Released: June 12, 2006

Cable franchise battle brewing

Source: By Deborah Yao, The Associated Press [USA Today]

Phone companies are leading efforts to rewrite rules giving local governments control over cable TV in their areas. Under bills passed or pending in at least 14 states and Congress, pay-TV control would shift to state or federal regulators. That would mean phone and cable companies no longer would have to make individual local franchise deals.

Supporters tout the bills as pro-consumer, saying video competition from Verizon Communications and AT&T will lower prices. Others, including municipalities, argue that the bills cede too many consumer protections to two companies that are almost monopolies.

Texas, Indiana, Kansas and South Carolina signed into law a state-approval process. Virginia passed a variation speeding the local approval process. Similar bills are pending in Pennsylvania, California, Iowa, Michigan, Minnesota, New Jersey, Tennessee, North Carolina and Louisiana. Connecticut ruled that AT&T doesn’t need franchises.

Meanwhile, the U.S. House last week passed a bill calling for a national franchise process. A similar Senate bill is pending, though passage is complicated by debate over other issues addressed in the bill.

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