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Note: The flip side of "competition = lower prices", in fact, competition allows the cable providers to petition the FCC to lift the remaining pricing caps, thus raising prices. If the recent past is any indication, the FCC will comply.

from: MultiChannel News

Comcast Seeks Rate Relief in 150 Communities
Cable Operator Says It Faces Effective Competition

By Ted Hearn -- Multichannel News, 8/6/2007 7:39:00 PM

Comcast, in a large request, asked the Federal Communications Commission to remove the last vestiges of rate regulation in nearly 150 communities across the country, the agency said Monday in a public notice that lacked key details.

Comcast sought deregulation in nearly 50 petitions for effective competition, including such places as Salt Lake City, the Chicago suburb of Du Page County and Tuscaloosa, Ala. The request appeared to be one of the largest the FCC has received from a single cable company since the onset of rate regulation under the 1992 Cable Act.

In March 1999, the FCC lost authority to regulate the price of expanded basic. Basic cable rates were still subject to price controls, however, until the cable operator could demonstrate that pay TV competitors were serving 15% of the households in the relevant franchise area. When the pay TV competitor is landline service affiliated with a phone company, no penetration test applies.

In the public notice, the FCC didn’t indicate the legal basis for Comcast’s request for deregulation.

The vast majority of petitions granted by the FCC over the years were based on the joint subscriber penetration of DirecTV and EchoStar Communications. Increasing, the so-called phone-company test, created by the Telecommunications Act of 1996, has come into use with the pay TV entry of AT&T and Verizon Communications.

When the FCC grants a petition for effective competition, the local government loses authority to cap the price of the basic tier, which all cable subscribers must buy. According to the FCC's most recent cable price survey, the national average price for basic cable is about $14 per month.

In addition, the cable operator is not required to offer a uniform rate structure, and it may require subscribers to purchase any number of programming tiers before they may access premium and pay-per-view offerings.

The FCC doesn’t face a formal statutory deadline to act on Comcast’s filings.