The US is a signatory to the International Telecommunications Union (ITU) treaties that allocate various parts of the radio spectrum for different uses around the world. One of those treaties (or some part of one; I forget which) prohibits the use of encryption to "obscure meaning."
So how is it that the satellite companies are allowed to encrypt their signals, while individuals are not? Another example where corporations have greater rights than individuals?
Well, it is a bit complicated and involves a bit of obfuscation, but there is a little bit of info regarding this in the August Wired issue (pg 127). For starters, a treaty that the US may sign is not "law" in the formal sense of the word, Congress must do a bit of legislative juggling to codify the treaty into the USC. So, for the prohibition on encrypting wireless transmissions we go to the 1934 Communications Act which banned the use of encryption and scrambling for wireless communications. Skip forward 50 years to the 1984 Cable Communications Act; this set of laws makes private communications secure and allows one to encrypt private communications outside the "hobby" bandwidths. This bill basically defined satellite broadcasts as private communications because thier primary purpose (at the time the bill was written) is to provide a communication channel to the local cable companies. Of course, since the time the bill was passed things have changed quite a bit. How something like the the direct broadcast satellite tv system will fit into this is also unclear. jim