FCC rules on video programming diversity

The Federal Communications Commission (FCC) has adopted rules to promote video programming diversity by ensuring new video programmers can enter and compete in the video market. An Order adopted by the Commission sets the number of subscribers a cable operator may serve at 30 per cent nationwide. In a further notice also adopted, the Commission is seeking comment on vertical ownership limits and cable and broadcast attribution rules. The FCC suggests that the action will increase competition in the multichannel video programming market and provide consumers with greater programming choices and diversity.

At the time of the 1992 Cable Act, Congress directed the Commission to conduct proceedings to establish reasonable limits on the number of subscribers a cable operator may serve – a 'horizontal limit' – and the number of channels a cable operator may devote to its affiliated programming networks – a 'vertical' or 'channel occupancy' limit.

The 30 per cent limit, set first in 1993 and modified in 1999, was challenged by Time Warner in 2001. The DC Circuit Court then remanded it back to the FCC seeking further justification. That remand has been pending six years at the Commission.

The 30 per cent cable horizontal ownership limit set by the Commission is designed to ensure that no single cable operator can create a barrier to a video programming network's entry into the market or cause a video programming network to exit the market simply by declining to carry the network. In devising a limit to achieve this goal, the Commission first determined the minimum number of subscribers a network needs in order to survive in the marketplace, and then estimated the percentage of subscribers a network is likely to serve once it secures a carriage contract.

Separately, the FCC voted to ease restrictions on media ownership despite strong opposition from some lawmakers who threatened to block the plan on the grounds that it may harm competition. It voted to allow companies to own both a newspaper and a television station in the top US markets, giving media groups the potential to broaden their grip in 20 cities.

“(This) order strikes a balance between preserving the values that make up the foundation of our media regulations while ensuring those regulations keep apace with the marketplace of today,” said FCC chairman Kevin Martin. The three-to-two ruling by the commission amends a 32-year-old ban on cross-ownership in the newspaper and broadcast industries.

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