Small Cable Takes on Big Media, a la Carte

[Gregg Lengling]

In comments filed Tuesday at the Federal Communications Commission, the American Cable Association outlined what it said are efforts by a handful of media conglomerates to restrict choice and increase costs in smaller markets through their control of "must-have" programming.

That must-have programming helps those few companies with the content dominate basic and expanded basic channel lineups, require carriage of and payment for dozens of affiliated channels, and charge discriminatory wholesale rates to smaller cable companies, ACA said. The association said the unrestrained exercise of market power by media conglomerates is driving increased concern about choice, cost and content, especially in smaller markets.

Said ACA President Matt Polka, "For nearly all of the 50 most widely distributed channels, the media conglomerates contractually obligate ACA members to distribute the programming to virtually every customer. Contracts also mandate carriage of less desirable channels. These restrictions prohibit ACA members from offering more customized channel packages in local markets."

As for programming choice, Polka said a pure a la carte regime cannot work for smaller cable operators because of the cost. According to ACA's filing, head-end equipment costs alone would exceed $285,000. "Obviously, smaller cable systems cannot support these costs now or in the foreseeable future," Polka said.