Appeals Court Scraps Challenge to FCC Cable Regulation Order

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By Tara Jeffries

A federal appeals court July 7 denied a challenge to a Federal Communications Commission order that made it harder for state and local authorities to regulate cable rates.

The U.S. Court of Appeals for the District of Columbia Circuit denied a petition to review a 2015 commission order that cleared the way for cable companies to raise customer rates without local approval ( National Association of Telecommunications Officers and Advisors, et al. v. Federal Communications Commission , D.C. Cir., 15-1295, 7/7/17 ).

The decision is a win for cable providers such as Comcast Corp. and Cox Communications Inc.

The FCC reversed a previous assumption that cable markets lacked effective competition and that cable companies needed to prove otherwise to avoid local rate regulation. Instead, the FCC put the onus on local governments to prove that competition is lacking in their areas in order to wield power over basic cable rates.

Cable providers argue that there’s plenty of competition in the television market, including from satellite services. The FCC cited evidence of such market changes when it decided to shift the burden of proving the presence or lack of competition from cable providers to local authorities.

Opponents, led by the National Association of Telecommunications Officers and Advisors (NATOA), disputed that rationale. They argued that the FCC couldn’t apply statistics about satellite competitors broadly without examining competition in each individual market.

NATOA Executive Director Steve Traylor told Bloomberg BNA in an email that he’s “disappointed” by the decision, but “today’s outcome will not deter us from raising our voice in protest when we see the Commission taking action that conflicts with a recommendation from the Commission’s own Intergovernmental Advisory Committee, provides no clear benefits to consumers, and goes beyond specific Congressional direction.”

Cable groups, which argue that the FCC order eliminated unnecessary hurdles, cheered the court’s move in statements July 7. NCTA – The Internet & Television Association said the decision “further affirms that consumers are enjoying the benefits of a hyper-competitive video marketplace.”

American Cable Association President and CEO Matthew Polka said in a statement that “there is no longer any good reason that cable operators should remain subject to burdensome rate regulation.”

An FCC spokesman said in an email to Bloomberg BNA that the agency is pleased with the court’s decision.

To contact the reporter on this story: Tara Jeffries in Washington at tjeffries@bna.com

To contact the editor responsible for this story: Keith Perine at kperine@bna.com

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