
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: WEDNESDAY, February 23, 1994                   TAG: 9402230111
SECTION: NATIONAL/INTERNATIONAL                    PAGE: A-1   EDITION: METRO 
SOURCE: Associated Press
DATELINE: WASHINGTON                                LENGTH: Medium

CABLE RATES HEADING DOWN AGAIN

For the second time in less than a year, the Federal Communications Commission is ordering cable companies to cut the prices they charge for programs and equipment. The 7 percent reduction should affect 90 percent of America's cable television subscribers.

Gretchen Shine, Cox Cable Roanoke's vice president and general manager, said the cable industry was being penalized, while competitors such as telephone companies were not.

"We have every intention of being a player in the construction of the information superhighway," she said. "It appears that one side of the equation is being constrained rather rigorously, whereas other entities are not.

"We followed the rules and reduced our rates as per their [the FCC's] directives, and less than six months later" the rules have changed. Increased regulation will hinder the cable company's ability to compete and provide quality service, Shine said.

The FCC unanimously approved the new rate cut Tuesday, 10 months after ordering a 10 percent rate reduction that backfired for some consumers, who complained that their bills went up.

"We received a significant dent to our revenue stream" with the first rate reduction, Shine said, "but it didn't disallow us to provide quality services that we know we must. . . . This particular edict seems incredibly harsh to . . . those who played by the rules."

The new rate cut is expected to take effect in mid-May. Though the impact on any individual bill wasn't immediately known, most consumers can expect to pay less for cable service each month, because the reduction covers all channels except pay-per-view and premium services such as HBO, Showtime and Encore.

"If the subscribers look at what they were buying in September of 1992, the price will have gone down one-sixth" when the new rates go into effect, FCC Chairman Reed Hundt said in an interview.

That would mean a subscriber who in September of 1992 paid $25 a month for a package that includes local broadcast, government and public access channels plus such services as CNN, ESPN and the Weather Channel could expect to pay $21 a month when the new rates go into effect.

The rules approved Tuesday also broaden the commissioners' ability to take action if they find that a cable company has tried to avoid the rate cuts by changing the way it packages or bills for services.

While the FCC is responsible for making sure that rates are fair, it won't be reviewing bills from all 11,000 systems. Instead, it reviews rates only when a subscriber or a local government complains.

After the first attempt to cut rates last year, seven complaint forms were sent from residents in the Roanoke and New River valleys against Cox Cable, Salem Cable, Blacksburg Cable TV, Simmons Cable TV and Telemedia Co. The FCC would not release information on the complaints.

Staff Writer Melanie S. Hatter contributed to this story.

by CNB