FCC Announces Decision on Cableco/Telco Service Crossover
As reported by AXcess News, the FCC ruled in December 2006 that telephone companies can offer television programing in director competition to cable television companies allowing AT&T and Verizon, for starters, to offer television to their subscribers. In something of a marketplace balancing act, cable TV companies are slowing adding telephony customers in direct competition to telcos, which S&P estimates will reach 10 million subscribers by the end of this year. Readers know I am something of an expert on forecasting, and a forecast with this short of a horizon is likely to be precise.
Local municipalities will decide within 90 days on some phone-company applications to offer TV in competition with cable providers. The 3 Republican FCC members said it will lower costs to consumers, while the 2 Democrats said the decision will fail in the court system because the FCC rule looked like Congressional legislation and, therefore, the FCC had overstepped its bounds. Surprisingly, the cable lobby group did not immediately take a decision, although it hinted that it agreed with the Democrats.