FCC is Backsliding

A Federal Communications Commission staffer reports that commissioners are considering a 30% cap on the number of households a single cable operator may serve. Multichannel News notes that the cap would primarily affect one company:

Citing Kagan Research, Comcast recently told the FCC that it serves 26.2 million subscribers, or 27% of the country’s 96.8 million pay TV subscribers. Under a 30% cap, Comcast could, in a few years, find itself refusing service to customers seeking to sign up for its fast-growing voice-video-data triple-play bundle. The 30% cap would also effectively block Comcast from buying a cable company with more than 3 million subscribers.

If cable operators were the only source of video programming, it might make sense to have a rule like this. But, as everyone knows, they aren’t. There are the broadcasters, the Direct Broadcast Satellite providers and now the big telephone companies and the Internet. It’s hard to imagine any one company dominates this media galaxy. But if so, that’s why we have the Antitrust Division.

Intuitively, some people feel if we have more cable TV owners and CEOs, it stands to reason we’ll get more diverse views and programming. In reality, most investors and managers are motivated not by individual political, cultural or artistic agendas, but on serving customers, i.e., providing whatever sells. Others recall that, for whatever reason, back when we had heavy-handed regulation television seemed much more “tasteful” than it does today. But that’s only because society’s values used to be different. It’s impossible to legislate taste and morality.

A 30% cable cap will allow the FCC to extort anything it wants from Comcast, the only cable company with a market share approaching 30%. Because, eventually, Comcast will need to seek a waiver. We don’t know who will be running the FCC when that happens, nor what their political, cultural or artistic agenda may be.

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