Consumers Union said the FCC’s video competition report (CD Jan 2...
Consumers Union said the FCC’s video competition report (CD Jan 29 p7) demonstrated that consumers had been “short- changed and ripped off” since Congress began deregulating the cable industry under the 1996 Telecom Act. “As the FCC admits, much…
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of the hoped-for competition -- from telephone companies and cable ‘overbuilders’ -- has not materialized, and the explosion of satellite video has done virtually nothing to prevent cable from raising rates nearly 3 times faster than inflation,” CU said. It said the report recognized that in the few communities where 2 cable companies competed head to head, prices were lower. If head- to-head cable competition existed nationwide, consumers could save more than $4 billion per year in cable charges, CU said. CU also said the FCC had failed to note that revenue generated by add-on services, such as high-speed Internet and pay-per-view, would cover all investment in technology and generate a reasonable profit with no need for basic rate increases. “Once again the Commission fails to note the harms caused to consumers by cable’s unrestrained monopolistic practices,” CU said: “It is time for Congress to step back in.”