IN rural Henderson, Tenn., where citizens can tune in only fuzzy
far-away television signals off the airwaves, cable television is a
life-line to the world of news and Hollywood entertainment.
It wasn't until local cable rates jumped 40 percent overnight -
launching a battle worthy of a prime-time soap opera - that Mayor
Charles "Eddy" Patterson realized just how much of a necessity cable
had become. "It's kinda like running water in the house. Once you
become accustomed to it, you don't want to do without it."
It is this view - shared by many others - of cable television as
less a luxury than a basic American necessity that is behind a
growing movement to rein in an industry that exists in most
communities as a monopoly.
Congress and the Federal Communications Commission (FCC) are both
looking to re-regulate the cable business. Under Reagan-era
de-regulation, cable fluorished: A booming $15 billion-a-year
business, it's high-tech tendrils reach 50 million homes or about 60
percent of households with televisions. But there are few controls
on its rates, programming, or quality of service.
Henderson's experience is symbolic of the cable boom which has
steamrolled through America, says Mayor Patterson. "We're a prime
example of what can happen. ... (We have licensed) a monopoly."
Last June, the town's cable franchise, MultiVision Cable TV,
hiked the basic monthly rate for 17 channels 40 percent to $19.95.
Local outrage led to an unusual gambit: Henderson offered a second
franchise license to CableAmerica Corp. to build a competing cable
By November the town of 5,000 was wired with two working cable
systems. Locked in competition, both offered three months of free
cable service to new subscribers and basic monthly rates of under
$12 for an expanded offering of 40-plus channels.
Henderson residents thought they had found a way to make their
economic clout felt, says Mr. Patterson, who was even called to
testify before the US Senate on the effects of competition in
But the community was stunned last month to learn that
CableAmerica was selling out to MultiVision and basic cable rates
would rise to about $15 a month.
It is controversies like Henderson's as well, as a long-term
concern about the control of video technology, that give momentum to
the new regulatory effort.
The industry is already feeling the effects of the uncertainty
over the possibility both of re-regulation and of competition from
telephone companies and direct satellite video systems, says John
Mansell, a Washington analyst with the consulting firm Paul Kagan
"Cable stocks have been hit very hard; some are down, in many
instances 30 to 40 percent," he says. Looking for market stability,
industry operators themselves have even gone on record supporting
"We're now at a point where there is a refocus on what cable
television should be. ... It's clearly a business, but (because of
the) larger community policy questions we are not going to ignore it
as if they were selling widgets," says Donna Lampert, a fellow in
the Washington program of the Annenburg School of Communications.
Indeed, the growth of cable and its technological importance as
the conduit for video communications of all sorts has become more
than a question of how much it will cost the consumer to flip from
NBC to HBO.
"There's a very strong argument that any individual television
program is not a necessity. But television has become so important
in the fabric of society - to our national identity and at times of
crisis - (that it plays) a unique role in post-industrial
democracy," says an FCC cable official who asked not to be