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Re: Petitions for Declaratory Ruling Regarding Public, Educational, and Governmental (PEG) Programming: CSR-8126, CSR-8127, CSR-8128: MB Docket No. 09-13.

Published Tuesday, March 31, 2009 7:00 am

Michael J. Copps, Acting Chairman
Federal Communications Commission
445 12th St., S.W.
Washington, D.C. 20554
(Submitted Electronically)

Re: Petitions for Declaratory Ruling Regarding Public, Educational, and Governmental (PEG) Programming: CSR-8126, CSR-8127, CSR-8128: MB Docket No. 09-13.

Dear Chairman Copps:

This letter is in response to the public notice for comments on the Petitions for Declaratory Ruling regarding Public, Educational, and Governmental (PEG) programming: CSR-8126, CSR-8127, CSR-8128: MB Docket No. 09-13.

The Institute for Liberty (IFL) is a national advocacy organization based in Washington, DC. Our organization exists for the everyday working men and women who feel disconnected from the government decision-making process, yet want to use their voices to protect America's fundamental liberties from intrusive government expansion. Originally founded as a public policy center focusing on technology issues, IFL has expanded its scope to protecting fundamental free-market principles that have allowed American businesses and individual entrepreneurs to thrive.

With regards to the current petition process, IFL has four primary concerns:

1. Video services providers operate in a highly competitive market. Video providers included in this complaint such as Comcast and AT&T, face significant, demonstrated competition from Direct Broadcast Satellite (DBS) video services providers such as DirecTV and Dish that are not subject to PEG carriage requirements. In order to remain viable, competitors in such a market must be allowed to evolve with customer demand. Any ruling that acts as an undue impediment to one class of Video Services Providers (VSPs) who seek to win and retain customers, while leaving another class unregulated, would amount to the government choosing the winners and losers in the marketplace. As a guiding principle of public policy, this should be discouraged. It should also be noted that to the extent onerous PEG requirements drive customers to unregulated DBS providers, the PEG programmers will actually lose viewership.

2. Cable providers should be allowed to fully transition to a digital platform. Analog signal is an increasingly antiquated technology, as demonstrated by all VSPs other than cable -- DBS, AT&T, Verizon, and even over-the-air broadcasters as of June, 2009 -- operate on digital platforms. Cable providers are rapidly implementing digital service in order to better exploit the capabilities of their medium and to better serve the needs of their customers. Digital video signals are six times more efficient a use of their bandwidth than analogue, and offer consumers a superior range of video services including expanded video on demand, increased high definition programming, and even greater internet speed when analog bandwidth is freed up. Previously, the FCC has recognized these inherent benefits of digital conversion, offering incentives to cable operators who made the move to the new format. A ruling requiring a cable provider, such as Comcast, to carry PEG channels in analog would represent both a technological step backwards and a stark reversal in the Commission's previous efforts to spur the move to digital platforms.

3. VSPs should be allowed to respond to the evolving demands of the customer. Recently, AT&T U-verse moved all PEG channels to a single-channel, on-demand format. Comcast cable proposed digitizing all Michigan PEG channels, and grouping them into a "PEG channel neighborhood." Both actions are consistent with consumer preferences. Previously, PEG channels were interspersed with basic commercial channels, creating an unorganized and cluttered presentation disfavored by many consumers. These new formats are therefore a rational response, offering a clean, practical, and consistent delivery of PEG content that will mirror the way other, similar content such as sports, news, music, and pay movie channels are typically grouped together in the digital television world.

4. A Federal ruling for a Michigan complaint may well bring about unwanted consequences in other states. The trend over the past four years has seen states reforming cable franchising laws to promote greater competition and innovation within the broader statewide marketplace. Of the 20 states that have passed franchising legislation, 11 have specifically loosened the reigns on PEG carriage requirements, recognizing the new opportunities associated with the switch from analog to digital. The Michigan local franchising authorities' petitions represent an isolated effort to preempt Michigan's state franchising authority. A ruling by the FCC might not only restrict competition in Michigan, but could lead to further legal issues in other states that have reformed their cable franchising statutes.

The Institute for Liberty believes that any FCC ruling further defining cable operators' carriage of Public, Educational, and Government channels will only serve to hinder competition and might actually decrease PEG channel visibility. Cable providers, such as Comcast and AT&T, reside in a highly competitive marketplace that requires the implementation of the latest digital technology, and a sensitivity to customer demands to remain relevant.

Thank you for the opportunity to comment on this important issue. If you have any questions, or require any additional information, do not hesitate to contact us. We can be reached at (202) 261-6592, or via e-mail at Andrew.Langer@instituteforliberty.org .

Sincerely,

 

Andrew M. Langer,
President

The Institute For Liberty 1250 Connecticut Ave, NW, Suite 200 Washington, DC 20036 P: (202) 261-6592 F: (877) 350-6147