HomeMy WebLinkAboutCivil Action 92-2494 Time Warner Entertainment Company LP against Federal Communications Commission and United States of America BUNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
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TIME WARNER ENTERTAINMENT COMPANY, )
L.P., )
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Plaintiff, )
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-against- ) Civ. No. CI a9 I
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FEDERAL COMMUNICATIONS COMMISSION, )
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and )
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UNITED STATES OF AMERICA, )
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Defendants. )
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AFFIDAVIT OF JOSEPH J. COLLINS
STATE OF CONNECTICUT )
COUNTY OF FAIRFIELD )
ss:
Joseph J. Collins, being duly sworn, deposes and
states as follows:
1. I am Chairman and Chief Executive Officer of
Time Warner Cable ("TWC"), an unincorporated division of
Time Warner Entertainment Company, L.P. ("TWE"). I am a
Managing Director of TWE, and prior to TWE's formation in
the summer of 1992 I was Chairman and Chief Executive
Officer of Time Warner Cable Group, an unincorporporated
division of Time Warner Inc., which directed the operations
of American Television and Communications Corporation
("ATC"), of which I was Chairman and Chief Executive
Officer, and Warner Cable Communications, Inc. I have been
involved in the cable industry for 20 years. I make this
affidavit in support of TWE's motion for a preliminary
injunction.
Background of Cable Television
2. The printed word is no longer the only, or
even the primary, means of mass communication. The past
50 years have witnessed the development of vast new networks
of electronic media for the dissemination of news, informa-
tion and entertainment via television. In the first wave of
the video revolution, broadcast television made possible
instantaneous communication between broadcast television
stations distributing their signals from terrestrial
transmitting antennas and anyone within the station's
transmitting range who owned a television set. In that era,
most Americans had no more than three broadcast networks and
a handful of independent stations, which provided homogenous
programming to choose from. The programming was developed
to suit the broadest cross-section of America. Indeed, a
former FCC Chairman termed television in this first wave the
"Vast Wasteland".
3. In the second wave of that revolution, cable
television systems, which transmit from 12 to more than
150 channels of video programming by means of coaxial and
fiber optic cable, have made it possible to communicate a
vast array of news, information and entertainment
programming to persons within the system's service area who
pay a fee to subscribe to cable. Today over 54 million
people receive cable television.
4. As part of the cable revolution, a large
number of new programming services have been developed.
These are typically distributed by means of satellite to
cable operators and others, who in turn distribute such
programming services to their subscribers. The cable
revolution has made possible the development of both general
entertainment programming services and more specialized
services that present programming on such subjects as news,
religion, financial information, government, law, education,
music and minority affairs. Individual cable systems also
create their own local programming services. For example,
TWC's cable systems in the New York City area produce and
offer to their subscribers a 24-hour local news service
called New York 1.
5. In addition to cable, a number of other tech-
nologies, including home satellite dishes, videocassettes,
video disks, satellite master antenna television ("SMATV")
systems and multichannel multipoint distribution systems
("MMDS"), have been developed that compete with both broad-
cast and cable in communicating news, information and
entertainment.
6. The cable industry itself is not "highly
concentrated" by any customary economic measure (the ten
largest multiple system operators ("MSOs") account for
approximately 55% of all cable subscribers), and an effect
of the increasing size of larger cable operators has been to
enhance their ability to finance new programming ventures
and thus increase the number of "media voices" that are
available. Since cable television prices were deregulated
by the 1984 Cable Act, no fewer than 40 new programming
services have been launched, many of them financed in whole
or in part by cable operators.
7. Cable operators, including TWC, select which
programming sources to include in the array of programming
they offer their subscribers. For example, cable operators
must choose from among a vast array of programming services
devoted to such subjects as news and political developments
(C-SPAN I and II, Cable News Network, Consumer News and
Business Channel), law (Courtroom Television Network),
religion (National Jewish Television, VISN), music (MTV,
Video Hits-1, The Nashville Network), minority interests
(Black Entertainment Television, Galavision), education (The
Discovery Channel, Mind Extension University), sports (ESPN,
Sportschannel) and general entertainment programming (USA
Network, WTBS, TNT). In making such choices, cable
operators exercise editorial discretion--the same type of
discretion employed by newspaper editors in determining the
content of a daily newspaper.
8. In addition, cable operators develop their own
distinctive programming for distribution to their
subscribers. For example, many of the programming services
that characterize contemporary cable communications,
including Home Box Office, Showtime, MTV, C-Span, Cable News
Network and Headline News, were initially developed or
substantially capitalized, in whole or in part, by cable
operators, who created or invested in such services to
enhance their ability to compete with traditional media such
as broadcast television stations. In addition, individual
cable systems create their own distinctive local news
programming, as TWC has done with its New York 1 news
service in New York City and with its local news services in
other locations, including Ithaca and Rochester, New York
and other local programming that is produced by many TWC
cable systems.
9. Furthermore, many cable operators have
produced their own video editorials. For example, TWC's
predecessor produced a prize winning series of editorials
for telecast on its systems. The series, entitled "American
Viewpoints", examined many topical public policy issues. In
addition, many TWC systems are very similar to local,
newspapers, offering national and local weather, local
classified advertising, community bulletin boards and
television channel listings. Furthermore, many national
programming services, such as the Weather Channel and CNN,
provide time for local insertions in their programming which
TWC and other operators utilize.
Time Warner Entertainment Com4anv. L.P. and Time Warner
Cable
10. TWE is a partnership, the majority of which is
indirectly owned and fully managed by Time Warner Inc., a
publicly traded Delaware corporation. TWE is comprised
principally of three unincorporated divisions: TWC, which
operates cable television systems; Home Box Office ("HBO"),
which operates pay television programming services and which
is more thoroughly discussed in the accompanying affidavit of
Jeffrey Bewkes; and Warner Bros., which is a major producer
of theatrical motion pictures and television programs.
Warner Bros. licenses its motion pictures for exhibition in
movie theaters, on video cassettes and video disks and by
video programmers, including pay-per-view services, premium
services, basic services and network and independent
television stations. TWE also owns, directly or indirectly,
minority interests in various cable television programming
services, which are more thoroughly discussed in the accom-
panying affidavit of E. Thayer Bigelow.
11. TWE through TWC and affiliated companies owns
and operates cable systems in approximately 1000 franchise
areas throughout the United States, which have a total asset
value of approximately $8.2 billion, and which reach
approximately 6.9 million subscribers. TWE and its
predecessors built and acquired these costly assets with the
expectation that they, like any other speaker, would have
the ability to use their capacities without government
interference.
12. TWC's cable systems have channel capacities
that generally range from 30 to 70 channels. TWC's cable
system in one test area in Queens, New York, which uses
advanced fiber optic technology, has the capacity to provide
up to 150 channels of programming to its subscribers.
13. TWC and its local divisions exercise editorial
discretion in determining which program services should be
offered to subscribers. In making such determinations, TWC
personnel choose from among the entire array of programming
services that are available. They take into account such
factors as local tastes; local demographic characteristics,
including such variables as age, household size and
composition, income levels, occupational characteristics and
educational attainments; the quality of programming; the
needs and interests of identifiable segments of the local
population, including minority and ethnic groups; and the
availability of news, information and entertainment to cable
subscribers from non-cable sources, including broadcast
television stations, movie theaters, cultural and sporting
events and non -electronic media. The content of programming
services is often decisive in making such determinations.
For example, a TWC cable system located in a conservative
"middle American" community may choose to offer subscribers
a greater array of Christian religious programming, while a
TWC system located in an ethnically diverse urban center
might place greater emphasis upon program services,
including those oriented to persons who speak languages
other than English, that would have appeal to large segments
of the local population. For example, TWC's cable system in
Queens, New York, a community rich in ethnic diversity,
offers Greek, Korean and Hindi channels, among others.
14. TWC cable systems continually refine their
channel line-ups so as to increase subscriber satisfaction
and appeal. Over 55 different program services are carried
by at least one TWC cable system; it is estimated that there
are no more than three program services that are carried by
all TWC cable systems. In fact, the diversity of services
offered can be quickly ascertained simply by comparing the
channel line-ups of systems across the country. Where a
particular program service is carried in all or virtually
all TWC systems, it is because that service has demonstrated
broad appeal to United States television audiences and is an
economically attractive choice.
15. In addition to deciding which services to
carry, TWC systems also decide how services are to be
"packaged" in offerings to subscribers. In most TWC
systems, subscribers can choose from among two or more
packages or "tiers" of services, for which different prices
are charged, and can also elect to purchase premium and
pay-per-view services, for which an additional charge is
made. TWC systems typically offer a "basic" tier of
services and a "standard" tier, with the latter including
a
large array of satellite -delivered programming services, and
subscribers are usually required to purchase the "standard"
tier in order to purchase premium or pay-per-view services.
Premium services are often offered in discounted packages to
subscribers who wish to purchase more than one such service.
TWC personnel structure such programming tiers and packages
based on judgments about local preferences similar to those
described above with respect to the choice of individual
program services.
16. TWC regularly schedules "free previews".
During such previews, TWC offers a premium service for a
limited period at no charge to subscribers who are not
subscribers to that premium service. TWC has found that
free previews are an important factor in persuading
subscribers to add premium services to their cable package.
Thus, free previews are an invaluable marketing tool to both
TWC and the programming service whose premium service is
previewed.
17. TWC cable systems also exercise editorial
discretion in determining the channel numbers on which
particular programming will be offered. In determining
channel number location, TWC personnel consider factors
similar to those described above with respect to the choice
of individual program service, and weigh those factors with
channel accessibility.
