News

Small Ops Have Say on Hill

12/04/2001 7:46 AM Eastern

Small cable operators spoke out Tuesday in Congress, lamenting the clout big
programmers have and expressing fears that a combined DirecTV Inc.-EchoStar
Communications Corp. would get more exclusive shows, especially if
programming-access rules expire.

Speaking for the American Cable Association -- the trade group that
represents 900-plus small operators -- Uvision president Neal Schnog sounded an
alarm about 'the vastly increasing control over content, pricing, terms,
conditions and placement requirements by just a few programming giants.'

Schnog -- whose Uvision serves 8,300 cable customers in rural Oregon -- spoke
at a House Telecommunications Subcommittee hearing on competition in the
multichannel marketplace.

In written remarks, he said the choices his customers see on their TV sets
are controlled not by him but by 'programming cartels.' He called them
'America's own OPEC -- the Organization of Programming Extorting Companies.'

Schnog named four such programmers with extensive broadcast and cable
tentacles: The Walt Disney Co., News Corp., Viacom Inc. and General Electric
Co.

Disney, for example, passes through 20 percent annual rates for ESPN and ties
permission to air ABC broadcast stations to carriage of such cable channels as
SoapNet.

'Cartel' programmers also won't allow networks to be offered a la carte, so
big price hikes for some networks inflate the bills all customers pay, he
added.

Should DirecTV and EchoStar merge -- and should programming-access rules be
allowed to 'sunset' -- that satellite powerhouse could bargain for exclusive
programming, putting rural cable operators at a competitive disadvantage, Schnog
added.

ACA president Matt Polka, meanwhile, filed comments with the House Judiciary
Committee that the DirecTV-EchoStar merger would create a 'giant entrenched
satellite monopoly' that could undercut small cable companies, drive them out of
business and then raise prices to consumers, 'as all monopolies
do.'

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