FCC 'a la carte' reports draws mixed reactions

Fri, 02/10/2006 - 5:57am
Jeff Baumgartner, CED

As expected, a new "a la carte" report from the Federal Communications Commission drew a wide range of responses.

The U.S. cable industry, which has strongly opposed a la carte programming, reiterated its position that such a mandate would cause consumer costs to rise.

"Most studies conclude that a mandated a la carte regime would be more expensive for consumers and result in less diversity in programming," said National Cable & Telecommunications Association President & CEO Kyle McSlarrow, in a statement.

That conflicts with the FCC's latest report, which, using "corrected calculations," found that consumer bills would decrease from 3 percent to 13 percent in most of the scenarios applied toward an earlier study.

McSlarrow expressed disappointment that the FCC's Media Bureau relied "on assumptions that are not in line with the reality of the marketplace. The marketplace in which cable, satellite, broadcasters and others vigorously compete for customers should decide video offerings, not mandates and price controls imposed by Washington, D.C."

Other companies and organizations, meanwhile, were generally pleased with the FCC's new report, which ran counter to conclusions found in a report submitted to Congress in late 2004.

RCN Corp., an overbuilder, said it was "gratified" that the Agency has endorsed a "themed tier" a la carte option that the company brought to the Commission in 2004. Other MSOs, including Comcast Corp., have come forth with "family friendly" tiers designed to dampen desires for a full-fledged a la carte movement.

RCN complained, however, that the report did not address the elimination of what it called "restrictive, unilateral contract terms imposed by large programmers and the broadcast networks." The overbuilder noted that programmers require that popular channels be bundled to "less desirable ones," and that reduces the flexibility required to generate thematic tiers.

Consumers Union Senior Policy Analyst Jeannine Kenney praised the report, claming it "kick starts the national effort to give consumers' wallets a break and allow them more control over their television programming choices and cable bills."

EchoStar Communications, which does not own stakes in programmers in the way that many cable MSOs do, echoed that the report "came down on the side of consumers."

The DBS provider said it "is committed to providing consumers with more choice and flexibility, including themed tiers and a la carte programming discussed in the new FCC report."


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