Cable Operators Freed of Regulation in Almost 800 Communities
Cable operators have been freed of rate and other local regulation in recent weeks in hundreds of cities, after the industry prodded the FCC to reduce a pile of petitions based on claims the companies face sufficient video competition from DBS or talcs. Frequent criticism by the NCTA, Comcast and others about the agency’s slow handling of the effective- competition petitions (CD March 27 p16) prompted FCC Chairman Kevin Martin to ask the Media Bureau to reduce a backlog that stretched into the hundreds, said current and former agency officials and industry lawyers. But dozens of petitions remain to be handled, they said. An FCC spokeswoman declined to give the number.
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The bureau decided no petitions this year until March 14. That day, Associate Chief Nancy Murphy signed two orders releasing Comcast from regulation in part of the county surrounding Chicago and in five Connecticut towns. Murphy joined the bureau in 2007 after two decades in the cable industry and was tasked with clearing up the backlog (CD Special Report April 16 p9). Policy Division Senior Deputy Chief Steven Broeckaert, whose job includes approving the petitions, resumed issuing them March 28.
The orders free operators from local regulation of basic cable rates and charges for leasing to subscribers items like cable set-top boxes and for technicians’ visits, cable lawyers said. Most important to companies is that the orders free them from a requirement that they sell any programming package to basic subscribers -- meaning a consumer could get premium channels without expanded basic service, said the lawyer. An NCTA spokesman said the bureau has made “progress” in approving the petitions, “which is clear evidence that the marketplace is providing consumers with real choice in selecting a video provider.”
Martin has said he asked the bureau to get moving. He said March 20 that the agency had approved 100 petitions during his tenure, and several hundred more awaited action. Besides responding to public complaints by cable executives including Comcast Senior Vice President Joe Waz and NCTA President Kyle McSlarrow, Martin may have set his sights on slashing the count because he feared attention from lawmakers who are looking at FCC processes, industry sources speculated. But petitions have stacked up at the bureau under previous FCC chairmen, said former commission officials.
The bureau’s pace of approving orders picked up from mid-March through Thursday, our analysis of FCC records found. In the past six weeks, the bureau has approved 51 orders. That’s the most in such a time period since at least 2005 (CD Feb 2/07 p3, Sept 29/05 p1). Comcast was the biggest beneficiary, getting 35 orders. Time Warner Cable got five, Cablevision and Cox three each, Mediacom two and Bright House, Charter and Suddenlink one apiece. Thursday, the FCC issued an order freeing Comcast from regulation in South San Francisco and 13 other California communities. Cox escaped regulation in San Diego and 26 other municipalities in the state. There are more than a million households total in those areas, including unoccupied dwellings, according to the 2000 Census.
The bureau’s recent orders cover all or part of almost 800 communities in half of the states. Among large cities covered are Chicago, Detroit, Kansas City, Oklahoma City, Salt Lake City, and San Jose, Calif., along with suburban New York and Washington. More than 8 million households are covered, representing 6.3 percent of the country’s total. Almost all the petitions were unopposed, and the orders cited competition from DirecTV, Dish Network, Verizon and WideOpenWest.
Cox has no petitions filed before this year still awaiting a decision, said a person familiar with the process. Mediacom has nine petitions awaiting resolution, covering 15 municipalities, said Vice President of Legal Affairs Thomas Larsen. Suddenlink has two pending petitions, both filed in 2007, said a company spokesman. Charter has “less than a handful pending,” said a company spokeswoman. Officials at Bright House, Cablevision, Comcast and Time Warner Cable declined to comment or didn’t return messages. Many operators that had petitions on hold, in some cases for years, have gotten them approved, said a cable industry official.