Editorials - Broadcasting & Cable

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Apples to apples

With the big bucks of Wall Street, rather than the big sticks in Washington, for motivation, the cable industry has taken steps to regularize its accounting procedures. By providing more and more-detailed information on capital expenditures and by standardizing the definition of subscriber counts, the 11 participating cable operators should help improve the industry's image in the financial markets. That image has been sullied by the Adelphia scandal and a general lack of benchmarks that makes apples-to-apples comparisons problematic.

The new standards will add yet another acronym, RGU (revenue-generating unit), but will clarify sub-count comparisons. In the past, one company's sub could mean bare-bones basic, while another's could be a full plate of basic/phone service and high-speed Internet. Now the first will represent one RGU, the second three.

The decision by major cable operators to adopt their own reporting standards is an example of marketplace forces working to produce self-regulation, as well as a sliver of silver lining in the thunderhead that is Adelphia.

Common sense

Note to Senator John McCain and everybody else who continues to hammer on cable rate increases: The Government Accounting Office report on DBS and cable competition released last week says about cable's bang for the buck, "Cable prices are higher in areas where the cable company provides more channels, indicating that consumers generally are willing to pay for additional channels and that providing additional channels raises a cable company's costs." We'd like to say "no duh" in a dismissive sort of way, but common sense seems to be in short supply whenever the FCC releases its cable-competition report showing an increase in cable rates. Consumer watchpuppies by the basketful start yapping, led by legislators seeing a no-lose position to trumpet at election time. Yet those same FCC figures also continue to show that the per-channel price of cable is not soaring. In fact, it continues to trail the inflation rate. Of course, "reelect me because I recognize that cable service is provided at a fair market price" won't fit on a button.

Freeloaders

The preferences of 3,000 registered voters are nothing to sneeze at (just ask Al Gore). An NAB-commissioned study on voter preferences released last week found, much to the association's delight, that the vast majority believe that politicians should not be given a free ride on the airwaves and, if they did get one, would probably still raise fistfuls of cash (and then, we would add, spend it on billboard and print).

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