STELA Offers An Opportunity for Congress to Clean Out Old Cable Regulations

[Commentary] When Congress has an opportunity to eliminate outdated, unnecessary, and constitutionally problematic regulations, it should consider doing so. Congressional legislation reauthorizing the Satellite Television Extension and Localism Act (STELA) offers just such an opportunity.

Section 623 of the Communications Act contains basic tier regulations that are relics of a long bygone cable "bottleneck" era. STELA is considered "must-pass" legislation because it contains the framework for retransmission of broadcast TV content by direct broadcast satellite (DBS) providers. Some suggest that Congress should keep the STELA bill "clean." Here "clean" means extending provisions scheduled to sunset at the end of 2014 while avoiding any reforms of legacy video regulation.

Congress shouldn't be rigidly wedded to any artificial principle in order to obstruct genuine regulatory reform. Rather, it's a sound principle that burdensome government regulations premised on market failure should be reduced or eliminated where competitive market conditions actually emerge. Also, Congress could insert into STELA reauthorization a provision to eliminate basic tier cable rate regulation.

But must-buy has, like the rate regulation system, outlived its reason for being. Cable operators should be free to offer consumers video content according to their own editorial judgment, not government dictates. Congress should keep an open mind about using STELA reauthorization legislation as a route to regulatory reform for video services. Through STELA, Congress could tidy up its policy toward cable services by eliminating rate and must-buy basic tier regulations.

[March 7]