With apologies to Lewis Carroll, anytime I am asked to prognosticate on what is likely to happen during an upcoming congressional session, especially the one leading up to a presidential election, I am always reminded of Alice’s disorienting adventure down the rabbit hole complete with grinning cats, mind-altering elixirs and a whole host of Tweedledums and Tweedledees. This year is certainly no different. The telecommunications landscape has changed significantly since the last presidential election cycle. There is no longer any real debate over whether cable has competition. The newspaper ads are in your face and rooting in the mud in front of every member of Congress. But does that mean that we will be free of the call for cable rate regulation? No, of course not. This is an election year. So we can expect that the postponed hearings before Sen. John McCain’s Commerce Committee will result in some headlines decrying cable prices and comparing them, as usual, to the consumer price index. It will be a little harder for the politicians to get overly righteous this time, since in the area right around Washington, D.C., some state universities have raised tuition 41% in the past two years, and real estate taxes have gone up 52%. Never mind. They will yell about cable. The congressional focus, however, will be slightly different, I suspect. The fight over media concentration will be first up, with the debate over placing a cap on network ownership of local broadcast stations heating back up as soon as Congress starts work in late January. The deal worked out between the White House and congressional leaders is likely to stand, with a 39% cap imposed instead of the 45% cap adopted by the FCC. The media concentration theme will be with us throughout the political year, since various events will take place that will allow those concerned to continue to raise the issue. As examples, the digital cable carriage rules will be debated before the FCC, but Congress is likely to be heard from in the context of pushing for “localism.” And the fact that Rupert Murdoch now controls DirecTV will have an impact on debates that will swirl over programming that is either added or dropped from both satellite and cable as the programmers and distributors battle over escalating prices. There is some legislation that is considered must-pass. In particular, there are provisions of the Satellite Home Viewers Improvement Act (SHVIA) which will sunset at the end of 2004 unless Congress does something. These provisions in the main have to do with the carriage of distant signals, compulsory licenses and the like. They are very specific to satellite carriage, and they principally affect the more rural areas, so politically one way or another a bill will be passed. However, there is a reason why cable’s lobbyists shiver whenever anyone suggests “going to the Hill” for any type of legislation—even stuff that would theoretically help cable operators. The “Christmas tree” effect is well known. Once there is a bill that has a reasonable chance of passage regarding telecommunications issues, there is very little to stop some member of Congress from adding a little bauble here and a garish decoration there on “related” issues. Well, folks, we are all related in one way of another—and the SHVIA legislation could potentially pose some real problems if it is allowed to become the vehicle for all sorts of add-ons. The best antidote is to make sure the members of Congress really know what is going on out in the field, what the real competitive situation is and how cable is responding to it. Much to the credit of the current NCTA leadership and the major and smaller cable operators who have finally started strengthening their Washington voices, this is happening more today than in the past. Of course, we also have an excellent message to deliver. Cable has competition. We are the only facilities-based competitor to the phone companies, and we are moving rapidly in the area of offering new services such as VoIP. We also are the real reason high-speed broadband Internet connections have skyrocketed in the past few years. That has not been missed by Congress or the regulators, and it is all stuff they like to see. But those truths also create new challenges. Clearly, there is going to be serious inquiry about the need to change the rules regarding telephone competition. Hopefully, the rules will be lessened all the way around, not increased—and I think any major actions will happen after the elections, not before. The same is true for the multiple issues surrounding the Internet and the continuing digital transition. Issues such as copyright, peer-to-peer file sharing, privacy, access, taxes and the like will all be aired during the upcoming year, and cable is in one way or another central to all of them. So will there be major legislation affecting cable in the upcoming session? My view through the looking glass says no, it’s not likely, but then again, I just had a sip of something someone handed to me and things are getting a little fuzzy—a cat who looks a lot like a politician I know seems to be grinning at me from a tree—we’ll just have to see. Steve Effros has been a voice for cable television in Washington, D.C., for over 30 years. He writes a column that appears every Thursday in CableFAX Daily.

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