Think About That For A Minute

A cabbie in Chicago told me last week that the temperature was "all the way up to 40!" "Spring is here," he said. Well, I don’t know about that. I remember a lot of snowstorms in March. But it’s certainly heating up in the political and legal world of cable. We’ve been doing well for several years. By "well," you understand, I mean that the politicians and the courts have left us pretty much alone – allowing us to rebuild systems, upgrade services, and reconstitute corporate structures without too much interference. The $85 billion that we spent on upgrades has muted any overt actions against us. We have delivered what we said we would: a new and efficient telecommunications infrastructure that not only does a better job of providing multichannel video programming, but also now acts as the catalyst for new services from high speed Internet to the nascent voice business. In the process, we have seen lots of consolidations (MediaOne into AT&T into Comcast, DirecTV into News Corp and the like) and some major shifts as well, such as viewership clearly shifting toward cable programming and advertising revenue moving in that direction, too. But now we are reaching the point where some major issues associated with all those changes are arriving at the doorstep of the Congress and the courts. The debates are going to get a lot more heated from here on in. Those I recommend watching very closely include the "indecency" debate, retransmission consent litigation, consolidation reverberations and, as always, copyright. The trouble with the "indecency" issue is that it’s always tied up in political grandstanding. If we just debated this issue in the context of the law, cable would not be included in the brouhaha very much. Our customers choose to have the material we editorially "publish" come in to their homes, and we give them ample opportunity to block that which they don’t want. But in an election year, that may not be enough as the broadcasters try to argue that consumers don’t know the difference any more between cable and "TV," and therefore we should all be regulated alike. I don’t think that would ever survive a court challenge, but that won’t stop some politicians and regulators from suggesting it. Watch this one closely. The best antidote is to make sure your customers are aware that they can block any programming they don’t want, and educate them about how to make choices, and enjoy our medium. I’m glad NCTA is mounting a public awareness campaign to do this. Retransmission consent has become a bludgeon used by some broadcast interests to force more and more of their programming onto cable systems. The leverage is being abused, and now there are very interesting legal challenges being mounted. The one to watch is EchoStar versus Viacom. EchoStar is charging that Viacom is illegally "tying" its programming to its network retransmission consent negotiations. If that premise gains traction, it could have tremendous implications for all cable/programmer negotiations. The broadcasters should be sweating about this one. Consolidation interplays with all the other issues, since whatever side you are on it is easy to point to consolidation as having an impact. The hearings on Capitol Hill on every proposed merger prove that point. And copyright, or "digital rights management," is going to hang over everything we do in the digital world from now on. The heat is rising, and we had better be prepared for some extended global (issue) warming.