Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: TUESDAY, January 31, 1995 TAG: 9501310131
SECTION: BUSINESS PAGE: B-6 EDITION: METRO
SOURCE: Associated Press
DATELINE: WASHINGTON LENGTH: Medium
While some cable TV customers are still waiting for refunds mandated by Congress almost three years ago, efforts are afoot on Capitol Hill to undo the law that lowered the rates.
The Senate's Republican telecommunications policy architect, Larry Pressler of South Dakota, is proposing to deregulate the most popular cable programming as part of a larger effort to overhaul telecommunications laws.
Politically unthinkable months ago, cable rate deregulation is the sort of thing that could take wing in the new Republican-controlled Congress.
Senate Majority Leader Bob Dole, R-Kan., and House Speaker Newt Gingrich, R-Ga., both voted against the bill in 1992 that imposed rate and other regulation on the cable television industry.
Pressler plans to introduce his bill next month. He says that emerging competitive forces - namely, high-powered satellite and telephone companies - should protect cable customers from the kind of price gouging that led to industry reregulation.
The cable industry agrees.
But the Consumer Federation of America, which fought for cable regulation in 1992, says the threat of competition hasn't constrained cable prices in the past. Premature deregulation will hurt consumers, the federation contends.
``Make no mistake about it: These proposals would gut the Cable Act and take back the nearly $3 billion consumers have saved so far'' by federal rate regulation, said Bradley Stillman, the federation's legislative counsel.
Under Pressler's plan, rates for the vast majority of cable programs carried on tiers above the most basic would be deregulated. These tiers include such channels as CNN, MTV and ESPN.
``What we're talking about ultimately is eliminating regulation of the upper tier,'' said Decker Anstrom, president of the National Cable Television Association.
The entry-level tier known as basic would continue to be price-regulated under Pressler's proposal. This tier generally consists of broadcast channels; government, educational and public access channels; and a few cable networks, such as the Weather Channel.
Less than 10 percent of the nation's 59 million cable customers subscribe only to the basic tier.
The Federal Communications Commission began regulating rates for the majority of cable subscribers in September 1993.
``A lot of refunds have been given out, but millions of subscribers are still waiting for refunds due them,'' said Patrick Grant, an attorney who represents the National League of Cities. Those refunds remain tied up in bureaucratic red tape.
Yet even Vice President Al Gore, a champion of the 1992 cable bill, says new competitive factors may justify deregulating cable rates.
The direct-broadcast satellite business, which got off the ground in October, has roughly 600,000 customers and is expected to grow to more than 2 million by the end of the year. These services use high-powered satellites to beam more than 150 channels to dishes the size of pizza pans.
The cable industry hasn't calculated how many customers it has lost, if any, to direct broadcast, said Rich D'Amato, spokesman for the cable TV association.
The FCC, meanwhile, has authorized a handful of projects by regional telephone companies to deliver cable services to telephone customers. The projects cover a total of 1.5 million people - about 3 percent of all cable industry subscribers. None has begun to provide service.
by CNB