Released: December 21, 2006

Phone giants get FCC approval on TV

Source: Paul Davidson, USA Today

To jump-start competition for subscription TV service, the Federal Communications Commission passed new rules Wednesday designed to let the big phone companies obtain local video franchises more easily. The move is expected to let AT&T (T) and Verizon (VZ) more quickly enter hundreds of markets in the next few years, spurring new competition for the cable giants and possibly bringing lower prices.

By a 3-2 party-line vote, the Republican-controlled FCC said cities and counties may not impose unreasonable barriers that delay rollout of the video services.

AT&T and Verizon are spending billions to build fiber-optic lines that deliver bundles of voice, broadband and pay-TV services. But when they seek TV franchises, the companies say, local officials often cause delays by making outrageous demands, such as to build swimming pools and recreation centers.

“Such requirements are especially troubling, because competition is desperately needed,” FCC Chairman Kevin Martin says.

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