Title II and Cable Regulations

If you had the opportunity to listen to FCC Chairman Tom Wheeler at the recent NCTA Cable Show, you heard him say, “Title II is on the table.” (If you did not hear him, you can still go to the C-SPAN website and view the video). In order to understand his statement, you need a basic understanding of the roots of Title II and cable regulation.

I have found that the origin of cable regulation for most people is a bit obscure. If you are somewhat lost with all the legal references in the news, you are not alone. Let’s start with Title II and work our way through the major pieces of cable legislation that influence the cable industry today. The legislation contains some complicated issues and is wide-ranging, but a review of the basic provisions will point you in the right direction.

The Communications Act of 1934 was one of the major pieces of legislation passed during the first term of Franklin D. Roosevelt. This Act created the Federal Communications Commission (FCC) to regulate communications by “wire and radio.” The Act has seven sections (as amended), which are referred to as Titles I through VII. Title I describes the authority of the FCC; Title II covers common carriers; Title III covers radio; Title IV contains administrative provisions; Title V contains penal provisions; Title VI covers cable communications (through the 1984 Cable Communications Act); and Title VII contains miscellaneous provisions. In 1934, telephone (a common carrier) was the established communication technology, radio was the emerging information resource, television was a dream, and broadband was science fiction. If the FCC regulates broadband under Title II, then it would come under the same onerous regulations as the old AT&T telephone lines. The FCC regarded AT&T as a natural monopoly in 1934, and consequently, the heavy-handed regulations reflect that fact.

You may have noticed that Title VI was an amendment to the 1934 Act that regulated the cable industry through the Cable Communications Act of 1984. The House and Senate seriously debated the regulation of the cable industry at that time, and after three years of debate, the parties (including NCTA and the National League of Cities) came to an agreement. The Act established regulation around franchise standards between the FCC and local governments. Its intent was to promote competition and deregulate the cable industry. The Cable Television Consumer Protection and Competition Act of 1992, which, among other things, allowed broadcast networks to demand payment from cable networks in a debate you may have heard of called “retransmission consent,” further amended the Act.

The Telecommunications Act of 1996 was a major overhaul of telecommunications policy. The goal of the Act was to promote competition in the telecommunications business. This Act dramatically changed the cable industry and ushered in what we term the Third Generation of Cable—an era known for its innovation and for increased competition across several markets. In the current debates, you might hear a reference to Section 706, which is part of the 1996 Act concerning “Advanced Telecommunications Incentives.” You will note Section 706 in the discussion about net neutrality, which gives the FCC authority to take action that accelerates broadband deployment. When the FCC Chairman says the FCC has the authority to provide regulation of broadband and that the courts decided this issue, he is referring to a court decision in the recent Verizon v. FCC case. It is likely that you will hear much more about this in the coming months.

The Third Generation of Cable has been a remarkable period—it is the “age of innovation.” The 1996 Act gave the cable industry the confidence it needed to invest billions of dollars to build the broadband infrastructure we enjoy today. Amazon, Google, Facebook, Netflix and many other innovative companies exist because of the broadband foundation laid by the cable industry. I encourage you to follow the upcoming debates and hope this brief review of cable legislation will help clarify the issues. We are living in a time of extraordinary historical significance. And the decisions our leaders make today will affect us for many years.

(Larry Satkowiak is president and CEO of The Cable Center, the nonprofit educational arm of the cable industry. The Center preserves cable’s enduring contributions to society, strengthens relationships between cable and academia and unites the industry around the advancement of exceptional customer service. www.cablecenter.org)