On April 6, 2012, the FCC’s Media Bureau granted the City of Boston’s petition to revoke a 2001 determination of effective competition and permit the City to re-regulate Comcast’s basic service tier rates.  

A cable system subject to effective competition is exempt from cable rate regulation, uniform rate regulation, and tier buy-through regulation.  In 2001, the FCC concluded that the incumbent cable system in Boston was subject to effective competition based on the local exchange carrier (“LEC”) test.  The Communications Act provides that a cable operator is subject to effective competition if a LEC or its affiliate offers video services by any means other than direct-to-home satellite in the franchise area of the cable operator. The LEC’s video services must be comparable to those provided by the cable operator. In addition, the cable operator must show that (i) the LEC offers video programming services directly to subscribers in (ii) the franchise area of an unaffiliated cable operator providing cable service in that franchise area. 

In May 2011, the City filed a petition seeking recertification based on the argument that RCN no longer provides effective competition under the LEC test.  The Media Bureau agreed, finding that the competitive landscape in Boston had changed because of RCN’s limited coverage area and its plans not to expand.  While Comcast argued that it was now subject to competing provider competition, the Media Bureau chose not to address the claim at this time. 

Consequently, the Media Bureau granted the City’s petition for recertification, unless Comcast files a petition for reconsideration within 30 days, alleging competing provider competition.  If Comcast files a petition for reconsideration, the Media Bureau will stay the recommencement of basic service tier rate regulation in Boston pending the FCC’s review of Comcast’s petition.  

If you have questions regarding petitions for effective competition, please contact Scott Friedman at (312) 372-3930 or via email at sfriedman@cm-chi.com.