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Cable Contests (Another) Bid to Increase Pole Fees

10/03/2009 2:00 AM Eastern

American Cable Association president Matt Polka said power utilities are not subsidizing cable service and the Federal Communications Commission should reject a petition by a quartet of those companies asking for an increase in pole-attachment fees.

“Requiring cable providers to pay higher pole-attachment fees simply because they now offer digital phone service over their lines would drive up the cost of advanced cable services for consumers and slow the pace of broadband deployment across rural areas, where costs already run higher than average for small, independent cable operators,” Polka’s ACA, which represents those companies, said in comments to the FCC last week.

The FCC is currently deciding how to classify voice-over-Internet protocol phone service as well as collecting comments on the utility company request for a ruling. Last month, American Electric Power Service, Duke Energy, Southern Co. and Xcel Energy Services asked the agency to make cable operators pay the telecom rate for pole attachments, rather than the cable rate, which is lower.

They contend the higher rate was justified because VoIP is the functional equivalent of traditional phone service. The utilities also say the FCC should make that “clarification” before it takes up any related issues in its broadband notice of inquiry or proposed rulemakings on IP services and pole attachments.

The ACA pointed out that the FCC, in its report on rural broadband rollouts, said that “[t]imely and reasonably priced access to poles and rights of way is critical to the buildout of broadband infrastructure in rural areas.”

The cable industry has long argued that utility companies are well compensated by cable’s current payment formula, which has been upheld by the FCC and the U.S. Supreme Court (in FCC v. Florida Power). Cable operators also say the FCC has correctly applied the formula to attachments for cable-modem service.

The cable industry has argued for lowering the rate for all attachments to that paid by cable, to promote the rural deployment that the FCC has said is one of the keys to a national broadband-rollout strategy.

September