FCC Grants Charter Communications' Effective Competition Petition

The Federal Communications Commission adopted an Order granting Charter Communication’s Petition for Determination of Effective Competition, based on a finding that Charter is subject to effective competition from the AT&T TV NOW video streaming service in certain franchise areas in Hawaii and Massachusetts where Charter is currently subject to rate regulation. The FCC finds the local franchise authorities in Kauai, Hawaii, and 32 communities in Massachusetts may not regulate basic-tier cable rates because Charter is subject to effective competition under the statutory local exchange carrier (LEC) test, which recognizes competing video programming provided by affiliates of LECs as effective competition for purposes of rate deregulation. Specifically, the FCC determines that AT&T TV NOW, an over-the-top streaming service, which used to be branded as DIRECTV NOW, satisfies the requirements of the LEC test. Granting Charter’s petition is consistent with the text of the statute, requiring the deregulation of cable rates when, as here, an online streaming service option with comparable programming is available from a LEC affiliate in the franchise area, and reflects the competitive state of the video marketplace.