The Federal Communications Commission has proposed new rules that may give back to some cities the right to regulate basic cable television rates.
The FCC, acknowledging that cable TV is no longer the infant industry that Congress deregulated in 1984, offered several new ways that could make it tougher for cable TV systems to escape local price restraints.The commission voted 5-0 for proposals to redefine what constitutes "effective competition" for a cable TV system.
Systems currently may avoid rate regulation of their "basic tier" of service if they have effective competition, which the FCC currently defines as three over-the-air broadcast stations covering the cable system's community.
The commission proposed three new ways that a cable system could avoid rate regulation of its "basic tier" of service:
- There must be six unduplicated over-the-air channels available and with the cable system being subscribed to by less than 50 percent of the TV households in the community.
- There must be one other multichannel service provider in the community, such as microwave cable or direct broadcast satellites that are available to 50 percent of the homes of cable and are actually being subscribed to by 10 percent of those homes.
- The cable system must offers a minimum level of service and programs at a reasonable price that is comparable to communities in which there is effective competition. This so-called clause is favored by a number of FCC commissioners and is expected to possibly prevail over the other two proposals when the FCC finally adopts its new rules sometime next year.
FCC Chairman Alfred Sikes wants to encourage competition from other cable systems and satellite broadcasters, saying competition, not regulation, will help guarantee continued growth in the cable industry and hold prices down for subscribers. The new proposals would "give some measure of consumer protection and some assurance of fairness" to the cable industry, he said.