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

DATE: TUESDAY, October 18, 1994                   TAG: 9410180113
SECTION: BUSINESS                    PAGE: B-8   EDITION: METRO 
SOURCE: Associated Press
DATELINE: WASHINGTON                                LENGTH: Medium

CABLE OUTFITS MAY CHARGE FOR CHANNELS

What people pay for cable TV service may be changing - again.

The Federal Communications Commission is poised to adopt a new plan, perhaps as early as this week, giving cable systems the option to charge consumers an unregulated fee when they add cable channels, FCC officials and cable attorneys said.

These channels could not be added to existing tiers of service, but would be grouped in a new package sold to subscribers. The channels could be anything not previously carried on the system from existing networks.

The new plan would not change prices for regulated services that subscribers currently receive.

Under the plan, subscribers would buy additional channels only if they want them.

``The FCC has gotten a lot of flak about the potential of rates going up and people getting stuff they don't want. The FCC wants to discourage shoving things down people's throats on regulated tiers of service. This plan would control that,'' explained a FCC attorney on the condition of anonymity.

The plan is designed to provide cable system owners with a financial incentive to put on additional channels. Existing regulations discourage this, the cable industry says.

Since the first set of price regulations took effect in September 1993, cable executives say very few cable networks have been added to system lineups. A second, tougher set of pricing rules, implemented in May, has only aggravated the situation, they say.

Executives of the new channels, whose survival depends on broad carriage by cable systems, say the current regulations threaten their existence.

The proposed rules, according to the FCC, would provide pricing flexibility; but in return, cable systems would essentially freeze channel lineups on existing tiers of regulated services.

The new plan clarifies existing regulations, which have been fuzzy about how rates may be adjusted to account for changes in regulated services. The plan is part of what is expected to be a series of new rules to give operators incentives to add channels and to upgrade their systems.

The commission is working on another plan that will affect the price of regulated services. This plan will specify how much operators can charge subscribers when they add channels to existing regulated services.

The cable industry had asked to charge 25 cents a channel, but the commission rejected this. The commission, sensitive to minimizing increases in regulated rates, is interested only in a much lower per-channel charge, FCC attorneys said.

The commission is also considering limiting these additional per-channel charges so that any customer's monthly bill would not increase by more than $1.50 each year.