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Cable, Phone Companies Air Viewpoints

Posted on: Sunday, 19 February 2006, 12:00 CST

By Bloomberg, AP and Staff Reports

For consumers who yearn to see their monthly cable TV bills shrink, phone companies say they have just the answer: more competition.

They want Congress to make it easier for them to roll out their new video services that would compete with cable. The cable industry protests that such government assistance would create an unfair advantage for the phone companies and hurt consumers in poor communities.

Both sides on Wednesday took their arguments to Capitol Hill, where lawmakers are considering legislation to ease phone companies' entry into subscription video services.

Cable companies have long had to secure individual licenses, or franchises, from each of the thousands of cities and towns where they want to sell their service. But the phone companies, hoping to speed a process they say can take up to 18 months, are asking Congress and the states to intervene to eliminate those time- consuming requirements.

Phone giants like AT&T Inc. and Verizon say the current system is outdated and is choking competition.

"If we were somehow able to sign one franchise agreement every week of the year, it's going to take us 30 years to complete this process," Edward Whitacre, AT&T chairman and CEO, told the Senate Commerce Committee.

Cable companies dispute that the franchising process is a drag on competition. They accuse the Bell companies of trying to skirt rules that would bring service to all neighborhoods of a community, wealthy and poor alike -- an accusation the Bells deny.

"It is not hard to get a franchise if you are a competitor. What's hard to do is to go in and ask for a special deal," Thomas Rutledge, chief operating officer of New York-based Cablevision Systems Corporation, told the committee.

Source: Tulsa World

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