FCC Wants Compromise on Must-Carry


Anaheim, Calif. -- FCC commissioners and their staffers
said last week at the Western Show here that they're still hoping that broadcasters
and cable operators will work out their differences on digital must-carry before the
agency has to get involved.

But members remained fairly tight-lipped on the question of
how the Federal Communications Commission is leaning.

"My mind is absolutely not made up on that," FCC
commissioner Susan Ness said. "Over time, I'm hoping that we'll see a happy
intersection. We have a long way to go, in uncharted waters. And the industries are going
to have to work together."

Officials were equally coy about whether they would support
calls by America Online Inc. and others that the proposed AT&T
Corp.-Tele-Communications Inc. merger should be conditioned on a requirement that the
companies unbundle their data services.

But commissioner Harold Furchtgott-Roth seemed skeptical of
the idea.

"I don't think that we have any statutory
authority to do that," he said. "I'm speechless when I hear that
suggestion. I'm not happy about it. I just don't see it."

On must-carry, Furchtgott-Roth stressed that the FCC must
objectively interpret the statute.

"Do I personally like the concept of must-carry?"
he said. "No, but we don't write the laws. We just follow them."

In another session, FCC staffers agreed that the commission
should be cautious. "The question is, 'What's in the consumer's best
interest here?'" said Rick Chessen, senior legal adviser to commissioner Gloria
Tristani. "[Tristani] keeps that foremost in her mind, rather than looking at
who's up and who's down."

In response to a question, Tom Power, senior legal adviser
to FCC chairman William Kennard, said he would be hard-pressed to support any rules that
would force large numbers of cable networks off systems or result in the retransmission of
repetitive broadcast fare.

"That's not doing consumers any good," he
said. But he echoed the sentiment of Ness and Furchtgott-Roth by saying, "We're
really hoping that both sides can help us through this."

Power said the FCC can't assume that broadcasters
should receive special treatment in the digital realm unless they prove it.

"That's a burden that the broadcasters have to
bear," he added.

Meanwhile, FCC officials said in another panel that the
much-anticipated "Cable Reform" order that has been pending at the commission
for two years will come out "very, very soon," with changes that could effect
the definition of "effective competition" for purposes of rate deregulation.

Deborah Lathen, FCC Cable Services Bureau chief, said the
item will clarify various aspects of cable regulation, but she declined to reveal details
or the time when the FCC will release the item.

Meryl Icove, associate chief of the CSB, said the
LEC-affiliation (local-exchange carrier) test may change under the new rules, clarifying
language in the Telecommunications Act of 1996 that some quarters had claimed was

Lathen said the bureau is most focused on its review of the
AT&T-TCI, merger, digital must-carry and putting out a reconsideration order on rules
affecting navigation devices.

On the AT&T-TCI merger, Lathen wouldn't say how
she's leaning, declining to address TCI president and chief operating officer Leo J.
Hindery Jr.'s assertion at the opening session that any unbundling of TCI's data
network could kill the deal.

"Leo looks at his business case, and he has to make a
business decision," she said. "But we have to look at everything."