WASHINGTON (Reuters) - U.S. regulators are considering new rules, favored by phone companies, designed to give apartment and condo dwellers greater choice of pay television services by banning exclusive deals between building owners and cable TV providers.
The proposal, put forth recently by the head of the Federal Communications Commission, would prohibit the owners of apartment buildings and condominiums from making or enforcing exclusive deals with cable operators, sources close to the agency said on Friday.
“There appears to be momentum for it,” one source said.
The proposal could be voted on by the five-member FCC as early as the next few weeks.
If it’s approved, the new rule would be a victory for telecommunications companies such as AT&T and Verizon, which have been pushing into the pay TV business around the United States by offering packages of TV, broadband Internet and phone services.
“Why shouldn’t people in apartments and condos have the same choices everyone else does? And why should any company be able to block those choices?” Verizon spokesman David Fish said.
In recent filings before the FCC, AT&T and Verizon have complained that exclusive apartment and condo deals have been an anti-competitive obstacle that ultimately harms consumers.
“Providers like Verizon and AT&T, which are attempting broad-based entry in numerous markets throughout the nation, have already faced exclusive access arrangements designed to foreclose them from offering competing video (and broadband) services to (apartment and condo) residents in numerous instances across the country,” AT&T said in comments filed with the FCC.
But such a rule could run into a fight from cable providers such as Comcast Corp. and Time Warner Cable Inc.
The cable companies and the industry’s lobbying arm, the National Cable & Telecommunications Association, have questioned whether the FCC has the authority to interfere with contracts between cable companies and building owners.
They have voiced even louder objections to any provision that would nullify their existing exclusive contracts.
“The commission’s legal authority to act is tenuous, at best, and its legal authority to abrogate existing contracts is simply nonexistent,” Comcast Corp. said in comments filed with the FCC.
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