Chart 3

10%

5%

12.8%

0%

Source: MVPD market share: NCTA; Residential Telephone market share based on industry estimates.

7,235,383

May-97

Mr. TAUZIN. Thank you very much, Mr. Anstrom. The Chair is now pleased to welcome Ms. Deborah Lenart, President of Ameritech New Media of Chicago, Illinois, and we welcome your opening statement, Ms. Lenart.

STATEMENT OF DEBORAH L. LENART

Ms. LENART. Good morning, Mr. Chairman, and members of the subcommittee. My name is Deborah Lenart. I am the President of Ameritech New Media and I have submitted a full written statement for the record.

I do appreciate the opportunity to testify before you today regarding my company's efforts to provide competition to the cable marketplace and also in particular to talk about the impediments that we have encountered, particularly in obtaining popular cable programming.

Ameritech recognizes the extraordinary role that this subcommittee has played in making cable competition a reality today. Mr. Chairman, in particular, your program access amendment to the 1992 Cable Act truly jump started competition.

The repeal of that cross-ownership ban by the Telecomm Act of 1996 has also paved the way for head-to-head competition between telephone companies and incumbent cable operators.

Unfortunately, I am here to tell you today that more work does need to be done to provide consumers the benefits of competition that they deserve.

I will describe to you Ameritech's experience and suggest additional measures that Congress and the FCC can take to adopt to enable more enhanced competition.

Ameritech is the largest cable overbuilder in the history of cable television, building a new HFC digital video network completely separate from our phone network today. We have already created over 1000 new jobs and we have acquired over 47 franchises in Illinois, Michigan, and Ohio, and we are now providing service to over 29 of those communities.

Where we compete, one in three cable households on average subscribe to Ameritech's cable service. Our offering to consumers consists of 80 to 90 channels, an interactive program guide, a parental lockout feature, and our children's remote, which affectionately call "Red Junior."

Now in these communities consumers are dramatically benefiting from our competitive entry. Incumbent cable operators are indeed dropping prices, upgrading their networks and adding more channels exactly as Congress had intended. Now despite our successful launch of cable service, we do face a variety a unfair and anticompetitive practices by cable operators and programmers alike. These practices are inhibiting our ability to attract even more customers.

Mr. Chairman, as our experience demonstrates, Congress and the FCC must do more if consumers are to receive full-scale benefits of competition.

Congress recognized very early on back in 1992 that when it enacted the program access law that full and fair access to programming was the key to competition. The reality in some cases, Ameritech does not have access to that popular programming at