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FCC checks cable ITV strategies

The FCC wants to know if cable companies have incentive interfering with rivals' interactive television services and Thursday launched an inquiry into the need for anti-discrimination restrictions.

The cable industry is opposing even the suggestion of ITV rules, which can't be imposed directly by this review. But FCC officials said their review of the America Online/Time Warner merger raised fears that companies controlling both distribution and production of TV content will have an incentive to block services of other content providers. Besides asking for comment on the need for any restrictions, the FCC wants suggested definitions of ITV services, opinions on whether cable or other programming distributors will have an advantage in ITV, and if the agency has authority to impose ITV restrictions.

FCC Chairman William Kennard, who resigns from the commission today, said the inquiry is necessary because cable will be an important platform for ITV. "The Commission would do well to get ahead of the curve," he said. "I am concerned that a vertically-integrated ITV service provider might have the incentive and ability to discriminate."

Commissioner Gloria Tristani complained that the FCC was pursuing only an inquiry, meaning final rules can't be established without a second round of comments and replies. Republican Commissioner Harold Furchtgott-Roth, on the other hand, said even this preliminary step goes too far. "It is much too premature for the commission to address the topic," he said. "By the mere adoption of this item, the commission communicates to the public that something has gone awry in the marketplace. . .this simply is not the case."

Commissioner Michael Powell, who is expected to be named FCC chairman shortly, didn't comment on the inquiry yesterday but commenting on the AOL Time Warner merger last week said ITV issues "are not trivial, and clearly warrant fuller examination." - Bill McConnell