Scrambling is the electronic coding of a cable signal. The signal is unintelligible unless it is unscrambled in a converter box before it enters a television. The coding prevents the theft of the signal by non-customers and gives the company “addressibility,” the power to control from the company’s office what channels are available to the subscriber.

Many cable companies scramble the signals of premium channels such as HBO and Showtime. Several weeks ago, however, Continental took the unusual step of also scrambling basic cable channels such as ESPN and CNN, and even local over-the-air VHF stations such as KCBS and KABC. Industry observers say total scrambling is rare. Continental, whose other service areas include Culver City, Westchester, Venice and Mar Vista, has not resorted to total scrambling in any other areas it serves in the Los Angeles region. United Artists Cable in the East San Fernando Valley is one of the few area companies to completely scramble its signal. Copley Colony Cable, which serves parts of the South Bay, was scheduled to extend its scrambling to most or all of its channels this month.

“(Scrambling) is the strongest anti-theft measure you can take,” cable-TV consultant John Risk of Communications Support Group said. “But clearly there’s a downside to it. It’s not consumer friendly.”

The biggest drawback to scrambling is that the converter box imposes significant limits on the versatility of cable-ready TV and videocassette recorder equipment.

“It’s as though you went out and bought an expensive phone with lots of features like a speaker phone and auto-dial, and then the telephone company made you use an old rotary dial phone,” Continental customer Terry Press said.

When the signal is scrambled, for example, it becomes more difficult and sometimes impossible to record one show while watching another.

If the subscriber is willing to limit himself to watching an over-the-air channel while taping a cable-only channel such as ESPN, he can purchase an “A/B switch”--for $7.50 from Continental, or a little less at an electronics store. This switch makes it possible to pick up ESPN via cable and the over-the-air station from an antenna--provided, of course, the viewer has an antenna.

In order to record on one cable channel while viewing another, the subscriber has to obtain a second converter box from the cable company, for which Continental adds $5.77 to the basic monthly charge of $17.80 per month. The cable line would come into the home and go through a “splitter,” breaking the original line into two lines, one for each converter box.

Scrambling also makes it more difficult to set timers for multiple tapings, and in some cases makes it impossible to operate a VCR and a TV with the same remote control.

For a cable company, scrambling is an expensive investment, because it means installing a converter box for each customer, at a cost of $110 to $125 each. But it also means that when a customer orders a premium channel such as HBO or a pay-per-view event, the company can make the service available from the office. Previously, it was necessary to send a technician to the home with a ladder to make the change.

Also upset by the scrambling were the cable viewers who had been tapped into the system without paying. When Continental began its total scrambling, they received hundreds of calls a day, many from people who lived in apartment buildings and had simply plugged in the cable wire coming from the wall, unaware that they were expected to pay for it. Coming in a close second were the paying customers who saw in scrambling a downgrading of their equipment’s capability.

“Continental’s not giving me the service they could very easily give me,” subscriber Bob Claster said. “And the only reason they don’t is because they’re more concerned with the people who are stealing their signal than the people who are paying for it.

“People have fairly neutral feeling about the gas and electric companies,” Claster added, “but they hate the cable company--and it’s because of actions like this where they rub our noses in our lack of an alternative.”

There is an alternative to cable but Continental’s Gibbs cautions against it.

“If you think our converter box is difficult,” he said, “you should try getting the programs off a satellite dish.”