FCC Regulatory Land Grab in Cable Land?

The Wall Steet Journal reported this morning that the FCC might be preparing to "impose new programming and access requirements on carriers." (See FCC, Cable Firms Gird For Possible Access Row).  Apparently, there was a clause in the 1984 Cable Act that allowed the FCC to regulate the market by reducing the rates that programmers pay for access to spare channels on the cable networks, if certain market conditions are met.  The 1984 Act stated that when cable can reach 70% of US households, and when 70% of those househods subscribe to cable, then the FCC can intervene.  Apparently, the FCC now thinks these conditions are met.

The National Cable & Telecommunications Association (NCTA), disputes this claim, of course, with their own statistics, showing that cable can reach 97.5% of US TV Households, but that cable serves only about 59.8% of these households as of June, 2007. 

Who serves the remaning TV consumers?  The biggest competitor right now is Satellite TV, with about 25% of the market, and TV over Fiber Optic cable has about 4% market share.  Paul Carton provides lots of detail of a ChangeWave consumer market survey here.  The ChangeWave survey gives cable a higher percentage of the market than the NCTA, at 64%, but it is still well under the 70% threshold in the 1984 act.  What's more, the trend seems to be against cable, with Satellite and Fiber Optic providers gaining market share and enjoying higher levels of customer satisfaction.

This is a continuation of the FCC's recent ramp-up of pressure on the cable industry.  This morning's Wall Street Journal article on the same topic provides some good background of the FCC's actions against the cable industry, in hopes of giving consumers more choice of channels, and lower rates.  These are worthy goals, to be sure, but relying on the 1984 Telecom Act's 70/70 provision seems like a stretch to me.  Personally, I'd like to see any FCC action in this area supported by additional legislation before proceeding with an agency power grab.

So, why is the FCC considering regulation?  This smells like a regulatory body trying to expand its power base.  There's something rotten on 12th Street.