ORLANDO, FL -- Calls to regulate nascent interactive television services, which have yet to be defined, would have the unintended consequence of discouraging investment and slowing their introduction, National Cable & Telecommunications Association President & CEO Robert Sachs said Wednesday in his keynote address to the SCTE Expo 2001 in Orlando, Florida. “NCTA takes no issue with pure fact finding [by the FCC],” Sachs told the annual gathering of the Society of Cable Telecommunications Engineers. “But we consider regulation of yet-to-be developed services to be counter-productive to their very development.”

The development of ITV services would be best served, Sachs said, by allowing the work of engineers and marketers to progress free from government regulation. “Interactive TV needs the attention of the members of the SCTE – not the attention of the FCC,” he said.

Sachs also noted the inconsistency of those who advocate regulation of interactive TV services, pointing out that these same companies have benefited tremendously from market forces when it comes to their own businesses. Among those urging regulation are media heavyweights Disney and Viacom, two companies that boast a combined market capitalization of more than $160 billion.

Disney’s and Viacom’s holdings include broadcast and cable networks, TV stations, radio stations, home video operations, amusement parks and other enterprises. "They are not strangers to free enterprise," Sachs commented. "Therefore one might ask, why do they think the laws of the marketplace can be suspended for Interactive TV? And do they think cable operators are going to invest hundreds of millions of dollars in Interactive TV if there are pre-existing limits on how ITV services are permitted to develop?"

Sachs also noted the irony of Disney and Viacom-owned film studios (Buena Vista Television and Paramount Pictures, respectively) that refuse to make their first-run movie titles available to video-on-demand, an emerging interactive service. "Should the government require Disney and Viacom to sell their first run movies to video-on-demand on cable?" Sachs asked. "Of course not!" he said. "But neither should the government require cable operators to carry whatever ITV services these companies might develop in the future."

The real issue, Sachs suggested, is that companies are seeking regulatory favors for themselves for a service that is still in its infancy. "With ITV, the menu hasn’t even been printed, but some are already demanding a free lunch," he said.

Interactive TV will develop not by government regulation, but by innovation driven by marketplace forces, Sachs concluded. "If a viable market is going to develop for ITV – and I don’t doubt that it will – it needs to be driven by free market forces, not the heavy hand of government regulation."

The National Cable & Telecommunications Association (NCTA), formerly the National Cable Television Association, is the principal trade association of the cable television industry in the United States. NCTA represents cable operators serving more than 90 percent of the nation’s cable television households and more than 150 cable program networks, as well as equipment suppliers and providers of other services to the cable industry. In addition to offering traditional video services, NCTA's members also provide broadband services such as high-speed Internet access and telecommunications services such as local exchange telephone service to customers across the United States.

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