Bill Would Shift Cable Franchising Rights to State
By Andy Sher, Chattanooga Times/Free Press, Tenn.
Feb. 15–NASHVILLE — The battle between the cable television and telephone industries over video services entered the Tennessee General Assembly on Wednesday as legislators introduced a bill that would strip cable franchising rights from local governments and grant them to the state.
Sponsors of the AT&Tbacked Competitive Cable and Video Services Act said the local government-approval process is cumbersome. They contend a statewide franchising process would benefit consumers by allowing phone companies to jump-start their entry into providing video services.
“Statewide franchises will generate competition, promote consumer choice, improve customer service and also ultimately hold down prices,” Sen. Bill Ketron, R-Murfreesboro, said at a news conference.
The cable industry, the Tennessee Municipal League, the Tennessee County Services Association and some city officials, including Chattanooga Mayor Ron Littlefield, oppose the bill.
Mr. Littlefield said he supports increased competition, but he opposes the bill as drafted because he does not think it would provide enough local control.
“I have been involved in negotiating local franchises before both here and in Georgia, and I’m not comfortable with that process being handled at the state level,” he said.
“I understand we would be held harmless in terms of the fees that we receive,” Mr. Littlefield said. “But I’m more concerned with local control of the mechanics of how cable and fiber optics are installed and how the system is maintained and how much control we have over the companies.”
David Seviers, Tennessee County Services Association executive director, said the bill would let phone companies cherry-pick which customers they wish to serve. That would punish cable companies that have negotiated agreements with hundreds of local governments that require them to provide service to poorer or less populated communities, he said.
Mr. Seviers recalled problems in the late 1980s with fiber optics and companies “just going wild, digging into the streets, not doing repairs adequately, basically causing disruptions on thoroughfares and neighborhoods. We were able to control the situation because we had more control over the franchise.”
Some of the sponsors said the bill should encourage expansion of broadband services to rural areas, result in technology investments, provide parents with the ability to avoid subscribing to channels they deem offensive and protect revenue sources for local governments.
Rep. Charles Curtiss, D-Sparta, a sponsor, said increased competition should lower cable prices. Cable rates nationwide nearly doubled from 1995 to 2005, he said. He estimated savings of as much as $22 a month for consumers.
Information provided by AT&T at the news conference states that Comcast raised rates in Chattanooga by 51.6 percent from 2000 to 2007, which was the highest percentage among five state metropolitan areas.
Rep. Curtiss, chairman of the House Commerce Committee, said 11 states have passed legislation similar to the Tennessee bill.
Joe Hall of Joe Hall Strategies, a public relations firms hired by cable operators, said many of those laws retain “build-out” provisions under which providers of video services can be required to serve less profitable segments of communities for the overall public good.
He questioned whether AT&T or other telephone companies could avoid serving poorer neighborhoods.
At least 48 people are registered to lobby for either AT&T, Verizon, the Tennessee Cable Telecommunications Association and interested local government associations and major cities. Some Capitol Hill observers have dubbed the cable franchising bill the “Full Lobbyist Employment Act,” or FLEA.
AT&T has hired 18 lobbyists, according to registrations listed on the Tennessee Ethics Commission’s Web site.
At one point during Wednesday’s news conference, sponsors of the legislation called on Joelle Phillips, state operations counsel for BellSouth, now part of AT&T, to explain certain provisions.
Sponsors denied the bill was drawn up by AT&T, saying it was drafted by legislative attorneys.
E-mail Andy Sher at asher@timesfreepress.com
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Copyright (c) 2007, Chattanooga Times/Free Press, Tenn.
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