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FCC sets tone for future TV.

Despite vocal opposition from the cable companies, the FCC has approved new rules that will allow telephone companies to carry TV shows into homes over telephone wires. The decision is seen speeding the construction of a fiber optic network across the country but--importantly--does not yet authorize the phone companies to go into TV program production.

The FCC argues that the entry of Telcos into the entertainment and data transmission area will encourage competition and will automatically bring down cable rates, a hot issue with the Congress which wants to put a cap on what cable can charge.

The telephone companies have argued that, to modernize their systems, they need the added income from providing entertainment in the home. The cable operators, who anyway control much of the cable programming source, fear that telephone company competition will severely reduce their business since virtually all setowners already have telephone wires in their homes. It is estimated that the introduction of fiber optics--allowing a wire to carry a multitude of signals--would cost more than $100 billion, though some telephone companies have already begun to install optical cable. The FCC still has to find ways to get around the 1984 Cable Act which specifically bars the telephone companies from producing TV shows. It has, however, allowed the Telcos to acquire a maximum 5 per cent in other cable companies and in TV program producers.

At the moment, all the FCC decision actually means is that a telephone subscriber can obtain a TV dial tone, which can communicate directly with their TV set.
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Publication:Video Age International
Article Type:Brief Article
Date:Oct 1, 1992
Previous Article:HDTV to be market driven.
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