18. TWC's cable systems compete with a wide
variety of alternate sources of news, information and
entertainment. In particular, TWC's cable systems compete
with broadcast television stations, which, unlike cable
systems, offer their programming without direct charges to
viewers. Despite this, however, local broadcasting stations
achieve a very respectable profit. See John C. Severino,
Perspective on Television; No Cable Pie for the Networks'
Sky, L.A. Times, Jan. 27, 1992, B5 ("many local broadcast
stations are still making profits in excess of 50 cents on
the dollar") (attached hereto as Exhibit A).
19. Although TWC's cable systems compete with
broadcast television stations, it is important to note that
the cable industry is different from the broadcasting
industry. There are no physical limitations on the ability
to construct multichannel video distribution systems
equivalent to the physical scarcity of the broadcast
spectrum.
20. TWC's cable systems also compete with other
means of delivering video programming to consumers, includ-
ing satellite master antenna television ("SMATV") systems,
in which apartments in a multiple dwelling unit ("MDU") are
connected to a group of antennas capable of receiving
satellite -delivered program services, that are located on
the premises (some SMATV systems use microwave relays to
connect multiple MDU's to a single group of satellite
receiving antennas); multipoint distribution service ("MDS")
or multichannel multipoint distribution service ("MMDS"),
often called "wireless cable", which deliver one or multiple
channels of programming to subscribers by means of
terrestrial microwave antennas; home satellite dishes
("TVROs"), which enable their owners to receive a vast array
of programming services that are transmitted by satellite,
either through a subscription agreement, arranged directly
with the programmers or indirectly through any of a large
number of program packagers, or, in many instances, free of
charge; and video cassettes and video disks, which consumers
may rent or buy for viewing on their television sets in
conjunction with video cassette players. TWC's cable
systems also compete with radio, especially in the provision
of music, and with all these media and broadcast television
stations for advertising.
21. TWC's cable systems also compete with the
traditional print media, particularly newspapers and
magazines, especially in the provision of news. Cable
television is an electronic publisher which has become a
vital, if not primary source for the public of news,
opinion, and other information. As of the end of August,
1992, cable passed 95.9% of all homes in the country; 61.7%
of these homes, or 54.9 million homes, subscribed. The
Kagan Media Index,. September 28, 1992 at 6-7 (attached
hereto as Exhibit B). Cable networks, such as CNN, have
assumed great importance to the public in its daily receipt
of national and international news. See, e.g., Jay Rosen,
The Whole World is Watching CNN, 252 The Nation 622 (1991)
("For Americans with cable, CNN serves as a video wire
service, offering constant updates on the news. It's also
an instant delivery system for dramatic footage from around
the globe.") (attached hereto as Exhibit C). CNN's coverage
of the Persian Gulf War is a striking example in this
regard. Cable also often serves as an immediate source of
newsworthy local information. As discussed above, TWC
produces local news programs in New York City and Ithaca and
Rochester, New York, among other places.
The 1992 and 1984 Cable Acts
22. The 1992 Cable Act amends the 1984 Cable Act.
In so doing, it reestablishes government regulation that
pre -dates the 1984 deregulation. The 1992 Cable Act,
however, also goes further. It establishes a broad new
regime of federal and local regulation that will, if allowed
to stand, destroy the phenomenal development of new
programming services. In essence, the second wave of the
video, revolution could be undone.
The Must Carry And. Retransmission Consent Provisions
of the 1992 Cable Act, the PEG and Leased Access
Provisions of the 1992 and 1984 Cable Acts,
and the Free Preview Restriction Provisions
I. The Statutory Scheme
A. The Must -Carry and Retransmission Consent
Provisions of the 1992 Cable Act
23. Sections 4 and 5 of the 1992 Cable Act amend
the Communications Act of 1934 by creating, respectively,
new Sections 614 and 615 (the "must carry provisions").
Section 6 of the 1992 Cable Act amends Section 325 of the
Communications Act of 1934. Sections 614 and 615 impose
upon cable operators onerous "must carry" obligations which
require operators to offer to their subscribers certain
commercial and noncommercial broadcast television stations,
regardless of whether operators wish to carry such stations
or their subscribers wish to receive them. Cable operators
must carry these stations without receiving "valuable
consideration" and must carry them on the same channel on
which they are broadcast over the air, unless a station
requests otherwise under the statute.
24. Section 325 empowers commercial broadcast
television stations to withhold consent for retransmission
of their signals unless the cable operator pays them a fee.
If a station elects retransmission consent treatment under
Section 325 instead of must carry treatment under Sec-
tion 614, a cable operator may not carry that station's
signal without the permission of the station. In addition,
cable operators are prohibited from receiving payment in
return for carrying a station, even though market factors
might have prescribed payment, as they have many times in
negotiations between networks and cable operators.
25. I believe stations electing retransmission-
consent treatment will withhold their consent unless the
cable operator pays them a substantial fee. In addition, it
is my opinion that only the most popular, influential and
powerful stations will be in a position to elect retransmis-
sion -consent treatment. Such stations will attempt to
extract substantial payments from cable operators for the
right to retransmit their programming.
C. The PEG Provisions of the 1992 and 1984 Cable
Acts
26. Section 611 of the 1984 Cable Act (codified at
47 U.S.C. § 531) permits municipal franchising authorities
to require the cable operators they regulate to set aside
channel capacity for public, educational or governmental
("PEG") uses (the "PEG provisions"). Section 7(b) of the
1992 Cable Act amends Section 621(a) of the 1984 Cable Act
and permits franchising authorities to also require cable
operators to provide "facilities" and "financial support"
for PEG use. There is no statutory limitation upon the
number of PEG channels that a franchising authority may
require. Section 611 also provides, inter alia, that "a
cable operator shall not exercise any editorial control over
any public, educational, or governmental ase of channel
capacity".
27. Section 25 of the 1992 Cable Act expressly
limits the portion of channel capacity that a direct broad-
cast satellite ("DBS") service must reserve for educational
or informational use. Only 4 to 7 percent of a DBS service
must be reserved for such uses. In contrast, cable opera-
tors are subject to potentially limitless requirements.
D. The Leased Access Provisions of the 1992 and
1984 Cable Acts
28. Section 612 of the 1984 Cable Act (codified at
47 U.S.C. § 532) requires cable operators to set aside a
substantial portion--up to 15 percent--of their channels for
lease to unaffiliated programmers (the "leased access pro-
visions"). Section 612 also provides, inter alia, that "a
cable operator shall not exercise any editorial control over
any video programming provided pursuant to this section".
29. As originally enacted, Section 638 of the 1984
Cable Act exempted cable operators from criminal and civil
liability with respect to obscene matters that they were
compelled to carry on PEG or leased access channels.
Section 10(d) of the 1992 Cable Act amends Section 638 so as
to eliminate this exemption from criminal and civil
liability if a program "involves obscene material".
30. Thus, under Section 638 as amended, a cable
operator is exposed to criminal prosecution or civil
liability as to obscene programming created by others that
the PEG and leased access provisions require the operator to
carry. Section 10(a) of the 1992 Cable Act purports to
resolve this problem with respect to leased access
programming by amending § 612(h) of the 1984 Act to permit a
cable operator to prohibit or restrict indecent matter on
leased access channels. This power does not extend to PEG
programming. As to leased access programming, it requires
the cable operator to risk civil liability to an aggrieved
leased access programmer, or criminal or civil liability
under obscenity laws., if its decisions on obscenity should
later be determined to have been incorrect. As to PEG
programming the operator cannot even attempt to protect
itself from such liability.
31. Neither the 1992 Cable Act nor any other law
imposes leased access requirements upon SMATV or MMDS
systems, DBS operators or other providers of video
programming.
B. Free Preview Restriction Provisions
32. Section 15 of the 1992 Cable Act provides
that, if a cable operator wishes to provide a free preview
of a "premium channel" to subscribers that do not subscribe
to that premium channel, the operator must give notice of
that preview to all its subscribers 30 days in advance, and
block the channel carrying the premium service upon request
of a subscriber. Section 15 defines "premium channel" as
"any pay service offered on a per channel or per program
basis, which offers movies rated by the Motion Picture
Association of America as X, NC -17, or R." Accordingly ,it
would appear that notice is required regardless of whether a
particular preview contains such material, so long as the
premium channel sometimes "offers movies rated by the Motion
Picture Association of America as X, NC -17, or R" in
programming not included in the preview.
II. Injury As a Result of the Must Carry.
Provisions. PEG and Leased Access Provisions. and Free
Preview Restriction Provisions
33. Implementation of the must carry provisions
will cause irreparable injury to TWE in its capacity as a
cable operator in at least the following respects:
a. The provisions will require cable systems
of TWC to carry an average of approximately
8 commercial and nonce"mercial broadcast stations,
some of which the'cable.systems certainly do not
wish to carry. For example, in its Canton, Ohio
system, TWC may be required to carry a religious
broadcast station that it does not currently carry
and does not wish to carry. And, in its Staten
Island, New York system, TWC will be required to
carry approximately 17 commercial stations, two of
which are based in Bridgeport, Connecticut (which
is located 70 miles away and has very little, if
anything, in common with Staten Island). And in
its Keene, New Hampshire System, TWC will not only
be required to add 7 broadcast channels, but to
accomplish this, it would also have to purchase
and use expensive converter boxes, which it is not
now required to use.
b. Because much of the channel capacity of
TWC's cable systems is already in use for other
programming services, the must carry provisions
will require TWC to displace a substantial number
of existing services in favor of commercial and
noncommercial broadcast stations that TWC systems
would not otherwise carry. In addition, TWC will
be inhibited from offering new, innovative
services such as the Cartoon Network, which began
operating on October 1, 1992 and Sci-Fi Channel,
which began operating on September 24, 1992.
