Page 93 - Battleground The Media Volume 1 and 2

| Cable Carr age D sputes

established service standards and federal rate regulations as well as indecency
rules for cable access channels (which were later found unconstitutional) and re-
quirements to make cable programs available to competing providers including
direct broadcast satellite. Because the federal appeals courts in 1986 and 1988 had
struck down local broadcast carriage rules on free-speech grounds, the 1992 act
reinstated must-carry requirements on up to one-third of cable systems’ channel
capacity, which the Supreme Court narrowly upheld a few years later. The act also
gave local broadcasters the right to negotiate for compensation for carriage but
larger cable operators refused to do so. Instead, broadcasters and their affiliated
networks used this right to negotiate carriage of new cable channels, as did ABC
with ESPN2 (both owned by Disney), NBC with CNBC, and Fox with FX.
In the late 1970s, Congress began to contemplate a more systemic rewrite of
the Communications Act of 1934 to account for the emergence of new com-
munications technologies. Industry and federal regulators moved toward a
consensus that prioritized market competition and reduced government regu-
lation to produce comprehensive legislation in 1996. The Telecommunications
Act allowed telephone companies to offer video services, cable companies to
offer telephone service, and broadcasters to own more stations nationwide and
commit to timelines for converting to digital transmission. However, eight years
later, telephone companies had yet to offer substantial competition in video,
cable subscription rates had increased by 45 percent, and public interest groups
and angry citizens had persuaded Congress that loosened broadcast ownership
rules had given too much power to media conglomerates. In the late 1990s, di-
rect broadcast satellites developed smaller dishes and digital compression tech-
nologies to offer local broadcast channels in addition to national networks, thus
offering some competition to cable operators.

CaBle PrograM Carriage tiMeline

1952—Cable households, 14,000.
1960—Cable households, 650,000.
1961—A federal district court rejects restrictions on cable carriage on the basis of
“unfair competition.”
1964—A federal appeals court rejects right of broadcaster to restrict cable carriage.
1966—FCC asserts jurisdiction over cable and bans the importation of distant broadcast
signals into largest 100 cities.
1968—U.S. Supreme Court finds that cable carriage of broadcast signal does not infringe
on copyrights.
1970—Cable households, 4.8 million. FCC places content restrictions on pay cable.
1972—FCC lifts ban on distant broadcast signal importation into largest 100 cities and
enacts nonduplication rules for these distant signals. Top markets must provide public,
educational, government, and leased-access channels.
1974—A White House task force recommends separating cable operators from content
providers.