Cable TV: regulation or competition?
Brookings Institution, Jan 1, 1996 - Business & Economics - 161 pages
In 1984, Congress simultaneously eliminated state-local regulation of cable television rates and banned telephone companies from offering cable service in their own franchise areas. Five years later, the General Accounting Office discovered that basic cable rates had risen more than four times as rapidly as the overall consumer price level since rate deregulation. As a result, Congress began to move to reimpose cable rate regulation once again, finally succeeding (over President Bush's veto) in 1992.In this book, Robert Crandall and Harold Furchtgott-Roth examine the case of reregulating cable television and find that viewers gained far more than they lost during the brief deregulatory era because cable services expanded so rapidly in the deregulated environment. Moreover, they show that new technologies, such as direct-broadcast satellites, are likely to provide considerable market discipline for cable operators in the next few years, weakening any case for rate regulation. Given regulation's history of impeding innovation, they conclude that economic welfare is more likely to be enhanced by policies aimed at encouraging new entry into video services than by rate regulation.
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The Evolution of Cable Television
Cable Rate Regulation
Effects on Consumers of Changes in Cable
13 other sections not shown
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1992 Cable Act Allison Fisher average basic and premium basic cable networks basic cable services basic satellite basic service basic tiers broadcast channel broadcast signals Cable Act cable companies cable industry cable operators cable prices cable programming cable rates cable subscription cable systems Cable Television cable television services changes in cable choices Communications compensating variation Congress consumer welfare cost Daniel McFadden demand for cable deregulation direct broadcast satellites distribution Economics entertainment equation estimated FCC's federal franchise increase indirect utility function investment likelihood logit model market power measure monopoly MSOs multinomial logit multinomial logit model number of basic number of broadcast number of channels off-air offer parameter pay-per-view premium cable premium channels premium services quality of cable rate regulation regulatory result Sample mean satellite channels statistics subscribe to cable survey telephone companies tion variables Vertical Integration Viacom video services Warren Publishing