The two other Republican commissioners on the FCC are trying to pull back the reins on FCC Chairman Kevin Martin as he attempts to seize regulatory control of the cable industry. Commissioners Deborah Tate and Robert McDowell, typically Martin’s allies, recently published a letter pointing out the unreliability of the data Martin is using to justify his power grab.
Martin is relying on a clause in the 23-year-old Cable Act, which gives the FCC broad authority to regulate the cable industry should the industry meet two criteria: availability to 70 percent of U.S. households (long since exceeded) and 70 percent penetration of these households. According to the law, only operators with 36 or more channels are counted.
For years, the FCC has been relying on data on the latter measure compiled by Warren Communication News, which recently reported that cable has reached 71.4 percent penetration.
Tate’s and McDowell’s letter refers to comments by Warren Communications News’ editor, Michael Taliaferro, in Communications Daily, in which he said the reported penetration statistic is not entirely reliable for a variety of reasons.
Tate and McDowell wrote: “As you are aware, over the past three years, our Report has found cable subscribership hovers around 60 percent. With the increase in competition from satellite and phone companies, most large cable operators report a decline in subscribership. Thus, it was surprising to learn that Warren Communications reported a 71.4 percent subscribership rate this year, especially considering the two other major independent research outlets found rates at 61.1 percent (Nielsen) and 58.1 percent (Kagan).” The report referred to is the Commission’s annual report on cable.
Martin may try to shrug off the objection, because Kagan’s estimate takes into account all operators, not just those with 36 channels or more.
Nonetheless, with Warren Communications itself allowing that the data is not solid enough to be used for Martin’s purpose, with erstwhile allies on the Commission trying to put the brakes on, and with Martin’s chairmanship perhaps good only for another year or so (through the end of the current Administration—dependent on which political party’s candidate wins the 2008 presidential election), this might lead to a long enough delay for the cable industry to avoid heavier regulation.