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FCC May Move to Cap Cable Company Size 73

Posted by Zonk
from the maybe-we-could-get-decent-service-again dept.
explosivejared writes "The FCC is making plans to bring back the concept of a 'size limit' on cable operators. 'FCC Chairman Kevin Martin has enough support on the five-member commission to pass a measure that would bar cable companies from owning systems that have more than a 30-percent share of U.S. multichannel video subscribers ... the FCC could have a difficult time defending the 30-percent cap in court. The move comes six years after a federal appeals court threw out an identical FCC rule on the grounds that the agency did not have enough evidence to justify it."
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FCC May Move to Cap Cable Company Size

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  • by Anonymous Coward on Monday December 03, 2007 @06:49AM (#21558675)
    What do they know that we don't know? Are they trying to shift the ban from % of local ownership to national ownership? Are they trying to get this move knocked down in the legal system to set precedent for something else?

    No way George W. Bush's FCC is having a change of heart about big business ownership. So what's the scoop on this and other recent anti-cable proposals [wsj.com]? And why are they trying to rush a vote on it?

    • What do they know that we don't know? Are they trying to shift the ban from % of local ownership to national ownership? Are they trying to get this move knocked down in the legal system to set precedent for something else?

      No way George W. Bush's FCC is having a change of heart about big business ownership. So what's the scoop on this and other recent anti-cable proposals? And why are they trying to rush a vote on it?

      Have you considered that this may actually be a big-business vs big-business battle, with the FCC being one of the weapons? The telecom industry appears to have some serious ties to the Bush administration, and I'm sure they'd love to "regulate" the cable companies until the cable companies can no longer compete against the telecoms in the phone/internet markets.

      It's also possible that this is simply a result of some bureaucrats attempting to "expand their empire". Since the WSJ article mentions that the

    • What do they know that we don't know? Are they trying to shift the ban from % of local ownership to national ownership? Are they trying to get this move knocked down in the legal system to set precedent for something else? No way George W. Bush's FCC is having a change of heart about big business ownership. So what's the scoop on this and other recent anti-cable proposals? And why are they trying to rush a vote on it?

      This is a spat between FCC Chairman Kevin Martin and the cable industry. It's been go
    • Advantage: Telcos (Score:5, Interesting)

      by jmp_nyc (895404) * on Monday December 03, 2007 @11:06AM (#21560033)
      It's very simple. The FCC regulates two industries: Cable and Telco.

      Back before the 1996 Telecom Act, the two never competed directly. Now, you've got cable companies offering phone service, telephone companies offering television service, and both offering Internet access. In some areas, the buildup of higher bandwidth infrastructure has forced cable companies to add channels in order to compete with new telco TV offerings.

      Eventually, we'll likely move towards a model in which the cable and telephone companies simply sell bandwidth, and people will get most of their content through VOIP and IPTV. Until the real world implementation of the technology and the regulations catch up with the potential, the FCC is stuck regulating the services offered by these companies. As long as that's the case, added regulation on one industry means a competitive advantage for the others. If cablecos lose, telcos win.

      In many communities, this can ultimately be good for consumers. Here in NYC, one cable company (Time Warner) has the monopoly on providing television access. Over the air reception is a non-starter because of all the tall buildings, and many people (myself included) have no southern line of sight for satellite. My cable company provides horrible service. As bad as the local telco is, their service is actually better than the cable company. When Verizon wires my building for FIOS (a project that's already underway), and eventually gets permission to carry TV signals here in NYC, I will actually have a choice of provider if I want to watch live TV. Time Warner has already started offering higher bandwidth Internet connections in anticipation of FIOS data rates. I look forward to seeing what else the competition will bring...
      -JMP
    • by gaforces (1082431)
      Payback for taking VOIP customers, the death of the cash cow (land line.)
  • by JRGhaddar (448765) on Monday December 03, 2007 @07:09AM (#21558759)
    What will happen in the next 5 years when IPTV becomes a reality to the masses?

    This is where I believe we are headed:

    All HDTV's will begin to have Ethernet Jacks, a NIC Card, and some embeded linux with a VTR and a HD.

    You can Access IPTV/Local/Cable Channels from All over the world. VTR them. Watch YouTube and Other Net Video Channels, and be able to buy Movies for Watching like OnDemand. You can set your VTR from your office etc through your IPTV online account.

