FCC To End Cable Exclusive Deals for Apartments

Regulation by PR?

Why wait for a boring FCC meeting that no one will watch to announce a major policy, when you can talk to a New York Times reporter instead? Days before the official FCC meeting at which the issue will be discussed, FCC Chairman Kevin Martin has just told the newspaper that his agency is ready to strike down the exclusive contracts that cable operators have signed with apartment managers and homeowners' associations across the country.

— FCC to strike down exclusive apartment complex cable deals, By Nate Anderson, ars technica, October 29, 2007 - 01:45PM CT

Ars technica indicates that Martin sounds like he's serious on this one. Of course, Martin sounded serious about open access rules for 700Mhz spectrum, too, yet watered them down until they don't mean much. However, ars technica points out the biggest backers of this apartment rule change are telcos, so maybe he really means it this time. Hm, and I wonder who will sue this time?

Comcast, anyone?

Here's the good news and the bad news if Martin really does it:

Government and private studies show that when a second cable company enters a market, prices can drop as much as 30 percent.

— F.C.C. Set to End Sole Cable Deals for Apartments, By Stephen Labaton, New York Times, October 29, 2007

That sounds like the kind of price drop you get when a second airline enters a market (especially if the second airline is Southwest). That's good. But the bad news is twofold. Is this going to be like everywhere else, where FCC and FTC will declare two a market and stop there? If so, nothing will stop whoever the two "competitors" are from stifling whatever they don't like. And of course the main impetus for doing this isn't participatory Internet access, anyway, it's the boob tube. Is more misinformation really what the country needs most?

The cable companies also have a point that this move by the FCC will break existing contracts by the cable companies. It seems the FCC is willing, at the urging of the telcos, not only to toss net neutrality out the window, thus doing away with basic legal infrastructure needed for communication infrastructure, FCC is also willing, at the same urging, to cancel contracts, even though contracts are usually considered basic to markets.

Canceling these particular contracts may be good, since they're basically monopoly contracts, maybe analogous to Microsoft's stealth contracts that prohibit OEMs from letting other OSes boot. One can well argue that FCC never should have permitted these contracts in the first place. But one has to wonder what else is FCC willing to interfere with at the behest of the telcos?

-jsq

Comments

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