'Times' Takedown


The New York Times weighs in today with a slightly qualified call for more regulation of cable television.

The editorial is pegged to today’s FCC vote on whether cable has now penetrated 70% of U.S. homes – a report the Times editorial writers say the commission should accept, assuming the factual accuracy. It’s time for cable to be “energetically regulated,” the editorial says.  

The Times’s case, going back to the federal law that set the “70-70” test:

“Far more than in 1984, when broadcast television commanded the vast majority of viewers and cable penetration was low, there is a good case for energetically regulating the cable industry. Out of the regulators’ sights, the cable giants have cornered the basic cable markets, keeping competitors at bay by cutting favorable package deals with programming networks, which are sometimes part of their own conglomerate.

“Twenty-five years ago, cable carriers promised to provide consumers with a wealth of new programming options. Today, the carriers and their packages of unwanted channels are obstacles to choice. And their offerings are expensive: cable TV rates have been rising faster than inflation for years.”

Maybe I’m too close to the topic but for all the gripes I have about cable service as a consumer, lacking “a wealth of new programming options” isn’t one of them. There may be a few programming services my cable provider doesn’t offer that I would like to have, but I think most consumers realize that cable operators have to make choices and can’t just add every channel an individual consumer would want.

Except in places where you can’t get a satellite TV picture, cable has competition everywhere, and the desirability of the cable business has inspired new wireline competitors like the well funded Verizon and AT&T. So much for cornering the basic cable market, if you consider cable to be “multichannel programming.”

As for favorable package deals, I think the worst offense is cable operators finding ways to keep their owned programming – particularly regional sports networks – away from competing wired video providers, like RCN or Verizon. The FCC already has stepped in in such cases and gotten results.

Are cable systems packed with unwanted channels that are there because of favoritism toward the operators that own those channels? I wouldn’t say so. Is the NFL Network at odds with Comcast and Time Warner over past NFL offenses, involving the network’s games and the Sunday Ticket package? Maybe. But consumers also don’t want everyone’s cable rates to rise even “faster than inflation” for costly sports channels. They can switch to satellite for those services, as Jerry Jones wants them to. Or market forces will prevail and NFL Network and Big Ten Network or Hallmark will get carriage on cable.

One last point: which TV provider has most enthusiastically signed distribution deals for its own services lately in an effort to establish them as national pay channels? News Corp.’s DirecTV. Competition lives.