    Net IPTV Companies will partner w/ HDTV manufacturers to make sure there IPTV Portal is what is the default portal on connecting to the net.

    So to bring this back to today. Technology is changing the game so fast that monitoring a 30% rule seems mute because it's tough to measure now and once the HDTV gets on the net how the hell are they going to monitor all that without everybody getting upset. Consumers don't want to be watched by the governement and the internet is a global entity; which makes it difficult to get Viewer numbers on a company that may be overseas.

    • by ElBeano (570883)
      The cable industry is already a dinosaur and a nasty regulatory evironment could only relegate them even more rapidly to obsolescence. They've become telecom providers, but are highly dependent on interconnection with companies who are their direct competitors for those services. I happen to think too that IPTV is likely the best hope going forward for competition against the dish based providers. This story makes it seem like the FCC is stuck in another decade. Do they even have a clue?
    • What will happen in the next 5 years when IPTV becomes a reality to the masses?
      What does this have to do with Iowa Public Television [iptv.org]?
    • Yeah, I'm pretty sure Comcast et al will just sit back and let people grab HD content from other sources. They won't use packet shaping to protect their business model, er, revenue stream, er, no, um... Infrastructure. Yeah, that's it! Infrastructure. They're protecting the infrastructure and customer bandwidth.
    • Ethernet jacks and a nic card?

      Doubly redundant.
    • IPTV is not going to happen in the next 5 years, not on a large scale anyway. Keep in mind that, while most Americans have access to broadband, it's of the most questionable quality and reliability. That 10Mbit line your neighbour Joe has, what kind of throughput would it REALLY give you if you pushed it? 4Mbit? Less? Up here, a 6Mbit line from Rogers frequently can pull less than 2.5Mbit in reality, and this fluctuates wildly depending on network congestion.

      The last thing ISPs need is everyone pulling

    • Technology is changing the game so fast that monitoring a 30% rule seems mute because it's tough to measure now

      If I may pick a nit (as an anonymous poster has done)....

      Perhaps it is mute [dict.org] because it doesn't make noise. On the other hand, it may be moot [dict.org] because, as you say, it's tough to measure now.

      In any case, you are quite right that it will be interesting to see the effect of IPTV as it develops, though it's not likely to threaten the markets controlled by fear of the Death Star [slashdot.org] (which appears, in its dom
    • monitoring a 30% rule seems mute
      You meant to say "moot" not "mute." /grammarnazi
  • by Dachannien (617929) on Monday December 03, 2007 @07:10AM (#21558763)
    The real problem is not that an individual cable TV provider has too large a market share. The problem is that there is no competition among providers because of regional, not national, monopoly status.
    • Re: (Score:3, Interesting)

      by Coopjust (872796)
      You hit the nail on the head there. Most people have one or two choices: The local cable co., or DSL.

      I'm lucky enough to have a surprisingly good cable company in my area, but it's cable internet or DSL- and I, like many people in my community, am just out of range of the CO for DSL. Satellite is too high latency, expensive, and slow, FiOS isn't here, and there's no other way to get the internet (other than dialup, which isn't an option with high bandwidth websites nowadays)
    • by squiggleslash (241428) on Monday December 03, 2007 @07:56AM (#21558911) Homepage Journal

      It's a bit of both. If someone owns a significant number of TV viewers, they have a strong influence on what TV channels those viewers have access to. That can have a major impact upon free communications and diversity of media.

      As you say though, from a consumer standpoint it's also bad to have just one cable operator in one area, and that isn't impacted at all by whether or not Time Warner or Comcast serves 10% of TV viewers or 90%.

    • Re: (Score:3, Insightful)

      by bhmit1 (2270)
      Absolutely correct. The current system really discourages competition. I'd much rather see a policy that forbids exclusive local rights for cable companies. Then, instead of the 30% limit, let the companies get as large as they want, but regulate them if they get too large and some portion of their customers only have one choice for either cable, internet, or telephone access. This would encourage unregulated small startups to fill a market need, but if one company destroys all the competition they can'
    • Blame content creators and telecom.

      The FCC is trying to protect telecom's entrance into the content delivery business. Also, content creators like Viacom are pushing for breaking up cable, as this will provide them with more leverage on channel contracts.

