The Federal Communications Commission today 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:
* That there be six unduplicated over-the-air channels available and that the cable system be subscribed to by less than 50% of the TV households in the community.
* That there be one other multichannel service provider in the community, such as microwave cable or direct broadcast satellites, that are available to 50% of the homes with cable and are actually being subscribed to by 10% of those homes.
* If the cable system offers a minimum level of service and programs at a reasonable price that is comparable to communities in which there is effective competition. This 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.
Sikes said the new proposals would “give some measure of consumer protection . . . and some assurance of fairness” to the cable TV industry.
Cable systems today aren’t totally free from regulation: They pay hundreds of millions of dollars in franchising fees annually and are required to provide community access channels and make certain other public service commitments.
But critics claim cable systems have raised prices inordinately, while at the same time providing poor service to subscribers.