The Telecommunications Act of 1996, 110 Stat. This act eliminated most cable television rate regulations beyond the basic tier as of March 31, 1999 . In most cases, rates for a basic tier of services (defined as the tier that includes "over the air" broadcast stations) continues to be regulated either by local franchising authorities (LFAs) or state authorities. Most small cable operators (those serving less than 1% of all cable subscribers and having no affiliation with any company whose gross annual revenues exceed $250 million) were freed from rate regulation immediately. The Current Cable Market

According to the FCC's Twelfth Annual Report on Competition in Video Markets , released in March 2006, approximately 65.4 million homes in the United States, or 69.4% of all Multichannel Video Program Distributor (MVPD) television homes, subscribed to cable television as of June 2004. Such entities include cable operators, direct broadcast satellite (DBS) services, and—in much smaller numbers—subscribers to five other technologies that deliver programming. As of June 2005, DBS subscribers numbered more than 26.1 million, or 27.7% of all MVPD subscribers. This extensive fact sheet presents background information on the history and evolution of the cable industry in the United States, including the evolution of parts of the Communications Act of 1934 that affect cable television, discussion of issues such as must-carry regulations, and information on the regulation of cable television by state and local authorities, including local franchising authority agreements and customer service guidelines. Consumer Alert. This two-page notice details the end of federal regulation of expanded basic cable rates as of March 31, 1999, which was mandated by the Telecommunications Act of 1996, P.L. 104-104 .
Cable television is one of the oldest and most popular distribution technologies used to deliver video programming to consumers. It uses fixed coaxial or fiber-optic cables to accomplish delivery. Of the various other methods used to deliver video, only direct broadcast satellite (DBS) successfully competes with cable. It uses communications satellites to deliver signals to individual consumers. In 2005, cable television was received by 65.4 million homes, or approximately 69% of all pay television subscribers. In comparison, DBS was received by 26.1 million homes, or approximately 27.7% of all television subscribers. This report presents information on the history of federal regulation of the cable television industry and background information on cable rates and other cable industry issues. The DBS industry, cable's main competitor, is not addressed extensively in this report. The Telecommunications Act of 1996, 110 Stat. 56, P.L. 104-104, eliminated most cable rate regulation beyond the basic tier of services as of March 31, 1999. Some small cable operators were freed from regulation upon the enactment of the law, but in most cases, rates for a basic tier of services continue to be regulated. The Telecommunications Act also opened up new areas of competition between telephone companies and cable companies. This report will be updated as legislation or news events warrant.