Cabler asks FCC to stand firm on rules

Feb 10, 2003  •  Post A Comment

Before the Federal Communications Commission allows the nation’s major media companies to acquire any additional broadcast TV stations, the agency should adopt a wide-ranging series of regulations-including one that would allow cable operators to offer high-cost programming on an a la carte basis-to protect the rest of the industry.
That was the surprise advice from Mediacom Communications, the nation’s eighth-largest multiple cable system owner, in a 98-page filing with the FCC last week.
“Simply put, competition has not resulted in the need to relax, much less eliminate, the commission’s ownership rules,” said Mediacom.
Under pressure from the nation’s largest media companies, the FCC is currently proposing to relax or ax many of its restrictions on media ownership, including one that currently bars companies from acquiring TV stations reaching more than 35 percent of the nation’s TV homes.
The industry’s major players insist that competition has eliminated the need for the TV ownership cap.
But in its filing with the FCC, Mediacom said six of the nation’s leading media companies-Viacom, AOL Time Warner, The Walt Disney Co., News Corp., Liberty Media and General Electric-are already big enough to put a squeeze on independent cable operators.
“Relaxing or eliminating the limit on broadcast stations ownership would undoubtedly lead to a flurry of acquisitions of even more local broadcast stations by some or all of those companies, thereby adding significantly to their already excessive market power,” Mediacom said.
Among other things, Mediacom complained that some of the Big 6 companies have been using the clout they derive from their ownership of the nation’s most popular broadcast and cable networks to force independent cable operators to carry and pay for other programming they don’t want-and then socking them with annual fee hikes that exceed the rate of inflation.
“Many cable companies have almost been reduced … to the status of serving the Big 6 as pipelines for forced distribution of content selected by the programmers and as agents for collecting money from subscribers and passing it along to the programmers,” Mediacom said.
A partial fix, according to Mediacom, would be for the FCC to condition the right of any of the Big 6 to acquire additional stations on the following obligations:
* Give operators the right to break out high-cost programming from their basic tiers so they can offer it a la carte, ensuring that only the subscribers who want the programming have to pay for it.
* Guarantee when it comes to pricing not to discriminate based on size or other market criteria between buyers.
* Renounce retransmission consent rights, regulations Mediacom complains the TV networks have used to force carriage of new cable networks.
* Refrain from attempting to tie popular networks into package deals with less popular ones, directly or indirectly.
* Waive confidentiality clauses in program contracts that bar operators from disclosing carriage terms and rates.
“All of these requirements would serve the interest of the public policy goals of competition, diversity and localism and also further the goal of ensuring that all citizens, regardless of where they live, have access to video programming on a nondiscriminatory basis,” Mediacom said.