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Tue, Jan 11, 2000 - Page 3 News List

Legislators attack GIO's remedy for cable TV wars

MIXED RECEPTION Lawmakers have said it is not the government's business to subsidize cable TV

By Monique Chu  /  STAFF REPORTER

Legislators attacked the central government yesterday over its recommendation for a so-called "tiering" system in Taiwan's cable television industry -- which officials said would safeguard consumers' rights in the wake of a major row between cable operations and channel agents.

The system would allow consumers to choose between different levels of service, with greater channel selection meaning higher subcription costs.

But lawmakers said the government should not subsidize the plan, adding that emphasis should be placed instead on curing what they said is a monopoly market that has ignited growing public discontent with the cable TV industry.

Speaking at the Legislative Yuan yesterday, GIO director Chiao Yi (趙怡) said the government plans to implement the tiering system next year.

"The main purpose [of the initiative] is to give consumers the autonomy to choose the cable TV programs they want to watch. The fees they pay are thus contingent upon the bundles of channels they watch," said Chiao.

Chiao said the initiative was aimed at curing the problems with current cable TV operations, which are unable to handle tiering. Customers are not given any choice and receive the same bundle of channels for a flat fee, regardless of their interests.

The new subscription package will widen viewers' options. Aside from offering a single basic tier, the GIO intends to group additional channels on premium tiers at a per channel rate.

Claiming the initiative will benefit consumers, Chiao said the government plans to subsidize installation of the set-up boxes, as the cost of the machines around NT$3,000 per unit? -- a price he said might lessen subscribers' willingness to support the plan.

The written report Chiao submitted to legislature's education and culture committee also states the new initiative will allow cable operators to rationalize business costs.

Although agreeing in part to the GIO initiative, lawmakers criticized the subsidy plan as "unfair."

KMT lawmaker Lee Chin-an (李慶安) said that since not every household subscribes to cable TV, it's not fair to use taxpayers' money to subsidize subscribers, who only account for about four million households island-wide.

Lee also said cable operators should pay for the installation of the set-up-box. "It's not logical to argue that without the government's subsidy, consumers' rights would be damaged," he said.

Another lawmaker, Lai Shyh-bao (賴士葆), also blasted the GIO's subsidy plan, but he said he thought subscribers should pay for the installation of the boxes.

Meanwhile, lawmakers said the tiering system was not a panacea to correct Taiwan's cable TV operations. They urged the government to tackle the monopoly of the market by conglomerates in order to solve what they claimed are deep-rooted problems in the cable TV industry.

Rebar Corporation's Eastern Multimedia (Eastern) and United Communications of the Koo's Group (United), two of Taiwan's largest and most politically powerful companies, control over two-thirds of the cable TV operations. In Taipei they control about 88 percent of the market.

When asked why the commission turned a deaf ear to complaints about uncompetitive practices in local cable TV operations, Lai said, "it's because the forces behind [these conglomerates] are rich and powerful."

DPP legislator Fan Sun-lu (范巽綠) also said unless the commission was determined to investigate perceived uncompetitive practices in the market, consumers' rights will not be ensured even with the introduction of the new tiering system.

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