Moffett Has ACA's Back

Analyst Testifies Content Costs a Threat to Broadband
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MoffettNathanson's Craig Moffett, the noted telecom analyst, is testifying in today's (July 22) House Energy & Commerce Committee hearing that rising programming costs are threatening to derail broadband's future.

In his prepared testimony, for the Communications Subcommittee's “Promoting Broadband Infrastructure Investment." hearing, Moffett echoed the views of the American Cable Association, which represents small and mid-sized cable operators, ACA president Matt Polka said in a statement.

“Moffett backed up ACA’s claim that rising video programming costs not only harm video customers and competition but, by reducing MVPD margins, will slow broadband investment and deployment," Polka said.

Moffett had also spoken about programming costs and broadband deployment is a presentation at The Independent Show 2015 in Boston, where he painted a bleak picture of cable's future.

Others scheduled to testify at the hearing included Rep. Anna Eshoo (D-Calif.). and Rep. Greg Walden (R-Ore.),

The full text of Polka's statement on Moffett's testimony follows below.

“Today, in testimony before the House Energy & Commerce Committee, Wall Street analyst Craig Moffett backed up ACA’s claim that rising video programming costs not only harm video customers and competition but, by reducing MVPD margins, will slow broadband investment and deployment. Mr. Moffett explained to the Committee that ‘absent reforms to restrain runaway growth in programming costs, video will become unprofitable … [and] new builds of broadband will become increasingly economically challenged and therefore will become less and less likely.’ For years, ACA has been producing evidence about the harms caused by increasing video costs, and it most recently submitted a study to the FCC detailing how these rising costs will inhibit broadband deployment by MVPDs. But the FCC has been MIA. Time and again, the FCC has turned a deaf ear to the urgent need to act to stem these ‘runaway’ video programming costs. In fact, just yesterday, Chairman Wheeler, in announcing the conditions he proposed for the FCC to adopt in approving the AT&T-DirecTV merger, slammed the door on consumers and smaller providers seeking to prevent video costs from increasing as a result of the deal, despite having hard evidence that the deal would raise costs once again.

“The FCC is charged with serving the public interest. But, instead, by failing to act, it has tipped the scales in favor of program owners and ignored the harms to video and broadband consumers and providers. Yet, the FCC has within its power the ability to reverse its pattern of inaction. The AT&T-DirecTV deal is pending, which means the FCC can still alleviate the ‘programming’ harm. Moreover, the FCC has before it a long-pending program access proceeding, which would enable it to protect smaller providers from being charged discriminatory prices by ensuring their buying group has the protections under the rules that Congress intended. ACA calls upon the FCC to take these steps and do the right thing for consumers, broadband investment, and competition.”

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