Insight Provides Insight on Its Need for Waiver

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Washington — The Federal Communications Commission’s
approval of Time Warner Cable’s purchase of
Insight Communications came with the requisite waiver
of the agency’s ban on cable operators buying competitive
local phone companies.

Unless the FCC does away with that restriction, as cable
operators want, the commission will likely face many
more such waiver requests, and operators may face delayed
deals while they run that extra regulatory gauntlet.

The National Cable & Telecommunications Association
— TWC is one of its largest members — and the
American Cable Association, which represents smaller,
independent operators, have asked the FCC to lift its
prohibition on cable operators buying local phone companies,
saying such a move would be pro-competition.

In supporting the the NCTA’s petition, the ACA said
that alliances between cable companies and competitive
local-exchange carriers “can promote greater facilitiesbased
competition with incumbent local-exchange carriers
[such as Verizon Communications and AT&T] and
other providers, putting downward pressure on rates, increasing
the offering of innovative services, and enhancing
service quality.”

The FCC’s waiver policy could “increasingly encumber
or delay deals as cable operators become the dominant
second phone company in the market,” said a veteran cable
attorney. “Competitive carriers may want to sell out to
them but come up against the prohibition.” As cable operators
expand their phone footprints, they will increasingly
butt up against this rule, he said.