Comcast wins ruling on FCC cable ownership caps

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The nation’s biggest cable operator can get bigger.

The U.S. Court of Appeals for the District of Columbia Circuit sided with Comcast Corp. and against the Federal Communications Commission in a closely-watched case about just how much of the nation’s TV homes one cable company should be allowed to serve.

In throwing out the FCC’s rules that no cable company can serve no more than 30% of the nation’s TV marketplace, the court said the regulatory agency did not factor in competition to cable in the form of satellite television and that the rules were ‘arbitrary and capricious.’

The decision should clear the way for Comcast and other cable operators to expand. Philadelphia-based Comcast currently has 23.9 million subscribers reaching 24.8% of the nation’s television homes. In a statement, the company said the decision ‘affirms that rules must reflect the changing realities of the dynamic video marketplace where today consumers have more choice in video providers and channels than ever before.’

The 30% cap was first put in place by Congress as part of the 1992 Cable Act. In 2001, the district circuit ruled that the cap was unconstitutional. The commission then conducted an inquiry about cable ownership limits and in 2007 again tried to impose the cap.

FCC Chairman Julius Genachowski said the agency is reviewing the decision and will take it ‘fully into account in future action to implement the law.’ Whether that means the FCC will again try to impose a cap remains to be seen. Commissioner Robert McDowell, who in 2007 argued against the regulatory agency’s fight to maintain the 30% cap, said in a statement that the changing media landscape made it clear that justifying this cap was vulnerable.

If the FCC does back off, other advocacy groups might pick up the battle. Media Access Project, a Washington, D.C.-based think-tank and public interest lobbying organization told industry magazine Broadcasting & Cable that ‘this is not the end of the fight’ and suggested it would work with the FCC on taking the issue to the Supreme Court.

-- Joe Flint

Photo Credit: Top Right: AP Photo/Elise Amendola. Bottom Left: FCC Chairman Julius Genachowski. Credit: Robert Giroux/Getty Images