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Powell On NCTA’s 2014 Priorities: ‘Broadband, Broadband and Broadband’

NCTA CEO Said Window Is Still Open For Cable Operators To Pursue Usage-Based Models 10/22/2013 4:31 PM Eastern

ATLANTA -- SCTE Cable-Tec Expo 2013 -- The National Cable & Telecommunications Association (NCTA) expects to have a full docket in 2014, but when asked here during the opening general session to boil down the organization’s priorities heading into next year, president and CEO Michael Powell identified three: “Broadband, broadband, and broadband.”

That’s partly because broadband “is still relatively virgin from a policy and regulatory standpoint. It’s not really very old,” he said in response to questions from Kevin Hart, executive vice president and chief technology officer of Cox Communications.

That relative infancy has generated a “constant drumbeat” on how to evaluate broadband as it’s regulated an as high-speed services become increasingly important to consumers, Powell said. “Everything at the end of the day is broadband,” he added, hitting on the IP convergence theme that is shaping the show this week.

That, of course, has set up an ongoing debate around usage-based pricing and network neutrality.

On the latter, Powell echoed the NCTA’s stance that network neutrality rules “were fundamentally unnecessary,” noting that cable has no economic desire to prevent customers from accessing content over broadband. “An open Internet is critical to the vibrancy to that platform.”

Still, cable is willing to embrace the core principles of network neutrality with the caveat that it will fight hard – very hard – against any pursuit of rules that attempt to change the definition of broadband from an information service, as it is today, to a common carrier service. If rule makers try to regulate broadband services as common carrier services under Title II of the Communications Act of 1934, “that’s World War III,” Powell said.

Verizon Communications is challenging the Federal Communications Commission’s Open Internet order. The NCTA has reiterated a promise that cable operators will not block access to lawful content applications and services no matter how the case shakes out.

Powell was also asked about usage-based broadband policies, which are permissible by the FCC. He disagreed with arguments that the window for usage-based broadband is closing or that it’s too late for MSOs to implement usage-based policies when consumers have grown accustomed to unlimited access.

Cable, he said, “should be moving with some urgency and purpose,” with respect to usage-based billing.  Powell said operators have sound economic reasons to pursue a new model, but acknowledged that the industry faces perceptions that usage-based billing is viewed as an anti-competitive move designed to disadvantage over-the-top video providers.

“I don’t think it’s too late,” Powell said, noting later that the wireless industry has been acclimating consumers on the concept of usage-based Internet access. “But it’s not something you can wait for forever.”

Powell also addressed cable’s new, more diverse competitive landscape. “We play four-dimensional chess,” he said. “Competition used to be a very linear thing.”

The addition of over-the-top video has made the competitive environment more complex and difficult for regulators to grasp, he added, noting that some new entrants are being viewed as both friend and foe to cable. Netflix, Powell said, is sometimes viewed as both “the best thing or the worst thing that has happened to us.”

But he said the surge of competitive threats coming from a variety of angles is a good thing for cable, and has sparked operators to spend and develop new technologies and services. Historically, “our industry has been a little conservative, a little slow on the swing,” Powell said. The new influx of threats from Amazon, Google, Intel Media, Netflix and others “woke us up. We’re on our toes.”

Powell also expressed doubts that Google Fiber intends to be a direct competitor to cable long term, but noted that some cable operators are already using DOCSIS 3.0 to deliver tiers of 500 Megabits per second. With DOCSIS 3.1 on the horizon, cable can push speeds well beyond 1 Gigabit per second.

And Powell apparently doesn’t think DOCSIS 3.1 as much of a consumer-friendly brand, urging the the industry to come up with “something other than 3.1 to call this thing...We’re in a 4G and 5G world.”

“We’ve got the marketing department on it,” Hart joked.

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