Possible AT&T-Comcast union rasing red flags

A coalition of consumer orgs and citizen groups has asked the FCC to reimpose a strict federal limit on cable television system ownership, on the heels of the proposed merger of AT&T Broadband and Comcast.

In a filing last week, the groups contended that the FCC needs to reinstate the 30% ownership cap to prevent cable monopolies from dominating TV programming and Internet services, as well as to prevent them from blocking video competish.

“Without establishment of a 30% or lower horizontal ownership limit, the FCC will fail to meet Congress’s goal of enhancing effective competition, leaving consumers paying inflated prices for programming that fails to meet all their needs,” the groups said in the filing.

The AT&T-Comcast deal would result in a company with cable systems serving 34% of multi-channel video programming distributor households and more than 40% of U.S. cable subscribers. The $72 billion deal is certain to be carefully scrutinized by the FCC even though a federal appeals court recently struck down an FCC cap blocking a cabler from reaching more than 30% of the national audience.

AT&T and Comcast would have to shed about 3.5 million subscribers to comply with the limit supported by the groups.

Rethinking justification

“These are concerns we’ve had since last year when a federal appeals court found that the 1992 Cable Act that authorized the FCC to impose the ownership limit was constitutional,” a spokesman for the coalition said. The groups contend that the court rejected the FCC’s justification for how it constructed the 30% limit and argued that there is “overwhelming” support for a similar rule with a more articulated rationale.

The coalition includes Consumer Federation of America, Consumers Union, Media Access Project, Center for Digital Democracy, the United Church of Christ, Office of Communication, the Assn. of Independent Video Filmmakers, the National Alliance for Media Arts and Culture, and the Alliance for Community Media.

The filing was one of several last week to the FCC in connection with a deadline for comment on reviews of commission regs. The FCC will now take comments for the next three weeks in response to the filings.

Comcast noted in a 39-page filing that the FCC needs to follow its basic charge: “The commission must never lose focus on the main issue — preventing unfair impediments to the flow of video programming to consumers.”

Diversity crunch

And in a separate FCC filing, the Writers Guild of America has weighed in on what it perceives as the FCC’s refusal to impose limits on concentration of ownership. The Guild claims vertical and horizontal integration have limited diversity and creativity and asserts the FCC must hold hearings on the impact of recent key rulings.

“The WGA, which represents the 11,500 men and women who write virtually all the national entertainment programming and much of the national news Americans see, believes that these developments have contributed to an already steep decline in diversity, variety, and quality and that absent immediate remedial action by the commission, the current serious adverse situation will further deteriorate to the detriment of all Americans,” the Guild said in a 22-page filing.

The WGA said the easing of regs has created a situation in which mega-congloms control several aspects of production, exhibition and distribution. “The system rewards safety and conformity,” the filing declared. “It is a system in which minorities, women, older writers, all writers who have to pass through a narrowing funnel, are at a pronounced disadvantage.”

The Guild also called for new restraints on network ownership, new limits on network self-production, for keeping EchoStar and DirecTV separate and for the FCC to hold hearings on its easing of ownership rules.

“The Commission’s prior actions had far-reaching effects without a significant record to establish the danger,” it said. “Let’s not repeat the mistake.”

“We have witnessed an unparalleled consolidation within our industry,” said Victoria Riskin, prexy of the WGA West. “This consolidation limits diversity and creativity. Ultimately it is the American public that is hurt.”

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