News

NCTA to FCC: Make DBS Pay Up

3/10/2005 9:15 AM Eastern

The National Cable & Telecommunications Association is complaining that the Federal Communications Commission’s regulatory-fee regime is unfair to cable operators because direct-broadcast satellite providers pay much less to help fund the agency's operations.

For the current fiscal year, the FCC is expecting cable companies to contribute about $48 million, or roughly 72 cents per subscriber. Cable's chief competitors, DirecTV Inc. and EchoStar Communications Corp., are required to pay $1.9 million combined.

In comments filed with the FCC March 8, the NCTA called the difference a “gross disparity” and “fundamentally unfair” at a time when FCC oversight of DBS is increasing and DBS-subscriber penetration is soaring. The trade group pointed out that DirecTV and EchoStar, with about 25 million subscribers combined, will end up paying roughly the same amount as Insight Communications Co. Inc. and Mediacom Communications Corp., two midsized cable companies with about 2.7 million subscribers combined.

Cable operators are required to pay on a per-subscriber basis, while DBS pays on a per-satellite basis. The NCTA said DBS should start paying on a per-subscriber basis, too. If DBS paid cable 72 cents per subscriber, like cable, it would owe the FCC $18 million instead of $1.9 million.

September