TWC's cable service will be made less competitive
with other media thereby, and the consumer appeal
of and subscriber satisfaction with TWC's cable
service will be diminished. Lack of channel
capacity presents cable operators with substantial
operating problems. Indeed, Paul Kagan
Associates, Inc., in a recent solicitation for a
publication reviewing cable operator channel
capacity problems, termed "the hunt for channel
capacity" as "cable's equivalent to the search for
the Holy Grail". See Exhibit D.
c. There are no noncommercial educational
television stations operating in several of the
communities served by TWC cable systems. In each
of these communities, TWC will be required to
import distant signals from other localities,
regardless of whether local subscribers have any
interest in receiving such programming and
regardless of TWC's judgment concerning the
desirability or appeal of such programming.
d. The must carry provisions will also place
TWC cable systems at a disadvantage in competition
with other providers of multichannel video
programming services that are not constrained by
must carry obligations. Under the must carry
provisions, TWC will be forced to carry the
programming of commercial and noncommercial
broadcast television stations regardless of its
appeal to or suitability for audiences in the
areas served by TWC cable systems, and other, more
popular programming will be displaced. Because
individual cable systems have a definite number of
channels available, these provisions take channels
from the cable operators that they could otherwise
use in their best editorial judgment. Competitors
such as SMATV and MMDS systems and distributors of
programming to owners of home satellite dishes
will not be constrained by the must carry
provisions. Because viewership of broadcast
television programming has steadily eroded in
recent years, TWC's cable systems will be placed
at a substantial competitive disadvantage compared
to multichannel competitors not bound by those
provisions because they will have lost channels
that could have provided programming specifically
selected for their audiences.
34. The PEG provisions of the 1984 Cable Act
irreparably injure TWC's cable systems by enabling a
franchising authority to require those systems to designate
channel capacity for such uses without setting any limit on
the number of channels that the authority can so designate
and by enabling municipal authorities to require
"assurances" that such PEG requirements will be complied
with. For example, in Ithaca, New York the franchise
authority requires TWC's local system, which has 60
channels, to offer up to 9 PEG channels. The PEG provisions
give the .franchising authority control over the content of
the programs thus exhibited and expressly displace TWC's
editorial discretion. Further, because the PEG provisions
enable municipal officials to require TWC to carry
governmental channels, they force TWC to carry government
speech that TWC may not wish to carry to subscribers who may
not wish to receive it, and they enable government officials
to displace TWC's chosen messages with their own messages.
35. In addition, by subjecting providers of DBS
service to far less stringent PEG requirements than cable
operators are subjected to under the 1984 Cable Act, the
1992 Cable Act causes irreparable injury to TWC's cable
systems by placing them at a competitive disadvantage by
favoring DBS speech over TWC's. TWC is also placed at a
competitive disadvantage because neither the 1992 Cable Act,
the 1984 Cable Act, nor any other law requires other
providers of video programming, including SMATV and MMDS
systems and broadcast television stations, to provide PEG
channels.
36. The leased access provisions compel TWC to
publish the speech of others. These provisions expressly
abrogate the editorial discretion of TWC's cable systems and
force TWC to be identified with messages it does not wish to
convey.
37. The provision of Section 10(d) of the 1992
Cable Act which repeals the immunity from criminal and civil
liability with respect to obscene programming carried on PEG
and leased access channels causes irreparable injury to TWC
by subjecting it tothe risk of criminal and civil liability
for programming created by others that it does not wish to
carry but is required by law to carry. The provisions of
Section 612(h) of the Cable Act permitting TWC to prohibit
or restrict obscene programming does not alleviate such
injury in that
questions that
difficult, and
liability if a
Further, these
they compel TWC to determine obscenity
even Federal courts regard as exceedingly
TWC remains
court later
exposed to criminal or civil
disagrees with its determination.
provisions provide no protection whatever as
to obscene programming TWC may be required to carry on PEG
channels. At least one TWC cable system has already been
obligated to hire employees to screen programs for
obscenity, even though it did not choose to offer these
programs, and would prefer not to do so.
38. By compelling TWC to yield control of a
substantial portion of its channel capacity to unaffiliated
programmers, the leased access provisions irreparably injure
TWC by impairing its ability to offer programming created by
others or by itself that it would prefer to convey and that
TWC believes its viewers would prefer and by limiting its
ability to offer its own programming.
39. By permitting the FCC to regulate the price,
terms and conditions of channel leases, the 1992 Cable Act
irreparably injures TWC by subjecting it to regulation from
which its non -cable competitors are exempt and by placing
business control of its communications assets in the hands
of government officials.
40. Taken together, the must carry, retransmission
consent, PEG and leased access provisions of the challenged
legislation irreparably injure TWC by requiring it to
relinquish editorial and business control of a substantial
portion of the cable channels that enable it to communicate.
The average TWC system has approximately 45 channels, is
located in an area having approximately 8 local commercial
and noncommercial broadcast stations and is required by
franchise to provide approximately 2 PEG channels. The
Cable Act, therefore, would require TWC to relinquish
editorial and business control of over an estimated 30% of
its channels (approximately 8 must carry channels,
approximately 2 PEG channels and approximately 3.5 leased
access channels).
41. The restrictions of Section 15 will make it
more difficult and costly for TWC to offer free previews of
premium services. I believe it will be very expensive to
block such previews from objecting customers. Based upon my
experience, I expect that, as a result of these burdens,
some of TWC's cable systems will offer fewer free previews,
and some might even stop offering them altogether. Because
Section 15 might be construed to apply even if a particular
preview contains no "movies rated by the Motion Picture
Association of America as X, NC -17, or R", I expect this to
be true regardless of whether a particular preview contains
such material. Therefore, Section 15 will have the likely
effect of significantly inhibiting TWC's communications with
its subscribers through free previews, to its irreparable
injury. In addition, Section 15 discriminates against cable
operators because it allows non -cable program distributors
to promote their premium services without limitation. This
places TWC and other cable operators at a competitive
disadvantage.
The Exclusive License and Standardized Terms and Conditions
Provisions
I. The Statutory Scheme
42. Section 19 of the 1992 Cable Act adds Section
628 to the Communications Act of 1934. Section 628 directs
the FCC to prohibit cable programmers in which a cable
operator has an' attributable interest from entering into an
exclusive agreement with any cable operator, except that if
the programming is to be distributed to areas currently
receiving cable, they may enter into such a contract if the
FCC finds that it is in the "public interest".
43. Section 628 also directs the FCC to prohibit
discrimination by a satellite cable programmer, in which a
cable operator has an attributable interest, in the prices,
terms, and conditions of sale and delivery of cable
programming between cable systems, cable operators or other
multichannel video programming distributors.
II. Iniury to TWE as a Result of the Exclusive
License and Standardized Terms and Conditions Provisions
44. The exclusive license provisions will
irreparably injure TWC by rendering it difficult or
impossible for TWC to obtain exclusive licenses from
cable -affiliated programmers, thus impairing TWC's ability
to differentiate itself from its competitors. As the
Secretary of Commerce and Attorney General have recognized:
"Requiring programming networks that are commonly owned
with cable systems to make their products available to
competing distributors could undermine the incentive of
cable operators to invest in developing new
programming. This would b^ to the long-term detriment
of the American public."
Letter from Barbara Hackman Franklin, Secretary of Commerce
and William P. Barr, Attorney General to Congressman Edward
J. Markey, at 2 (April 1, 1992) (attached hereto as
Exhibit E); see also Letter from Robert A. Mosbacher,
Secretary of Commerce, and James F. Rill, Assistant Attorney
General, Antitrust Division, Department of Justice, to
Senator John C. Danforth at 2 (March 13, 1992) (attached
hereto as Exhibit F).
45. These provisions will also impede the
creations of new programming services by cable operators,
who have historically been among the most important creators
of such programming. Any new programming created by cable
operators will, by definition, have attributable cable
interests, and therefore be subject to the exclusive license
and antidiscrimination provisions of the 1992 Cable Act. I
believe that operators will be reluctant to embark on the.
financial risks of new program service creation when their
ability to control the distribution of such services is
subject to such intrusive regulation.
Rate and Service Content Regulation. Limitation
of Cable Operators' Ability To Create Programming.
Limitation on Number of Cable Subscribers and
Exemption of Government -Owned Cable Operators from
Franchises and Damages
I. The Statutory Scheme
A. Rate and Service Content Recrulation
46. Section 3 of the 1992 Cable Act amends
Section 623 of the Communications Act of 1934. Under the
amended provision, cable operators that are not subject to
"effective competition" (as defined) will be subject to FCC
and municipal regulation of the rates they may charge for
their most widely subscribed -to service tier, and the
content of that service tier will be prescribed (the "rate
and service content regulation provisions"). Section 623
also subjects such cable operators to FCC regulation of
rates for all other non -premium cable services.
47. In addition, Section 623(d) requires a cable
operator to have a rate structure that is uniform throughout
the geographic area to which a cable system provides
service. In a related provision, Section 623(b)(8)(A)
provides that a cable operator may not require that a
subscriber receive any service other than basic as a
requirement to receive programming on a per channel or per
program basis. It also provides that an operator cannot
discriminate with regard to rates charged for such
programming on the basis of whether a subscriber orders
basic service or a higher tier of service.
