FCC's Chairman Looks at Television in a New Way

February 27, 1994|By DAVID ZURAWIK

It was a landmark week for TV viewers. And the biggest event had nothing to do with ice skaters named Tonya or Nancy.

It took place in Washington, not Lillehammer. It starred a middle-aged guy in a banker's gray suit who most viewers probably never heard of.

His name is Reed Hundt. He's the new chairman of the Federal Communications Commission. And, if you think your cable bill's too high or there's too much violence on TV, it looks like Mr. Hundt is the person who's finally going to do something about it.

Mr. Hundt and his fellow commissioners made headlines with a 7 percent cut in cable TV rates on Tuesday.

Remembering last September's attempt to cut rates, which backfired into higher instead of lower bills for almost one-third of all subscribers, some wondered at first if the cuts would really mean anything for cable customers. But most of those questions were answered less than 24 hours later when the cable industry's howl of protest was heard. It took the form of Tele-Communications Inc. and Bell Atlantic calling off their merger Wednesday and blaming its collapse on Mr. Hundt and the FCC.

The two companies have since eased up in their finger-pointing at the FCC. But they still say the FCC's action this week will mean that the information superhighway -- that 500-channel small-screen panacea that was supposed to be here any minute now -- will not be arriving on time.

Cable TV experts are calling events of the past few days the dawn of a new era at the FCC, which promises to reverse almost two decades of consumer-be-damned policy. And that looks to be good news for anyone who still believes in the spirit of the language, which says television is supposed to be operated "in the public interest."

"When they write the history of cable TV, Tuesday's action by the FCC is going to be seen as marking the start of a new era," said Douglas Gomery, who teaches media economics and cable TV at the University of Maryland College Park.

"This is a big deal because it clearly reverses the cable law of 1984, which said cable companies could raise rates and shouldn't be regulated. . . . This says the FCC wants a new, more consumer-oriented policy."

Jeffrey Chester, executive director of the Center for Media Education, a public policy and cable TV watchdog organization in Washington, agreed: "I think consumers should be grateful. For the first time since 1980, we have a somewhat pro-consumer FCC -- based on what they did Tuesday."

Both Dr. Gomery and Mr. Chester said the key to understanding the sea change at the FCC last week and to anticipating future developments is in appreciating Mr. Hundt and what he represents.

"He's a former prep school roommate of Vice President Al Gore's . . . a graduate of Yale Law School with Bill Clinton. Hundt is the administration's only representative on the commission. To see what the administration really wants from the FCC, watch Hundt, watch how he votes, and who he helps choose for the two vacant seats on the commission," Dr. Gomery said.

Three FCC commissioners voted unanimously Tuesday to cut the rates 7 percent. But FCC aides say the unanimous vote masked major differences among the three. Andrew Barrett, a Republican, wanted no rate cut. Mr. Hundt, a Democrat, wanted a 15 percent rate cut. And James Quello, also a Democrat, wasn't sure what he wanted -- a posture that marked his recent term as acting chairman.

"The cable industry has been lobbying against a rate cut like crazy. A week ago, Hundt couldn't even get the votes to bring the issue of cuts before the commission. And, now this week, he hammers out a deal that gets a unanimous vote. I'll tell you, I'm impressed," Mr. Chester said.

What the administration wanted was a cut that would put some '' real money back in consumers' pockets this time.

The previous action in September, which had backfired into higher bills, had become a political liability for the White House. The cuts were part of the 1992 Cable TV Act, which Mr. Gore, then a senator and vice presidential candidate, helped push through Congress over a veto by President Bush.

When the rate relief Mr. Gore had promised in November 1992 became higher bills in September 1993, radio commentator Rush Limbaugh sounded the opposition call: "If this is how the Clinton administration re-invented cable TV, wait until they get to health care."

The problem wasn't with the Cable TV Act. It was with the way the FCC implemented it before Mr. Hundt's arrival. Mr. Hundt, who was sworn in in December, is the administration's Mr. Fix-It. And Tuesday he went to work on cable TV.

FCC watchers say they were impressed not just by the votes Mr. Hundt mustered for the rate cuts, but also by the way he stood up to the cable TV industry Wednesday when it tried to use the TCI-Bell Atlantic merger collapse as a public relations club against his consumer-oriented posture.

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