CQ TODAY ONLINE NEWS – TECHNOLOGY & COMMUNICATIONS
June 27, 2012 – 4:24 p.m.
House Committee: 20-Year-Old Cable Industry Regulations Need Update
By Ambreen Ali, CQ Staff
House lawmakers said Wednesday that they are considering an overhaul of cable and broadcast laws to account for the rising popularity of Internet video alternatives.
Members of both parties acknowledged at a House Energy and Commerce subcommittee hearing that regulations set 20 years ago to control the cable industry are no longer relevant. The popularity of cable has diminished greatly as consumers have turned to alternative video options available online and through satellite providers.
“I think it is time to review the telecommunications video market,” said Rep.
“We should examine whether the legal framework created 20 years ago still works for a video market filled with choices that did not exist even two or three years ago,” Waxman said.
Less clear is which way Congress plans to swing the regulatory pendulum. Cable providers testifying before the Communications and Technology Subcommittee called for deregulation, while broadcasters suggested that current transmission guidelines for cable and satellite be extended to emerging online players.
“I, for one, do not believe we should be expanding video regulation,” subcommittee Chairman
In particular, members focused on retransmission guidelines set by the 1992 Cable Act (PL 102-382) that allow broadcasters to choose between requiring cable providers to carry their signals or negotiating retransmission fees that cable operators must pay for the broadcast networks available free over the air. Lawmakers cited frequent programming blackouts on cable and satellite services as a sign that the current system is not working.
“Consumers should not be held hostage when retransmission disputes break down,” said subcommittee ranking Democrat
Rep.
“It’s important to remember technology has changed drastically, but the law hasn’t changed at all,” Scalise said. His measure, introduced in December, still has no cosponsors. Neither does the Senate counterpart (
Internet Firms Seek Tighter Cable Controls
Not all lawmakers are eager to change the decades-old regulation of cable. Rep.
House Committee: 20-Year-Old Cable Industry Regulations Need Update
Rep.
“You always have to be wary, especially when people start talking about rewriting the 1992 and 1996 Telecommunications Acts as if somehow there is too much competition, there are too many players out there, that the smaller players don’t need protection,” Markey said.
Internet companies, too, pressed for tighter controls on cable companies instead of deregulation. David Hyman, general counsel for Netflix, noted that companies such as his deliver their video service through Internet access often provided by cable operators. But cable is also a competitor, and in some cases operators have exempted their own video programming from data caps that they place on Netflix and others.
“When you couple limited broadband competition with a strong desire to protect legacy video businesses, you have both the means and motivation to engage in anti-competitive behavior,” Hyman said, prompting concern from Eshoo about how data caps could affect the growth of video-streaming companies.
But a cable representative dismissed the data-cap argument, saying his industry benefits from the increased demand for Internet created by services such as Netflix.
“The exploding growth of online video usage undercuts any argument that cable is standing in the way of this business,” said Michael Powell, president of the National Cable and Telecommunications Association.
The Justice Department is investigating whether cable providers are suppressing content from their video competitors. In April, the Senate Commerce, Science and Transportation Committee also held an exploratory hearing on emerging online video services.