48. I believe that under the definition of
"effective competition" contained in Section 623(1)(1), the
greatmajority of cable systems in the United States,
including those operated by TWC, will be found to lack
effective competition. As a result, under
Section 623(a)(2), the rates for basic cable service of the
great majority of cable systems in the United States,
including TWC's, will be subject to rate regulation by local
franchising authorities or by the FCC, and the rates for all
cable programming services (as defined) offered by such
cable systems will be subject to FCC regulation.
49. Neither Section 623 nor any other law purports
to prescribe the service offerings or regulate the rates of
SMATV systems, MMDS systems, DBS operators, other
distributors of programming to home satellite dish owners or
cable systems that have "effective competition". Moreover,
the FCC has only specifically delegated to state and local
authorities the power to impose such regulations on cable.
B. Limitation of Cable Operators' Ability to
Create Programming
50. Section 11 of the 1992 Cable Act amends
Section 613 of the 1984 Cable Act to add new Section 613(f).
Section 613(f)(1)(C) requires the FCC to consider the
"necessity" of imposing "limitations
on the degree to which
multichannel video programming distributors may engage in
the creation or production of video programming".
51. Section 613, therefore, gives the FCC
authority to limit the creation and production of new
programs and programming services by multichannel video
programming distributors, including cable operators. I
believe that cable operators are at present the only
multichannel video programming distributors that engage in
production and creation of programming to any significant
degree. Accordingly, the proposed FCC regulations would, in
fact, apply only to program creators affiliated with cable
operators.
52. No other program creators in the United States
are subject to such a prospective blanket limitation on
their ability to create and produce news, information or
entertainment.
C. Limitation on Number of Cable Subscribers
53. As added by Section 11 of the 1992 Cable Act,
Section 613(f)(1)(A) directs the FCC to establish
"reasonable limits on the number of cable subscribers a
person is authorized to reach through cable systems owned by
such person, or in which such person has an attributable
interest".
54. Under Section 613(f)(1)(A), the FCC is
obligated to limit the number of subscribers that can
receive information from a given cable operator. Whatever
limitation the FCC ultimately adopts will prevent cable
operators subject to the limit from disseminating
information to additional prospective viewers.
55. The mandated limitation of the number of
subscribers a cable operator may serve will prevent cable
operators and programmers from reaching willing audiences
and will prevent subscribers who wish to receive the
services and programming of cable operators that are subject
to the limit from obtaining them.
56. The provision concerning limitations on cable
operator size discriminates against cable operators because
of the means of communication they have chosen. There are
no comparable limitations on the number of persons who may
receive or subscribe to newspapers, magazines or other
traditional media. Limitations on the number of television
stations that can be owned by a given entity have been
upheld only because the electromagnetic spectrum over which
broadcast television signals are transmitted physically can
accommodate only a very limited number of speakers. There
are no similar limitations on the number of persons who may
communicate by means of cable or other multichannel
distribution technologies.
D. Exemption of Government -Owned Cable Operators
from Franchise Requirements and Damage Awards
57. Section 7(c) of the 1992 Cable Act amends
Section 621 of the Communications Act of 1934 to add new
Section 621(f). Section 621(f)(1) provides that nothing in
the Act shall be construed to "prohibit a local or municipal
authority that is also, or is affiliated with, a franchising
authority from operating as a multichannel video programming
distributor in the franchise area, notwithstanding the
granting of one or more franchises by such franchising
authority". Section 621(f)(2) provides that nothing in the
Act shall be construed to "require such local or municipal
authority to secure a franchise to operate as a multichannel
video programming distributor".
58. By exempting municipally owned cable systems
from franchising requirements, Section 621(f)(2) enables
municipal authorities to compete with the very private cable
operators whom they regulate, and to do so free of the
burdensome terms and conditions that municipal franchises
commonly entail. Under this provision, municipal
authorities may regulate --and, through franchise fees, tax --
their private competitors.
59. Section 24 of the 1992 Cable Act amends the
Communications Act of 1934 by adding new Section 635A.
Section 635A(a) provides that "[i]n any court proceeding
pending on or initiated after the date of enactment of this ,
section involving any claim against a franchising authority
or other governmental entity" (including government
officials) "arising from the regulation of cable service or
from a decision . . . with respect to a grant, renewal,
transfer, or amendment of a franchise, any relief . . .
shall be limited to injunctive relief and declaratory
relief". This provision exempts franchising authorities and
their personnel from any liability in damages for misconduct
they may engage in while regulating private cable operators
under their jurisdiction.
II. Injury to TWE as a Result of the Provisions
Concerning Rate and Service Content Regulation. Program
Creation, Number of Subscribers and Exemption of Government -
Owned Cable Operators from Franchises and Damages
60. Individually and together, the rate and
service content regulation provisions, the limitation of
cable operators' ability to create programming, the
limitation on the number of cable subscribers and the
exemption of government-owned video distributors from
franchise requirements and damage awards discriminate
against private cable operators such as TWC simply because
they communicate news, information and entertainment by
means of cable.
61. The provisions of the 1992 Cable Act that
specify the contents of each cable operator's basic service
tier override TWC's local editorial discretion to determine
the contents of the basic service tier. These provisions
will also irreparably injure TWC by requiring it to offer
basic service offerings that it would not otherwise offer
and that do not maximize subscriber satisfaction.
62. The provisions of Section 623(b)(8), which
prohibit cable operators from structuring their rates for
their premium and pay-per-view services in relation to the
non-premium services that a subscriber purchases, also
impinge on TWC's editorial discretion because they interfere
with TWC's editorial judgment in valuing different forms of
speech. Such provisions also place cable operators,
including TWC, at a competitive disadvantage as against the
non-cable distributors of news, information and
entertainment with which they compete.
63. The provisions of the 1992 Cable Act which
subject essentially all cable operators to extensive rate
regulation as to their lowest-priced and other non-premium
service offerings discriminate against cable operators,
including TWC, simply because they communicate news,
information and entertainment by means of cable. They place
TWC at a competitive disadvantage as against the non-cable
distributors of news, information and entertainment with
which they compete. Such provisions place business control
of TWC's communications assets in the hands of government
officials.
64. Authorizing local franchise authorities to
regulate rates is especially thr:atening to TWC and other
cable operators because franchise authorities are given
broad discretion in determining what rates are acceptable
for their speech. This broad discretion empowers franchise
authorities with jurisdiction over TWC's cable systems to
retaliate against systems for political stances.and
positions that they have taken or may take by lowering the
system's rates or refusing to permit needed increases. Such
rate regulation will certainly chill cable operators
exercise of their First Amendment right to criticize local
government officials; no matter what regime of rate
regulation the FCC ultimately adopts, local officials will
be left with considerable discretion in applying those
rules. It is simply unrealistic to expect that a local news
channel produced by a cable operator would vigorously
criticize the very officials who determine the prices it may
charge.
65. By threatening to limit the ability of cable
operators, including TWC, to produce and create their own
programming, the program creation provisions of the 1992
Cable Act will discourage TWE from creating and
disseminating programming that reflects its own distinctive
point of view.
66. By threatening to limit the number of
subscribers that TWC may serve, the provisions of the 1992
Cable Act directing the FCC to prescribe limits on the
number of cable subscribers an operator may. serve will
prevent TWC from disseminating information to prospective
viewers, to its irreparable injury. In addition, those who
wish to receive TWC's service will be barred from receiving
it.
67. TWC currently operates cable systems in at
least 10 localities where municipal authorities have
established or expressed an interest in establishing
municipally owned cable systems. The, provisions of
Section 621(f) and 635A will likely encourage other
municipalities in which TWC has cable systems to establish
such systems. In such localities, the provisions of
Sections 621(f) and 635A threaten TWC with irreparable
injury by subjecting it to regulation, including taxation
through the imposition-of franchise fees, by municipal
authorities who are competitors and who are exempt from any
damages remedy for regulatory misconduct. Such provisions
confer upon government officials the power to abuse
regulatory authority for purposes of censoring the
communications of private cable operators or punishing them
for stances they have taken or may take on political issues,
including franchising issues. Such provisions also cause
irreparable injury to TWC by favoring government officials,
and disfavoring private cable operators including TWC, as
competitors.
68. In summary, the must carry, free preview
restriction, PEG, leased access, exclusive license and
.standardized terms and conditions, rate and service
contract regulation, limitation on cable operators'
ability to create programming, limitation on the number
of cable subscribers requirements implement a regulatory
structure that in combination discriminates against cable
operators in the most harsh and intolerabl= manner.
Sworn to before me this
qth day of November, 1992.
State of Connecticut
County of Fairfield
h J. Collins
On this 4th day of November, 1992, Elyse Egleston, the undersigned
officer, personally appeared Joseph J. Collins, known to me to be
the person whose name is subscribed to the within instrument and
acknowledged that he executed the same for the purposes therein
contained.
In witness whereof I hereunto set my hand.
ELYSE S. EGLESTON
Notary Public
My Commission Expires Aug. 31, 1997
PAGE 5
34TH STORY of Level 1 printed in FULL format.
Copyright 1992 The Times Mirror Company
Los Angeles Times
January 27, 1992, Monday, Home Edition
SECTION: Metro; Part B; Page 5; Column 2; Op -Ed Desk
LENGTH: 792 words
HEADLINE: PERSPECTIVE ON TELEVISION;
NO CABLE PIE FOR THE NETWORKS' SKY;
BARRY DILLER WANTS TO TAP CABLE FOR A NEW REVENUE STREAM. HE'D DO BETTER TO PUT
BROADCASTING'S HOUSE IN ORDER.
