No Movement Seen on Proposed DTV Fines, Despite Transition

After Martin left and Michael Copps took over as acting chairman, the three current commissioners decided to continue putting off approval of the proposed fines, commission officials said. They said some were concerned about the amounts of the fines, the first proposed against pay-TV and phone companies for violating the commission’s DTV consumer education order. Because all pay-TV companies followed the spirit of the DTV education order and in most cases the letter, the fines seemed high and punitive, a cable lawyer said. Many of the companies discussed settlements with the bureau before the notice of apparent liability was circulated, but none reached a deal, commission officials said.

The upshot: None of the three commissioners has voted for the fines, a commission official said, and they haven’t recently discussed moving forward, said others at the FCC. Martin voted for the order when he circulated it, said an official, but he has left the commission.

The lack of momentum for the fines mean they'll become an issue for the new, filled-out FCC after Julius Genachowski is confirmed as the chairman, commission officials said. Liability notices against consumer electronics retailers that were released but didn’t result in forfeiture orders fall into the same category, a commission official said. Benton Foundation Chairman Charles Benton, a member of an FCC committee advising the commission on the DTV switch, looks forward to “more evenhanded treatment” by the next FCC chief of phone and cable companies, he said. “I think that Martin was just very negative about the cable folks, not without reason. There are things to criticize. He just seemed to take every opportunity to put them down.”

Consumer education was an important part of the DTV transition, and eligible telecommunications carriers and multichannel video programming distributors seem to have “devoted a lot of resources to helping educate consumers,” said an FCC spokesman. “There may have been some deficiencies early on in meeting all aspects of the DTV consumer education rules, but it appears they have devoted substantial resources and efforts to helping consumers.” After the DTV switch, the FCC will decide “whether to pursue enforcement” when it looks at consumer education rules “in a holistic way” and at how the word was spread about June 12, the spokesman added.

The companies that were the objects of the liability notices were AT&T, Charter Communications, Comcast, Time Warner Cable, Verizon and two other cable operators, commission officials said. The companies were fined amounts varying by how many monthly customer bills they neglected to include transition information in, FCC officials said. AT&T will “respond appropriately if and when” the commission makes public the proposed penalties, a company spokesman said. Verizon went “above and beyond requirements to make sure consumers are fully informed,” said a spokesman. “After correcting minor problems that lasted for a few weeks in the spring of 2008, everyone who was supposed to receive bill messages received them in a timely fashion.” Officials at the other companies didn’t respond to messages seeking comment.

Cable operators have followed the FCC’s consumer education rules by putting notices about the DTV switch in customer bills since April 2008, said an NCTA spokesman. “These detailed monthly notices have alerted customers about the end of analog broadcasting and the need to obtain a converter box for analog TV sets that are not connected to cable service in order to ensure continued viewing,” he said. They also told consumers how to get more information from the government and from cable operators, he said.