Cable industry battles FCC chief to a stalemate

By Peter Kaplan - Analysis

WASHINGTON (Reuters) - The top U.S. communications regulator thinks cable television subscribers should be able to buy only the channels they want. And while his three-year campaign to make it happen has stalled amid fierce opposition from the cable industry, the issue is far from dead.

"The cable industry has used millions of dollars in lobbying pressure to beat back (the idea)," said Dan Isett, public policy director for the watchdog group Parents Television Council, which has pushed hard for the idea. "This is not an issue that's going away."

So-called a la carte cable pricing has been the Holy Grail of Kevin Martin's tenure since he became chairman of the Federal Communications Commission in 2005. To get the channels they want under the current system, consumers must sign up for "tiers" of service that critics say often include lots of channels that they never watch or do not even want.

Allowing customers to choose the channels they want, Martin argues, would allow consumers to reduce their cable bills and let parents keep racier channels out of their living rooms. A 2006 FCC study concluded that it could lower cable TV bills by as much as 13 percent.

Martin's push for a la carte pricing is supported by the Parents Television Council and Family Research Council. Some consumer groups like the idea too, citing the prospect of lower cable bills.

But selling individual channels is a non-starter to cable giants like Comcast Corp and Time Warner Cable. They say it would actually raise costs to most customers and cut TV programming diversity by forcing cable companies to eliminate smaller, niche channels. Cable providers have provided parents technology to block channels they don't want, they point out.

Martin has not been able to muster enough support from the four other commissioners to move ahead. And with a new administration taking office in January, the FCC chief faces "an atmosphere where folks might not be as willing to accommodate the chairman as they once were," said one agency source, who was not authorized to speak on behalf of the FCC.

"It's unlikely he's going to accomplish his objective in the time he's got remaining," agreed Andrew Jay Schwartzman, president of the watchdog group Media Access Project.