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McCain asks GAO to investigate cable rates

Sen. John McCain (R-Ariz.), ranking member of the Senate Commerce Committee,
asked the General Accounting Office Tuesday, with the help of the Federal
Communications Commission, to investigate why cable rates are rising higher than
the rate of inflation.

On April 4, the FCC released its annual review of cable prices, which found
that cable rates had increased an average of 7.5 percent over the year ending
July 1, 2001.

'While the FCC's report provides a statistical analysis of the purported
causes of cable-rate increases, the data are based completely on self-reported
information from cable operators,' McCain said in a prepared statement. 'The
time has come for an independent review of the cable industry's claims.'

The 7.5 percent figure does not take into account increases in services,
however. On a cost-per-channel basis, cable rates have not topped the inflation
rate, the FCC study also showed, so they have effectively gone down.

'We believe that the GAO's examination of cable-pricing issues will confirm
conclusions reached previously by the FCC and the Bureau of Labor Statistics --
that cable prices per channel have remained relatively constant since
deregulation in 1999, despite substantial operator investment in programming and
personnel to support cable's more advanced services,' the National Cable &
Telecommunications Association responded.