Printer Friendly
The Free Library
14,679,271 articles and books
Member login
User name  
Password 
 
Join us Forgot password?

Cable TV operators ticked off over new FCC rate rules.


Cable television service in Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850.  elicits almost as many complaints as crime, traffic and smog. Several thousand people call the city's Department of Telecommunications annually to complain about cable service and its high cost.

Rulings by the Federal Communications Commission Federal Communications Commission (FCC), independent executive agency of the U.S. government established in 1934 to regulate interstate and foreign communications in the public interest.  announced April 1 attempt to control soaring national cable rates. They also may quell local consumer complaints -- but cable operators are howling over the potential impacts of the government's intervention.

If cable system operators are forced to cut prices, it could curtail their cash flow and prevent them from making critical upgrades to their systems, they contended. Many are planning to lay fiber-optic cable to increase channels and need as much cash as they can generate for this expensive upgrade.

Most cable operators here claim they aren't profitable and the government's rate regulations aren't going to help their bottom lines.

The FCC's regulations could hit Los Angeles County cable operators hard because they have the dubious distinction of implementing some of the highest rate hikes in the nation.

Since the industry was deregulated in 1987, the nation's rates have risen 60 percent. However, in Los Angeles County, the rates have gone up 129 percent, according to according to
prep.
1. As stated or indicated by; on the authority of: according to historians.

2. In keeping with: according to instructions.

3.
 statistics provided by the telecommunications department.

Since last September 14 cable operators in the county have dinged consumers an additional 6 percent.

The FCC (1) (Federal Communications Commission, Washington, DC, www.fcc.gov) The U.S. government agency that regulates interstate and international communications including wire, cable, radio, TV and satellite. The FCC was created under the U.S.  is ordering a rollback to September 1992 rates for basic service. A possible 10 percent cut on those rollback rates is also being considered but a benchmark formula for the new rates won't be announced until the end of April.

The FCC announcement said 75 percent of the country could expect an average 10 percent decrease on the rollbacked September rates. In addition, the FCC has also imposed a 120-day rate freeze and is empowering local telecommunications boards to set future rates starting July 1.

In anticipation of the FCC's ruling, 13 of the 14 local companies raised their rates in the last 12 months, with several boosting their rates twice in that period. The average monthly rate for basic cable here is now up to $23.75 compared to $10.35 in January 1987.

Only one system, Times Mirror Co.'s Dimension Cable Services servicing Palos Verde, got caught with a rate proposal on the table but has had to rescind it because of the freeze. Dimension was planning a 9 percent increase to begin June 1.

Susan Herman, general manager of Los Angeles' telecommunications department, said the FCC rulings would have a positive impact for consumers but warned they shouldn't have high expectations of large savings because they may be dashed.

"Prices have been high because of the companies' monopoly status which contributes to rate inflation which has been four times higher than the CPI (1) (Characters Per Inch) The measurement of the density of characters per inch on tape or paper. A printer's CPI button switches character pitch.

(2) (Counts Per I
 (consumer price index)," she said. "We are happy with the FCC announcement. It will help increase customer satisfaction and give them a better sense of value."

Bill Rosendahl Bill Rosendahl is a Los Angeles City Councilman, representing Council District 11, including the communities of Brentwood, Del Rey, Mar Vista, Marina del Rey, Pacific Palisades, Palms, Playa del Rey, Playa Vista, Venice, West Los Angeles and Westchester. , senior vice president of Century Communications Corp., which services the Westside, has a different viewpoint. He said, "Our first reaction was, we were stunned stun  
tr.v. stunned, stun·ning, stuns
1. To daze or render senseless, by or as if by a blow.

2. To overwhelm or daze with a loud noise.

3.
 and found it to be a tremendous blow to the industry. What it means only time will tell but our hope is there will be some reasonableness in particular markets. We are going ahead with our improvements and will invest $100 million to rebuild 1,700 miles of cable to 160,000 homes which will allow us to go from 40 channels to 78."

Rosendahl said he is hopeful that the company's investment to improve service will have a mitigating factor on setting his franchise rates. He predicted the industry will challenge the FCC rulings on constitutional and first amendment issues.

Craig Watson Craig Robert ("Wattie") Watson (born 2 June, 1971 in Invercargill) is an athlete from the New Zealand, who competed in triathlon.

Watson competed at the first Olympic triathlon at the 2000 Summer Olympics. He took sixteenth place with a total time of 1:50:01.85.
, general manager of Crown Cable and president of the Southern California Southern California, also colloquially known as SoCal, is the southern portion of the U.S. state of California. Centered on the cities of Los Angeles and San Diego, Southern California is home to nearly 24 million people and is the nation's second most populated region,  Cable Association, said, "Most of us are getting ready for fiber optics fiber optics, transmission of digitized messages or information by light pulses along hair-thin glass fibers. Each fiber is surrounded by a cladding having a high index of refractance so that the light is internally reflected and travels the length of the fiber  which will allow us to offer 500 channels and digital, which is a few years away. We will spend $1.5 million in our small area (San Gabriel Valley The San Gabriel Valley is one of the principal valleys of southern California. It lies to the east of the city of Los Angeles, to the north of the Puente Hills, to the south of the San Gabriel Mountains, and to the west of the Inland Empire. ) for fiber optics but the FCC rulings makes us pause and there is fear.

"If there are major price rollbacks, our biggest fear is there won't be resources there for expensive projects like fiber optics," he continued. "We need to upgrade for the coming changes but this latest action concerns us all."
COPYRIGHT 1993 CBJ, L.P.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

 Reader Opinion

Title:

Comment:



 

Article Details
Printer friendly Cite/link Email Feedback
Author:Ginsberg, Steve
Publication:Los Angeles Business Journal
Article Type:Industry Overview
Date:Apr 12, 1993
Words:717
Previous Article:Solutions to managing retiree health care. (California Consumer Alert: AB 1672)
Next Article:Evaluating a health insurer's financial stability. (California Consumer Alert: AB 1672)
Topics:



Related Articles
Teamwork looks likely in new cable service ventures. (telephone companies allowed to develop other communication services)(Special Report:...
Cable TV firms prepare for blast over rising rates. (Los Angeles, California)
FCC checks out Walnut cable TV firm amid nationwide rates gripes. (Walnut, California; Crown Cable Inc.)
Station brakes: the government's campaign against cable television.
Let the race begin. (impact of Telecommunications Act of 1996 on telecommunications industry)(includes related article on new regulatory...
Firm Loses Its Battle for Open Access to Cable Lines.(Brief Article)
FCC SAYS DROPPING ABC FROM CABLE ILLEGAL.(Business)
CABLE-TV FEE REFUND UPHELD RULING FAVORS SUBSCRIBERS IN 2 LOCAL CITIES.(News)
Court gives cable a victory over consumers. (World).(Brief Article)
EchoStar's Ergen ties merger bid to new competition. (Media & Technology).(Charlie Ergen, Echostar Communications Corp.)(Brief Article)

Terms of use | Copyright © 2009 Farlex, Inc. | Feedback | For webmasters | Submit articles