Time Warner Chief Says New Rules Penalize Cable : Communications: Gerald Levin warns that second FCC-ordered rate cut will slow development of new systems.

The government’s new rules for cable TV penalize the industry too harshly and will harm development of better communications systems, the head of the nation’s largest media company said Tuesday.

Gerald Levin, chairman and chief executive of Time Warner Inc., sharply criticized the Federal Communications Commission, which last month invoked the second rate cut in less than a year on the industry.

“The FCC issues eloquent calls for achieving American leadership in building the communications systems of the next century, then turns around and does its best to postpone or prevent that achievement,” Levin said.

With the speech, made at a conference of investment bankers and entertainment industry executives, Levin joined the chorus of cable and technology executives to protest the new rules.

He and other executives say the loss of revenue will weaken their capital investment plans and slow improvements to phone, cable and wireless networks.

FCC Chairman Reed Hundt, who followed Levin with a luncheon address at the conference, did not respond to the criticism in his speech. However, in response to a question from an audience member, he repeated his often-stated view that one government decision cannot drastically slow the development of systems that allow voice, video and data to be sent and received anywhere.

“I think it’s going along at a tremendous pace,” Hundt said.