Congressmen Seek Re-Regulation of Cable TV

Two Connecticut lawmakers, declaring that cable television has turned from a luxury into a “psychological necessity” for millions of Americans, vowed Wednesday to press for consumer protections against fast-rising rates.

Sen. Joseph I. Lieberman (D-Conn.) and Rep. Christopher Shays (R-Conn.) introduced legislation to regulate an industry that they say has been riding roughshod over consumers since it began setting its own rates 2 1/2 years ago.

“It is time to return consumer protections to cable television,” Lieberman said. “We’re not trying to punish the cable TV industry. We’re just saying, ‘Let’s be fair.’ ”

Congress barred state and local governments from setting cable TV rates in most jurisdictions Dec. 29, 1986. The move was designed to foster growth in the relatively new industry. Cable companies had complained that their basic rates were kept artificially low by local officials who were subject to election pressures.

But with virtually no competition--more than 99% of the nation’s cable systems enjoy a local cable monopoly--basic service prices have risen 32% since deregulation, Shays said. The Commerce Department estimates that rates will increase by 14% this year, according to Lieberman.

Shays said the monthly service fee on the basic package in his southern Connecticut district has increased from $4.50 in 1984 to $19.95 today.

“It is one thing for the government to foster the growth and development of a fledgling industry . . . and quite another to allow a powerful industry to continue extracting monopoly prices from the nation’s consumers,” the senator said.

“You can’t have it both ways,” Shays said at a news conference. “There’s either got to be competition or regulation.”

Lynn McReynolds of the National Cable Television Assn. argued that cable TV operators do not have monopolies because the $13.8-billion industry competes with commercial television as well as video rentals, satellite TV and movie theaters.

“Cable is a competitor in the entertainment marketplace and there’s lots of competition,” she said.

McReynolds said basic service fees have increased by about a third since deregulation because those fees had been set by local officials. Other special services, which were never regulated, have seen only slight increases and in some cases decreases since December, 1986, she said.

The Bureau of Labor Statistics said overall cable fees increased by 6.6% in the first year of deregulation and 7.9% last year, McReynolds said.

Industry representatives also argue that cable TV is a luxury that consumers can choose to buy and therefore should not be regulated like power companies.

“We’d like to get to the point that we’re a necessity, but we’re still a long way from that,” McReynolds said.

The lawmakers, however, argued that cable TV has become more and more of a necessity as cable companies buy up rights to sporting events and other programming that previously was available on traditional commercial television.

Lieberman said many Americans, especially the elderly, rely heavily on cable programs for their news, entertainment and even shopping.

The bill would allow local governments to set cable rates, require 60-day notices for service changes and allow regulators to adjust rates as a result of any changes. The measure also seeks to limit concentration of ownership and encourage cable systems to provide local stations.

The issue of re-regulating the cable industry emerged in Congress last year during hearings held by Sen. Howard Metzenbaum (D-Ohio), but Lieberman and Shays are unsure of their prospects for success in this session.