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Comcast Asks to Set Basic Cable Rates

Posted on: Friday, 10 December 2004, 15:00 CST

Dec. 10--Saying satellite television provides enough competition in North Texas, Comcast Corp. has petitioned the Federal Communications Commission to allow it to set its own basic cable rates.

In its petition, filed in early November, the company said more than two competitors offer comparable service and together serve more than 15 percent of the market.

Comcast said rival satellite TV operators DirecTV and EchoStar Communications offer enough competition to satisfy an FCC rule.

Under federal law, a cable operator is allowed rate deregulation if it can prove that competitors serve more than 15 percent of a market. Comcast claims that satellite has a penetration rate of 17.6 percent in the Metroplex markets it serves.

Area municipalities regulate rates for the most basic tier of cable services. The basic tier includes local stations, public access channels and other networks Comcast designates. Municipalities also oversee what a cable provider charges for maintenance and fees, which include equipment.

If the FCC grants the petition, there will be no federal or local oversight of Comcast's cable rates in North Texas. The FCC's authority to regulate rates charged for cable services above the basic tier ended in March 1999.

"We believe that in a competitive environment, marketplace forces and consumer choice are the most effective regulatory measures," Angel Biasatti, a Comcast spokeswoman, said in an e-mail. "Comcast is delivering high-value, quality services at a competitive price. By lifting this regulatory burden, Comcast will be better positioned to serve our customers and attract new ones."

Comcast is the nation's largest cable company, with 21.5 million users, and is the leading broadband Internet provider, with 5.7 million subscribers. The company serves 39 North Texas municipalities, including Arlington, Bedford, Colleyville, Dalworthington Gardens, Euless, Flower Mound, Grand Prairie, Grapevine, Irving and Pantego.

The company charges $12.03 for basic service in Arlington, $26.96 for expanded basic and $9.95 to $91.99 for digital cable services.

Comcast is not the first cable company in the region to ask for deregulation.

Tarrant County's largest cable provider, Charter Communications, won rate deregulation from local governments two years ago. The company said TV MAX, EchoStar and DirecTV had gained enough market share in the region to provide effective competition.

The FCC is soliciting comments on Comcast's petition. Few have appealed thus far.

"We have our comments and our questions about the data and how it was collected," said Alan Cass, Arlington's risk management administrator. "But the information they provided was well above the threshold limit. Now if it was in a narrow range, then that would be different."

Jennifer Fung, McKinney's finance director, decided to appeal Comcast's petition. She said she believed that the company used erroneous data that were favorable to Comcast.

"We do not agree with their calculations," Fung said. "We want them to be fair and accurate."

Rebecca Fisher, an FCC spokeswoman, said there is no timetable for the commission's review of Comcast's petition.

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Source: Fort Worth Star-Telegram (Fort Worth, Texas)

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