BYLINE: By JOHN C. SEVERINO, John C. Severino is president of Prime Ticket
Network. Before he was president of ABC Television, he was president and general
manager of KABC-TV in Los Angeles.
BODY:.
The broadcast networks should be ashamed of themselves. Their latest solution
to their money-losing situation is to demand that the cable industry bail them
out. Just a few days ago, Fox Inc. chairman Barry Diller said: "Broadcasters
have to get paid (by cable operators) because if they don't get a second stream
of income beyond advertising support, they will eventually go out of business."
As the former president of ABC Television, let me tell you that Diller and
his friends are completely out of line. This is the same group of astute
business executives who pay their affiliates hundreds of millions of dollars a
year to carry hit shows like "Roseanne," "60 Minutes," "The Bill Cosby Show" and
"The Simpsons."
The networks not only spend millions of dollars to develop and air these
shows, and give their affiliate stations advertising time next to them, but they
continue to pay them dearly for exhibiting these shows. This system of bribing
stations to carry a particular network was designed back in the days when there
were only two networks. It's incredible that this is still being done. Does Fox
pay movie theaters to exhibit "Grand Canyon?" No way!
It should be the other way around -- the station affiliates should be paying
the broadcast networks. Just like the cable affiliates pay the cable
programmers. Then the networks would have their second revenue stream.
Yes, annual reports certify that the networks are losing money. But at the
same time, many local broadcast stations are still making profits in excess
of 50 cents on the dollar. It's tough to feel sorry for these people. Maybe if
stations paid an affiliate fee to their broadcast network, they could be
very happy with a profit of, say, 25 cents on the dollar.
Who do the local stations pay? No television station ever paid for the use of
the publicly owned broadcast spectrum they occupy. It was given to them
absolutely free by the government. And cable, which was mandated to provide more
programming choices in addition to helping take the three networks over the hill
to the people who couldn't see 'em, is going to be their cash cow?
LEXIS NEXISa== LEXIS. NEXISa= �
PAGE 6
Los Angeles Times, January 27, 1992
Cable operators, on the other hand, have paid billions of dollars to build
their delivery systems and are reinvesting billions more in newer and better
technologies, like fiber optics. In the process, the operators also pay hundreds
of millions of dollars to local municipalities for the privilege of using those
systems.
The broadcasters' cry for new legislation is an interesting twist, because I
can remember when not too long ago they -- myself included -- lobbied for the
"must carry rule," forcing cable operators to televise the networks on their
systems. Now they're saying, "Pay me for what I make you take!"
Perhaps my friends who have decided to stay in the network business should
consider that they still have many options for making money. They can reverse
their system of paying affiliates for what they program. They can take advantage
of cable and broadcast's natural synergies in joint programming ventures and
shared production facilities.
Finally, the networks should reconsider the way they do business. It's no
longer 1952, and antiquated broadcast business practices must change. It's time
to wake up and smell the coffee!
Does CBS need 7,000 employees when CNN has only 500? Do Los Angeles broadcast
stations need 300 to 500 employees, per station when we at Prime Ticket operate
with fewer than 90?
Are billion -dollar rights fees for sports an appropriate expenditure? Are
newscasters like Peter Jennings, Dan Rather and Tom Brokaw really worth annual
salaries in excess of $2 million to sit and read the news for 30 minutes?
Why is it that from 7 to 9 a.m. every morning, every network televises the
same hosts interviewing the same guests with the same weather breaks coming at
the same times? In L.A., why do all the stations program local news at 5 and 6
o'clock and network news at 6:30 p.m.? Why do the network affiliates all program
the same type of game and reality shows from 7 to 8 p.m.? What law says that all
television programs must be divisible by 30 minutes?
Broadcasters are right to want to see their business change. It has changed,
but the networks haven't.
The philosophy of pursuing ratings at any cost is hurting the networks today.
Instead of thinking about how many ratings points they can get, they should be
concerned with rate of return.
For 23 years I was in the broadcast business; I'm guilty of having
perpetuated many of these practices. However, that was then and this is now.
In our free -enterprise system, every business is entitled to get as big a
bite of the pie as they can. But I'd like to think our government doesn't have
to spoon-feed it.
GRAPHIC: Photo, John C. Severino ; Drawing, "In the beginning there was only one
channel." / PUNCH
TYPE: Opinion
LEXIS NEXIS®====
Service ; Mead Data Central, Inc.
LEXIS NEXI_;= �
Plash .huaA/JepC. .c, .yy.i r. c
MONTHLY MEDIA INDICATORS
Local Spot HUtiap-Mt y
(1 biL)
2.8
0.58
0.51
0.44
0.37
0.30
(8 bil.)
0.70
0.62
0.54
0.46
0.38
0.30
1907
1988
1980 1900 1901 1992
National Spot Billiap-May
2.4
22
2.0
1.9
L5
Local Spot Bininewrm
2.518
1907 1999 1900 1900 1901 1902
1987
1980
1989
1990 1991 1902
(i
biL) Mine Ad Revenue -2nd Qaartor
2.00
1.85
1.70
1.55
1.40
125
(8 bu.)
3.5
3.2
2.9
2.8
2.3
2.0
1987 1968 1989 1990 1901 1992 1987 1988 1989 1990 1991
O 1992 Pau! Kagan Associates. Inc. analysis of Arbitron Broadcast Advertising Reports, Radio Network
Association and Publisher's Information Bureau data.
. Disgusts. Ad Ito,aane-YTD
3.551
1992
8/30/91
8/31/92
8/31/93
Cable penetration of all TV homes
67.8%
-59.2%
60.4%
VCR, penetration of all TV homes
TBacl4ard
75.7
80.3
84.4
dishes as % of all Whams.
3.8
3.9
4.2
Homes passed as % ofall TV homes t
95.1
96.9
96.4
Cabin penetration of all homes passed
80.8
81.T
62.8
Payy-able as % of belie able
78.7
76.8
-75.3
�►ddresaable homes as % of basic cable
35.1
313
43.7
PPV marketed homes as % ofbasic cable
33.8
38.1
42.8
PPV homes as % of addressable homy
1
95.9
96.9
-298.1
TRE KAGAN MEDIA INDEX/Sept. 28, 1992/P. 7 of 14
--Proj.-- ---% Uig. ---
8/30/91 0/31/92 8/31/93 91-92 92-93
1 U.S. TV haus (MIL) 91.8 92.7 93.7 1.12 1.02
2 Hoses passed by cable (MIL) 87.3 88.9 90.3 1.9 1.5
3 Basic cable subscribers (MIL) 53.0 54.9 56.5 3.5 3.0
4 Pay-cable subscription units (MIL) 41.8 42.2 42.6 1.0 1.0
5 Expanded basic cable subscribers (MIL) 13.5 14.7 15.5 9.0 5.0
6 Backyard dishes (MIL) 3.3 3.7 4.0 10.0 8.0
7 Backyard dish subscribers (MIL) 0.8 0.9 1.0 17.9 12.9
8 SMATV subscribers (MIL) 0.9 0.9 1.0 7.4 7.4
9 MDS subscribers (MIL) 0.0 0.0 0.0 (43.9) (17.1)
9 Wireless cable subscribes (M11.) 0.0 0.0 0.0 (7.5) (1.8)
10 Addressable cable homes (MIL) 18.6 21.6 24.7 15.9 14.5
11 Pay-per-view (PPV) marketed homes (MIL) 17.8 20.9 24.2 17.2 15.9
12 PPV revenue (year -to -data) (MIL)$ 258.7 400.7 400.0 54.9 (0.2)
13 PPV revenue (latest 12 mo.) (MIL)* 3414 - 530.0 600.3 55.4 13.3
14 PPV revenue/cable boas/mo. $ 0.5 0.8 0.9 S0.2 10.0
15• VCR homes (MIL) 69.5 .74.5 79.0 7.2 6.1
16 Cassette rental tures (year -to -data) (MIL) 2.252.6 2.359.2 2.483.8 4.7 5.3
17 Cassette rental turns (latest 12 mo.) (MIL) 3.352.5 3.485.5 3.663.4 4.0 5.1
18 Cassette rentals/VCR hams/mo. . 4.0 3.9 3.9 (3.0) (1.0)
19 Cassette rental rev. (year-to-date)• (MIL)$ 5.180.9 5,507.5 5.914.5 6.3 7.4
20 Cassette rental rev. (latest 12 ■o.) (MIL)$ 7,720.7 8,098.0 8.668.2 4.9 7.0
21 Avg. videocassette rental price $ 2.3 2.3 2.4 0.9 1.8
22 Cassette rental rev./VCR home/mo. 1 9.3 9.1 9.1 (2.2) 0.9
23 Cassette unit sales (year-to-date) (MIL) 151.5 174.1 199.1 15.0 • 14.3
24 Cassette unit sales (latest 12 mo.) (MIL) 217.1 249.9 286.1 15.1 14.5
25 Cassette unit sales/VCR home/mo. 0.3 0.3 0.3 7.3 7.9
26 Cassette sales rev. (year-to-date) (MIL)$ 2.151.2 2,463.9 2.786.9 14.5 13.1
27 Cassette sales rev. (latest 12 mo.) (MIL)$ 3.093.7 3.539.5 4.018.8 14.4 13.5
28 Avg. cassette retail price $ 14.2 14.2 14.0 (0.6) (0.8)
29 Cassette sales revenue/VCR boas/mo. $ 3.7 4.0 4.2 6.7 7.0
30 Total home.vidso rev. (latest 12 mo.) (MIL)$ 10.814.4 11,637.5 12.687.0 7.6 9.0
31 Total boss video rev./VCR home/mo. $ 13.0 13.0 13.4 0.4 2.7
32 Video shopping homes (24 -hr. equiv.) (MIL) 66.3 68.3 70.3 3.0 2.9
33 Video shopping rev. (year-to-date) (MIL)$ 1,333.5 1,444.3 1.559.8 8.3 8.0
34 Video shopping rev. (latest 12 no.) (MIL)1 1.928.3 2,111.0 2.281.9 9.5 8.1
35 Video shopping revenue per home/P0. $ 2.4 2.6 2.7 6.3 5.0
36 Cable operator rev. (year-to-date) (MIL)$ 13.212.6 14,314.1 15,248.6 8.3 6.5
37 Cable operator rev. (latest 12 mo.) (MIL)8 19.180.9 20.920.4 22.405.6 9.1 7.1
38 Revenue/basic sub/mo. $ 30.1 31.8 33.0 5.4 4.0
39 Cable network fes rue. (year-to-date) (MIL)$ 861.3 977.3 1.080.0 13.5 10.5
40 Cable network fes rev. (latest 12 mo.)(MIL)$ 1.228.0 1,408.0 1.568.6 14.7 11.4
41 Cable network fes rue./cable sub/mo. $ 1.9 2.1 2.3 10.8 8.2
42 Broadcast net. ad rev. (year -to -data) (MI1.)8 6.481.3 6.851.3 7.283.3 5.7 6.3
43 Broadcast net. ad rev. (latrt 12 mo.)(MIL)$ 9.815.0 10,092.0 10,709.0 2.8 6.1
44 Spot TV ad rev. (year -to -data) (MIL)$ 4,806.7 4.926.7 5,173.3 2.5 5.0
45 Spot TV ad rev. (latest 12 mo.) (MIL)1 7,378.3 7,330.0 7,636.7 (0.7) 4.2
46 Local TV ad rev. (year-to-date) (MIL)$ 5.100.0 5,276.7 5,540.0 3.5 5.0
47 Local TV ad rev. (latest 12 mo.) (MIL)$ 7,737.3 7,826.7 8.178.3 1.2 4.5
0 1992 Paul Ragan Associates, Inc. estimates.
