Rich Fiscus
24 Jan 2008 0:29
One of the FCC's most contreversial decisions last year was a rule banning contracts for cable providers to exclusively service entire buildings or complexes, with no choice given to the tenants. "I believe that people in apartment buildings deserve to have the same choices as people in the suburbs," Martin said at the time. "The commission found that people who live in apartment buildings often have no choice of companies when it comes to their video service provider. This is because building owners often strike exclusive deals." He also pointed out that between 1995 and 2005, a period during which cable rates nearly doubled, other communications services such as long distance calling actually fell.
Now the National Multi Housing Council and National Apartment Association who represent the owners of many of these buildings are challenging the ruling in the U.S. District Court of Appeals' District of Columbia division. The complaint alleges that the ruling exceeds FCC authority and is "arbitrary and capricious, an abuse of discretion, unsupported by substantial evidence."
This isn't the first high profile case against the FCC on similar grounds. In 2005 the courts overturned a FCC rule that would have required consumer electronics manufacturers to obey a so called broadcast flag instructing equipment not to copy content. In that case the court noted that mandating features in manufactured goods is outside the scope of the agency's jurisdiction.
"These misguided regulations reveal a total lack of understanding on the FCC's part about how the multifamily video market works," said Jim Arbury, senior vice president of government affairs for the NMHC and NAA, in a release. "Exclusive access contacts were the primary means through which apartment owners could force the large cable firms to lower their prices and improve their service offerings. By taking this bargaining tool away from owners, the FCC has essentially removed a key incentive the cable firms had to negotiate with apartment owners."
"While the idea of expanding competition in the telecommunications industry with the stroke of a pen appeals to some policymakers, in reality it is just not that easy," he said. "We predict that many renters will see higher prices and worse service as a result of the FCC's actions, exactly the opposite of the commission's stated intention."