      Over the past couple of years, the FCC has pushed Time Warner to divest itself of it's channels, and threatened to cap Comcast from new markets. If the cable companies are capped in size, but still geographically monopolistic, the cable have less leverage
    • by PPH (736903)
      Good point. All this move will buy us is the forced splitting of Comcast, for example, into 'Baby Comcats'. No doubt this will be in exchange for relief from other regulations. "Look! We're all itty, bitty cable companies now. These regulations are driving us out of business." Then, when that's all fixed to their liking, the FCC withdraws the market share reg. After all, one big company is more efficient than a bunch of little ones, duplicating functions and will produce savings for the customer.

      Just like

    • Can we mod this one up above a 5 please?

      Who cares how BIG they get -- ownership and control can be through holding companies. The real issue is that there are cable monopolies at all. Without another source for your cable, you pay the price you are told. The only real competition is Satellite.

      And I'd love to have no Local phone company while I get on the Internet and just have a cell phone with unlimited calling -- that would save me about $80 bucks a month over my local monopoly baby bell phone company.
  • to submit your campaign donations for the senators on the FCC oversight committee.
  • by MosesJones (55544) on Monday December 03, 2007 @07:30AM (#21558847) Homepage
    Now what would be really radical would be to allow more global competition for the US marketplace. One of the biggest issues at the moment is that there are a small number of companies who know their only competition comes from inside the US and there is no way that anyone outside could aggressively target the market. As much as Rupert Murdoch isn't my favourite person in the world it has to be admitted that he, as an Australian who sold his nationality for commercial gain, has shaken up the broadcast side and distribution sides of the market. Why not allow more people in from outside to see what they could do and to wake up what should be the world's most competitive market but which unfortunately is probably one of its least.

    The problem isn't 30% or whatever the problem is lack of choice and competition.
  • Hypocritical (Score:4, Interesting)

    by Toasty16 (586358) on Monday December 03, 2007 @07:49AM (#21558897) Homepage
    The FCC gives SBC a free pass to stifle competition by recreating the AT&T conglomerate that was broken up in 1984 but they have a problem with cable company size?
    And allowing local/regional phone and cable monopolies rather than leveling the playing field for 3rd parties to rent coax and phone lines from incumbents hurts the consumer more than any other decision the FCC makes.
    Not to mention that the FCC has done nothing significant in the most egregious abuse of access, that of AT&T (formerly SBC) allowing the NSA to essentially wiretap the entire internet backbone...
    • Hey, they're just doing what they're paid for... By the phone companies.
      I'm sure if you look up how much the Bells ..er..SBC is "contributing to someone's campaign" it much more than the Cable companies.

      When stupid decisions are made, follow the money.
    • by Gizzmonic (412910)
      You nailed it. Kevin Martin is in bed with the Telcos (AT&T and Verizon) but they oppose the cable companies. It's not a good situation.
    • You raise a good point. The aggregation might have been allowed just so that the NSA would have an easy wiretap access point.
  • by redelm (54142) on Monday December 03, 2007 @08:06AM (#21558949) Homepage
    Like jail, I think that breakups and size limits are very counterproductive but occasionally necessary for "bad" market actors. The problem is cablecos have never been given proper discipline and indeed allowed to illegally expand their monopoly vertically (selling content).


    While monopoly of "the last mile" might not be easily fixeable, the vertical expansion easily is and has been done in a number of cases. End the cableco's ability to sell any content beyond basic OTA. "premium" and PPV channels are sold by subsciption by unrelated others (in competition) and the content merely carried (billed, gated) on cable (at a regulated cost).

  • This rule is completely unnecessary. We don't need the FCC. Everyone knows that the magic of the free market can provide all our telephony needs, just as it provides all our healthcare, education, electricity, roads, water and national defenses.

    All this big bad government regulation simply inhibits the market from reaching its optimal state; which is not a monopoly, despite what some pinko econmmunits and their "facts" would have you believe. The true patriot has faith in the Invisible Hand, Profit be Upon It.
    • by PinkyDead (862370)
      Using the magic of XML:

      <sarcastic>
      This rule is completely unnecessary. We don't need the FCC. Everyone knows that the magic of the free market can provide all our telephony needs, just as it provides all our healthcare, education, electricity, roads, water and national defenses.
      </sarcastic>

      <not-sarcastic>
      All this big bad government regulation simply inhibits the market from reaching its optimal state; <unrealistic> which is not a monopoly</unrealistic> , despite what some pi
    • Straw Man.
    • Re: (Score:3, Insightful)

      by jc42 (318812)
      Hmmm ... Only one mod, "Insightful". This is a good example of why we should encourage people to always include a smiley in posts that are written as humor. Especially the one that on their surface can be read as any of the conventional semi-religious economic dogmas. People who believe in those dogmas do get mod points, and they tend not to notice subtle humor.

