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Val. 8 No. 12--March 21. IM--$1A0
<br />Cable Comes Under Fire
<br />At Senate Antitrust Hearing
<br />ft Larry JaNN
<br />W AS111NGIMN —The open-
<br />ing guns sounded last week in
<br />what promises to he a long
<br />series of skirmishes on Capitol
<br />Hill and elsewhere over
<br />whether the cable trlevision in-
<br />dustry has grown tfx) Inrge and
<br />powerful and nerds additional
<br />government regulation
<br />""The mesvage that is (firming
<br />throngh loud and clear is that
<br />we !(;"ogress) should revisit
<br />our dv(,I ki"n to deregulate
<br />cable," lien Ilowsrd Mr,sen-
<br />haunt 11) t )111 said at Ic,gt
<br />week's hearing, which h
<br />cha i red
<br />(hirer groups scheduled to
<br />eondort inrluires into the cable
<br />industry include the Ilouse
<br />telers mmunicaIions subcom-
<br />mittee and a group of state
<br />attorneys general which last
<br />week launched an ingoiry into
<br />the industry isee story, page
<br />131
<br />A total of 13 witnesses rep-
<br />resenting the ('able, "wirrlem
<br />cable," home satellite dish and
<br />broadcasting Industries tegtt-
<br />fiecl at the hearing on corn-
<br />l(etitivr issues in the cable in-
<br />dustry held by the Senate sub-
<br />eommitlM on antitrust, mom) -
<br />polio, and business -ights
<br />Sen Mrizenbaum said the
<br />sulwommittee will revisit the
<br />issue withir ' next (A) day*,
<br />after whirl+ will determioe
<br />hrilter Irgislnlivr action is
<br />sppmpriair fir added he
<br />hot,ecl congre*airnai action
<br />would not have to be taken and
<br />the industry before then o,uld
<br />"get its house in order
<br />National Cable Televisi•,n
<br />Association president Janes
<br />Moonev said after the hearing
<br />that the swain served of, "let
<br />off seam" ami the message
<br />received fr+•nr the senator was
<br />that the induatry "nerds to
<br />tread at,fily
<br />SM. NDword Mt bsnbaum (POHg IaNna to teadmony at last
<br />If government involvement
<br />is the only possible solution,
<br />'•this chairman won't be
<br />bashful to facilitate such inter-
<br />cession" to put an end to
<br />"exorbitant rates" and ensure
<br />.table competition to cable,
<br />`en Aletu•nbaum .aid
<br />The :March 17 Senate hear-
<br />ing will be followed on March
<br />30 by the House is le-
<br />c"mmunciations subcommit-
<br />tee's cable oversight hearings,
<br />which will deal with Rimilar
<br />issues, such as the industrv's
<br />size, vertical integration, the
<br />need for another set of must -
<br />carry rules that would pass
<br />constitutional muster, and
<br />whether the Cable Act needs to
<br />be amended
<br />in addition, Sen John
<br />(ferry I D-MA 1, who sits on the
<br />Commerce Committee, has
<br />begun an informal irrvestgation
<br />that might eventually lead to
<br />hearings ort alleged anti -com-
<br />petitive practices by the cable
<br />ind u*try
<br />Other than seporew. brief
<br />appearance* by Sen. Strom
<br />Thurmond (R-SC) and Sen
<br />Gordon Humphrey IR-Nill,
<br />Sen Metzenhaurn, the sub-
<br />committee's chairman, was the
<br />only senator present to listen to
<br />comments at the 2 1/2-hour
<br />hearing
<br />During 1tr Mooney's testi-
<br />mony, Sen . Metzenbaum cut
<br />him off to say, "Some of us
<br />Icongressmenl f: l we were
<br />had, wher we passed that
<br />bill," referrtrtg to the Cable
<br />Communications Policy Act of
<br />l(W4, which deregulated the
<br />industry
<br />Mr Mooney painted out
<br />that (:)ngrrss, via the act, let
<br />munici,)alities decide how
<br />mac ny "mpanies can ol,erate
<br />in an area. Sen Metz.enbaum
<br />interjected, "Isn't that un-
<br />realistic," noting that virtually
<br />all cable systems operate
<br />without competition from
<br />"liver cable companies. and are
<br />de fart* nuinopolies.
<br />ready to re --examine the net ic,
<br />respect to rates and program
<br />availability," he said. "I'm
<br />very concerned that the self -
<br />policing called for is not occur-
<br />ring," he said, adding that the
<br />hearing was not a "precursor
<br />to the introduction of legis-
<br />lation," but rather "a sound of
<br />warning and indication of con-
<br />cern to the cable industry "
<br />The senator espressed con-
<br />cern about the plight of two
<br />"wireless cable" companies,
<br />which utilize multichannel
<br />multilrjint distribution t6ervlce
<br />terhnulogy, and testified that
<br />many cable programmers w ill
<br />not sell to them
<br />"You can't operate wireleaq
<br />cable without being able to ob-
<br />tain product If you can't get
<br />programming, you have to go
<br />under This is a fact," Sen.
<br />Metzenbatun said .
<br />During the pr(x•eeding. the
<br />lawmaker pointed out to Home
<br />Box Office Inc. president
<br />Joseph Collins that James
<br />neroux, Wireless Cable As-
<br />sociation chairman ,.r regu-
<br />latory affairs and an c.1MDS
<br />operator in Cleveland, testified
<br />earlier that HBO as well as
<br />other programmers would not
<br />sell to his company .
<br />Mr. Collins said historically
<br />HBO has been supportive of
<br />MMDS technology, and cur-
<br />rently diabributes via micro-
<br />wave in Milwaukee and New
<br />York City However, the com-
<br />pany is concerned with the
<br />heightened possibility of signal
<br />theft, which is a problem in
<br />Washington. DC. where HBO )
<br />is currently available via wire-
<br />less cable. he added
<br />HBO will not sign more
<br />MMDS contracts until the
<br />company "is sure our signal is
<br />secure .. he said Sen
<br />Metzenbaum pressed for a
<br />date when the tests w•ouW be
<br />completed, but Mr Collins
<br />would not give one
<br />The senator also questioned
<br />Robert Thom -Ain. Tele-(- kim-
<br />munications for vice presi-
<br />dent of governmental affairs,
<br />about the largest operst.or's
<br />financial interests in wveral
<br />programmers, and whether
<br />that give* TCI influence over
<br />pr,Wrammers' decisions not to
<br />deal with alternatives to coax-
<br />ial cable "Vertical integration
<br />i• r -mvern of this commit•
<br />tee," he "Id
<br />
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