Fri, Jan 07, 2000 - Page 12 News List

Editorial: Cable TV wars sickening

Over the past decade, early January has traditionally brought a swift end to the festive season for Taiwan's television viewers. This is the time when the Koo's Group (和信) and Rebar-Eastern Multimedia (?O霸東森) stage their annual power struggle in the island's cable TV industry, which they dominate. Their battles usually feature price hikes, channel shifts and channel cuts. Wedged in the middle of this struggle, consumers have been forced to suffer silently.

All we ever see in this annual ritual is government authority being repeatedly trampled by two powerful consortiums. Last year, it took the then KMT secretary-general John Chang (31孝嚴) to mediate between the bosses of the consortiums to resolve the conflict. The battle has been renewed this year, right on time and on a fiercer scale, and even the Taipei City Government appears powerless to do anything about it, despite its best efforts to fine cable operators in its districts.

What are we to expect next year? Without a major election in the offing, we can be sure that consumers will have to fend for themselves.

What is different about this year's cable TV war is that the two big operators now appear to be fighting for the next pie in the communications market: broadband networks. Koo's Group and Rebar each claim that they have recently signed contracts with cable operators serving three to four million subscribers. Which means that the market has been effectively dominated by them. With such a captive audience, they can afford to expand the delivery of their own content, even at the expense of channels that are probably more popular among viewers. And because cable operators take their fees in a lump sum -- six months up-front -- viewers are locked in for a fixed period. This allows the two groups to actively cross-promote their new Internet services, which they see as the multi-billion-dollar future of the industry.

What can the government do? Many have pointed their fingers at Chao Yi (趙怡), Director-General of the Government Information Office, accusing him of pussyfooting and trying to be both a referee and a player. But many seem to have forgotten the Fair Trade Commission (FTC), which has been hiding behind the skirts of Premier Vincent Siew (蕭萬長). It was only after Siew finally made some somber remarks at yesterday's Cabinet meeting that Chao Yang-ching (趙?2M), the FTC Chairman , warned the cable operators against further concerted acts.

Since Chao Yi took office as GIO director, the two cable TV stations he used to head up have both run into trouble. He has effectively answered the question asked by this newspaper upon his appointment: how can a man who was so recently a media boss maintain neutrality in the event of a dispute among his former friends and employers? He can't. By contrast, FTC chairman Chao's long tenure in her position makes her claims to ignorance of the cable TV dispute hard to believe.

Yet it is not only these two who are deserving of censure. In fact, the current dispute poses a serious challenge to the entire administration's credibility, caught as it is between two feuding KMT business titans.

Indeed, the presence of Koo Chen-fu (辜振甫) and Wang Yo-tsen (?y?S曾), patriarchs of the two consortiums, on the KMT's central standing committee is enough to negate anything the GIO and FTC chiefs might want to do to resolve the dispute. Last year, the two tycoons gave some face to the government. This time, their families have learnt to maneuver behind the scenes, away from the media spotlight. It might take a far stronger man than John Chang was a year ago to solve the dispute this time around.

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