Media watchdog org wary over telco victory

Congress should pass legislation ensuring safeguards against potential telephone company abuses once the Baby Bells enter the cable TV arena, a liberal public interest group said Wednesday.

The Center for Media Education said Congress and the Clinton administration “must act to ensure that meaningful competition and an open marketplace will exist in the cable TV delivery business.”

CME’s remarks came one day after a federal judge in Virginia tossed out as unconstitutional Congress’ longstanding ban against telcos packaging video in their local phone service region. The decision, if upheld on appeal, could pave the way for intense competition between the cable and telephone industries in coming years.

Cablers and telcos are in a mad scramble to build the “information superhighway,” an ambitious technological plan that would allow consumers to have full video, voice and data transmissions on demand. CME co-director Jeff Chester warned Wednesday that the seemingly pro-competition aspects of the court ruling may be short-lived unless Congress passes legislation safeguarding consumers.

“While consumers may see temporary competition, mergers and buyouts may result in larger and more powerful monopolies controlling telephone, TV and data communications services,” warned Chester. “Once telephone companies have the regulatory structure of the cable industry, they could easily discriminate against programmers just as the cable industry has.”

Meanwhile, National Assn. of Broadcasters prez Eddie Fritts reacted cautiously to the judge’s decision. NAB continues to have “concerns” over telcos “replicating the cable model and controlling both the conduit and content of video programming,” said Fritts.

Fritts added, however, that telcos “have expressed a much more cooperative attitude” than cablers over the issue of making retransmission consent payments to broadcasters.

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