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CONTACT: Amy Smorodin
November 20, 2008
(202) 289-8928
FCC Cable Rate Probe Questioned
Esbin Raises Numerous Process, Statutory Concerns

WASHINGTON D.C. - The Federal Communications Commission appears to be conducting a far-ranging data gathering effort concerning cable prices and analog-to-digital channel movements under the guise of individual complaint enforcement. In "Der Undue Prozess at the FCC: Part Deux," released today by The Progress & Freedom Foundation, PFF Senior Fellow Barbara Esbin explains that the FCC's regular processes and procedures appear to have been perverted to achieve ends not within the agency's delegated authority, making it difficult to conceive how consumers will benefit from this diversion of public and private resources.

In the paper, Esbin identifies four flaws in the FCC's investigation: (1) the FCC has very limited authority to regulate cable rate levels; (2) it is local franchising authorities that are statutorily empowered to carry out enforcement activities related to service change notifications; (3) the FCC has no rules either prohibiting cable operators from migrating cable programming channels from analog to digital or requiring corresponding per-channel rate reductions; and (4) to the extent the FCC is required by Congress to collect data on the multichannel video programming distributor market and cable pricing generally, the agency is directed to do so by means of its annual video competition and price survey reports. "Thus, not only is the digital cable probe being conducted in a manner that calls into question the fundamental fairness of agency processes (with guilt virtually presumed)," the author states, "it seems to be pursuing goals hard to fathom."

Esbin further explains that the probe is likely to slow progress on ensuring a smooth transition to digital television transmission and encouraging the speedy deployment of ever faster broadband services as enormous resources are diverted to producing and reviewing information relevant mostly to activities that lie outside the scope of the FCC's regulatory jurisdiction. More importantly, she states, "consumers cannot possibly benefit, in the long run, when the government conducts its business using questionable procedures in a manner that strongly suggests a lack of impartiality, fairness and predictability, because there can be no confidence that the results of such actions will be fair and reasonable." According to the author, "The public interest would be better served if the FCC would 'stick to its knitting' and faithfully carry out its statutory mission."

"Der Undue Prozess at the FCC: Part Deux" is available on the PFF website.

The Progress & Freedom Foundation is a market-oriented think tank that studies the digital revolution and its implications for public policy. It is a 501(c)(3) research & educational organization.



The Progress & Freedom Foundation