In a move that puts the company in compliance with many of the major portions of last year’s cable reregulation laws, cable giant Tele-Communications Inc. is implementing several new customer service, technical and operational procedures within its operation.
Viewing the new law as “no more or no less than some new rules,” TCI is adapting itself to the realities, albeit not all of them, laid out in the 1992 Cable Act. The cabler has no plans to follow retransmission regs, which require it to pay broadcasters to carry their signals to cable subscribers.
As a result, TCI will eliminate internal policies that in the past required cable subscribers receiving basic service to “buy through” other levels of cable service in order to buy premium or pay-per-view services.
Under the cable act, this provision provides for a 10-year window in which cable systems can accommodate the rule. In the past, and currently on a majority of systems, basic-cable subscribers are all but eliminated from buying premium services. To do so, many are forced to increase their monthly spending to gain access to the premium channels.
The new cable act’s must-carry and retransmission clauses are the basis of lawsuits filed by Turner Broadcasting and other cable networks. Those provisions give television stations the right to negotiate carriage fees with cable operators and, in cases where a station does not negotiate, the operator must carry the signal.
TCI officials, speaking to the media Monday, said that in an effort to reduce the possibility of confrontation and disruption of broadcast service to cable subscribers, the company has started discussions with the national broadcast networks and, in a month, the local stations.
However, before stations start looking for a windfall from retransmission fees, TCI is making it clear: There will be no negotiations concerning retransmission fees.
Executives on an afternoon conference call declined to discuss what incentives they could offer stations instead of cash.
“We’ve never been opposed to voluntary broadcast agreements,” said Barry Marshall, chief operating officer of TCI Cable Management Corp. “All I can say is yes, we won’t pay. But also, we are very anxious to avoid confrontation and discord.”
To meet another provision of the cable act, TCI will institute a basic or lifeline package on all of its systems by April 1 at a cost to subscribers of about $ 10. The package will consist of the broadcast networks and any local access channels.
Moreover, customers buying the entry-level deal will not be required to purchase higher packages to gain access to pay-per-view or premium services. Addition of the entry level package will not affect the pricing of other programs being offered by the operator.
TCI also intends to start developing standards for compatibility between cable service and home electronics equipment, long a sore spot with consumers, and to increase customer services requirements.
On the technological front, TCI executives say that within the next four years, 90% of the company’s cable subscribers will be serviced with fiber-optics cable systems. Capital expenditures will increase from $ 450 million in 1992 to $ 750 million in 1993.