Policy

Martin Hints At Fining Comcast

11/19/2008 3:41 AM Eastern

Washington—Federal Communications Commission Kevin Martin on Tuesday suggested that Comcast Corp. is looking at a fine as punishment for filing an incomplete response to the agency's investigation into the movement of analog channels to digital tiers.

"They didn't even answer the questions directly. They had a narrative but they didn't even answer the specifics of the questions directly," Martin said, referring to Comcast.

Martin has his appointed FCC staff probing 13 cable operators about whether they moved channels to digital and then charged consumers to rent digital boxes to maintain access to the same number of channels.

The FCC is also looking at whether cable operators lowered the price of an analog tier after channels had been removed. The agency is trying to determine whether consumers and local government were properly notified.

"Different operators provided different levels of information," Martin said.

Martin didn't say a Comcast fine was guaranteed.

"I haven't said what [we'll] end up doing," he said. "I was asked, `Did that include the potential for fines?' I said yes, it always does."

The scope of the FCC's investigation was broad, seeking data going back to 2006. Cable operators were particularly nervous about the FCC's interest in knowing the wholesale price of channels removed from the analog tier.

Comcast, for example, gave the FCC an overview of its digital migration policy but didn't provide a granular look at its programming contracts.

"There was not detailed programming cost information in there," a Comcast spokeswoman said. "After reviewing their request for information, we determined that it would have taken over 1,500 man hours just to compile the information for 2008."

Comcast excluded wholesale programming contract information from its FCC response.

"We stand ready to work with them and to see how best to proceed from this point. The amount of information was so substantial and the amount of time very short," the Comcast spokeswoman said.

Martin warned that cable operators that failed to provide full responses could face fines and other penalties.

"I think companies that didn't provide sufficient answers will be subject to the commission's enforcement actions as they always are when companies don't provide sufficient information," he said.

A decision by Martin's staff can be appealed to Martin and the other four FCC members, who have a track record of bucking Martin on some key issues.

Cable operators, Martin said, should not have been concerned about providing the commission with program cost information.

"To make sure there was no question about it, we issued a protective order before the due date of the information and said that information would be protected from the public. It would not be released, so you could still end up providing that without having to be worried [about] violating any FCC rules," Martin said.

Martin said he didn't think that in the end the FCC would force cable operators to return channels to the analog tier.

"I don't think that we've ever ordered, [in] the failure to provide adequate notice, that the relief [is] to move the channels back," Martin said. "I don't think we've done [that] in the past. I'm not sure that there is a limit on our authority per se, but I don't think that's what we've done in the past where there have been violations, for example, of not providing adequate notice [to cable customers or local governments].

March