Telecommunications: Issues Related to Competition and Subscriber Rates in the Cable Television Industry
GAO-04-8
Published: Oct 24, 2003. Publicly Released: Oct 24, 2003.
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Highlights
Over 70 million American households receive television service from a cable television operator. In recent years, rates for cable service have increased at a faster pace than the general rate of inflation. GAO agreed to (1) examine the impact of competition on cable rates and service, (2) assess the reliability of information contained in the Federal Communications Commission's (FCC) annual cable rate report, (3) examine the causes of recent cable rate increases, (4) assess the impact of ownership affiliations in the cable industry, (5) discuss why cable operators group networks into tiers, and (6) discuss options to address factors that could be contributing to cable rate increases.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Federal Communications Commission | To improve the quality and usefulness of the data that FCC collects on cable television rates and competition in the subscription video industry, the Chairman of the FCC should take immediate steps to improve the cable rates survey by (1) including more detailed, standardized instructions and examples for how to calculate the cost changes that the cable operators experienced in the previous year and (2) eliminating the requirement for the cost increases to sum to the change in rates. |
FCC has modified several aspects of its survey on cable franchise rates and in doing so implemented GAO's recommendations regarding the clarify of their survey.
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| Federal Communications Commission | To improve the quality and usefulness of the data that FCC collects on cable television rates and competition in the subscription video industry, the Chairman of the FCC should review the commission's process for maintaining the status of effective competition among franchises in order to keep these designations more up to date. |
FCC does not believe that it can change the manner in which it classifies franchise areas as having "effective competition".
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Topics
Cable ratesCable televisionCommercial televisionCompetitionData integrityDirect broadcast satellitesRatesTelevision broadcastingRetransmission consentTelevision programming