Washington

Moffett: FCC Net Neutrality Proposal Backs Usage-Based Pricing

Says that will be big boost to cable operators 12/01/2010 09:33:20 AM Eastern

Saying that "broadband rationing is now the
order of the day," Bernstein Research senior analyst Craig Moffett says
that the FCC's just-circulated order on codifying and expanding network
neutrality guidelines "specifically and expressly endorses usage-based
pricing for broadband."

The item was circulated at around midnight
Tuesday, just beating a customary deadline of three weeks before a public
meeting, in this case the Dec. 21 meeting.

Moffett says that will be a big boost to cable
operators, who should be able to boost penetration with lower-priced
tiers, and help address the cord-cutting issue by migrating video customers to
broadband, or discouraging cord-cutting altogether as broadband prices rose to
offset the decline in video revenues.

"The tacit endorsement of UBP is, in our
view, the biggest news of the day, and must be viewed as very positive for
terrestrial broadband operators," Moffett said. "We would expect the
introduction of UBP plans from major cable MSOs to follow in short
order, and we would expect that their stocks will respond well to such
introductions."

The National Cable & Telecommunications Association is said to
support the chairman's proposal, though it would prefer no new rules.

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