From: Nigel.Allen@bbs.oit.unc.edu (Nigel Allen)
Subject: NAB, CFA on cable re-regulation
Organization: Echo Beach
Date: Fri, 11 Sep 1992 22:58:57 GMT

Here is a press release from the National Association of Broadcasters and
the Consumer Federation of America.

 NAB, Consumer Federation of America Comment on Final Congressional
Action on Cable TV Bill
 To: National Desk, Television Writer
 Contact: Eddie Fritts, president, National Association of
          Broadcasters, 202-429-5350,
          or Gene Kimmelman, legislative director,
          Consumer Federation of America, 202-387-6121


   WASHINGTON, Sept. 11 /U.S. Newswire/ -- The following was released
today by the National Association of Broadcasters and the Consumer
Federation of America:

   House and Senate conferees reached agreement on a final cable TV
bill Wednesday night.  The bill, which has been debated for more than
three years, should come before the House and Senate for final
passage the week of Sept. 14.  Once Congress approves it -- which is
expected -- the bill will be sent to President Bush.  The president
has threatened a veto, but both the House and Senate passed their
original cable bills by veto-proof margins earlier this year.

   The Bill:
   The bill combines consumer protection features -- including
regulation to curb rates that have risen three times faster than
inflation, customer service standards, prohibitions on unfair sales
practices and more -- with reforms to promote competition.  The
latter includes one provision that will enable over-the-air
television stations to compete more fairly with cable systems, and a
second that will allow home satellite and other alternative delivery
systems to offer cable programming at competitive prices.  (See
attachment 1).

   Cable's Distortion Campaign:
   The conference committee's quick work is yet another sign of the
overwhelming bipartisan support in both houses for cable legislation.
Two weeks ago the cable industry launched an unprecedented
multi-million dollar advertising and grassroots campaign against the
bill.  Their campaign, which has been widely criticized by the press
and members of Congress for its numerous distortions, has failed to
slow momentum for the bill's enactment.  (See attachment 2).
   The cable bill is supported by a broad coalition of consumers,
senior citizens, labor, rural and local government organizations, as
well as by cable's competitors.  The only opponents of the bill are
cable companies and cable associations.
   For more information about the cable bill contact Eddie Fritts at
202-429-5350, or Gene Kimmelman at 202-387-6121.
    ------

              KEY PRO-CONSUMER/PRO-COMPETITION ELEMENTS
                 OF THE CONFERENCE REPORT TO S. 12:
    THE CABLE TV CONSUMER COMPETITION AND PROTECTION ACT OF 1992

   Rate Regulation
   -- The FCC and franchising authorities are authorized to ensure
that rates for basic service are "reasonable" where cable systems do
not face effective competition.
   -- The bill allows citizens, local government and other public
organizations to file petitions to the FCC challenging rates for all
other tiers of service.

   Equipment Prices
   -- Allows the FCC to ensure that prices for installation, remote
control, converter boxes and other equipment used to provide basic
service shall be "reasonable."

   Customer Service
   -- The bill requires the FCC to establish enforceable customer
service standards addressing concerns such as outages and service
calls, system office hours and telephone availability, and
information on billing and refunds.
   -- The bill allows local governments to establish additional
standards.

   Encouragement of Multiple, Competitive Cable Franchises
   -- Franchising authorities may not award exclusive cable
franchises, and may not unreasonably refuse to award additional
competitive franchises.

   Municipal Operation of Cable Franchises
   -- Municipalities are explicitly authorized to operate cable
systems.

   Prohibition on "Buy Through" Requirements
   -- After a 10-year transition period to allow cable operators to
upgrade their systems, operators will be prohibited from requiring
subscribers to purchase expanded service tiers to be able to buy pay
services such as HBO and Showtime.  Additional waivers are available
to avoid hardship to cable systems.

   Customer Privacy
   -- Customer privacy laws are strengthened to restrict access to
cable systems' information about their customers.

