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NCTA Chief Lashes Out at FCC’s Martin

Nov 14, 2007  •  Post A Comment

The head of the National Cable & Telecommunications Association unleashed an unusually broad attack on Federal Communications Commission Chairman Kevin J. Martin, suggesting he is “manipulating” statistics, scheduling FCC decisions and tilting reports to operate the agency more like a political campaign than a regulatory agency.
“The FCC is broken,” NCTA President-CEO Kyle McSlarrow said at a news conference today.
The event came a day after the NCTA sent a letter complaining about the FCC’s decision that cable’s reach has now exceeded 70% of the nation’s households, a ruling that could open the door to greater federal regulation of the cable industry.
While Mr. McSlarrow said that decision and the FCC’s failure to detail the statistics on which it’s based is the immediate object of the NCTA’s ire, he offered far broader criticism, suggesting Mr. Martin’s desire for cable subscribers to be able to buy channels a la carte was coloring everything he does.
“When you look at the kind of proposals, from a la carte, to the imposition of additional must-carry obligations, to technology mandates, to decisions that literally cost consumers more and raise their rates, to decisions that favor one industry over another … it’s very clear that what this is all about is pursuing one particular agenda item—a la carte—and using the rest of these proposals to pressure our industry to do voluntarily what the FCC does not have authority to mandate,” Mr. McSlarrow said of the FCC under Mr. Martin.
He said the cable industry would not accede to the demand for a la carte.
“There is no question in my mind that the array of items brought before the commission or proposed are designed to pressure the entire industry to reach a conclusion that the only way out is to implement some kind of a la carte system,” he said. “It’s not going to happen. We have to respect what our customers want. We aren’t going to wreck our business model and hurt our customers in order to appease one chairman of the FCC.”
In response, Mr. Martin issued a statement:
“Our focus is not on the welfare of a particular industry but the welfare of consumers and ensuring they receive the benefits of competition in the form of lower prices, more choice and better services. Consumers have not seen those benefits from cable. The average cost of cable has almost doubled from 1995 to 2005—increasing 93%—while the cost of other communication services fell. The cable industry needs more competition and we will continue to act to bring more competition and its benefits to consumers.”
Mr. McSlarrow also charged that Mr. Martin is ignoring normal good government administrative procedures to act on some favored mergers and rule-makings before others; leak and make FCC decisions before the public or industry has a real chance to comment; and time reports to achieve an ideological goal.
“What I’ve seen is a predilection to issue reports or to delay issuing them to promote a particular viewpoint,” he said, pointing to a phone company deal where AT&T bought Southern Bell that moved quickly through the FCC while a cable deal lingered.
He also said the decision-making process itself is skewed.
“I have been in politics myself,” Mr. McSlarrow said. “A regulatory agency has very strict procedures under the Administrative Procedures Act. When I see leaks to the press, an effort to time release of documents without anyone seeing them, without anybody being able to refute them … that’s something that happens in politics,” he said.
Mr. McSlarrow questioned any statistic showing the cable industry had reached 70% of households and said even if it had, increased competition between cable, satellite and phone providers doesn’t warrant additional regulation.
He also said his talks with congressmen and senators, even those who don’t agree with the cable industry, uncover widespread concern about the FCC moving to impose any new limits on cable.
“I’ve talked to a lot of Democrats and Republicans. The reaction is they are horrified, pretty well universally. The FCC was not given a mandate by them or previous law to go in that direction,” he said.

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