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Kevin Martin Doesn't Hate Cable, He Just Loves Ma Bell
Editorial: Time to stop pretending FCC boss is pro-consumer...
by Karl Bode 01:57PM Wednesday Nov 14 2007
The cable industry was already convinced that the FCC's Kevin Martin hated their guts. That impression only grew after last week's news that the agency was getting ready to heap a new pile of regulation on the cable industry. For an agency that consistently toes the Milton Friedman line on regulation when it comes to their friends at AT&T and Verizon, the move begs a few questions.

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Martin is using a provision in a 1984 law that would give the FCC new authority to treat cable operators as common carriers. The move would allow Martin to slash cable leased access rates by 75% and cap Comcast at 30% of all pay-TV subscribers nationally. In short: he aims to control cable dominance.

Martin insists this is to protect consumers, but his track record tells us his interest is more in helping AT&T and Verizon make a splash in the TV business, with your financial welfare being purely circumstantial. His cable power play is something he'd never try with AT&T or Verizon -- say to help quell high phone prices or ensure even treatment of CLECs.

This kind of inconsistency from Martin has been very consistent.

Martin will criticize cable astroturf (bogus grass roots PR shenanigans), while ignoring the same tactics (often vastly more sophisticated) used by incumbent phone providers. He's given last minute digital set-top waiver requests to Verizon while refusing to do the same for Comcast. He leaks telco-related FCC decisions early, but cable operators say they get no advance warning.

Yes, we know that Martin's story for consistently uneven treatment of the cable sector is that he's just really concerned about high cable TV rates.

We're not buying it.

TV rates continue to rise with the entry of the baby bells into the market, and we don't expect them to stop any time soon. Martin is a bright fellow; he knows both the cable industry and the phone industry will be engaging in non-price competition (we have the most HD channels!) as their markets overlap. Both AT&T and Verizon have already raised TV & DVR prices since they joined the fight for your entertainment dollar.

The promise of lower TV prices has been used for years as a PR carrot on a stick by Martin and the bells to sell lawmakers and the public on "franchise reform". This push has stripped away consumer protections, eliminated eminent domain rights, killed public access television and all-but ensured that rural America will never see next-generation services. The primary goal: protect telco revenue, not yours.

Here we have an FCC boss that's all for the elimination of media consolidation regulation on all fronts -- except when it comes to cable? An ex-Dick Cheney aide who is utterly apathetic to a sea of consumer issues, but is consumed with worry that Comcast is over-charging for cable TV?
Even if you did actually believe that Martin was acting as a righteous consumer protectorate (judging from this week's press reports, many do), his track record and political history contradict it.

This is an FCC majority that dismisses rural broadband penetration concerns as unfounded whining, and has fought tooth and nail to keep accurate broadband data out of the hand of consumers. Martin has played a starring role in the elimination of consumer protections and competition at every turn -- almost always thanks to short-sighted, profit-centric policies lobbied for by incumbent phone providers.

Here we have an FCC boss that's all for the elimination of media consolidation regulation on all fronts -- except when it comes to cable? An ex-Dick Cheney aide who is utterly apathetic to a sea of consumer issues, but is consumed with worry that Comcast is over-charging for cable TV?

It doesn't make any sense.

I've heard some suggest that Martin is actually accomplishing a good (and long desired among some watchdogs) deed here, by using the 70/70 rule to expand the FCC's authority over cable and help curb growth. But this assumes that Martin (a) actually cares about cable power, and (b) that there's anyone in government willing to use the new authority to help consumers.

In an age where regulators are usually ex-lobbyists from the industries they now oversee -- I'll believe it when I see it. It's far more likely that Martin's motivations lie elsewhere, such as the erosion of FCC accountability.

And while Martin has been a great proponent of indecency regulation and "a la carte" cable pricing, we're not sure he's a humanitarian on that front, either.

Martin has shown interest in a post-FCC political career in North Carolina. Indecency issues like Janet Jackson's wardrobe and "a la carte" pricing (the ability to sign up for just the "wholesome" channels without the menace of boobies) are primarily of interest to family values groups like the Parents Television Council. Such groups are useful allies in any future political career in his home state.

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Martin's inconsistency is also on display if you compare his treatment of mergers. AT&T's massive merger with BellSouth -- which created the largest broadband provider in the industry -- was approved quickly with only a handful of meaningless conditions. When it came to the smaller XM & Sirius merger, Martin suddenly became a consumer advocate, worried about public welfare.

It's more likely he was looking out for the will of the vastly more influential National Association of Broadcasters (NAB), whose profits would be greatly impacted by a more powerful satellite radio industry.

Don't get us wrong. The cable industry is certainly no saint, and we're rarely shy to criticize them when they do something stupid. Their endless rate hikes teeter somewhere between criminality and absurdity.

But it's time to stop simplistically pretending that Martin's uneven treatment of cable operators is because he's worried about what grandma pays for MTV. The majority of real consumer advocates (and anybody running a smaller ISP) will tell you that Martin has probably set this industry back twenty-five years by relentlessly pandering to the incumbent phone providers.

A more reasonable and simple explanation for Kevin Martin's inconsistency is that he simply follows the money, and caters to the more powerful lobbying machine (shocking in Washington, we know). You'd be hard pressed to find a more powerful lobbying presence than the one fielded by AT&T and Verizon. Their policy and PR tendrils run deep, utilizing everything from think tanks to bogus consumer advocacy groups to get what they want.

The cable industry has simply never been as effective on K Street.

The baby bells employ a system of lobbyists, public relations and policy gurus that are so influencial, they recently turned the supposedly impartial Department of Justice into a public relations mouthpiece on network neutrality. These folks are so good -- that when their employers face legal trouble -- they can have the law changed and gain immunity from prosecution.

Getting an FCC commissioner to clamp down on cable competitors as the phone industry entered the TV business was a much easier task.


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BillRoland
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Best article I've ever read on this site

Kudos to Karl Bode See Profile and DSLR for posting this. Cable companies are getting the shaft, and its not going to be good for anybody in the long run. I know that others will be quick to point out that if the shoe were on the other foot, cable would be trying to use favor with the FCC to get its agenda passed at the expense of everybody else. Sure, and satellite would be too, etc. That's why we have an FCC, and in theory they're supposed to make sure the opportunity is fair. Right now that FCC is using its authority to brow beat an entire industry at the request of another.
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"Don't steal. The government hates competition."

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