Telephone Companies Win Pay-TV Ruling By FAWN JOHNSON and AMY SCHATZ Wall Street Journal
June 28, 2008; Page B7 http://online.wsj.com/article/SB121459657481311553.html?mod=googlenews_wsj A federal appeals court Friday upheld a Federal Communications Commission rule designed to make it easier for telephone carriers and other competitors to offer pay-television services. The decision was a win for phone companies including Verizon Communications Inc. and AT&T Inc., which are expanding into the pay-TV business to compete with cable companies. It could speed up the rollout of services by these entities, by removing uncertainty over how long a community has to rule on applications from new competitors. The ruling also upholds the FCC's view in the 2006 rule that phone companies aren't required to build out service into lower-income areas. Phone companies have complained that some communities held their applications hostage in hopes of wrangling funding for local projects, such as landscaping or playground equipment. "The commission's action was an important step toward competition at a time when consumers had little choice. We are pleased the court agrees," said Verizon Senior Vice President Michael Glover. The decision by the U.S. Court of Appeals for the Sixth Circuit in Cincinnati was a blow to state and local officials, who had hoped to keep greater control over franchising decisions. "The federal government should not be dictating what's going on in our local communities," said Elizabeth Beaty, executive director of the National Association of Telecommunications Officers and Advisors, which represents local governments. The FCC rule imposes a 90-day clock on decisions for local cable franchise license applications. If local governments don't act on applications within that time, they are deemed granted. In cases where companies don't already have existing cable or phone lines in place to provide services, the FCC rule imposed a six-month time limit on approving new applications from competitors. The three-judge panel, in a unanimous ruling, said the commission's reasons for imposing the time limits are "more than reasonable." "Due to protracted franchise negotiations, the agency found that prospective entrants were abandoning attempts to join the cable market and acceding to otherwise unacceptable franchise terms simply to expedite the process," the court said. Phone companies had heavily lobbied the FCC to change the rule in 2006, but they have also successfully persuaded state legislatures to streamline cable-franchising laws to make it easier to offer TV service. Consequently, the FCC rule has been slightly less critical to the phone companies than it might have been, but it acts as backstop for companies in disputes with local authorities. FCC Chairman Kevin Martin said the ruling is a win for consumers since it will lead to more choices in pay TV. To combat rising cable prices, he urged cities and towns to quickly allow new entrants to offer service. Mr. Martin said limiting build-out requirements is important for phone companies seeking to enter the cable market. "When the cable operators come in and compete with telephones to provide voice service, there's no requirement that they provide that service to everybody," Mr. Martin said. "If they don't do it on the voice side, they shouldn't on the video." ================================ George Antunes, Political Science Dept University of Houston; Houston, TX 77204 Voice: 713-743-3923 Fax: 713-743-3927 antunes at uh dot edu ******************************* * POST TO [EMAIL PROTECTED] * ******************************* Medianews mailing list [EMAIL PROTECTED] http://lists.etskywarn.net/mailman/listinfo/medianews