  • by Anonymous Coward
    http://www.cnn.com/2007/US/12/03/us.debt.ap/index.html [cnn.com]

    yikes almighty. time to get real yet? see you there?
  • Time and again we have people who moan about monopolistic tendencies of large corporations. They offer negative opinions of the so-called free market. Unfortunately for the consumer, the FCC and local municipalities have assured us of never having a truly free market in cable (and cable-provided services).

    We need to stomp on the FCC and allow them to truly deregulate (which they've never really done) at the national level. The FCC should have no mandate over cable, or any non-wireless communications prov
    • by Kuma-chang (1035190) on Monday December 03, 2007 @10:51AM (#21559921) Journal
      Parent is one of the most naively ignorant comments I've seen on the communications business. To wit:

      Time and again we have people who moan about monopolistic tendencies of large corporations. They offer negative opinions of the so-called free market. Unfortunately for the consumer, the FCC and local municipalities have assured us of never having a truly free market in cable (and cable-provided services).

      You can't get the local municipalities out of the cable business for the simple reason that the cable companies cannot possibly buy via the free market the property rights necessary to string up a network. It's a classic holdout problem. Every property owner (including the municipality itself) that sits in a strategic position will have the leverage and incentive to hold out from selling access until they can extract all of the cable company's profits. Without the political process to facilitate the necessary access to public and private property, it just doesn't happen. It's the same for the landline phone business. And wireless has its own reasons for requiring regulation. The simple fact is that this has always been a regulated business, and it always will be. It's the unavoidable nature of the business.

      I know of so many people who are concerned that deregulation (national and local) of cable and comm providers would end up giving us millions of wires overhead on the telephone poles. This is untrue.

      Your conclusion is correct, even if your reasoning is inane. There would not be millions of wires because that would be unbelievably economically inefficient. The market wouldn't support it. Even ignoring the property rights issues discussed above, last mile networks are extremely expensive and completely redundant. Combine with property rights complications and you have a market that will have very few entrants. Regulated or unregulated, there will be little competition for the physical last mile network. That's just going to have to be an uncompetitive market. The question is how far do you want this non-competitive market to extend? Should we allow lack of competition in last mile networks to turn into lack of competition in ISP's by getting rid of unbundling and open access to the local loop? Should we it to turn into lack of competition for services over the Internet like VoIP and IPTV by not enforcing net neutrality? The telecom companies want to push these noncompetitive advantages as far as possible into markets that are actually competitive. The only thing to stop them and preserve actual market competition is regulation.

      Thankfully, we're seeing more solutions slowly popping up. WiFi networks, maybe WiMax networks, and other competitive products should hopefully push the cabled providers to lowering their prices, which may end up having the effect of creating a deregulated market before government will move to unrestrict that competition.

      Funny that you should phrase it as if the emergence of wireless competition would spite the FCC. Platform competition has been the primary aim of the FCC. That's why they shut down unbundling and access to the local loop. Unfortunately I don't think it will play out very well. I remain unconvinced that wireless access networks (as opposed to WiFi, which is not really an access network at all) will be able to compete with wired access networks for speed. WiMax is likely to deliver 2-4 Mbps. Cable and DSL could do 10 times that (and do in other countries, although not often in the US), and fiber, forget about it. Wireless is just not in the same class, and as people more and more start to depend on broadband to get video content, that's going to make a big difference. And while we've all spent a decade waiting for broadband over powerlines, it just doesn't appear that it is going to be commercially viable. So we could be looking at a long term duopoly for residential broadband Internet service between the cable and phone companies. The market will not save us.
      • You can't get the local municipalities out of the cable business for the simple reason that the cable companies cannot possibly buy via the free market the property rights necessary to string up a network. It's a classic holdout problem. Every property owner (including the municipality itself) that sits in a strategic position will have the leverage and incentive to hold out from selling access until they can extract all of the cable company's profits. Without the political process to facilitate the necessa
        • When it comes to private property, there is absolutely no reason why a cable-connect middleman can NOT go to each person and tender an agreement to utilitize their property for cabling. Part of the agreement would be the transfer of rights in the process of selling or leasing that property to others. It's done now with cell phone towers quite successfully on private land. I know of three building owners who get a nice chunk of change in exchange for placement of a cell tower on their property. If someone d
          • by dada21 (163177)
            This is a gross oversimplification. The reality is that overbuilding is allowed in many places in the US. It's not like regulators don't want competition in the cable market, they'd love it. But in practice it almost never happens. That's because it's just not that easy. In order to roll out a network you need to get a whole bunch of property owners to agree at the same time. If one of them holds out, well, depending where he is located you might be able to route around it at increased cost. If several hold
            • ...all you want, but it's not going to make free market utopianism a reality.

