Is cable’s win a loss for subscribers?

Alisa Roth Aug 28, 2009
HTML EMBED:
COPY

Is cable’s win a loss for subscribers?

Alisa Roth Aug 28, 2009
HTML EMBED:
COPY

TEXT OF STORY

KAI RYSSDAL: It can’t possibly be a good thing when a federal regulation is described as “arbitrary” and “capricious.” That’s exactly the language a federal appeals court used today to describe FCC restrictions on cable companies. Two years ago, the Federal Communications Commission said a single cable provider can’t serve more than 30 percent of the nation’s subscribers.

Cable companies, of course, sued. And today, they won. Will subscribers be the losers?

From New York, Marketplace’s Alisa Roth reports.


Alisa Roth: Right now, about a quarter of all cable subscribers in the U.S. get their service from one company, Comcast. Today’s ruling means Comcast could become the cable provider for even more people.

Mark Cooper’s the director of research at the Consumer Federation of America. He says letting Comcast get bigger would be like handing it the remote control.

Mark Cooper: How much power does Comcast have to determine the fate of someone who wants to produce a new show?

He thinks a lot, if it controled more than 30 percent of the market.

Cooper: Once you get bigger than that, you can basically make or break any program.

Because most cable companies own some programming, too — like Comcast owns E! the Entertainment Channel and Cablevision owns AMC. So a cable company could push its own shows. Or hurt the competition by not carrying theirs.

The argument over how much market share a cable company can have has been dragging on for years. Tuna Amobi follows the entertainment business at Standard & Poors. He says he doubts Comcast is even interested in buying up more cable companies anymore.

Tuna Amobi: Arguably, the environment today is not what it was even five years ago. So in that perspective, I would question whether bigger is necessarily better.

He says these days cable’s competition comes from satellite TV, the Internet and even old school telecommunications companies like AT&T and Verizon.

So he says cable companies don’t want more market share. Instead, they’ll try to beef up their content.

In New York, I’m Alisa Roth for Marketplace.

We’re here to help you navigate this changed world and economy.

Our mission at Marketplace is to raise the economic intelligence of the country. It’s a tough task, but it’s never been more important.

In the past year, we’ve seen record unemployment, stimulus bills, and reddit users influencing the stock market. Marketplace helps you understand it all, will fact-based, approachable, and unbiased reporting.

Generous support from listeners and readers is what powers our nonprofit news—and your donation today will help provide this essential service. For just $5/month, you can sustain independent journalism that keeps you and thousands of others informed.