Since I became Chairman of this Subcommittee, we have examined the competitive status of the cable industry several times. We do so again today in our oversight role, in an effort to raise questions about competition and other concerns that remain unresolved in the industry. We must view today's competitive conditions in the context of the deregulation of cable rates, resulting from the Telecommunications Act of 1996. Under that law, rate regulation ended for many small cable operators, with most remaining services being deregulated in 1999. The results of this deregulation seem to be mixed.
Deregulation appears to have done little to halt the trend of increasing cable rates.
Critics of the industry blame these rate increases on a lack of competition and believe that the industry is taking advantage of consumers. In response, many within the industry believe that deregulation has been a success and that competition is accelerating. They argue that rate increases are not a result of monopoly power, but are justified by higher programming costs and expensive system and equipment upgrades that are required to provide broadband services as envisioned under the Telecommunications Act. This is one issue we will explore today. In doing so, I would like to hear what our witnesses believe accounts for the continuing increases in cable rates.