622
ARTICLES.
- GLITZ! VISUAi.S! ACTION!
NOME
The Nation. TH16 MATEFltAt. MAY BE May 13, 1991
pRQTECTt:D EY COPYTITC314T
LAW (crttt 17, '..5. C.1 .)
The Whole World
Is Watching CNN
JAY ROSEN
The bus shelter ads say. "CNN: NOW MORE THAN
EVER." They have a point. Indispensable and omni-
present during the gulf war, Ted Turner's Cable
News Network now looks to be the future of TV
news. But what kind of future will it be? The answer depends
on which of its many identities CNN is inhabiting at a given
time (or place).
For Americans with cable. CNN serves as a video wire serv-
ice, offering constant updates on the news. It's also an instant
delivery system for dramatic footage from around the globe.
In a crisis it becomes a kind of videq bulletin board where key
players can post messages to r••e another in full view of the
world. With its growing internatio al presence, especially in
the environments traveled by power�ul elites, CNN represents
a new dimension of an emerging global culture that is already
heavily Americanized. And in countries where the media are
still government controlled, CNN offers an image of an open
society—modeled, of course, on the commercial aesthetic of
American TV. •S .
Any reckoning with C]vN must gin with the reasons for
its rise, first in the United States an then internationally. The
essence of CNN is that it is a twenty -four-hour news network,
meaning that .within the organization there is no other com-
peting programming.Ry giving its undivided attention to news,
CNN gains a large advantage over the nems divisions of the
three major networks, which are just that—divisions within
an increasingly hostile cnrnorate climate. where there's con-
stant pressure to cut costs. CNN is now ready to accomplish
in news what the Hollywood movie studios have done in en-
tertainment—parlay the huge U.S. market into a revenue
source that can fund the leap into an even larger international
market. It is now in the process of ei ecuting this strategy, but
the networks. with far more experience in the news business.
are closing bureaus and trimming staff.
Asa global news service CNN will soon have competi-
tion—from the BBC. for example—but none of its inter•
national rivals will be able to count on the two income streams
CNN enjoys in the United States: cable fees and advertising
revenues. Whether Turner continues 10 own it (there are ru-
mors of a Time•W'arner takeover), CNN is here to stay. and
,rot unly here but abroad as well. in unc form or another. it
reaches more than 100 countries: it has agreements to share
footage with broadcasting agencies all over the world. It is
Jay Rosen teaches journalism at /,tw York Unirerstty and Is
currently a research fellow at the Oannett Foundation .Mediu
Center at Colurrtb+a L'n, ►snit)
the global village. as Marshall McLuhan is reported to have
told Turner.
uring the gulf war, CNN's triumph became clear to every -
if one. It achieved its highest -ever U.S. ratings, ranging
from 4.7 million to 10.9 rnillion homes in prime -time hours
(compared with fewer than 930,000 before the crisis). The net-
works also saw their ratings jump during. the war, but not their
revenues. For them, Mar cuvcragc cut intu prlmc•titnc hours
normally reserved for entertainment shows; the advertisers
didn't like it and recused to buy ads. War news. they said, was
not the right "environment." Given the gravity of events in
the Gulf and the high ratings their own coverage was getting.
ARC, NBC and C:BS had no choice but to stick with their
news divisions, even though they were losing millions of dol-
lars a day in canceled ads. After the war. a new round of
budget cuts. which executives justified by thc costs of war
coverage, hit CUS News.
CNN. meanwhile, was not only keeping advertisers hut rais-
ing its rates, from 53,300 before thc war to more than S20,000
for a thirty-second spot. This underlines the essential advan-
tage the network enjnys: Those who watch are watching it spe-
cifically for news; those who advertise on CNN have already
decided they are willing to advertise on the news. The result
is that CNN, despite its lower ratings. can invest more in news
gathering than any of its competitors, a gap that is certain to
grow given the networks' financial losses during the war. ABC
now has twelve foreign bureaus. NBC thirteen and CRS seven.
CNN has fifteen, with more 10 come.
On the first night of the war, CNN stunned the rest of the
news business by maintaining a phone link into Raghdad as
the bombs began dropping. While CNN's correspondents
gave us their version of the U.S. bombing raid. the networks
witnessed a vivid sign of their own demise. About 200 local
stations that had agreements with CNN switched to the cable
network's war coverage, including many network affiliates
that would ordinarily be carrying Dan Rather, Tom Brokaw
or Peter Jennings. In Los Angeles CNN was on all four in-
dependent stations. in New York it was on thrcc. We got a
sudden glimpse of the future; Local stations M ill retain their
own highly profttablc news operations and rely on CNN for
national or international news. Who needs Rather, Brokaw
and Jennings':
CNN feels it doesn't. Up to now. it has refused to create
what is known in thc trade as "anchor monsters." with
their outsized egos and outrageous salaries. This is part of
Turner's water. of producing the news at lower cost and
spreading those costs oser twenty-four hours of program-
ming. Of course, the costs are lower relative only to the U.S.
nctaorks. In comparison with thc toned -down atmosphere
of TV news to other countries, CNN looks rich, glitzy, ex-
citing, "American." The pricey anchors may be absent. but
the zooming graphics. high-tech feel and picture.driven
pace ni a network. newscast are important features of CNN.
This snake+ :t auutltcr %chicle fur the 'tweed of Ai:writ:an
May 13, 1991
The Nation.
%aloes. disguised this time as production salurs.
Herr, ton, Inc parallel with the Hollywood studios holds.
Against the calculated slickness and thrill -a -minute action of
the big -budget Hollywood feature, the filmmakers of other
nations have a hard time competing. The same kind of com-
petition ix already occurring in newt, at the polished look and
up-tempo pace of CNN force home-grown broadcasters in
turope to adopt similar techniques. As CNN producer Bob
Furnad told the 1.ns.Angeles Times last year, "We live in an
ens ironment where people are watching a channel for three
minutes and then pressing that clicker. We've got to get them
Matching and keep them watching"
Political deeds that lack a visual
dimension may tend to escape
world notice because they bore
the image -hungry producers
at CNN
The ethic of "get them watching and keep them watching"
is born of the American experience of competing for ratings
in a multichannel commercial system. it is an attitude toward
the audience, a manipulative way of viewing others, that is
highly developed in the U.S. media but still underdeveloped
abroad. In setting out to equalize this differential, CNN
es mets a one-worldism that is considerably less admirable
than Turner's well-publicized concern for the environment
and world peace. The one world implied by thc production
values of CNN is one in which the viewer's attention can be
held in the sante manner everywhere: with dramatic visuals
deployed for their oomph value rather than their importance
in any explanatory scheme.
This frenzy of the visual, in which U.S. television has long
specialired, has political consequences, but no politics per sc.
In the gulf war, for example, it worked to the advantage of
the U.S. military in favoring repeated showings of laser -guided
micelles hitting their targets squarely and spectacularly. But
it also dictated that CNN would show scenes of what Iraq said
was a civilian shelter destroyed by allied bombs. It would be
Mrong to suggest that CNN has no politica: II acts in an
explicitly political manner when it shows defiance in the face
of any attempt to prevent it from airing the footage it wants
to broadcast. Thus the live coverage it sent front Beijing in
the spring of 1989, when Chinese officials were seen order-
ing the network to shut down its signal.
