FCC declares 'effective competition' in Lafayette cable market

by Nathan Stubbs

The Federal Communications Commission has issued an order declaring "effective competition" in several cable franchise markets in Louisiana, including Lafayette.

The Federal Communications Commission has issued an order declaring "effective competition" in several cable franchise markets in Louisiana, including Lafayette. Cox Communications recently petitioned the FCC, requesting the ruling.

In its petition, Cox had to prove higher levels of competition based on one of three separate standards. In issuing an effective competition determination, the FCC essentially deregulates the franchise areas, allowing for an open, laissez faire market. The main effect of the ruling is that Cox, and all the other providers in Lafayette and the other effective competition markets, are no longer required to follow the FCC's uniform pricing rule, which mandates cable providers offer the same rates for the same services to everyone within a franchise area. Cox and LUS Fiber, its main competitor in Lafayette, are now free to offer different rates and promotional offers throughout the Hub City franchise market.

In its ruling, issued on Sept. 9, the FCC determined effective competition exists in pockets of four separate service areas in Louisiana. These include the greater Baton Rouge area, the greater Lafayette area,  St. Charles Parish, and St. Mary Parish and Baldwin. Locally, the FCC lists Abbeville, Broussard, Carencro, Delcambre, Duson, Erath, Iberia Parish, Jeanerette, Lafayette city and parish, Loreauville, Scott, Vermilion Parish and Youngsville as having effective competition.

Cox had one of three ways to prove effective competition in each area:

  1. At least two satellite cable competitors offer service to at least 50 percent of a given market and have combined secured more than 15 percent of subscribers in that market.
  2. Cox's own penetration in a given market was less than 30 percent.
  3. A Local Exchange Carrier "or its affiliate offers video programming services directly to subscribers by any means (other than direct-to-home satellite services) in the franchise area."

Cox was able to prove effective satellite competition in most of its rural service markets. It demonstrated low penetration in the East Feliciana and Kaplan markets. Cox also proved Local Exchange Carrier competition, coming from either Eatel, LUS Fiber or AT&T's U-verse service, in Ascension Parish, East Baton Rouge Parish, Livingston Parish and Lafayette Parish.

LUS Director Terry Huval says being in a competitive market is good for both consumers and providers interested in offering the best service. His only concern, he adds, is if Cox would charge higher rates in areas outside the city of Lafayette where it doesn't have as much competition to help subsidize lower rates inside the city. "But we welcome fair competition," Huval says. Cox spokesperson Ann Ruble also responded to the ruling, stating, "We welcome the FCC's decision because it recognizes the hyper-competitive telecommunications market in the regions we serve across south Louisiana. This gives us the opportunity to compete on a level playing field with all of the video providers including satellite, AT&T and smaller operators."