CABLE DOMINANCE STILL IS ‘MAJOR HURDLE’ FOR DBS, SBCA SAYS
Market power of cable remains hurdle DBS operators must overcome to become legitimate competitor, Satellite Bcstg. & Communications Assn. (SBCA) Pres. Andrew Wright said in report released late Thurs. He said 8th annual multichannel video marketplace report (CD Jan 15 p4) demonstrated dominance of cable and need for consolidation of DBS market. As of June 2001, cable operators had 69 million of 88.3 million U.S. multichannel video subscribers, up 1.3 million, for 78.1% of market, FCC survey said. DBS operators had 16 million subscribers and C-band 1 million. “It’s clearly premature to declare that competition has arrived” in MVPD marketplace, Wright said. Despite popularity of local-into- local, he said stringent must-carry regulations had “limited the rollout of local-into-local into smaller markets and threatens its further expansion.”
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“Dominance” by cable “underscores the need for extension” of exclusivity protections provided by program access rules, Wright said: “These rules ensure that satellite providers can continue to offer comparable programming at reasonable rates.” He said Commission report offered proof of progress made by DBS industry in providing competition to “cable monopoly,” but report also showed “real competition has yet to be achieved.” Wright again called on Congress to reject Northpoint proposal to use satellite spectrum for its terrestrial service, saying it would “severely threaten the budding competition being offered by DBS.”
DBS also must adjust to working with newly created Media Bureau at Commission as part of major reorganization (CD Jan 18 p1). SBCA isn’t totally comfortable with reorganization and switch from International Bureau where it had “carved out a unique niche” for “special interests related to the satellite industry,” DBS source said. Media Bureau will oversee policy and licensing for DBS, cable, broadcast TV and radio, with satellite matters remaining under authority of International Bureau where DBS operators unsuccessfully fought to stay. SBCA said satellite industry lobbied Commission hard in 1994 to have all satellite functions placed under International Bureau: “The International Bureau offers the satellite industry an important edge that it needs to maintain its global market position.”