Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, February 10, 1994 TAG: 9402100078
SECTION: BUSINESS PAGE: B-7 EDITION: METRO
SOURCE: Associated Press
DATELINE: WASHINGTON LENGTH: Medium
Cable revenues were frozen last year while a new law regulating the industry was being implemented. The Federal Communications Commission said the freeze is being extended to May 15.
Cable Telecommunication Association President Steve Effros said his group planned to fight the freeze in court. National Cable Television Association president Decker Anstrom denounced the extension as "particularly harsh for small and mid-sized firms."
Cable companies that think they are injured by the revenue freeze can appeal for an exemption, FCC officials said.
The freeze originally was imposed to give local communities time to participate in the cable regulation process.
But the FCC decided to reconsider rates in general after a public outcry last fall over changes in how cable companies bill customers. The changes resulted in complaints that many people received higher bills.
The agency is planning to review rates this month, and officials said extending the revenue freeze would make it easier to implement any new regulations they might propose.
Meanwhile, local communities have been slow to complete the process of certifying their local cable companies as monopolies, a step that permits them to regulate basic cable service.
As of the end of January, systems had been certified for 7,500 of the nation's 33,000 cabled communities. Commission officials said the revenue freeze also extends the time for the remaining communities to act.
Rate regulation cannot be enforced until local communities have received FCC certification that the local cable company operates as a monopoly and thereby is covered by the new law.
It's up to the local authority to enforce the section of the law governing charges for basic service - the package of channels comprising local broadcasters and government and public-access cable channels.
The FCC enforces the section of the law that dictates how much a company can charge for channels beyond basic service. But the commission will not take any action until it gets subscriber complaints.
By extending the freeze, the FCC is trying to maintain stable pricing until local communities are prepared to enforce the law.
Many questions have surfaced since cable companies announced billing changes in September to comply with the new cable law.
Variations in channel packaging and equipment charges caused individual bills to go up or down, but the freeze prohibited companies from collecting any more in overall revenue than they had six months earlier. Cable company revenues can increase if new subscribers are added.
Consumers who believe the changes caused excessive charges for cable channels beyond the basic package can generate FCC action against the company by filing a complaint with the commission.
The National Cable Television Association, meanwhile, has chafed under the revenue freeze, with officials estimating that it has cost the industry $2 billion.
by CNB