N.J. Pols Take Hard Look at Rates

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New Jersey legislators are taking testimony on cable rates,
and at least one state senator wants to press Congress for reregulation of consumer costs.

The New Jersey Assembly Telecommunications Committee
recently called upon state regulators and the president of the state cable association to
explain why rates continue to rise in excess of the rate of inflation.

One legislator, state Senate Minority Leader Richard Codey
(D-Essex), backed a resolution supporting federal intervention on rates. The
telecommunications committee adjourned without taking action, though.

"Rates and service -- those are the two biggest
complaints in our office," a staffer for Codey said. "He is very hot on this
issue." Codey did not return calls for direct comment by deadline

The chairwoman of the telecommunications committee,
Assemblywoman Carol Murphy (R-Morris), confirmed to the local press a spike in rate
complaints to her office.

Legislators don't have the information to answer the
queries, but they fumed that about 40 percent of the state's cable customers
experienced rate hikes of about 11 percent last year.

Federal intercession is the only way to deal with rates.
The Telecommunications Act of 1996 took rate regulatory authority out of the hands of
state and local franchise authorities. But this doesn't mean officials can't put
operators on a very public hot seat.

New Jersey Cable Telecommunications Association president
Karen Alexander laid the blame for price hikes on the sports and entertainment industries.
Spiraling salary demands from top performers raise costs for the shows and events
subscribers want to see, she explained to the committee.

One month of cable still costs less, at about $30, than
taking a family of four to a sporting event (about $125) or the movies ($40), she added.

Further, cable operators are investing in the state, she
said. As of January, systems serving about 70 percent of the state have been upgraded for
the delivery of digital cable, high-speed data and, in some markets, telephony over cable.

Legislators indicated that there would be more hearings to
determine how competition will affect rates.

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