The Federal Communications Commission this week went on record opposing the proposed settlement of an antitrust lawsuit against top U.S. cable companies accused of trying to thwart competition in the direct broadcast satellite industry.

The case involves Primestar Partners, a DBS venture owned by Tele-Communications Inc., Time Warner and other large cable operators.

In June, the U.S. Dept. of Justice and attorneys general in 40 states announced they entered into antitrust consent decrees with the cablers in which the cablers agreed not to block popular cable programming from competitors.

But barely before the ink was dry on the settlement, critics alleged the pact would subvert a provision in the 1992 Cable Act requiring cable webs to grant their programming to all carriers on a non-discriminatory basis.

The FCC, in a letter to U.S. District Judge John Sprizzo in New York, sided with critics of the proposed settlement. The agency said that far from embracing the concept of competition, the settlement “strongly suggests the defendants from the cable industry are more concerned with positioning themselves to manage their competition than … cooperating in the realization of a competitive, diverse multichannel video market.”

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