American Cable Association Announces FCC's New Digital Broadcast Carriage Rules Threaten Viability of Small Broadband Providers

Business Wire, Sept 12, 2007

Burdensome Regulations Add Costs to Running Small Cable Systems

PITTSBURGH -- Matthew M. Polka, President and CEO of the American Cable Association, issued the following statement in response to the FCC approving new broadcast carriage rules that require all cable operators to carry the digital signals of must carry broadcasters in both digital and analog formats.

"The ACA and its membership are disappointed because the order fails to sufficiently recognize the detrimental impact that this carriage requirement will have on small, rural cable operators and their ability to provide broadband services. For the foreseeable future, cable operators serving smaller and rural markets are the only companies that can provide affordable access to broadband products and services. For this reason, it's disappointing that a majority of Commissioners would vote to impose new burdensome obligations on these operators.

"At the Commission, we showed that the equipment and labor costs required to carry the broadcasters' signals in multiple formats could exceed $150,000 for systems that provide broadband, video, and voice services. The new carriage obligations now make it more difficult for operators of small systems to stay in business. If forced to comply with this order, small operators will have less capital to invest in broadband because they need to purchase costly equipment to provide the same must carry channels in more than one format. Some very small systems will have no choice but to shut down because their small subscriber bases cannot support the costly equipment mandated by this order.

"While the order allows cable operators with systems of 552 MHz or less to apply for an exemption from the carriage requirements, this offers little meaningful relief, requiring these systems to engage in, and pay for, yet another process at the FCC, with the outcome far from certain.

"The order stands in direct conflict with the key policy goal of accelerating broadband deployment to all Americans, especially those served by small cable systems in rural America and smaller markets. For ACA's constituency and their customers, this order reached the wrong result."

About the American Cable Association

Based in Pittsburgh, the American Cable Association is a national association of small, locally-based cable TV companies providing advanced broadband services primarily in rural markets. The Association represents smaller and medium-sized independent cable businesses through active participation in the regulatory and legislative process in Washington, D.C. ACA's nearly 1,100 member companies serve approximately 8 million subscribers in all 50 states. For more information, visit www.americancable.org.