US Media Watchdog Cracks Down on Cable Contracts

01 November 2007

WASHINGTON DC: US media regulator, the Federal Communications Commission has voted to ban cable companies from entering into exclusive agreements with owners of apartment blocks and condominiums.

The move is intended to give around 100 million consumers more choice in television, online and telephone services.

It will be welcomed by telcos such as Verizon and AT&T, which offer these bundled services but say they have been frozen out by long-term contracts between property owners and cable firms.

The latter sectors claim their 'bulk buy' deals allow them to offer cheaper rates to residents.

The FCC, unimpressed by that claim, maintains that cable costs have almost doubled over the past decade while competition has driven down web and wireless prices.

Its new rules bar cable companies from enforcing current exclusive deals, or making new ones, in multi-occupancy residential building.

Daniel Brenner, svp of the National Cable and Telecommunications Association defends rising costs, arguing that they reflect changing and improving technology. He also questions the FCC's authority to regulate property owners' right to enter into such contracts.

But the commission's chairman, Kevin Martin, is adamant: "We have to make sure we are removing any barriers for people to be able to come in and compete."

Data sourced from Washington Post Online; additional information by WARC