LACK OF LEGISLATIVE THREAT SLOWING DTV TRANSITION, MARKEY SAYS
House Republicans aren’t using the threat of DTV legislation as effectively as they could, and it could be slowing the transition, House Telecom Subcommittee ranking Democrat Markey (Mass.) told the American Cable Assn. (ACA) Wed. He said the threat of legislation should be hanging over the industries involved in the DTV transition as a “catalyst” to negotiate. “It depends if you take the Republicans’ claim that ‘we might regulate’ as a serious threat,” Markey said, adding that committee leadership should have made it clear last year that there would be a markup of a DTV bill this session.
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Markey said it was “less likely than more likely” that the House Commerce Committee actually would vote on a DTV bill this session. Commerce Committee Chmn. Tauzin (R-La.) is expected to introduce DTV legislation sometime this month. Markey said he believed the industry could and should resolve DTV conversion issues, all of which he believed were technically resolvable. “No industry could know how they'll be affected by a bill,” Markey said. “At some point, we should act. We've not yet reached that point, but we should hang out legislation as a threat.” He told reporters he also had a DTV bill, but said he would wait at least until Tauzin’s bill was introduced before floating his own.
The Republican Congress isn’t likely to act on other issues involving small cable companies, Markey told the ACA. He specifically highlighted programming costs, saying that while large cable companies cited high program costs as the reason for rate increases, most also had invested as content producers. He said the cost complaints of vertically integrated cable companies “remind me of someone preaching temperance from a barstool.” Several senators, including Senate Appropriations Chmn. Stevens (R-Alaska), had expressed similar skepticism at a cable rates hearing Tues. (CD May 7 p1).
Markey said cable operators should be able to purchase content from programmers “a la carte” and should sell to cable subscribers “a la carte.” He said the recent agreement between Cablevision and the YES Network on a la carte sports programming was positive and would begin to set a precedent of more tiered programming choices. Cable companies should disclose the cost of cable channels to customers, he said, adding that there were too few independent cable programmers. He said he had asked Telecom Subcommittee Chmn. Upton (R- Mich.) for a hearing on cable competition that would emphasize programming costs.
The rollout of broadband has been encouraging, Markey said, noting that no one had DSL or cable modems when the Telecom Act was passed in 1996. “This is not a crisis, this is remarkable,” he said. With 75% of Americans having access to broadband, Markey said availability wasn’t an issue -- price is the issue. “When you see more Darwinian pricing competition, it will lead to more subscribers,” Markey said. Market forces will begin to foster deployment in some areas, he said, but other areas may require “private and public policy” to create “ubiquitous broadband availability and affordability.” Universal service is one policy tool that should be used to spur broadband deployment, he said.
Regulators must look closely at programming issues when reviewing the proposed News Corp. acquisition of Hughes Electronics and subsidiary DirectTV, Markey said. However, he said he was more comfortable with that deal than with EchoStar’s failed effort to take over DirectTV, since it still would leave 2 competitors in the satellite marketplace. Competition in the cable marketplace hasn’t emerged as expected, partly because the Bell companies didn’t invest in video distribution as they had said they would in the debate over the Telecom Act, Markey said. “We're still waiting -- like Godot -- for the Bells to show up in the marketplace,” he said.
Markey said he didn’t support lifting the 35% TV ownership cap, which FCC Chmn. Powell is expected to move to raise when the FCC concludes its ownership review June 2. Markey said the 35% ownership cap was in the Telecom Act through one of his own amendments. He said Powell’s direction on media ownership was “misguided” and would result in higher programming costs.