SUBCOMMITTEE ON TELECOMMUNICATIONS AND
THE INTERNET March 10, 2004 Mr. Chairman, thank you for calling this hearing today. Before we discuss the business at hand, I would like to note the existence of a business dispute -- between Viacom and Echostar - that is hurting consumers in my district and across America. I am not casting judgment as to who may be right or wrong. I strongly urge both of your companies to return to the negotiating table as quickly as possible and to settle this dispute.As the Committee looks to reauthorize the Satellite Home Viewer Improvement Act, it must pursue three equally important and potentially conflicting policy goals. First, the Committee must work to strengthen the ability of satellite companies to compete with the entrenched cable industry in the video marketplace. Second, it must empower consumers to receive the programming of their choice. And finally, in taking such actions, it must not unduly weaken American's local broadcasters nor disrupt their core revenue stream. Certainly, the Congress should use this opportunity to strengthen competition in the marketplace for video services. Though DBS satellite is a growing presence nationally, the cable industry still holds a commanding position in each local market. To their credit, the cable companies continue to roll out popular new services such as video-on-demand and V-O-I-P telephone service. Unlike satellite systems, the cable plant is uniquely capable of offering this bundle of digital services, and the industry has smartly utilized its unique abilities to gain a commanding lead in the emerging "digital marketplace." As the only video distributors with a national platform, satellite may possess its own unique abilities to differentiate itself and attract consumers. For example, satellite may be able to help spur the transition to digital by offering consumers a high-definition network signal in those instances where a consumer is unable to receive such a signal from the local broadcaster. In other instances, satellite may be able, for example to provide a distant signal that would allow my friend Ed Markey to watch Red Sox games from his home in Maryland. Clearly, both of these proposal may please consumers and also make satellite a more vibrant competitor to cable. That is important. At the same time, however, both of these proposals may have the effect of hurting local broadcasters. The Committee must closely examine such effects to ensure that local broadcasters are not unduly weakened by potential legislation. Ultimately, the Committee must carefully balance these competing equities in a way that protects the local broadcaster.
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