In The Black
Helping state businesses and consumers benefit from new competition to cable
Today’s advanced telecommunications are changing the way businesses communicate and establish a strong customer base.
Phone companies across the country have begun deploying new technology that competes directly with cable TV and will give African American businesses and consumers a new, exciting array of choices and products while lowering prices.
However, current outdated rules and regulations related to the cable TV market are slowing down the roll-out of this new technology because they place unnecessary burdens and restrictions on new competitors in the cable market.
The Wisconsin Supplier Development Council (WSDC), which supports and develops alliances with minority-owned businesses, believes it is time to update these rules and bring this technology to consumers and businesses faster.
The WSDC understands the connection between technology and productivity in the business world.
New technology facilitates improved efficiency and productivity, directly impacting many African American businesses’ bottom line. Wisconsin’s minority-owned businesses need to have access to the best technology in order to effectively compete in today’s business environment.
Regulations governing the cable TV market have created a system in many markets where one cable company holds a near monopoly, permitting them to continuously raise rates and offering little incentive for improving service quality and technology.
The Federal Communications Commission (FCC) reported in its most recent survey on cable competition that nationwide cable rates rose 86 percent from 1995 to 2004.
Additionally, The University of Michigan’s American Customer Satisfaction Index survey shows, that in 2006 consumers were less satisfied with cable companies than the IRS for the second year in a row.
These patterns are especially alarming for African Americans because research from Kersey Strategies and Scarborough Research shows that African Americans spend more than any other demographic on cable-TV service, about $5 billion annually.
Their research also shows that if competition were introduced into the market, African Americans could save $1.3 billion a year, or more than a quarter of what is currently spent on cable bills.
Technology advancements in recent years have transformed the communications marketplace dramatically and it’s time for the cable market to catch up.
For example, wireless plans 10 years ago were expensive and service was often poor.
But investments in technology and competition between wireless companies have dramatically improved service and brought prices so low that a record number of consumers are using wireless phones as their only means of communication.
In order to speed the roll-out of new technology, regulators took a hands-off approach that allowed the market to drive competition. These laws have allowed new technology to reach more households, lower prices and bring better products to consumers.
Laws in the cable TV market should be reformed to follow the example of the wireless industry and encourage greater competition, instead of keeping antiquated rules in place.
Ten states across the nation have opened the cable-TV market to increased competition.
Consumers in Texas, Florida and Virginia, as well as other states, have already seen the positive results of cable competition--prices have dropped and new services are available to consumers.
State lawmakers must address cable TV regulations soon in order to enable phone companies to begin making important investments to compete in the cable entertainment market.
Competition for all Wisconsin consumers should not be held up because of outdated and burdensome laws and regulations.
The Wisconsin Supplier Development Council believes it is time to reform Wisconsin’s cable market to ensure future competition and lower rates for the state’s African American businesses and consumers.
About the Wisconsin Supplier Development Council
The mission of the Wisconsin Council is to support and develop minority-owned businesses by facilitating important connections between corporations and minority suppliers.
The council is a nonprofit organization composed of companies from throughout the state. Members work together to increase the amount and quality of business transacted with minority-owned firms.
Membership in the council is a voluntary effort that demonstrates the initiative of the private sector concerning minority business opportunities.
