Insight Provides Insight on Its Need for Waiver

By John Eggerton -- Multichannel News, 2/13/2012 12:01:00 AM

Washington — The Federal Communications Commission’s approval of Time Warner Cable’s purchase of Insight Communications came with the requisite waiver of the agency’s ban on cable operators buying competitive local phone companies.

Unless the FCC does away with that restriction, as cable operators want, the commission will likely face many more such waiver requests, and operators may face delayed deals while they run that extra regulatory gauntlet.

The National Cable & Telecommunications Association — TWC is one of its largest members — and the American Cable Association, which represents smaller, independent operators, have asked the FCC to lift its prohibition on cable operators buying local phone companies, saying such a move would be pro-competition.

In supporting the the NCTA’s petition, the ACA said that alliances between cable companies and competitive local-exchange carriers “can promote greater facilitiesbased competition with incumbent local-exchange carriers [such as Verizon Communications and AT&T] and other providers, putting downward pressure on rates, increasing the offering of innovative services, and enhancing service quality.”

The FCC’s waiver policy could “increasingly encumber or delay deals as cable operators become the dominant second phone company in the market,” said a veteran cable attorney. “Competitive carriers may want to sell out to them but come up against the prohibition.” As cable operators expand their phone footprints, they will increasingly butt up against this rule, he said.