Cablers on offensive

With a week to go before the FCC votes on further cable TV price rollbacks, Capitol Hill sources said Monday that top cable MSOs have launched a massive lobbying blitz to limit the size of the price cuts.

“The cable industry has been relentless up here,” said one congressional staffer. “We’ve been getting a lot of calls.”

Hundt warned against cuts

Cable’s entreaties to Congress have already paid dividends: Last week, Republicans on Rep. Ed Markey’s House telecommunications subcommittee fired off a letter to new FCC chairman Reed Hundt warning that they’re against further cuts in cable rates.

Whether Hundt listens to House Republicans remains to be seen, particularly amid reports that he is weighing plans to roll back cable rates as much as an additional 10%.

Hundt, after all, is a Democrat, who has maintained a close, lifelong friendship with Vice President Al Gore. Gore was one of cable’s most vitriolic critics while serving in Congress.

With little official word coming out of the FCC — a source described the situation as “fluid”– one cable lobbyist said the industry is “expecting the worst” from the Feb. 22 agency vote.

“We’re hearing rate cuts anywhere from 3% to 20%,” said another industry representative. There was also widespread speculation that the new FCC rules will be designed to curb excessive a la carte pricing that ensued following the first round of rate rollbacks.

First round a draw

Last April, the FCC adopted regs that were supposed to result in as much as a $ 1.5 billion reduction in cable rates. Preliminary results of the action have shown that the typical cable customer saw a $ 2 drop in monthly rates. However, about a third of consumers saw cable rates increase, which prompted Markey and other Democrats in Congress to call for further price cuts.

Next week’s FCC vote will be closely watched not only to determine the future of cable rates; it will also provide insight into how far Hundt is willing to go in offending Congress, and perhaps his fellow FCC commissioners.

Already, reports have circulated that Hundt may be having difficulty lining up a second vote at the FCC to ensure his proposal passes.

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