FCC Chief Cites Rights

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Washington -- FCC chairman William Kennard didn't let
the expiration of cable-rate regulation occur without taking indirect swipes at the cable
industry and -- remarkably, for the supercautious chairman -- at Congress.

On the day when the Federal Communications Commission was
told to trash its upper-tier rate rules -- March 31 -- Kennard issued an eight-point
cable-consumer bill of rights that FCC sources said was designed to be an educational
guide for subscribers who think that their cable rates are too high.Kennard ordered his
staff to distribute the bill of rights in camera-ready form to 5,000 small newspapers and
weekly shopping guides and to alert the American Association of Retired Persons about it.

The FCC's World Wide Web home page was revised to
include, in bold letters, "Consumer Alert -- Cable Rates." The words flashed in
green neon to stand out against the page's blue and black lettering.

Kennard got some help on the cable-rate front from House
Telecommunications Subcommittee chairman Rep. Billy Tauzin (R-La.).

Tauzin warned the cable industry against gouging customers,
saying that doing so 7would invite reregulation.

"[Cable operators] have not been given permission to
hunt on baited fields. Simply put, my colleagues and I in Congress will not tolerate
predatory pricing practices," said Tauzin, one of 414 House members who voted for the
March 31 sunset.

Kennard issued his eight commandments without overt support
from the other four FCC commissioners.

"This is strictly his business," an FCC source
said. "They are not involved. I know that they support the idea of informing the
consumer as much as possible."

Some people, preferring not to be quoted, said they found
Kennard's bill of rights baffling and contradictory.

For example, Kennard in a statement indicated that the
sunset left consumers naked to unchecked cable-rate hikes. Yet point eight in the bill
said unhappy cable subscribers should check out the rapidly growing direct-broadcast
satellite industry.

Kennard indicated that the FCC had been the consumers'
guardian by ordering cable operators to refund "nearly $100 million" to
subscribers since 1993.

Meanwhile, between 1994 and 1998, the FCC collected $143.5
million from cable subscribers in the form of FCC user fees to fund the operations of the
Cable Services Bureau.

Judging from his appearances before congressional
committees, Kennard has been reluctant to confront his critics. That changed last week in
a subtle, yet noticeable, way.

Kennard's bill of rights conveyed the underlying
message that it was necessary not because of an FCC decision, but because of a move by
Congress -- namely, letting a date on the calendar substitute for good policy.

In his statement, Kennard repeated the fact more than once
than Congress assumed in 1996 that cable competition would be thriving by this time.
"At this point, that has not yet occurred," he said.

Here are Kennard's proposed rights:

• Consumers should expect a fair deal from their local
cable company, with reasonable rates that fairly reflect the costs of doing business.

• Consumers should expect an explanation from their
cable companies whenever rates for the programming-service tier are raised, particularly
when cable companies attribute price rises to increases in the cost of obtaining
programming.

• Consumers are entitled to write or call their cable
companies whenever they have complaints about the cable services being provided on the
various channels, or about program cost increases, and they should expect a speedy
response.

• Consumers are entitled to file complaints with their
local government (city, town or county) regarding basic-tier cable-rate increases and
service quality.

• Consumers are entitled to provide their own inside
wiring for cable hookups.

• Consumers will soon be entitled to purchase and use
cable set-top boxes at competitive market prices.

• Consumers have a right to contact local, state and
national consumer-advocacy groups with grievances that are not being adequately resolved
by their cable providers.

• Consumers who are unhappy with their local cable
company should explore competitive alternatives for video-programming service available
from other providers.

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