Deregulation of the Cable Industry
In 1984, Congress passed the Cable Communication
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In 1984, Congress passed the Cable Communications Policy Act. This Act called for the deregulation of the cable television industry in America. However, instead of encouraging competition within the industry, deregulation enabled local cable companies to establish monopolies around the country. As a result of this lack of competition, cable rates went up and service quality went down. Recently, there have been arguments in favor of reregulating the cable industry. These arguments call for laws which would reduce the ability of new cable companies to hold exclusive contracts with local governments. This would lead to increased competition as well as increased benefits to consumers. In contrast with consumer opinion, the cable industry is opposed to reregulation. According to industry arguments, deregulation has been responsible for better quality programming and a wider variety of channels to chose from. In actuality, the cable companies are afraid of the new competition which might arise as a result of reregulation. Although cable TV did not become popular until the 1980's, the cable television industry actually has a long history which dates back to the late 1940's. The first experimental cable television system was developed in Astoria, Oregon, in 1949. The following year, the first cable system for commercial use was introduced in Lansford, Pennsylvania. At first, cable television was designed for the purpose of bringing broadcast transmissions to rural ar
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ith cable service. Cable TV's main asset is its ability to provide a wide variety of unique programming. Few consumers have complained about this aspect of the industry. Rather, the complaints generally center around the reduced quality of service and the increased prices which are associated with cable TV monopolies in local areas. As reported in the Economist: "The problem... is not with the kaleidoscope of networks. It lies with the cable-operating firms that supply the images. Though there are more than 9,600 of these, each tends to hold a monopolistic grip on the areas it serves."
The deregulation provided by the 1984 Cable Communications Policy Act gave local governments the authority to give "exclusive franchises" to individual cable companies. For the most part, this is exactly what the local governments did. Thus, most communities in the United States today are serviced by cable monopolies. According to the Paul Kagan Associates research firm, there are barely more than 65 cities that have competitive cable systems. The vast majority of America's cable companies have exclusive contracts. Such monopolies result in the problems which are generally associated with a lack of market competition. These problems ar
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Approximate Word count = 2187
Approximate Pages = 9 (250 words per page)
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