Comcast Defends Michigan PEG-Channel Move

Executive VP David Cohen Testifies Before House Energy & Commerce Committee 1/29/2008 09:15:00 AM Eastern

Comcast was on Capitol Hill Tuesday defending its transition of some Michigan PEG (public, educational and government) channels to digital delivery but apologizing for the way it was handled.

David Cohen

The move raised concerns on the Hill, including from Democratic House Energy & Commerce Committee chairman John Dingell, who is from Michigan.

According to testimony being submitted to the House Telecommunications and Internet Subcommittee, Comcast executive vice president David Cohen told legislators the move was a transitional one given that virtually all cable channels move from analog to digital.

He pointed out that the satellite competition is already all-digital but is not required to carry PEG channels at all. Cohen argued that competition requires that cable operators offer PEG channels in digital, and that if Comcast and other cable operators are "unduly restrained" in the transition to digital, it will weaken them competitively and, ironically, could actually harm PEG programmers if subscribers are driven to competition with no PEG requirements.

"Even if our transition of PEG channels to digital causes some temporary, minor inconvenience for some of our customers," he added, "it is important to understand that these citizens will receive little or no PEG programming if they move from their local cable system to the all-digital lineup provided by our telephone and DBS [direct-broadcast satellite] competitors."

The concerns by Michigan PEG-channel providers -- which led to a court challenge and a stay of the PEG-channel move -- included that viewers who had received the channels in analog would now have to get digital converter boxes to see the channels. Cohen said that as channels migrate to digital, all of its customers will need set-tops, DTV sets or some other devices.

But he added that the Michigan move was atypical in two regards. First, he said, most of Comcast's systems still carry PEG channels in analog and Comcast has "no current plans to change that." The Michigan move at this time, he said, was because of "the relatively large number of PEG channels in certain Michigan communities," which required it to "work out different arrangements to help us accommodate consumer demand for other services."

Among those services, he said, were HDTV and faster broadband.

The move was also atypical, he added, in that Comcast had failed to explain why it was doing what it was doing and to work as cooperatively as it could have with the affected channels. “I want to apologize for that,” he said, adding that the company was now engaged in “friendly and what I am sure ultimately will be fruitful discussions with local government officials in Michigan.” Dingell praised Comcast for working toward a solution, but said he continued to be concerned that PEG get first class treatment, “ not second-class billing.”

Cohen said Comcast was not discriminating against PEG channels. It was putting them on the same basic tier, only delivered in digital rather than analog, and only in some Michigan systems, with the majority of its PEG channels still in analog.

But he also argued that Comcast was within the law to move PEG channels to digital. "The bottom line," he said, “is that we believe that digital delivery of PEG channels is fair, it is appropriate, it is pro-consumer, it is key to our ability to respond to competition, and we believe that it is lawful.” However, he added a line below the bottom line that the company is "committed to working cooperatively with [its] local partners to ensure efficient PEG delivery."

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