June 18, 2007

The Truth Behind Calls for Legislation

When lawmakers demand new cable regulations, they’re often merely sending coded messages to operators.

By Steve Effros

When press releases start flying and hearings begin to multiply regarding proposed cable laws, my phone starts to ring. Cable operators want to know what the heck is going on, and why we always seem to be a target. Wall Street analysts want to know the odds on passage, and what that legislation will mean to the bottom line. Reporters, of course, just want to talk about the battle.

It’s at times like these that I tell all the callers a story. One day, years ago, I was walking across the Capitol grounds with then-Rep. Billy Tauzin (R-LA). It was at just one of those times. The cable industry was trying to deal with the C-band satellite phenomenon. Satellite signals to cable head-ends were not scrambled, so it became a sport for folks at home to pick up, for free, all of those transmissions. The theory was: Anything that falls on my property is mine, and I have the right to use it. Whenever I heard that argument I would note that telephone conversations, transmitted by either microwave or satellite, similarly fell on their property, but if they intercepted and listened to those, they would be violating the wiretapping laws.

Never mind — the point was that there were lots of hearings about the cable industry making the "skies go dark" when the decision was reached to start scrambling satellite feeds and deprive hobbyists of their fun. Billy was loudly in their corner, pushing for satellite access to cable programming. We were having a lively debate about this when he said to me that I shouldn’t get too worked up, that he didn’t expect any of the legislation to pass — that it was all part of an exercise to keep the industry honest. It was part of the game. He was just rattling their chains, he said.

That was an important part of any legislator’s job, Billy said. Not necessarily to legislate, but to keep issues in the forefront, to suggest possible legislative "solutions" that he knew one side or the other would not want, and thereby nudge both to act, or keep them from taking steps that he considered inappropriate.

I always remember that conversation when I hear chain-rattling about cable rates or "blocking" websites or even a la carte and dual must-carry. In many cases the likelihood of legislation is low — though not always — and you have to be able to spot the difference. Often the real motivation behind the noisemaking is the desire to influence the telecommunications industry’s attitude and actions. That’s how the government game is played.

A former FCC attorney and president of CATA, Steve Effros is a columnist and consultant in the cable television industry. He can be reached at steve@effros.com.