Testimony before the Mt. Hood Cable Regulatory Commission on Qwest’s Cable Franchise Proposal
Members of the Commission, my name is Steve Buckstein. I’m Senior Policy Analyst and founder of Cascade Policy Institute, a non-profit think tank based in Portland. Our mission is to advance policies that foster individual liberty, personal responsibility and economic opportunity in Oregon.
In the late 1980s I remember one Multnomah County Commissioner campaigning on a platform of bringing multiple cable TV providers to the county. Hopefully, tonight is the night that promise will come true. The mere choice of providers is, I believe, the most powerful public benefit that will be generated with the acceptance of Qwest’s franchise request.
We can speculate about why there hasn’t been any real competition in the cable industry so far. But we all know that’s changing. Satellite TV is now here, and high-speed broadband networks, telephone companies and other providers are poised to provide powerful new choices for consumers.
It’s time to move beyond the belief that cable is somehow a natural monopoly that needs to be regulated in the name of consumer protection.
At least 13 states have recently streamlined their cable franchising regulations, making it easier to enter the market, and therefore customers can expect new choices, greater value and improved service.
One analyst testified last year that increased cable TV competition could push rates down an average of 27 percent, saving Americans at least $107 billion on their cable bills over the next five years.
Such dramatic rate reductions will help close the gap between what some call the information “haves and have nots.”
In the last twenty years cable TV rates have risen more than twice as fast as inflation, while technologies such as TV equipment, telephone services and Internet services have either dropped in price or risen far slower than inflation. The differences can be attributed in large part to whether the industry is competitive or not.
Lack of competition has also hampered innovation in the cable market. Just look at the computer you own today compared to the one you owned ten years ago. Compare the Internet access you have today to what you had then. The differences are like night and day. Cable TV service, in comparison, has changed very slowly. Again, the difference is all about competition.
None of us know what innovations might be possible if you throw open the doors and say anyone is welcome to compete for our cable business. I know such a broad choice isn’t before you tonight, but you can begin moving in that direction by approving Qwest’s proposal.
I can confidently predict that almost the minute you do so, if they haven’t already started, the incumbent cable provider will begin looking hard at how it can reduce its prices and improve its service. Why? To keep its customers happy.
You can make existing and future cable customers happy by giving all of us more choices in the marketplace. I encourage you to take that step tonight.