Tele-Communications Inc., the nation’s largest cable operator, soon will be offering customers fewer channels on the basic tier as a result of Congress’ recent passage of cable reregulation legislation.
That was the message yesterday from TCI senior veepee Bob Thomson, who delivered a speech on the cable bill and the future of the cable industry before the Media Institute, a D.C.-based org that focuses on free-speech issues.
Thomson said TCI cable systems nationwide currently have 26 channels on the lowest tier of service. Because the legislation passed by Congress requires rates to be regulated on the lowest tier, Thomson said it’s likely the number of channels will be sliced.
TCI believes the price it now charges for its basic tier is “too high” to meet Congress’s goal of a low-priced basic tier, Thomson said. He declined to predict how many channels the new basic tier on TCI systems will have, or what the monthly fee will be.
Thomson also expanded on TCI topper John Malone’s widely reported claim that TCI will not pay broadcasters for the right to receive broadcast signals. (Under the retransmission consent provision of the cable bill, broadcasters can negotiate carriage fees from cablers.)
Thomson said TCI would consider paying for broadcast signals only if three conditions are met: That cable operators be allowed to offer broadcast channels on an a-la-carte basis, that must-carry requirements forcing cable operators to carry broadcast stations “disappear” and that the cable compulsory copyright license be repealed.
TCI’s embrace of compulsory license repeal will gladden the hearts of Hollywood exex, who lost the battle to eliminate the license during the cable rereg fight. Thomson said that if cable operators are required to pay broadcasters for their programming, then Hollywood should be allowed to recover their costs for providing the shows.
Thomson said TCI is “not going to defy Congress” and is “going to try to comply” with the new regs.
However, he said some sections of the bill are “badly in need of clarification” by the Federal Communications Commission and the courts. In particular, cable operators need to know the scope of their First Amendment rights, per Thomson, and whether the must-carry requirement is constitutional.