We can also expect more arresting irrules&nee. like the cov-
erage via satellite of American crews extinguishing oil fires
in Kuwait. CNN carried it lige on April 10, essentially because
it was promotable on the air April 9. It's significant that prior
to the gulf war, CNN's biggest ratings included its live cover-
age of the 1987 rescue of a baby trapped in a Texas well and
the 1989 San Francisco earthquake. This I'm iahising of thc live
623
may seem harmless, but when the next baby—or trapped
whale—captivates the whole world rather than the nation, the
power to create global distractions will perhaps draw greater
scrutiny. Of course, the same power can (and no doubt will)
he used to focus worldwide attention on various government
atmcitiec and political crimes, as long as they are highly vis-
ual and available to the cameras. Any rumbling of tanks into
city streets, as in 1 tananmen Square, will be costly to the
governrnent involved.
As CNN begins to:constitute—rather than merely inform—
thc global public sphere, its limitations will become global as
well. Politi.al deeds that lack a visual dimension may tend
to escape world notice because they bore the image -hungry
producer s at CNN (urns competitors). Consider in this con-
nection the savings and loan scandal and other complex
maneuvers of finance: they occutiin a political field that is
fundamentally nonvisual and dais of negligible interest to
those whose task is to "get them watching and keep them
watching." It's not that thc facts of such scandals arc sup-
pressed, but they arc relegated to financial news segments and
therefore escape the continuous cycles of repetition that are
the essence of the CNN style.
Sti11, it would be wrung to assume that CNN is eutitely ur
even predominantly a malignant influence. There are several
ways in which its approach to news is a progressive one. For
example, its preference for live coverage means that it will
often carry important news conferences, announcements
and hearings in their entirety, avoiding the tyranny of the
soundbite and thc TV reporter's breezy, overly facile wrap-
up. Granted, what CNN considers "important" is likely to
involve government officials, but there's still a net gain for
viewers, who can watch, listen and decide fur themselves
what they think. Similarly, the refusal w build up the on-
624
The Nation.
one-Wa Radio
merica broadcasts to all corners of the globe.
In recent discussions of the Pcrsian Gulf
war, we have ignored the international di-
mension of broadca4ting and the consequent
role that American news plays•ir Iraq and the gulf coun-
tries. CNN has received the most attention, as a result of
its expanded role in the gulf erar. when it was widely
watched in the Arab world and. more controversially.
when it relayed Saddam Husseip's words directly to thc
American people.
But the cheapest and most extensive way in which
the United States speaks to the, world is through radio.
Throughout the gulf war the Voice of America pumped
out all -news shows to the Mid East for fifteen hours
a day in Arabic and for'eighteea hours a day in English.
People can tune in to the V.U.A. in Baghdad while they
cook, shave or drive to work. They can pick it up on
cheap, battery -run receivers anti listen to shows relayed
through Greece. Those who h'a•exit FM radio can hear
the V.O.A. from Dhahran. I
In Iraq, news is government c ntrolled. as it is through-
out the gulf region. The politi intellectual elite, and
countless others as well, listen a very wide spectrum
of international radio br adcas4Cts. They tune in stations
from the BBC to Radio Moscoollw, from Kol Israel to the
Voice of Palestine. They pay attention to France's Radio
Monte Carlo, Germany's Deutsche Welk—and to the
Voice of America.
Radio. unlike print, knows no boundaries, and its sig-
nal is unstoppable. Jamming i ternational broadcasts is
expensive because it requires a ormous electrical power.
and it is never completely eft tive. Last August 3, Iraq
began jamming the Voice of erica; by September 26
it had given up. Arab countries onitor the V.O.A. (along
with all other international stati Wand issue daily book-
lets of excerpts to their own p ess. Although subject to
censorship. overseas newspa and radio stations em-
ploy tV V.O.A. as a wire sere ce.
People listen. After the gut crisis started. according
to a BBC survey,/he number of kgyptians who listened
•to the V.A.A. mss from 1 rte t to 11 percent of the local
listening audience. In Saudi A bia 13 percent of the au-
dience tuned in to the V.U.A. mons the political elite,
we can assume that a much igher proportion listen.
When ABC anchor Peter Jen ings conducted his inter-
view with Saddam Hussein on ovemberin,1990, his in-
terpreter interjected that anot er 100.000 American sol-
diers were on their way to the lf. Saddam immediately
corrected him, doubling the fi ure. The Iraqi leader had
cornett) the interview directly rpm listening to the Voice
of America.
Although Saddam and matter other Iraqis listen to the
V.O.A., how many Americans:have ever heard of, not to
May. ::..>91
mention heard, Radio Baghdad' It has regularly broadcast
to North America for two hours a qday in English; it trans-
mits programs in Arabic as well. But few Americans bother
to listen to shortwave at any time, even to the BBC. Whcn
Iraq's electrical transmitter ceased operating. English-
language broadcasts of Radio Baghdad also ended.
George Bush receives monitored reports about the station
and ;$ b, icfcd on it by military intelligence and the C.I.A.,
but he never tuned in to Radio Baghdad himself.
International broadcasting is tn.general a one-way flow.
While it is true that people in the Arab nations listen to
one another's radio stations, Western countries usually
broadcast to the less-developed countries. not the other
way around. This means that a leader lake Saddam can-
not seal off he people of Iraq from news of the war or
news of thc world. But it also means he cannot make his
own voice heard abroad..
. That is why demonstrators around the world carry
placards written in English for television cameras send-
ing footage to American audiences. Their only way of
communicating to foreign peoples and governments is
through the Western media. With the rise of CNN and
the growth of American media domination of interna-
tional broadcasting, that imbalance has become all the
more evident—and frustrating.
Saddam needed to usa thc American media to talk to
the American people—and. once the channels of di-
plomacy had shut down, to thc American government.
This is not to say that Peter Arnett was wrong to stay in
Baghdad and report what he saw.' But the furor in the
United States over whether he was being used as an in-
strument of Iraqi propaganda mint he viewed in the con-
text of the dilemma in which every Third World•rtation
finds.itself: America can talk to them and to their pen -
pie. but they cannot reach uc. 11 is rally by looking at the
Arnett case from the viewpoint of American -news -as -
cultural -hegemony that we can understand fully the
meaning of his broadcasts.
Third World nations will continue to listen to foreign
radio, including thc Voice of America. CNN will grow in
international importance in the coming years, bombard-
ing the world with American news from an American
perspective. As international broadcasting increasingly
facilitates Western hegemony, the cense of media impo-
tence and thc resultant political anger already felt in the
less-developed nations of the world will expand accord-
ingly. Until we become aware of the nature of the prob-
lem, we will not understand why Third World nations try
to use our broadcasters as a channel of communication
to the United States. Americans rarely think about the
media in international terms, but we must learn to do so.
HOLLY COwAN SNl'L%,AN
Holly Cowan Shulman reaches Amerrcon history at the
University of Maryland and is the author of The voice
of America (University of $'isconsin).
Mu; . , ..);91
The Nation.
air people as stars has a welcome effect: They're not tcmptcd
to appoint themselves Secretary of State, as Ted Koppel is
inclined to do.
In general, the fact that CNN is on all the time reduces thc
pressure on any particular half-hour to perform in the ratings,
which means that the people on air don't have to blow-dry
themselves to perfection or edit out every trace of reality's
messiness. Among network news traditionalists, CNN is often
said to lack "depth." But in a tradition where "depth" means
five minutes for a complex subject rather than two, the charge
is hard to take seriously. For a standard thirtyminute news-
cast, CNN is similar enough to the networks to substitute for
them, which it is doing and will continue to do.
CNN's shrewdest move to date has been to target the in.
ternational elite, those who are involved in the news as actors
more than audiences. In newsrooms, international airports,
foreign ministries and financial houses around the world,
CNN is left on all the time, becoming the medium of record
for people whose business it is to monitor the glebe. For ho-
tels that cater to international elites, CNN is also a must. it
is this elite viewer, more than any mass audience in foreign
countries, who gives CNN a potent internatirsnal presence. in
Iraq during the war, CNN was received by satellite, but only
by a handful of government offices that could bear the ex-
pense of rooftop dishes. Saddam Hussein coulC watch, but
not most Iraqis. This international presence gives CNN the
cachet it needs to capture interviews with world leaders and
kcy announcements from the players in a crisis. These can be
aired in real time, making the network even more valuable to
political actors. That is why desk officers at foreign minis-
tries assign someone to watch CNN around the clock.
In countries where television and the press have been rig-
idly controlled, there is little doubt that the arrival of CNN
means n freeing:up of the media system. Solidarity knew what
it was doing in the mid -198th when it got the Polish authori-
ties to concede a half-hour of CNN on the nightly government
newscast. Similarly, opponents of the ruling pa, ty in Mexico
credit CNN's presence with making it harder for the govern-
ment to manipulate voting results. For U.S. viewers, there's
the fact that CNN is more likely to give "outlaw" leaders like
Saddam andCol. Muammar el-Qaddafi a chance to be heard.
The rcason,'of course, is more economic than political. If
you've got twenty-four hours a day to fill, why not Ict Qad-
dafi haw his say?
