House Panel Freezes DBS-Fee Hike

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Washington -- A House of Representatives panel voted last
week to freeze a decision by the Librarian of Congress to raise copyright fees on
satellite carriers that distribute distant-network and superstation signals to home-dish

The House Telecommunications Subcommittee passed the bill
(H.R. 2921) by voice vote, after rejecting on parliamentary grounds an amendment that
would have extended cable-rate regulation roughly eight months or so beyond the March 31,
1999, sunset date specified in the Telecommunications Act of 1996.

Rep. Edward Markey (D-Mass.) offered the cable-rate
amendment, which was ruled out of order because it was not germane to the underlying
legislation, said Rep. Billy Tauzin (R-La.), the committee's chairman and sponsor of
the copyright bill.

Tauzin's bill needs the approval of the full Commerce
Committee. Problems could crop up with the Judiciary Committee, which has jurisdiction
over copyright issues.

Companion legislation (S. 1422) sponsored by Sen. John
McCain (R-Ariz.) is awaiting Senate floor action. But differences with Senate Judiciary
Committee chairman Orrin Hatch (R-Utah) have kept McCain's bill off the fast track.

Last fall, the Librarian of Congress set the satellite
copyright rate at 27 cents per month, per subscriber, per signal. The old rate was 6 cents
for networks and either 14 cents or 17.5 cents for superstations. Meanwhile, large cable
operators pay an effective rate of 2.45 cents for networks and 9.8 cents for

Rep. Rich Boucher (D-Va.) said the 27-cent rate would raise
the price of direct-broadcast satellite service by about $20 per year for some
subscribers. DBS carriers don't have to make their first 1998 copyright payments
until next month.

Under the bill, the fee increase would be stayed until one
year after enactment of the legislation, and it would be made retroactive to Jan. 1, 1998.
During the stay period, the Federal Communications Commission would be charged with
examining the impact of the 27-cent rate on the competitiveness of DBS versus cable

"The bill will impose a time-out on the
Librarian's decision until the FCC can determine its impact on consumers and on the
video marketplace," Tauzin said.

Under Markey's amendment, the FCC would continue to
regulate cable rates for 15 months after passage.

"There is no question that competition is the answer
to the cable-rate problem ... but the competition isn't here yet," Markey said,
before being defeated.

A spokesman for the National Cable Television Association
said the organization supports the copyright-fee freeze and market-oriented approaches to
promoting video competition.