Porterville
Recorder
November 14, 2007
1984 law permits regulation if
certain levels of consumer use are reached. That may be getting close.
Perhaps its not all that
surprising. Any government agency set up with a mission to regulate
some aspect of commercial life develops an institutional imperative to
regulate ever more aspects. So the Federal Communications Commission,
which was barred by law in 1984 from regulating cable television to
give the industry a chance to grow and develop now wants to start
regulating the industry with a vengeance. It would be difficult to
imagine a better way to stifle the growing array of choices consumers
have available for viewing television programming.
What might let the FCC get its
nose under cables tent is a portion of the 1984 Cable Act, which said
that if cable television becomes available to 70 percent of U.S.
households, and 70 percent of those who can subscribe to cable do so,
the industry then can be regulated. There is controversy as to whether
that threshold has been reached. The FCCs report in 2005 put the number
of cable subscribers at 54 percent, while a cable industry-sponsored
study this year puts it at 58 percent. But a recent court decision
defined TV service offered by a phone company over fiber optic cable as
being cable. If subscribers to Verizon and other phone company TV
services are included, that could push the number of cable subscribers
to more than 70 percent.
That highlights the fact that
the marketplace now offers more competition than regulation could
facilitate. The phone companies are getting into providing television
transmission, in addition to the satellite providers. More and more
people are getting TV shows over the Internet. Heavy-handed federal
regulation is more likely to stifle this kind of innovation than to
encourage it.
Even though the 70/70
provision was written into law in 1984, it lacks the kind of
justification whereby the FCC, back during the New Deal enthusiasm for
creating new regulatory agencies, was given authority over
broadcasting. The airwaves over which signals are sent, the rationale
went, belong to the public, which means the government can decide who
can use them and how. This was a stretch the airwaves are part of
nature, which doesnt necessarily imply that somebody in a government
office has more right than anybody else to decide how they shall be
used and it involved government in regulatory micromanagement that
would never have been tolerated in the print media. But at least there
was a rationale.
Cables, however, are privately
funded and privately owned, which gives the government no legitimate
authority to regulate how they are used, except possibly in the
unlikely event legitimate health or safety issues arise. The fact that
Congress passed a law in 1984 asserting a regulatory right if certain
arbitrary numbers are reached doesnt change these facts, and if the FCC
does start asserting regulatory authority we expect a court challenge.
The other problem is that the
kinds of regulations the FCC is thinking about imposing in the apparent
belief that people in offices in Washington, D.C., know what consumers
want better than consumers, through their choices in a highly
competitive marketplace, reveal about their preferences would almost
certainly make the industry less competitive rather than more so.
For example, the FCC is said
to want to force programming providers to stop bundling their
programming offering cable companies popular channels like MTV only if
they also take less-watched channels like Spike. Theres also talk of
forcing cable companies to offer subscribers an a la carte system,
letting them pick just the individual channels they want rather than
the packages the cable company assembled.
But you can see how this might
lead to less diversity rather than more. The present system makes for a
variety of channels that serve relatively small niches but piggyback on
more popular channels. If each channel had to rely on individual
subscriptions at both the consumer and local cable company end, some
might well not survive.
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