In its often sloppy, seat -of -the -pants reporting during thc
gulf war, and in presenting Parr Arnett's censored reports
from Baghdad, CNN showed tendency to shift the editing
function toward the audience. The right to sort through in-
formation and discount what some people say was removed
from TV producers and given to viewers. That's progress, at
least on my ledger. What isn't progressive about CNN is the
implicit nihilism of picture-drisvn news and the "keep 'em
watching" mentality. In these respects, Turner's triumph will
do more for the spread of TV culture than for the cultivation
of intelligent citizenship around thc globe. But CNN bears
watching, if for no other reason than that a Rood portion of
the world is likely to be watching it too. _:
625
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Honorable Edward 47. !'Markey
Chairman, Subcommittee on
Telecommunications and Finance
Committee on Energy and Commerce
House of Representatives
Washington, D.c. 20315
THE SECRETARY or COMMEAC(
WI!ha.t0+% O.C. 3OQ3O
April I, 1991
Dear Mr. Chairman:
We are writing to inform you of the Administration's views
OA your draft cable television bill, which the subcommittee hes
scheduled for markup today.
The Administration has strongly opposed proposals to re.
regulate the cable television industry considered by Congress in
recant years, including 5. 12, which passed the Senate in January
1992, and H.R. 5267 which passed the Nouse in September 1990.
The new draft bili includes numerous proposals similar to those
that the Administration opposed in these past bills.' Therefore,
if the bill were presented to the president in its current lora,
the Attorney General, the Secretory of Commerce, and the
President's other senior advisers mold sercousend a veto.
Cur principal ebiectivn t4 the *raft bill is that, like its
predecessors, it doss not sufficiently emphasise competitive
principles in addressing perceived problems in the cable
television industry. It has been the Administration's consistent
position that competition; rather than regulation, creates the
most substantial benefits for consumers and the greatest
opportunities for American industry.. Television viewers will be
best served by removing barriers to entry by nfirms into the
video services marketplace. The i►diinistranewion, therefore,
supports removal of currant legislative prohibitions against
telephone company provision of video programing, with
appropriate safeguards.
Tba Administration also objects to the draft bili because it
vould greatly expand regulation of cable rates. It would require
regulation of cable systems by either the Federal Communications
Commission (TCC) or local government. In this respect the new
regulatory regime vould.be even more intrusive than that which
prevailed prior to the 3.994 Cable Act, when regulation of cable
systems was permitted but not required at either the local or
federal level.
' The number of cable systems and variety of cable programs
have grown dramatioally in the absence of extensive rate
regulation. Reimposing such regulation would both hamper the
3
develops►ent of new products and services for cable subscribers
and slow the sxpaneion of cable service to areas not now served.
The Administration also opposes the provisions of the draft
bill that would restrict the discretion of cable programmers in
distributing their product. exclusive distribution arrangements
ars common in the entertainment industry and encourage the risk
taking needed to develop new progressing. Requiring programming
networks that are comnonly owned with cable systems to sake their
product available to competing distributors could underpins the
incentives of cable operators to invest in developing new
programming. This would be to the lonq•ters detriment of the
American public. It competitive problems emerge in this area,
they can and should bm addressed under the existing antitrust
lave.
Additionally, the draft bill would require cable operators
to carry the signals of certain local television'stationa
regardless of whether the operator believes that the stations are
appropriate for inclusion in its package of services, and
regardless of whether such inclusion reflects the desires and
tastes of cable subscribers. to the &dsinistration's vier, such
•gust carrya requirements would raise st=ious First Anand int
Questions by infringing upon the editorial discretion exercised
by cable operators in their Selection ofinq. The draft
bill would else give television stations �on to oboes.
statimconsent to require retransmit itssble sign* . This proin the
vision,
however, does not address the serious first Amendment concerns
noted[ hete. While the Administration supports retransmission
consent (without must carry), this should be coupled with repeal
of the cable compulsory license.
Furthersore, the Administration opposes Section 14 of the
draft bill, which would restrict foreign ownership of V.S. cable
systems, as well as cable relay systsss, multipoint distribution
services direct broadcast satellite services, and other
programming -related services. •Noh a restriction invites
retaliation by other nations that could stiffs the growing
invsatsent of V.S. firms in foreign cable systems and could
hinder U.S. efforts to open Foreign markets. These provisions
would violate existing international obligations under the
Organisation for $vonosie Cooperation and Devslopeent's Code of
Liberalization of Capitis Movements. Mao, they could undercut
V.S. efforts to liberalise trade in services in the Cenral
Agreement on Tariffs and Trade.
In addressing any concerns about the cable industry, the
task for policymakers is to do so in a way that does riot
jeopardise the substantial benefits that the cable industry has
produced for consumers since passage of the 1984 Cable act. The
Administration is convinced that this task is bast accomplished
3
by increased competition and tlegislating
is1atiaq more cost
ly,
Government, and unnecessary governmenteslse• Additional
Government regulaticne would stifle investment, reduce consumer
to
d
choice, and conflict with President's efforts
•Td stimulate the
�.
advised by the Office of aagemenof i vises deet
we neve beenobjection to the submission
that there is no
at enactment of this cables television
ogram a bill in
•.Con s. o" in accord with
tbe �s current loran ecoid not be
President.
670.4441woot
Barbara Daman Franklin
nkl in
Secretary
Sincerely,
...11ias P.Bar
NttorneY
1
1 tNd WCeszs o� DOMPAsset
w.s+o +. OZ. Napo
Naas'' Sarah 13, 1991
Honorable John C. Danforth
United states senate
va*hington, D.C. =0510.0125
near senator Danforth;.
We are writing to Wore you of the Admigistration's views
ten 3.12, the Cable Television Consumer lrotaatson Act of iota.
As you Know, last year the administration strongly opposed
proposals to re -regulate U%$ cable television industry then
rending in Congress, inolt.dinq 1.1110. Unwise S.l2 is smiler
In all Materia, respects to 1.1110, the Administration strongly
r+pposee e•lal as well.
Our principal objevt;.on to 1.12 is that the bili, like its
ppredecessor, doss not sttfrieiently septsa.ite competitive
principles in addressing peroaivtd probleas in the cable
television industry. St has been the ministration's oonsistent
position that competition. rather than regulation, creates the
rest substantial benefits fox consumers and the greatest
('pportunities for American industry, sus t i ik that Congress can
hest serve television Vf.awera by removing barriers to entry by
new rims into the video services marks a... the
neministretion therefor 1,1,:1 z .L._A t Of- —771E 1 islative
1'ro - - - 'me one cO7n any prow s OR o v - so
rogramm%.
Moreover, the Adiiniitration supports iegiele►tion barring
cranchiein authorities from unreasonably refusing to award a
pecond cable franchise. such a provision ri33 remove an existing
farrier to entry by competing providers of video service to the
benne.,
The Administ=atlon also objects to e.12 b'reause it Mould
grontly expand Federal regulation of cable ragas Such a ties
would both Wiper tit& dei elopasnt of nawoducts and servitor
for cable subscribers and •lov the expansion of cable service to
areas not now served. Tta Administration believes that, until
nnmpotition is fully established. regulation of cable rat..
rhou]d continue to be governed by the framework laid out in the
,4l4 cable Aci, rather than by now and inflexible legislation.
That le, regulation shOuLd odour only vhen'a Cable system doss
hot taco "atfective eoap.+tition," as defined by the Federal
c:psaaaunieations Comaissieu Mewl). As you knew, the FCC has a
j'endl.nq4 ruleaaxinqQ in vh._ch it proposes to reVise the "misting
"effective compstition'� +standard. In eoaaments to the FCC, boh
Z
the Department of =mans and the Department of Justice have
proposed new standards tbau, while increasing the number et cable
systems subject to rats regulation, Nahid avoid the inflexible
+e-rsgulatton that 1.12 vol.tld impose on the coahis industry.
The Administration also opposes the prevllions et Sell that
would restrict the diicr,tion of cable programmara in
distributing their product. These provisions 4gnore the reality
that exclusive distribution arrangements ars men in is
entertainment industry and saOouregs the sL�k�tia*inq needed to
develop new programming. acquiringnetvorks that are
commonly owned with Cable systems toP2:11".
the product available
1 n competing distributors could the ntives of cableoperators to invest in de�4loping new progra nq services to
the lonq'tsra detriment of the American pu»1io. Zr competitive
problems emerge in this area, they .an► and should ba addressed
miner the existing antst",st law.
tinily, 8.12 would require cable operators to Carry the
mignsis of certain telsviaion nations, regardless of whether the
/lib's operator believes that the stations art pppropriate for
inclusion in its package of services, and regardless of whether
such inclusion reflects the desires and tastes of cable
subscribers. The AdetnLslratios believes that such 'most carry"
requirements would raise serious First Amendment questions by
.infringing upon the ediso:Fal discretion exercised by cable
nporstara in their s.lsdtion of prograasing.
The Administration to wall scare of the Widespread ovnosrna
'bout the structure and performance of the Cable televialore
industry. The task for palicymakers is to address these concerns
in a vay that doss not jeeppardits the substantial benefits thart
the cable industry has produced for eonouaers.alnce passage of
the 1984 Cable Act. The Administration is convinced that this
Leek can best be accomplished by the expansion of comppe�tition in
the video services marketplace and appropriate* rulemaking by the
FCC, rather than by the comprehensive rl.regulation of the cable
inaurtry contemplated by 1.11. ,
We have bean idviseU by the otlioe of Management and Budget
that WI is no objection to the submission0t these views to
the t.
the from the standpoint of the l�iiplattve program of
esi
Robert A. Wombedher
secretary of Commerce
aces v. 411
sistant Attorney General,
Antitrust Division
Department of Justice