Cable industry reversal upsets California cities By JOHN HILL Sacramento Bee
27-JUN-06 http://www.shns.com/shns/g_index2.cfm?action=detail&pk=CABLE-06-27-06 SACRAMENTO, Calif. -- The cable television industry reversed course Tuesday on a bill to let telephone companies compete for cable business, agreeing to support it as long as cable providers have a way to get out of franchise agreements with local governments. Cities opposed to Assembly Bill 2987 said the change heightens their concerns, arguing it would let cable companies walk away from commitments to public and educational programming, serving low-income areas and responding to consumer complaints. The cable industry and the telephone companies had been waging an intense and expensive war over AB 2987 by Speaker Fabian Nunez, D-Los Angeles, and Assemblyman Lloyd Levine, D-Van Nuys. Nunez has argued the bill would give consumers lower rates and more choices by encouraging competition. The cable industry had argued that it would let phone companies "cherry-pick" wealthier communities at the expense of lower-income television viewers. But at a Senate committee hearing on the bill Tuesday, Dennis Mangers, a lobbyist for the cable industry, announced the about-face, assuming the bill is amended to allow cable companies to opt out of local franchise agreements. Instead, they could choose to play by the state's rules, the same ones that will be imposed on the telephone companies that enter their turf by AB 2897. The Senate Energy, Utilities and Communications Committee did not vote on the bill or any amendments, postponing a decision until another hearing on Thursday. But the bill's authors have been exploring ways to allow cable companies to break their franchise agreements when they are faced with direct competition with telephone companies. The details are still being worked out. One possibility, Mangers said in an interview, is for cable providers to be freed from their local agreements 10 days before a competing company starts offering service. "It's pretty narrow, but it was very important to my industry that we not be crippled by different fees" and other provisions, Mangers said. "The rules ought to be the same" for cable and telephone companies. Mangers said some jurisdictions have used their leverage in granting franchises to impose requirements on cable providers unrelated to television, such as making gifts to non-profit organizations. In other cases, he said, the local government requirements for funding channels dedicated to public, educational and government programming goes beyond what the federal government envisioned. Even when cable companies abrogate their local franchise agreements, Mangers said, they would still be bound by state requirements. The bill currently authorizes a franchise fee of up to 5 percent of gross revenue for the local governments where the service is provided. Local governments could also tack on another 1 percent for the capital costs of public, educational and government channels. But the League of California Cities remains opposed to the bill. Allowing cable companies to break their local agreements opens the door to different levels of service to different neighborhoods as new technologies become available, spokeswoman Megan Taylor said. An analysis of the bill by Senate committee staff says local governments would still be able to enforce customer service standards. AT&T and Verizon, faced with competition in the telephone industry, have been pushing for a statewide system that would allow them to offer cable television, Internet and phone services for one monthly fee. As it is, the telephone companies can negotiate with local governments to provide cable, and have done so in a handful of cases. But they say that going city by city would take too much time. The Assembly passed the bill 77-0, sending it to the Senate. (Distributed by Scripps-McClatchy Western Service, http://www.shns.com.) ================================ George Antunes, Political Science Dept University of Houston; Houston, TX 77204 Voice: 713-743-3923 Fax: 713-743-3927 antunes at uh dot edu Reply with a "Thank you" if you liked this post. _____________________________ MEDIANEWS mailing list [email protected] To unsubscribe send an email to: [EMAIL PROTECTED]
