NCTA: Cable Ops Might Exit if Telcos Come

Allowing phone companies to cream-skim cable markets instead of providing service to every household could put some cable systems at a large economic disadvantage -- and these lopsided regulations may force some cable operators to abandon local markets, the National Cable & Telecommunications Association told the FCC. In the FCC filing, the NCTA said that an economic consultant it hired concluded in a study that cable companies that have been required to offer service to every household in a community for social-policy reasons might not have a cost structure capable of withstanding competition from a deep-pocketed rival employing a strategy that ignores low-income consumers. “Cable operators could not continue to compete effectively in the areas served by telcos while still sustaining the higher costs of serving the areas that the telco chose not to enter. As (our consultant) shows, a cable operator will not be able to upgrade service in those areas or might not be able to continue serving them at all,” the NCTA said. Wow this seems like the all-so-successful AT&T strategy of competing with Baby Bells!
[SOURCE: Multichannel News, AUTHOR: Ted Hearn]
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