Powell's cable rollout

Chairman says industry must be good actors to maintain the most positive regulatory regime in decades

FCC Chairman Michael Powell didn't bend over backwards to make the cable industry feel good about itself last Tuesday at the NCTA convention, but the former gymnast did somersault his way onto the stage.

Following a troupe of acrobats, Powell flipped his stocky frame—dressed in a pinstripe suit—head over heels before getting up to tell the cable industry that it needs to stay on its best behavior if it wants to stay on regulators' good sides.

Powell illustrated his point with a fairy-tale theme, calling the cable industry a toad that has been turned into a prince by a "digital kiss."

"Once upon a time, cable was known as a toad of communications policy: Yeah, it was a nice little business, but it was hardly charmed," Powell said. But now: "Coaxial cable has been spun into gold thread.

"This industry," he continued, "has all the tools it needs to succeed, and may I suggest that this is the most positive regulatory regime the cable industry has seen in decades. But it's largely in the hands of the industry to maintain favorable conditions."

Powell listed several areas in which the cable industry needs to watch itself, starting with digital television.

Broadcasters complain that cable operators are not trying hard enough to create interoperability between digital broadcast signals and digital cable systems. "This industry should find ways to be a productive partner in this transition, rather than an obstacle."

Not everyone in the audience was pleased with what he had to say. "Powell's fairy tale has a nightmare end for consumers," said Jeff Chester, of the Center for Digital Democracy.

Chester and other consumer advocates are pushing the FCC to implement rules that would require cable operators to allow competitive Internet service providers to use their high-speed networks. Consumer advocates also agree with Disney and Viacom that vertically integrated broadband companies—AOL Time Warner in particular—should be forbidden to carry exclusively their own and their partners' interactive-TV content.