Chairman Kennard's Statement on the Cable Consumer Bill of Rights Campaign

March 31, 1999

STATEMENT BY WILLIAM E. KENNARD REGARDING THE CABLE CONSUMER BILL OF RIGHTS CAMPAIGN

In the Telecommunications Act of 1996, Congress deregulated cable rates as of March 31, 1999. The competition that was expected to keep consumer cable rates reasonable beyond March 31st is not yet here. Like the nearly 70 million American cable television subscribers, I am greatly concerned about cable rates rising following the end of rate regulation. I believe that cable television operators must act responsibly as they set rates. Members of Congress have already indicated that they will be watching carefully.

Six years of FCC cable rate regulation on the cable programming service tier has been a plus for consumers. The FCC has ordered nearly $100 million in consumer refunds since 1993 to 40 million consumers. Cable consumers have paid an estimated three to five billion dollars less than if rates had continued their pre-1992 Cable Act rise. The FCC has disposed of about 18,000 consumer complaints regarding their cable rates.

At the same time, the cable industry has continued to grow and facilities are continually being upgraded. The per-channel cost of cable is approximately the same as it was in 1992. Many consumers, however, feel that since they are not able to choose their cable channels, they are paying extra for channels they do not want.

That is why I have also launched the Cable Consumer Bill of Rights Campaign, eight options for consumers regarding their cable service. Even with the end of direct federal cable rate regulation, I want cable subscribers to know that there are ways that they can exercise their rights as consumers.

The FCC will continue to develop and adopt strongly pro-competitive orders that will increase consumer choice in the video programming marketplace. Our 1998 Cable Competition Report shows that 85 percent of Americans continue to get their video programming from cable. However, more than seven million consumers now receive video programming from a satellite service ("DBS") and in 1998, approximately two-thirds of new subscribers to a multichannel video programming service chose DBS.

Various wireless services, telephone companies and start-up cable companies are also providing video services, but the FCC would like to see the programming marketplace become even more competitive. The FCC will continue to make sure that new competitors do not face insurmountable barriers by improving program access, ensuring access to inside wiring and guaranteeing pole attachment rights. Additionally, we will continue to remove restrictions on the use of DBS dishes and other antennas necessary to receive video programming.

George Santayana said, "those who cannot remember the past are condemned to repeat it." I hope the cable industry remembers the consumer outrage earlier this decade and does not repeat the mistake of raising prices unreasonably.

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