Martin pushes against clock, cable in twilight of Bush administration

by Todd Shields, Bloomberg

After roiling Comcast Corp. and other cable operators for almost four years, Federal Communications Commission Chairman Kevin Martin shows no sign of relenting as his term nears its likely end.

``Listen, if I can think of anything that'll help lower prices for cable customers, I would move forward on it,'' he told reporters Nov. 4 ahead of an FCC meeting. Cable rates almost doubled from 1995 to 2005, according to Martin.

With less than 10 weeks left in President George W. Bush's administration, the FCC is still considering whether to loosen cable's grip on some professional sports programming and raise the price companies pay to attach lines to utility poles. Martin, a Republican, must step aside when President-elect Barack Obama, a Democrat, is inaugurated Jan. 20 and names a replacement.

Any new rules Martin shepherds through would stand, unless undone by a court, a future commission or Congress. Last week, he announced an investigation of whether cable carriers are exploiting next year's transition to digital television to overcharge consumers.

Martin has ``a priority list of punishing the industry,'' said Kyle McSlarrow, president of the National Cable & Telecommunications Association, in an interview. ``That pattern of conduct will continue until the day he leaves office.''

McSlarrow said Martin is penalizing cable for selling consumers channels in bundles, rather than letting subscribers buy only the programming they want. Martin says that would bring down cable bills, while cable companies say such a move would raise costs and leave consumers with fewer channels.

Late Decisions

Martin, 41, could stay on the five-member commission until his term expires in 2011. On Nov. 10, he said he hasn't decided what to do.

Some FCC chiefs issue a flurry of decisions late in their terms. In January 2001, as a Republican administration prepared to take office, Democrat William Kennard led votes that set rules for cable carriage of digital TV signals and approved the merger of America Online Inc. and Time Warner Inc.

Under Martin, the FCC has been more active than usual in the final months of a president's term, Andrew Jay Schwartzman, president of the Media Access Project, a Washington-based public-interest law firm, said in an interview.

`Not Coasting'

``Martin is trying to use the time available to him as effectively as possible,'' Schwartzman said. ``He's not coasting.''

In May, Martin told reporters that he didn't think a White House directive calling for regulations to be completed by Nov. 1 applies to the FCC, an independent, bipartisan agency.

Martin, a graduate of Harvard Law School, was named to the commission by Bush in 2001 and designated chairman in March 2005, succeeding Michael Powell, who resigned after four years in charge. Before joining the FCC, Martin worked on Bush's transition team, served as an aide to an FCC member and practiced telecommunications law in Washington.

Since Martin took over, the FCC has ended cable providers' exclusive contracts with apartment buildings, limited how big those companies can get and required operators to carry both digital and analog signals from broadcasters.

Comcast and Cablevision Systems Corp. would be among companies affected if the FCC decides cable companies have to make some professional sports events more broadly available to competitors. Pole attachment rates would also affect Comcast, as well as No. 2 provider Time Warner Cable Inc.

Commission Opposition

``He does have a chance to get at least some of this through before Obama's sworn in,'' said Paul Gallant, a Washington-based analyst with Stanford Washington Research Group.

Kim Kerns, a spokeswoman for Bethpage, New York-based Cablevision, declined to comment. Philadelphia-based Comcast, the biggest U.S. cable operator, had no comment, said spokeswoman Sena Fitzmaurice. Alex Dudley, a spokesman for Time Warner Cable in New York, also declined to comment.

Last month, the other four commissioners -- two from each party -- forced Martin to send a dispute between Comcast and the NFL Network to an administrative law judge rather than deciding it outright. They also compelled him to abandon a bid to help community TV stations demand space on cable systems.

``I'm going to continue to try to push the commissioners to make decisions and to take hard votes on the issues,'' Martin said. ``Those aren't the first items that I've lost.''

Congress Investigates

Cable's competitors have fared better with Martin. Under his leadership, the FCC has made it easier for AT&T Inc. and Verizon Communications Inc. to offer video service, relaxed phone pricing regulations on a case-by-case basis and approved AT&T's purchase of BellSouth Corp., the biggest U.S. phone merger.

Last year, Martin dropped an attempt to gain broader authority to impose rules on cable. Fellow commissioners said he relied on questionable data. The episode is one subject of an investigation of the FCC by the Democratic-controlled House Commerce Committee, the results of which haven't been released.

In a hearing Feb. 13, U.S. Representative Anna Eshoo, a California Democrat, told Martin she wondered ``what cable has done to so enrage you.''

He gestured at a chart showing cable prices.

``What we've seen is a dramatic increase,'' Martin said. ``We need to do something about the ever-expanding cable rates.''

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