IP Democracy: FCC Chairman Gets Pants Pulled Down

The famed FCC meeting slated for today hasn't started yet and is unlikely to start at all, not a surprise given the fiasco generated by Chairman Kevin Martin's highly controversial proposal to impose new regulations on the cable industry. One key reason for the delay is that Martin has no support among his fellow commissioners for the cable proposal and the initiative has been scrapped...for now.

Martin has been so roundly rejected by his colleagues that he seemingly can't even get the votes needed for an alternative proposal, one that simply calls for cable operators to submit data to the FCC. Martin's regulatory proposal is premised on his contention that cable now serves more than 70% of homes capable of buying the service and he's been criticized for ginning up numbers to justify his proposal.

Martin's fallback proposal is to order cable operators to submit data to the FCC to generate yet another set of statistics on the industry's penetration rates. Even this stripped-down, face-saving proposal has so far failed to generate support among the remaining commissioners, and for good reason.

As my fellow analyst Bruce Leichtman has said (and as I documented here) it's not remotely possible that cable has surpassed the 70% threshold and "that's what is so appalling about this " So a data collection effort by the FCC would be an absurd, futile exercise.

A clear sign that Martin has suffered a truly humiliating defeat is that he personally briefed reporters this afternoon on his failure to get the necessary votes. As the WSJ's Corey Boles notes:

Mr. Martin has had to pull items before, but he has never personally come down to reporters and admitted that he couldn't find the support for a rule change.

Update: The New York Times (which seems to be the preferred outlet through which Kevin Martin makes policy announcements) has this article in which Martin claims that despite his defeat on the big issue, "he was still able to force action he and some consumer groups maintain could help to make programming more diverse and ultimately reduce cable costs."

Huhh??? Supposedly Martin was able to strike some kind of pact with his fellow commissioners this evening that would force cable operators to charge independent programmers lower rates for leased access to systems.

Nothing about this new deal or new set of rules is up on the FCC's web site. In fact, the FCC's meeting still hasn't started today. And I have a hard time figuring out how Martin did this without first proving that cable had passed the 70% threshold.

It is clear that Martin is spinning and spinning. The NYT article pins Martin's loss on a lobbying "blitzkrieg" by cable operators and claims that the supposed compromise proves that cable didn't win a total victory.

Yeah, I don't think so. It is true that cable pulled out all the lobbying stops. But I've seen the cable industry do this before and lose. This go-around, cable got lucky. Martin just simply lost credibility by making up data.

Posted by Cynthia Brumfield on November 27, 2007 1:59 PM to IP Democracy