              A local business investor can do just fine, especially in smaller towns or areas. The business investors has a better chance of acquiring the land rights (through direct involvement with property owners), and once they've acquired the rights, they can then lease them to other companies, or even outright sell those rights to another larger middleman. It could even be tens of thousands of individuals acquiring the rights in variou
              • by jayp00001 (267507)

                Outside the world of free market utopianism, not all markets are identical. Sometimes the only way to force competition is through regulation. And anyone who favors free markets over real competition has become so immersed in free market dogma that they've forgotten why markets are beneficial in the first place.

                As a real life example take a look at verizon running out of new england as fast as possible after deploying fiber to all the urban areas. Since there is no regulation if you live in a rural area an

            • by cdrguru (88047)
              You don't see some of the obvious things that people do. I lived in a subdivision where the builder had three holdouts that wouldn't sell. They had to carve the plans up around them because they assumed they would get lots more than market value if they could hold the builder up. The builder went around them. Slowly and at great cost.

              The problem with networks is that one or two holdouts can certainly push their way through. Local businesses? Ha. If I had the opportunity to shut a project down until I
  • by acoustix (123925) on Monday December 03, 2007 @10:04AM (#21559547) Homepage
    Why are they focusing on cable companies? What about DSS services? Seems to me that this move will hurt cables ability to compete with larger nationwide satelite services like DirectTV and Dish.

    Nick
  • I am all for the government staying out of my business, but you guys have to realize that regulation is not always a bad thing. Say for example, we get rid of all FCC and Telco Regulation. I can guarantee that the very next day all of the Cable/Satt/Tele companies would merge into "Hyperconglomeration" just like before the telco breakup in the 80s. There will not be any competition because the big players will push everyone else out of the market. Why would they sell bandwidth to their competitors at whol
    • by cdrguru (88047)

      Why would they sell bandwidth to their competitors at wholesale prices when they don't have to?

      The problem today is "wholesale prices" are dictated by a years-old decree that is today below cost. So the telecom folks are left with two choices: enable their competitors to undercut their prices while paying less than cost for the lines or block everybody and say it isn't available at all.

      They can't charge "wholesale prices" because the tariffs were fixed in 1996 or so. There is no motivation at the state l

  • by Nom du Keyboard (633989) on Monday December 03, 2007 @11:18AM (#21560121)
    So I end up with Comcast East and Comcast West. How much better will my life really be?
  • Equal rules for satellite, telco, cable. It's obvious who has Kevin Martin in their pocket.
  • by OrangeTide (124937) on Monday December 03, 2007 @01:31PM (#21561547) Homepage Journal
    I agree that cable operators should not grow and merge into a powerful monopoly. I think it is unfair to consumers and reduces competition. But I disagree that the FCC has the authority to regulate a business, even if they have done so in the past. If any battles between the FCC and corporations are ruled on by a constructionalist judge, it is unlikely the FCC would succeed. Since the FCC has little constitutional authority and a constructionalist would likely only view the department as a manager of broadcast spectrum and regulation of radio emitting and receiving devices. And such judges take a dim view of government entities overreaching their authority.
  • Get rid of it.

    It has no social value at all.

    It's basically owned by Payola by commercial interests. It's one giant infomercial to the record companies.
  • um... (Score:2, Informative)

    by shentino (1139071)
    ...Isn't this the FTC's job anyway?
  • Kevin is only looking to improve his image after pimping the removal of restrictions on newspapers owning radio stations and vice versa.
  • In this story the FCC is moving to cap the size of cable companies, while in this one [slashdot.org] the FCC is moving to allow ownership of multiple media outlets in a single market.

    Are they confused, or are they theying to confuse the public?

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