The FCC has this all wrong. The cable industry just got through spending over $75 BILLION in plant and equipment upgrades in order to be able to deliver broadband digital and HDTV programming and high-speed Internet access. The cost of fulfilling this a la carte requirement, now backed by an FCC that has changed its mind, if enacted by Congress, will be staggering. My guess is another $50 billion, that the industry does not have. Highly leveraged aacquisitions have emptied their bank accounts and those of their stockholders. The money will have to come from the subscribers who are already digging deep to pay for the massive upgrade. Uninformed subscribers, consumer groups, legislators, and even FCC economists, just don't get it. It is appallingly naive for anyone who lives in, for example, a 200-channel cable universe costing $100 per month to believe, that by paring down to their favorite 20 channels, their cable bill will go down to $10 per month. This proposal will have the opposite effect and will cripple the industry. People complain about the cost of cable, but who do you know who doesn't pay his cable bill? This proposal would constitute the biggest free gift ever bestowed on anyone by the government to the satellite and wireless community, none of whom have, or ever will, incur anywhere near the capital costs borne for the last 50 years by the cable folks.
Ray Davenport | 12.01.05 - 9:58 am | #