Consumers Have Role to Play in Ensuring Better Cable Future

Cable television consumers across the nation are halfway to their goal of getting lower prices and better service, thanks to the passage of a cable reform bill in the U.S. House of Representatives. The COPE Act will make it easier for new companies to enter the cable market and compete for consumers. That will mean more choices, better service and price cuts of as much as 25 percent.

Even more important, competition will usher in a new era of Internet and interactive video services, like pre-school education and telemedicine. Static TV sets will be transformed into more socially useful appliances, just as personal computers were in the 1990s.

Gearing Up for Battle

We are only halfway toward this new video revolution, however. Consumers can expect a battle as the Senate considers similar cable legislation over the next few weeks. Internet companies wanting to position themselves strategically in the home video market are trying to inject their own issues into the cable competition debate. These companies are threatening to stop the bill altogether if they don’t get their way.

Consumers must step up and tell their U.S. Senators to pass cable reform quickly — and without adopting these extra provisions that will complicate the immediate delivery of cable consumer benefits. Studies show consumers will pay US$8 billion too much for cable service this year alone if competition doesn’t enter the cable market. The House rejected these special interest provisions and passed cable reform by an overwhelming bipartisan vote of 321-101.

Senate passage is threatened by a group of multi-billion dollar Internet companies — Google, eBay and the like — that do not want to pay for the development of the next generation of Internet and video technology. They propose adding what they call a “net neutrality” provision to the bill. Net neutrality, however, is neither neutral nor essential to the passage of cable competition legislation. It is simply the Internet giants’ attempt to get something for nothing.

Upgrading to Premium

Think of the Internet as “regular” gasoline. Cable and telecommunication companies offer this service today through cable hook-ups and phone lines. In the future, they will deploy infrastructure that works like “premium” gasoline — an upgraded connection that will deliver better performance. Just like gasoline for a car, the Internet will continue to run on “regular,” but some services may run better on “premium.” The Internet giants are all in favor of “premium” service; they just don’t want to pay for it.

As the House did, the Senate should adopt standards ensuring fair access to the Internet, but not dictate the commercial terms upon which Internet giants obtain service from video providers. Net neutrality, as defined by the Internet giants, should not be an excuse for the Senate to avoid picking up the cable competition ball and scoring a touchdown for consumers this summer.

The Internet giants have a right to pursue their net neutrality case, but they do consumers a disservice by threatening the viability of a bill that offers $8 billion in savings and better cable service. The House didn’t let them get away with that. If consumers speak up, the Senate won’t either.