BY BOBBY WILSON The Associated Press – SEATTLE (AP) The Federal Communications Commission is giving some of its largest cable providers a boost, as they fight to stay in business and the cable industry tries to come to grips with the cost of keeping cable customers in the network.
The FCC announced Tuesday it approved a $4.7 billion plan that would raise the amount of money the companies pay to pay for network infrastructure.
That would make it easier for them to survive as cable companies and their customers struggle with an increasingly crowded marketplace.
In total, the commission approved more than $1 billion in funding to help keep some of the nation’s largest cable and satellite companies in business.
The money includes $1.4 billion for broadband network upgrades, $2.3 billion for high-speed internet and $2 billion for pay TV and broadband.
It is also helping Comcast, the nations largest cable company, which owns NBCUniversal and CNN, and Charter Communications, which has an aggressive bid for Time Warner Cable Inc.
But that money comes at a steep price.
The companies must also pay taxes and fees on all the money.
Those fees are expected to reach $100 billion in 2019 and will make up more than one-third of their operating expenses, the FCC said.
The money is the result of the FCC’s proposed 2015 rules that aim to give consumers more choice in the cable market.
The FCC also approved $3.2 billion to help build and expand high-capacity broadband networks, a goal that has been met in part by the rise of wireless and cable broadband.
The rules would raise rates on all cable and wireless services, including those owned by cable companies, for the first time since 1996.
They also call for allowing some cable and broadband services to offer Internet access over a faster wireless connection.
The new money would also make it more difficult for cable companies to keep their networks afloat and help them avoid bankruptcy.
The companies could file for bankruptcy or have to sell off assets, including the cable networks and facilities they have in some states.
The agency has long argued that cable companies should pay for infrastructure.
The rules are part of a broader effort to make sure cable companies can continue to provide their services even after the market shifts.
The vote came after a two-year review of how to allocate money for cable systems and networks that had become too expensive for the companies to continue providing the services.
The commission was expected to vote on the proposal later this year.
“It’s been an unprecedented process, and it’s been quite a roller coaster ride, but I think we have to be realistic,” FCC Chairman Ajit Pai said.
“This is going to be a tough one for them, but we’re going to make it as easy as we can for them.”
The commission’s action also comes at an awkward time for the cable and telecom industries, whose cable packages are growing and consumers increasingly view streaming video services as a more important way to watch their favorite shows and movies.
The cable and cable industry has fought hard to keep its businesses intact.
Cable companies and others who own network equipment have lobbied the FCC for years to keep costs down.
Many of them have said they want the money to help them keep their businesses going as cable customers, but the commission has not set a deadline for the money that they would be eligible for.
The commission also approved the first step in the process to make cable more competitive.
It voted Tuesday to require cable companies offering Internet access services to be licensed by the FCC, which would allow those companies to offer more choices in broadband speeds and service quality.
That is expected to be finalized later this month.
The move would allow them to compete against other Internet providers with higher speeds and better video quality.
It also would allow the companies that have been operating under licenses to compete with those who do not.