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Subcommittee Gets Earful on Video Competition

Depending on whom you were listening to, the proposed divvying up of Adelphia between Comcast and Time Warner Cable was either a boon to the bankrupt MSO's 5 million subs, or another step toward cable's monopoly of video distribution.

The sides, witnesses in a Senate antitrust subcommittee hearing on video competition, lined up along party lines. The hearing itself was divided into two issues, the Adelphia deal, which Subcommittee Chairman Mike DeWine (R-Ohio), called "Adelphi" and telco entry into the video space.

Congress is preparing to update the 1996 Telecommunications act in light of market and technological changes, including media concentration and the rise of alternative providers like satellite, telcos, wireless and the Internet.

On the Adelphia deal, Time Warner Cable Chairman and CEO Glenn Britt said that the takeover would bring more services and better customer service to Adelphia, which he said lagged in both in its two years in bankruptcy.

That came in response to a question from DeWine, who noted that he had Adelphia cable service at home and wondered how it would affect him and other Ohio customers.

Ranking committee Democrat Herbert Kohl (D-Wis.) weighed in with concerns about the size and power of Comcast and Time Warner, alrady saying further concentration could make it more difficult for independent programmers to get carriage. He said he was "deeply concerned" that only channels from big cable nets or broadcast nets can get carriage.

He called for program access conditions on the merger similar to those agreed to by News Corp. in its purchase of DirecTV. He also suggested several updates to the 1996 Act--including closing program access "loopholes," and giving independent channels "a fair shot at carriage."

Witness Mark Cooper of  Consumer Federation of America agreed, arguing that the clustering of the divvied-up systems would lead to greater market power for Comcast and Time Warner, including control over programming, which he said thye already exerted to favor their affiliated networks.

Britt argued that cable had plenty of competition from satellite and DBS with their national footprint, and soon from telcos, which he said were already better clustered than his company would be after the Adelphia deal.

He pointed out that cable is already subject to some of those conditions. But he said that others were directly related to News Corp.'s ownership of TV stations. "We don't own TV stations," he said.

As to telco video competition, both Britt and National Telecommunications & Information Association Presdint Kyle McSlarrow said that the government should treat like services alike. The cable industry is concerned about proposals to allow telcos to bypass the local franchise process in the interests of jump-starting its broadband video rollout, he said.

McSlarrow also took the opportunity to speak out against mandatory cable carriage of broadcasters' multicast signals, tying it to concerns about independent programmers not finding room on cable.

The pipe we provide is broadband, he said. If somebody takes our private property, it's not just hurting out ability to provide independent voices, but it is hurting our ability to provide other broadband services as well.