The Federal Communications Commission took the first step yesterday toward allowing the three major television networks to own and operate cable television systems.
By a unanimous vote, the FCC agreed to release a staff report that strongly recommends lifting almost all of the agency rules that now strictly limit what kinds of companies can operate cable systems.
If the commission ultimately goes along with its staff report, the networks no longer would be barred from owning cable systems, nor would local television stations be prohibited from owning and operating a cable system in their own viewing areas as they now are.
Additionally, cable operators would be permitted to own as many stations, serving as many subscribers as they want, if the commission goes along with the staff recommendation that there be no limits imposed on the number of cable systems one company can operate.
The current restrictions only hinder competition in the rapidly growing cable industry and limit the number of choices available to consumers, the staff concluded. If competitive problems occur, they can be dealt with under federal antitrust laws, the staff contended.
However, the staff concluded telephone companies should still be banned from operating cable systems in urban areas because the staff believes their involvement could reduce competition in the cable industry. The staff contends that local phone companies could engage in anticompetitive practices because they control the telephone poles which cable systems use to hook up their cables.
But under a final decision unanimously agreed to yesterday, telephone companies will now be able to own cable systems in rural areas. In these areas, the commission said, independent cable systems are scarce and the telephone companies offer the best opportunity to bring cable systems to areas that have relatively little television service.
In agreeing to release the staff's report, commissioners indicated that they agreed with the general thrust of the recommendations.
"This commission is very much in an unregulatory mood," FCC Chairman Mark Fowler said. "We want to move forward on this. If this commission doesn't do it, I can't imagine any future commission that would."
Even so, the commission declined to endorse the report or begin any specific rule-making proceedings to implement the staff's report. Instead, it decided merely to issue the report for public comment.