   Prohibition on Negative Option Billing
   -- Cable systems are prohibited from charging subscribers for
services or equipment that they have not explicitly requested.

   Consumer Equipment Compatibility
   -- The FCC is directed to adopt regulations to ensure that
subscribers' investments in cable-ready televisions, VCRs, remote
controls, and other capabilities are not made obsolete by
incompatible cable system technologies.
   Program Access
   -- Cable programming services in which cable operators have a
financial interest will be restricted in their ability to deny these
programming services to cable's competitors.  Limitations on
exclusive contracts expire in 10 years.

   Retransmission Consent Option
   -- Local television stations may opt for must-carry protections,
or may elect to negotiate with local cable operators over the terms
and conditions of carriage on cable systems.

   Leased Access Channels
   -- The FCC is directed to set maximum rates for channels set aside
for leasing by competitive programming services, and to set
standards for local systems' access terms, conditions and billing for
these channels.

   Cable Integration Limitations
   -- The FCC is directed to establish reasonable limits on the
maximum number of cable subscribers a single company can control, and
reasonable limits on the number of channels on a system that can be
programmed with services in which the system operator has a financial
interest.


           THE CABLE TV INDUSTRY'S DISINFORMATION CAMPAIGN

   The Cable Industry's Tactics Include the Following:
   -- Thirty-seven million bill-stuffers in subscribers' monthly
statements.
   -- Television ads on cable networks and systems across the
country, radio ads, and full-page print ads in newspapers nationwide.
   -- An "800" telephone number.  Advertisements instruct consumers
to call the 800 number and have messages sent for free to their
members of Congress.
   At least two consumer front organizations -- including one each in
Pennsylvania and Georgia -- called "Consumers Opposed to S.
12." These organizations sent consumers telegrams claiming that
S. 12 will force cable rates up and asking them to actively
oppose the bill.  Most of the people representing these so-called
consumer organizations have proven ties to the cable industry.
They include an executive producer of a cable-owned sports network,
a publisher of a newspaper with a financial interest in a cable
company, and an owner/operator of a 24-hour cable channel.

   The Cable Industry's Message is Distorted
   The Cable Industry Claims: The bill will make rates go up, not
down.  Cable further claims that the U.S. Commerce Department
concluded that the bill "could mean increased costs of $23 to $51 per
year for each cable customer."
   The Truth is: The cable bill is a pro-consumer bill that will
regulate cable rates and help hold them down.  The so-called Commerce
Department figures actually came from reports given to the Commerce
Department by the cable industry.  The Washington Post, The Wall
Street Journal, and The Charleston (S.C.) Post & Courier all have
criticized these reports and said they made faulty assumptions or
measured costs that would not necessarily be passed on to consumers.

   Cable Industry: Newspapers, including The New York Times, and The
Cincinnati Post oppose cable legislation.
   Truth: NCTA published advertisements quoting these newspapers out
of context.
   The New York Times -- in the very editorial quoted by NCTA -- said
"a 'yes' vote in the House would successfully conclude an uphill,
three-year battle."
   The Cincinnati Post -- also in the editorial quoted by NCTA --
said, "...Cable operators in most communities found themselves with
virtual monopolies. After the 1984 deregulation stripped local
governments of their right to control rates, the industry jacked up
prices by an average of 60 percent.  Along the way, many cable
operators earned a reputation for frequent breakdowns and poor
service....As long as cable companies maintain effective monopolies
in their services [sic] areas then, yes, they should be regulated."

   Cable Industry: The cable bill could force cable companies to pay
broadcast TV stations as much as $1 billion per year.  It will also
make cable viewers pay for their network programming.
   Truth: At issue is a retransmission consent provision that gives
local stations control of their signals and the right to negotiate
with cable stations who want to retransmit those signals.  The
provision does not require cable operators to pay broadcasters, nor
does it mandate a tax/surcharge to cable consumers.  It specifies
only local station, not network involvement.  It also directs the
Federal Communications Commission to take retransmission consent into
account to ensure that it does not adversely affect rates.
 -30-

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