Cracking the Digital Safe

Cable World, June 4, 2001 by David Connell

Because law enforcement doesn't prioritize cable theft, many MSOs have taken it upon themselves to catch and pursue cable thieves. Some have chased down pirates by "walking the system," according to Cablevision's Hack.

"We attack illegal hookups by having people on the street auditing the system periodically," Hack says.

So far this year, Cablevision has cut down 70,000 "unauthorized connections," says Hack.

Hack says the company doesn't treat these instances like theft. Instead, he says, the company sends the property owners a warning that they are receiving unauthorized service and an offer to become paying Cablevision subscribers.

He adds that Cablevision will likely convert about 45% of these individuals into paying subscribers.

However, the company is much harder on people who repeatedly and willfully steal cable service, by either reestablishing an illegal hookup or using a black box to steal premium services. If these instances are detected, Cablevision will bring civil suits seeking damages, Hack says.

Cablevision has a special division to go after people who traffic in illegal equipment. The division will attempt to set up "sting" operations in which they purchase illegal set top boxes and gather evidence against black box purveyors.

In early April, Cablevision was awarded $29 million in damages from various companies that were selling boxes in the New York City area. In addition to seeking damages against those selling the boxes, Hack says the company obtained customer lists in their raids and have brought civil suits against approximately 1,000 people, winning about $2 million.

AT&T Broadband has a similar strategy for stopping cable piracy, according to Blair.

"We go after it customer by customer," Blair says. "The way our billing system is set up, we know every paying customer. We put our auditors in the street and try to identify nonpaying customers."

"We typically have not gone after these people with legal action," Blair says. "Our primary concern is turning them back into paying customers."

If AT&T finds that a customer is using a black box to steal premium programming, it will usually seize the box and attempt to find out where the customer purchased the equipment, Blair says. The MSO will then go after that company in a civil suit, he adds.

"We get a number of those a year," Blair says.

Comcast, however, has a different approach to cable theft, according to mid-Atlantic spokesman Mitchell Schmale. Prior to conducting audits, the MSO will set up an "amnesty period" in which nonpaying customers can turn themselves in without legal or financial repercussions. However, those customers are not required to purchase Comcast service once they've turned themselves in.

The MSO ran such an amnesty program in Prince Charles, Anne Arundel, Charles and Calvert Counties in Maryland last December. The program yielded 23,000 unauthorized subscribers, of whom "a little under half" turned into paying customers, Schmale says.

To run the amnesty program, Comcast set up a toll-free hotline and advertised it in local papers and on its own systems, Schmale says. Following the amnesty program the MSO performed an audit to catch thieves who had not turned themselves in, he adds.