The National Cable & Telecommunications Association defended itself against competitors that charge that MSOs are stifling competition – first by denying them access to critical programming, namely the regional sports networks that in many key markets are controlled by cable operators, and secondly through the practice of signing exclusive deals with the management of multiple-dwelling units.
The NCTA submitted comments with the Federal Communications Commission asserting that competition is thriving. The association backed that up with documentation of how AT&T, Verizon, DBS companies and other providers are all growing, all at the expense of the cable industry’s market share.
The NCTA’s comments were partially a response to the FCC’s 13th annual report on video competition published last January (links to the report are here), and partially an input into the FCC’s 14th report due at the beginning of 2010.
In the FCC’s 13th competition report, the Commission reported: “Cable’s competitors also maintain that entry and competition are inhibited by: 1) difficulties in obtaining valuable programming, especially regional sports, as a result of the use of exclusive contracts and the terrestrial exception to the program access rules; and 2) difficulties in gaining access to MDUs as a result of the existence of long-term exclusive contracts between MVPDs and MDU owners.”
A recent court decision disallows contracts of that nature, but cable’s competitors continue to press on the issue of access to regional sports networks.
The NCTA’s argument reduces to claims that competition is thriving, therefore any additional regulation is unjustified, and that the FCC lacks the statutory authority to make certain regulations requested by cable competitors.
Specifically, the NCTA tries to undercut the competitive value of regional sports networks by citing its competitors’ growth statistics.
The NCTA also reiterated its views vis-à-vis the so-called 70/70 rule, against the possibility of that argument being revived. The obscure legal provision says that if cable has passed more than 70 percent of U.S. households, and also has a 70 percent market share, then the FCC will get broad regulatory authority over cable to encourage more competition. The NCTA reminded that the cable industry has significantly less than a 70 percent market share.