Open-government advocacy group Common Cause charged last week the cable industry’s near $100 million spending on campaign contributions and lobbying has led to favorable treatment in Washington, resulting in higher prices for consumers and the defeat of a la carte legislation.
“The return on cable’s investment has been impressive: A 90% increase in cable rates since 1995, and industry friendly regulations that boost profits, coupled with even more consolidation among cable companies,” Common Cause said in unveiling its first “Ask Yourself Why” report. “Big cable’s spending also has limited the tools that parents have to shield their children from inappropriate cable programs.”
The National Cable & Telecommunications Association immediately disputed the report’s findings and allegations.
“It’s ridiculous,” NCTA spokesman Brian Dietz said.
In its five-page report, part of a series on special-interest spending, Common Cause said cable has spent more than $92 million on lobbying in Washington since 1998, and that the industry’s spending has increased dramatically in the past two years.
“After Comcast acquired AT&T’s cable operations in 2002, it became the largest cable provider in the country,” the report said. “Comcast’s size instantly made it the target for activists and members of Congress. As a consequence, between 2003 and 2004, the company increased its spending on lobbying by nearly $1 million.”
In response, Comcast executive vice president David Cohen said, “As Comcast emerged as the leading cable and broadband provider, we found that we needed to respond to a wide array of issues in Washington that potentially affect our ability to compete and invest, particularly in our cable, high-speed Internet, and digital voice businesses. Given the incredible span of issues and the size and scope of organized interests around our issues, from phone companies to tech companies to broadcasters, we’ve expanded our Washington presence.” He added that the company’s Washington office was dwarfed by those of many of its competitors.
Common Cause also said that since 1991, major cable companies and their trade groups have given more than $13.8 million to congressional candidate committees and leadership political action committees. Nearly $7.7 million went to Republican candidates and more than $6 million to Democrats.
The five congressional members who currently are key to big cable’s legislative agenda have received more than half a million dollars in political contributions from major cable interests during that same period, Common Cause said.
The report alleges that cable’s lobbying gave it the “clout in Congress” to help “keep a la carte at bay.”
Dietz, though, said there have been several studies about the negative impact a la carte would have had if legislated.
“Evidence shows, including independent government and industry reports, that a la carte would be harmful to consumers because most consumers would pay more, the number of channels would diminish and diversity would decrease if a la carte was forced upon consumers,” he said.
Dietz also said cable has not gained any edge over its rivals — satellite, telcos and broadband overbuilders — either, in Washington.
“Competition is thriving in the multichannel video marketplace, as evidenced by the fact that consumers today have a choice of at least three, and sometimes up to five, different providers for their home-video needs,” Dietz said. “There’s never been more competition and there’s never been more choice for consumers.”
Common Cause listed PAC donations, totaling $13.8 million, from cable interests to federal candidate committees and leadership PACs since 1991.
Cable PAC donations to key Congress members: Sen. Ted Stevens (R-Alaska), $82,200; Sen. Dan Inouye (D-Hawaii), $51,000; Rep. Joe Barton (R-Texas), $150,000; Rep. John Dingell (D-Mich.), $158,300; and Rep. Fred Upton (R-Mich.), $119,000.